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Kingfisher, owner of the Castorama and Brico Dépôt brands, warned on Monday that its profit this year would be lower than analysts’ expectations and that it would restructure its Castorama activity in France.
“In the short term, while existing housing repair, maintenance and renovation activities continue to support resilient demand, we are cautious on the overall market outlook for 2024 due to the mismatch between housing demand and request for renovation,” said general manager Thierry Garnier in a statement.
The stock, listed on the FTSE 100, fell 2.7% at 9:44 a.m. GMT on the London Stock Exchange.
For the 2024-25 financial year, Kingfisher expects adjusted pre-tax profit of 490 million to 550 million pounds (571.02 to 640.95 million euros), below the average analyst forecast of 560 million pounds.
The group also plans to simplify its activities in France, in particular by restructuring and modernizing the Castorama store network.
In the first quarter of 2024, the retailer’s like-for-like sales fell 2.3% year-on-year. The group still notes an improving trend in the United Kingdom and Ireland, France and Poland compared to the previous quarter.
Sales in France and Poland had been affected in 2023 with inflation.
In the 2023-24 financial year, Kingfisher posted adjusted pre-tax profit of 568 million pounds, in line with the company’s forecast, reduced in November, but down almost 25% from 758 million pounds. reached a year earlier.
Total sales for the financial year fell 1.8% to £12.98 billion, with like-for-like sales down 3.1%.
(Reporting by James Davey; French version by Gaëlle Sheehan, editing by Kate Entringer)