Kingfisher Lifts H1 Profit 9.9% to £404M, Upgrades Annual Guidance
Kingfisher reported 9.9% adjusted PBT growth and raised full-year profit targets as trade and e-commerce channels expanded significantly.
Key points
- Kingfisher's adjusted PBT rose 9.9% to GBP404 million, with full-year guidance raised to GBP595-635 million.
- Trade sales grew 16% excluding Screwfix to GBP2.1 billion, while e-commerce sales increased 16% to GBP1.6 billion.
- Free cash flow reached GBP339 million, and the company returned GBP333 million to shareholders via dividends and buybacks.
Kingfisher PLC reported adjusted profit before tax of GBP404 million for the first half of its fiscal year 2027, representing a 9.9% year-on-year increase. Excluding a one-off GBP14 million business rates refund in the UK, the underlying profit growth stood at 6.1%. The company simultaneously upgraded its full-year adjusted PBT guidance to a range of GBP595 million to GBP635 million, an increase of GBP20 million at the midpoint compared to prior estimates.
Adjusted earnings per share rose by 16% during the period, supported by gross margin improvements of GBP40 million. This margin expansion was driven by group buying efficiencies, sourcing optimizations, and growth in marketplace and retail media segments, partly offset by freight headwinds. The retailer generated GBP339 million in free cash flow, maintaining a net leverage ratio of 1.4 times.
Channel performance drives revenue growth
Total group sales including marketplace gross merchandise sales grew by 1.6% in the first half. Trade sales reached GBP2.1 billion, increasing 16% excluding the Screwfix brand, with trade penetration rising to 31% of total sales. E-commerce performance also accelerated, with online sales hitting GBP1.6 billion, up 16% excluding Screwfix, and accounting for 22% of the group's revenue.
The marketplace channel saw gross merchandise value grow by 42%, contributing over GBP13 million to retail profit. Retail media revenue surged by 75%, reflecting higher digital advertising uptake. These digital channels are increasingly central to Kingfisher's strategy, helping to offset softer demand in traditional high-volume categories like bathrooms and building materials.
Regional results show mixed momentum
In the UK and Ireland, retail profit increased 4.9% to GBP361 million. Screwfix, the primary driver of volume-led growth, recorded like-for-like sales up 5.6%, significantly outperforming the broader market. However, core UK sales declined 2.7% due to adverse weather, soft market conditions, and a shift toward online purchases that reduced store footfall.
In France, retail profit rose to GBP74 million, with the Castorama brand returning to growth in the second quarter. Conversely, Brico Depot France like-for-like sales fell 4.2% amid weak building material demand and website transition issues. In Poland, retail profit jumped 15.7% to GBP60 million, while Iberia saw like-for-like sales grow 7.7% with two new store openings.
Cost control and shareholder returns
The company delivered GBP44 million in structural cost reductions, which helped mitigate a GBP48 million headwind from operating cost inflation, including higher UK national insurance contributions. Capital expenditure of GBP171 million was allocated to nine new stores, new product ranges, and technology upgrades. Working capital generated a net inflow of GBP5 million.
Kingfisher returned GBP333 million to shareholders through dividends and share buybacks during the period. An interim dividend of 3.8p per share was declared, and the company plans to complete a GBP300 million buyback program by the end of December, with GBP175 million already executed. The upgraded guidance, as reported by Yahoo! Finance Canada, reflects management confidence in sustained performance despite ongoing supplier inflation pressures.
