Kingfisher shares climb on strong H1 results, upgraded outlook

Investing.com — Shares of Kingfisher plc (LON:KGF) rose on Tuesday following its half-year results, which beat market expectations.

At 4:39 am (0839 GMT), Kingfisher plc was trading 6.6% higher at £309.56.

The home improvement retailer reported a PBT of £334 million for the first half of 2025, which was above the company-compiled consensus of £286 million. This is partially attributed to a one-off business rate refund of approximately £25 million at B&Q.

The company’s like-for-like (LFL) sales fell by 2.4% year-on-year, slightly missing the consensus estimate of -2%.

The UK & Ireland and Poland each saw a modest like-for-like (LFL) sales decline of just 0.2%, while France reported a broader market decline with an LFL drop of 7.2%. 

“As expected, demand for ‘big-ticket’ categories has remained weak, in line with the broader market, while seasonal category sales trends have improved since early July. Against this backdrop we maintained a strong focus on effectively managing our costs and inventory,” said Kingfisher’s chief executive, Thierry Garnier. 

Kingfisher’s e-commerce division reported strong growth, with the group’s gross merchandise value (GMV) soaring by 80%. The company’s e-commerce sales penetration rose to 18.3%, marking a 150 basis points improvement year-on-year.

The company reduced operating costs in France by 3% and maintained a competitive gross margin. Net inventory was down £134 million year-on-year, underscoring disciplined management practices.

Going forward, Kingfisher has revised its full-year adjusted PBT guidance to a range of £510 million to £550 million which is above the previous consensus estimate of £490 million to £550 million and has upgraded its free cash flow forecast to £410 million to £460 million.

“We move FY25e adj PBT by 0.9% to £516mn (+0.6% vs pre-results cssus) in line with tightened guidance, lifting the bottom end,” said analysts at Morgan Stanley in a note.

Analysts at Goldman Sachs in a note flagged that potential upside risks for the stock include stronger-than-anticipated like-for-like (LFL) sales growth and the effective expansion of trade formats such as Screwfix. 

Conversely, downside risks could arise from falling consumer confidence and heightened competitive pressures.

The existing £300 million program is expected to be completed by March 2025, with a revised expectation of around £250 million compared to the initial consensus of £185 million.