Screwfix is on track to see sales reach £2bn in its current financial year after months in which online sales have soared at its parent company the Kingfisher Group – and in the wider homewares category.
The update came as B&Q and Screwfix owner Kingfisher Group says it expects its full-year pre-tax profits to be at the top end of expectations after fast online growth helped sales to grow strongly over the final quarter of its financial year.
In a fourth quarter pre-close update today, Kingfisher said that sales across the group had risen by 16.9% on a like-for-like (LFL) basis – stripping out the effect of store openings and closures in the fourth quarter of its financial year – to January 9. Across the group ecommerce sales rose by 155.4% in November, while sales across all channels were up by 11.4% LFL and by 24% in the UK and Ireland alone. In December, online was 154.3% ahead, group LFL by 22.1% and UK and Ireland sales by 20.8%. In the UK, says Kingfisher, growth at Screwfix accelerated from November 2020 - the peak trading period – with the retailer now on track to turn over £2 billion in 2020/21.
The growth comes after the group’s LFL sales rose by 17.4% in the third quarter, and takes full-year LFL sales to 6.5% ahead of the same last time last year.
Thierry Garnier, Kingfisher Group chief executive, says: “While the strength of our fourth quarter trading, to date, is reassuring, uncertainty over Covid-19 and the impact of lockdown restrictions in most of our markets continue to limit our visibility. Longer term, we are confident that the strategic and operational actions we are taking are building a strong foundation for sustainable long-term growth. We also believe that the renewed focus on homes is supportive for our markets.”
Currently the retailer is trading online and from about 1,380 shops that are open for in-store sales as well as click and collect pick up. Screwfix shops are fully open in the UK, although parts of B&Q stores including its garden centres and design showrooms are closed in varying parts of the UK in accordance with local lockdown restrictions.
Commenting, Amy Higginbotham, retail analyst at data and analytics company GlobalData, says: “Kingfisher continues to benefit from high demand for home improvement as consumers across Europe stay home amid Covid-19, and as stores remain open over periods of lockdown. Group like-for-like sales rose 11.4% in November, driven by a strong performance in the UK and Ireland. The group performed particularly well in December, with group like-for-like sales growing 22.1% as it achieved strong growth across all markets. It expects adjusted profit before tax for the full year to be at the upper end of the current £667m-£742m forecast range.
“Growth was driven by online, with ecommerce sales more than doubling during November and December, even though stores were open over the period. Growing online sales is a key priority for the group as part of its ‘Powered by Kingfisher’ strategy and investments in services such as click and collect will continue to pay off not only during Covid-19 but also post-pandemic."
She adds: “The retailer had begun to gain momentum in kitchen, highlighting that the category performed particularly well in Q3 following the roll out of its new range in the first half. But the closure of showrooms, which help consumers design kitchens and bathrooms, in England, Scotland and Wales during the current lockdown will dampen further growth. B&Q also planned to introduce a kitchen installation service in January – a move which may now be delayed."