Kingfisher share price: what to expect from its Q1 results
The B&Q and Screwfix-owner saw its CEO Veronique Laury step down amid declining profits at the end of its financial year, with investors eager to see if its turnaround plan will finally reap rewards in 2019.
When is Kingfisher’s results date?
Kingfisher will release its Q1 results on May 15.
Kingfisher’s results preview: what does the City expect?
Kingfisher ended the year on a downbeat, with the DIY specialist announcing the resignation of its CEO Veronique Laury, alongside a disappointing set of full-year 2018 results that saw it record a 52.8% fall in pre-tax profit at its French business Castorama.
In April, investment bank RBC repeated its ‘underperform’ recommendation for the company but increased its target price for the stock to 220p a share, up from 200p.
Kingfisher’s share price stood at 262p at the time of its recommendation and currently sits at 251p a share as of Tuesday 3:10pm GMT.
‘We have increased our fiscal year 2020-21 pre-tax profit forecasts for Kingfisher by 2% due to stronger than expected industry data for France and the UK recently, helped by strong seasonal sales versus very soft comparisons,’ RBC said in a note.
‘We rate Kingfisher ‘underperform’ with a 220p price target as we think it will take time for the performance of Castorama France to improve, plus we see potential for a margin rebase under a new CEO.’
Kingfisher turnaround woes
Despite the departure of its CEO the DIY specialist has vowed to stick with its five-year turnaround strategy, which it is now three years into, even though the plan has faced criticism from analysts and investors.
Over the last 12 months, Kingfisher’s stock has lost around a third of its value, with the group’s management team hoping to boost its bottom line with its ONE Kingfisher turnaround plan.
However, the decision to get rid of Laury in the wake of the group's full-year results suggested that the turnaround strategy had fallen short of the mark for investors.
The five-year plan is expected to cost around £800 million and involved unifying the group’s product range across its various DIY brands, with a focus on boosting online sales and improving overall efficiency.
The group announced that it is considering closing 15 poor-performing stores over the next two years and closing 19 Screwfix outlets in Germany. It also plans to address the underperformance of Castorama France, which has consistently struggled.
Investors will be eager for an update on who will replace Laury and be hoping that the company’s turnaround plans have finally begun to reap rewards when Kingfisher releases its Q1 trading update on Wednesday next week.
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