Record first half period for discount retailer B&M

Discount retail chain B&M has achieved significant growth in revenues and profits in a record first half, to Septemer 29, it announced today.

The business, based in the Speke area of South Liverpool, saw sales soar by 16.1% to £1.56bn.

Pre-tax profits of £115m were 32.5% better than the same time last year.

And the group says its impressive performance has continued in the second half of its financial year.

At the start of its third quarter, like-for-like sales growth so far in B&M fascia stores in the UK has been similar to the first half, and the business is well placed for the “golden quarter” trading over the season period.

Group adjusted EBITDA5 increased by 13.5% to £131.8m (FY18: £116.1m) and the B&M UK adjusted EBITDA5 increased by +12.1%

Cash flow from its operations of £67m compared with £44.2m previously, which it said reflects working capital discipline.

The interim dividend for shareholders has been increased by 12.5% to 2.7p per share.

During the course of the half year period B&M opened 22 new UK stores, including five relocations, and is on track to open at least 58 new stores across the group this financial year, despite the torrid time high street retailing in general is suffering.

Its German business, Jawoll, opened two new stores in the period, and is on track to open 10 new stores this financial year.

Jawoll’s revenue growth was +4.1%, although the margin was impacted, as expected, by clearance activity on old stock lines as Jawoll introduces more B&M-sourced products.

The Heron Foods division has continued to trade well and opened nine gross new stores, net four, and is on track to open at least 20 gross new stores this financial year.

Babou, a value retailer in France, acquired in October 2018 with 95 stores, is providing a platform for future growth in a large and attractive market, the group said.

Chief executive Simon Arora said today: “B&M has delivered a good first half performance.

“The core B&M fascia stores made good progress and we have made a solid start in the second half of the financial year.

“Heron Foods has grown strongly in the UK, and in Jawoll the new management team is now utilising the B&M supply chain, with clear early signs that customers are responding positively to the new products.”

He added: “I’m delighted that, having completed our recent purchase of Babou in France, we are now positioned to expand B&M’s disruptive, value-led model in Europe’s three largest consumer markets.

“With the core B&M UK business having had a record half year performance, we are well placed to prosper in a difficult and uncertain retail environment.”