Strong ‘Golden Quarter’ for discount retail chain
Discount retailer B&M enjoyed its best Christmas trading period, it revealed in a market update today.
The Liverpool-based group, which also includes the Heron Foods brand in the UK and a 107-store French business, reported progress for the third quarter period, to December 25.
It also revealed it will pay 24,000 staff an extra week’s wages this month as a bonus for their efforts throughout the year, and said it expects its adjusted annual EBITDA will be ahead of consensus. It expects to achieve figures of between £605-£625m, compared with previous estimates of £578m.
Group revenues, on a constant currency basis, grew by 0.1% in the third quarter period, and 0.9% for the year to date, to £1.395bn and £3.663bn, respectively, as group figures returned to more normal levels compared with previous results driven by pandemic lockdowns.
The group said it achieved a strong performance across categories, with excellent sell-through of seasonal ranges supporting gross margin in the quarter.
During the quarter, B&M UK opened nine stores, and closed two, and the group expects to open a further 13 stores before the end of fiscal year 2022.
The Heron Foods brand continues to improve, with third quarter revenues of £105.2m, up from £102.9m at the same point last year.
B&M France saw sustained momentum, with quarter three revenues up 30% year-on-year at £108.8m.
The group now trades from a total of 1,110 stores, up from 1,075 a year ago.
Chief executive, Simon Arora, said: “The group has delivered a very strong Golden Quarter, with our two-year like-for-like performance demonstrating strong retention of new customers.
“Our decision to take receipt of imported Christmas stock early in the season meant we were able to provide customers with great products at great prices. The consistency of performance in the core B&M UK business reflects the growing appeal of our stores as a destination visit for seasonal products, as well as the strength of our supply chain. I would like to thank all of our colleagues for helping to deliver our best ever Christmas.”
He added: “Although the pandemic continues to create challenges for retailers and consumers alike, our relentless focus on value for money remains undiminished.
“Despite ongoing supply chain disruption, inflationary pressures and uncertainty surrounding possible COVID-related restrictions, we remain confident in B&M’s prospects for 2022.”
In November last year, the group announced its half year figures that showed statutory pre-tax profit had risen 2.4% to £241.4m on revenues of £2.2bn, which was up 1.2% for the 26 weeks to 25 September 2021, while cash generated from operations halved from £403.2m to £201.7m.
B&M declared a half year dividend increase of 16.3%, to 5p per share.