B+M eyes more store openings after strong ‘Golden Quarter’
Discount retailer B&M has hailed its Christmas trading as a golden quarter with strong profitable growth and sales of £1.35m for the 13 week period from 24 September 2023 to 23 December 2023.
The Liverpool headquartered discounter described group revenue growth in the quarter of 5.0% year-on-year (“YoY”) to £1,645m. Q3 YTD growth of 8.1% YoY to £4,194m.
The company told the stock market this morning that like for like revenue growth was 1.2% over the period and that group inventory was “clean”.
The company is planning to open 65 new stores in the UK in 2024, 45 B+M stores and 20 of the discount food retail brand Heron Foods. The company is also targeting 11 new stores in France.
Alejandro Russo
Alex Russo, chief executive, said: “The performance across the Golden Quarter has been pleasing, with strong operational execution across the three businesses. Our strategy remains unchanged – we are an everyday low-price discounter with a laser-focus in keeping excellence in retail standards and our costs the lowest. This allows us to provide our products at the best price to all customers – many of whom continue to face significant cost-of-living pressures.
“We are well-positioned for the year ahead and we reiterate our guidance for Group adjusted EBITDA (pre-IFRS 16) within our target range of £620m – £630m for FY24 (FY23: £573m). Our store pipeline is strong and we will open not less than 45 B&M UK stores in each of the next two financial years, driving disciplined cash generating growth.”
However, analysts said the results represented slower growth and was ‘fine not fantastic’.
Russ Mould, analyst at AJ Bell said: “Aldi and Lidl’s strong Christmas trading updates last week implied shoppers were turning to the discounters in their droves and B&M has come within a whisker of joining the celebrations.
“While its third quarter trading period was robust, including a decent showing from its Heron Foods arm, the pace of growth has slowed down from the rate reported at its half-year results.
“B&M is a general merchandise group and has its fingers in many pies, meaning it is a good bellwether for the retail sector. A slowdown in sales growth has become a common theme in the retail industry, particularly among fashion sellers. While disappointing that B&M has joined the club, it is not alone in suffering this fate.
“The business continues to expand with new stores which creates more opportunities to reach a bigger customer base and the long-term opportunities remain rich. However, the best way to sum up B&M’s latest trading update is ‘fine but not fantastic’. It means the retailer will have to try harder to get the tills ringing faster in 2024.”
