No white smoke at B+M as search for CEO continues
Group revenues at discount retail group B&M hit £5.6bn in the financial year to 29 March 2025 but most of the growth has come from its French business.
In a trading update to the stock market this morning, the Liverpool headquartered business said revenue for the year rose by +3.7% with growth from new store performance and positive like-for-like sales in France offsetting a negative performance in B&M UK and Heron Foods.
Alex Russo
The company also revealed that the board “is making progress” on the recruitment of a CEO to replace Alex Russo and says it expects to make an announcement “in the coming weeks”.
In the final quarter the company said B&M UK general merchandise sales values and unit volumes increased across Garden, Toys, Paint and Stationery categories have underpinned performance, as consumer goods delivered a negative like for like, while remaining positive in total sales value and volume growth.
Actions are underway to improve like for like performance and the company said.
The business has opened 45 B&M stores which it said are performing “in line with our expectations and are generating strong returns”.
Pipeline for next year continues to be robust with 45 gross new store openings expected in the UK, with opening in France with 11 gross new stores and Heron with 14 gross new stores opened during the year.
Analysts at Panmure Liberum issued a BUY notice on the shares this morning, noting their poor performance over the last year but claiming the trading update offered evidence of action on the weakness of its performance in fast moving consumer goods, “a shift from prior positive commentary” under Russo.
“Today’s update helps extend a recent relief rally in the shares as the company narrows the guidance given in a recent profit warning.
“However, a new CEO and a clear direction for the business are needed before it can really get back on track, with current boss Alex Russo having fallen on his sword in the wake of the poor performance.”
He added: “Significantly, the company needs to arrest the continuing decline in UK like-for-like sales if it is to rebuild confidence and credibility with the market.
“This trend suggests B&M’s competitive position remains quite vulnerable amid pressure from other discount specialists and the supermarket sector. The company continues to target an ambitious roll-out of new stores, but unless it is able to grow organically then scepticism is likely to linger among investors.
“The business is performing quite well in France but remains a modest contributor to the group as a whole. B&M needs to get the basics of retail spot on, having the right products in the right place and at the right price point.
“One factor which plays in the favour of whoever takes charge is, thanks to its disappointing recent performance, upcoming trading may be flattered by comparison.”
