Rise in revenue for Howdens as firm reports good trading performance
Howden Joinery Group has today announced a good trading performance so far this year, with a 6% rise in overall revenue.
Howdens UK depots’ total revenue for the period from 12 June to 28 October increased by 8.2% on the comparable periods in 2016. The increase in revenue was driven mainly by volume growth and also reflected the slowdown in revenue growth reported during the second half of 2016.
Howdens reports results based on a weekly cycle, rather than on a monthly basis. The range of analyst expectations of operating profit for 2017 is believed to be £215m to £234m, with a mean of £228m (excluding 53rd week costs) and £205m to £224m, with a mean of £218m (including 53rd week costs).
In the first 11 periods of 2017, total revenue in the UK increased by 6.3% and by 4.4% on a same depot basis, while gross margin performance has been in line with management expectations.
The company remains on track to meet the Board’s expectations for the full year but said that the two remaining trading periods together typically account for more than 10% of annual revenue.
The firm has opened five new depots since the July 2017 half year report, resulting in 16 new depots added so far this year, taking the total depots in the UK to 658. Howdens expects to add around 20 new depots in the UK in 2017.
Howdens has acquired 8.6m shares since July 2017 as part of the £80m share buyback programme announced on 23 February. In total, 11.2m shares have been acquired in 2017, for a consideration of £47.9m.
Howdens reports results based on a weekly cycle, rather than on a monthly basis. This means that for most years the company reports 52 weeks of trading, but in 2017 it will report 53 weeks of trading, including the week between Christmas and New Year, when depots are closed while incurring ongoing costs.
The inclusion of a 53rd week in 2017 will increase operating costs by approximately £10m, but will not contribute to revenue.
Howden Joinery Group Plc is the parent company of Howden Joinery (Howdens). In the UK, Howdens is engaged in the sale of kitchens and joinery products to trade customers, primarily small local builders, through approximately 650 depots.
Around one-third of the products it sells are manufactured in the company’s own factories in Runcorn, Cheshire and Howden, East Yorkshire. The business also has nascent operations in France, Belgium, Holland and Germany.
