KINGFISHER, the owner of B&Q, yesterday announced it had beaten forecasts with a 20 per cent rise in annual profit to £807m as it set out plans for further growth.
Sales at the group, which also controls Castorama and Brico Depot in France, rose 3.6 per cent to £10.8bn, while the full-year dividend was lifted 25 per cent to 8.84p a share.
Profit was up substantially in its UK stores, even as like-for-like sales fell 1.4 per cent.
Attempts to introduce DIY into China have faltered and Kingfisher’s local business, which relies on fitting out new homes, lost £3m last year.
“DIY doesn’t exist in China. If you have the money, you get someone else to do it for you. They tend to renovate and overhaul the whole flat,” chief executive Ian Cheshire explained.
Despite the struggles he said it was too big a market to exit and the firm were set to experiment with a “do it for me” format: “If we can demonstrate a format which works then we will stay [in China.]”
Cheshire is set to receive a pay packet worth over £7m after smashing growth targets set out in 2008 under the four-year “Delivering Value” scheme.
Investors are now eagerly awaiting his new ‘creating the leader’ growth package which will see the firm buy more goods directly from manufacturers and focus on the challenge from online retailers.
The firm is also looking to downsize some of its enormous ‘big box’ stores in the UK and focus on more convenient locations.
Despite growth worries it expects to open 67 stores in the next financial year, including 50 in Britain.
Shares in the firm closed up 2.5 per cent at 307.4p.