First Kingfisher now Wickes: DIY drop off dents profit for home improvement – but it’s not all bad news
Wickes has seen a drop in profits for the year as consumers’ love for home improvements took a dent from rising costs, despite the company reporting ‘record’ sales.
The DIY retailer posted pre-tax profits of £75.4m down from a “record” £85.0m in 2021 when Brits were engulfed in a number of circuit breaker lockdowns and chose to spend disposable income on doing up their homes.
The Watford headquartered retailer, which has 230 sites across the UK, had operating profits reduced for the year down to £67.7m from £96.7m per cent.
Despite this, total year-on-year revenue grew by a steady 1.8 per cent to £1.5bn as Wickes held on to its customer base through a number of the introduction of 30-minute click & collect and new buy now pay later options.
As the DIY boom which defined much of the pandemic dies down, Wickes said that core sales are “moderately behind” the same period last year.
“This was a period in which we achieved record sales and made further market share gains.
“While profit declined, the outcome is still significantly ahead of the pre-Covid period,” David Wood, chief of Wickes, said.
Wickes is not alone in its failing profits, as rival Kingfisher also posted a loss in profits for the year.
The group, which owns B&Q and Screwfix, posted pre-tax profits of £611m, down 39.3 per cent from £1.7bn in the same period last year.
Speaking at the time, Zainab Atiyyah, analyst at Third Bridge, said: “2023 will be very difficult for the UK home improvement sector, particularly for DIY players.
“The cost-of-living crisis and slowdown in property markets are going to put a big dent in the sector’s growth outlook.”