Kingfisher's first quarter sales decline

Kingfisher reported a 0.4 per cent fall in first quarter sales to 2.6bn pounds as a result of weak consumer confidence and unseasonably cold weather in March and early April.

The home improvement retailer's sales in France dropped by 3.8% to £1.08m, reflecting fewer trading days compared to the first quarter last year.

Gross margins were up 10 basis points driven by on-going self-help initiatives and tight cost control, including lower levels of variable pay. Retail profit came to £66m, compared to the previous year's £78m.

In the UK and Ireland, sales declined by 3.4% to £1.07bn in a slow market affected by weak consumer confidence and an early Easter coupled with record cold weather, through March and early April.

Retail profit fell to £50m from £74m in UK and Ireland.

Gross margins were broadly flat as benefits from on-going self-help initiatives were offset by investment in pricing. A strong focus on operating cost efficiencies continued across both businesses.

Other international sales increased by 5.6% to £476m, boosted by like-for-like growth in Russia and China and new store openings. Three net new stores opened, two in Poland and one in Spain, adding around 5.0% new space.

"Market conditions have remained challenging in the first quarter compounded by the effects of an early Easter and unseasonably cold weather across Europe," said Chief Executive Ian Cheshire.

"However, our performance towards the end of the quarter was encouraging following a return to more normal weather patterns.

"Looking ahead, we still have our key summer season to come and we are ready to capitalise on any improvement in conditions during this peak trading period. We will continue to focus hard on our margin and cost initiatives helping us to reinforce our value credentials with customers during these challenging times."

Shares fell 2.07% to 321p at 08:24 Thursday.

RD