LONDON (Reuters) - Home improvement group Kingfisher (KGF.L) saw its sales turn positive in the first week of May as more stores emerged from coronavirus lockdowns, encouraging people to take on do-it-yourself projects, sending its shares sharply higher.
Kingfisher, which owns B&Q and Screwfix in Britain and Castorama and Brico Depot in France and other markets, said on Tuesday its like-for-like sales slumped 74% year-on-year in the first week of April, but recovered to rise 2.7% in the first week of May, with the UK up 18.9%.
Top selling products at B&Q in the UK were building materials and garden and outdoor products, with cement, sand, plasterboard, fence paint, pressure washers, plants and compost proving particularly popular.
Over the group’s fiscal first quarter to April 30 total sales fell 24% to 2.16 billion pounds ($2.67 billion), with like-for-like sales down 24.8%, reflecting COVID 19-related disruption.
Shares in Kingfisher were up 7.2% at 1246 GMT, paring 2020 losses to 19.7%.
All of Kingfisher’s UK and French stores were closed for in-store purchases from March 23 and 15 respectively, though click and collect and home delivery options were made available.
The group was not obliged to close its stores but did so anyway to establish social distancing and other health and safety protocols.
Kingfisher gradually re-opened its UK and French stores in the second half of April and now 631 of its total 1,370 stores across Europe are open. Most of those not open to the public are offering click and collect services.
The group has also acted to reduce costs, preserve cash and boost liquidity to get it through the crisis, said Chief Executive Thierry Garnier, who succeeded Veronique Laury as chief executive in September.
Kingfisher has utilised government job retention schemes across Europe and business rates relief in the UK, moved to monthly rent payments, reduced product purchasing in certain categories and deferred tax payments.
Board directors are also foregoing 20% of their base salaries.
As at May 8, the group had access to over 2 billion pounds in total liquidity, including 700 million pounds of cash and eligibility to funding from both the UK and French governments.
“Our current cash balance provides us with sufficient financial headroom based on assumptions of a prolonged period of reduced sales,” Garnier said.
The group did not issue profit guidance for the 2020-21 year.
Reporting by Sarah Young and James Davey; Editing by Kate Holton and Jan Harvey