B&Q owner Kingfisher’s profits fall 30% amid cost of living crisis

theguardian.com:

Profits at the B&Q owner Kingfisher fell by almost a third in the first half of the year as the pandemic DIY boom came to an end, but the company is benefiting from soaring demand for home insulation.

Pretax profits at Kingfisher, which owns the B&Q and Screwfix chains in the UK along with Castorama and Brico Dépôt in France, fell to £474m in the six months to 31 July, a near-30% drop from a year earlier.

Like-for-like sales dropped 4.1% year on year. Kingfisher had a very strong first half last year because DIY stores were allowed to stay open during Covid-19 lockdowns, and the move to home working prompted many people to make DIY improvements to their homes and gardens.

This looks to be over, and the Kingfisher chief executive, Thierry Garnier, warned of “a more challenging environment” as a recession looms and household budgets are hit by soaring energy and food bills.

Shares fell nearly 6% on Tuesday morning, making Kingfisher one of the biggest fallers on the FTSE 100.

“The cost of living [crisis] probably is worse in the UK [than France],” Garnier said. “The French government very early on decided to cap energy prices … We are really welcoming the decision of the new [UK] prime minister in this area.”

However, Garnier said the energy crisis had pushed up demand for insulation products, such as loft insulation. At B&Q, sales have jumped 110% in the past three weeks from pre-pandemic levels, and are 82% higher year on year. Overall, across the group, insulation sales are up 70% from 2019, and 32% higher than a year earlier.

He said Liz Truss’s first priority should be to support people faced with soaring energy bills, especially those on lower incomes, but he also stressed the importance of long-term measures to improve