The final set of results for outgoing Kingfisher plc (LON:KGF) boss Véronique Laury have dashed any hopes of a positive exit as half-year profits tumbled.
The FTSE 100 owner of B&Q reported that in the six months ending 31 July underlying pre-tax profits had fallen 6.4% to £353mln while revenues dipped 1.4% to £5.6bn.
READ: Kingfisher appoints Carrefour executive Thierry Garnier as new boss
The group blamed the downturn on the underperformance of its French business, Castorama, which saw profits fall 12.7% and like-for-like (LFL) sales drop 4.4%, as well as a poor showing from B&Q in the UK where LFLs slipped 3.2% on the back of implementing new ranges of décor.
A bright spot among the misery was the group’s trade tools business, Screwfix, which reported a “positive sales performance” of 5.1% LFL sales growth and an expansion of its market share.
There were also gains from the company’s operations in Poland and Romania, where LFL sales were up 3.3% and 10.5%, respectively.
However, things didn’t look good for the company going forward as it warned of a “mixed” outlook across its geographies and “continued uncertainty” around UK consumer demand.
Laury also said turnaround activity had resulted in “some ongoing disruption” which had impacted sales at B&Q and Castorama.
Share price slide
Kingfisher’s difficulties have been partially attributed to a now over three-year-long transformation plan spearheaded by Laury, which as of yet has failed to deliver the desired results.
Her tenure has also been marked by a 37% drop in the shares since taking the helm in December 2014, as well as rumours of a power struggle between English and French factions inside the business that has prevented the company from offloading its struggling divisions across the Channel.
Laury will be succeeded by Thierry Garnier, a former bigwig at French supermarket giant Carrefour, who Kingfisher said had a track record of transforming businesses in the face of “significant competitive pressure and sector disruption”.
“Thierry will bring a fresh perspective to the Group as we focus on delivering growth in shareholder value and creating a compelling experience for our customers and colleagues", said Kingfisher chairman Andy Cosslett.
Garnier will take up the role on 25 September, although it is not yet clear exactly how he plans to salvage the group’s turnaround effort, or whether he will scrap it entirely.
“No doubt Mr Garnier will have ideas of his own about how to turn the company’s fortunes around, and investors will surely be hoping his measures have a positive impact on the Kingfisher share price performance”, said David Madden, market analyst at CMC Markets.
However, he added that with ongoing Brexit-related uncertainty and Germany “on the cusp of recession”, the current economic backdrop was not ideal and would likely continue to negatively affect the stock.
In late-morning trading, Kingfisher shares were down 2.2% at 197p.