B&M has announced its interim results for the 26 week period to September 28th. The strong performance shows the retailer's proposition is still resonating with shoppers in the current challenging environment. We look at the retailer's performance in more detail.
Overall Group results
In newly released results variety retailer B&M's has reported growth of 21.6% to £1.9bn for the during the 26 weeks to September 29th, up from +13.8% last year. This encouraging result, boosted by the inclusion of its Babou business in France was offset by difficulties at its German arm, Jawoll, which has now been placed in review. Profit before tax was down 70.5% to £32.2m.
B&M UK sees increased shopper numbers and average transaction values
- Revenue growth 13.8%
- Like-for-like sales increased 3.7%, compared to +1.6% last year
- 25 net new stores opened
The retailer saw a good performance across its entire estate, with positive like-for-like sales in both out of town and town centre locations. Results were good across multiple categories, including an improvement in homeware and food/FMCG. These results were driven by growth in both shopper numbers and average transaction values.
B&M's shopper research shows that shoppers are;
- Using discount stores more often
- Shopping from a wider range of stores and retailers
- Do not see a big difference between the prices in discount stores or supermarkets
B&M UK has had a solid start to Q3, and remains positive about the future, with a healthy pipeline of store opening for 2021. However, it does remain cautious about how the political uncertainty will affect its performance going forwards.
Heron Foods success continues
The retailer has said Heron Foods continues to trade well on top of good performance in 2018/19.
- Revenue grew 8.1% to £93.1m
- Opened new 9 new stores
- Positive like-for-like, despite the strong comparative
Progress at Babou
B&M were pleased with the performance from Babou, France. Revenue was £144.1m, in a non-comparable period. During this time it opened three new B&M branded stores. Despite some inherited stock remaining in store this is expected to be cleared in 2020, leaving only B&M products that were sourced using B&M's supply chain.
This has changed the mix of sales, with clothing and footwear now accounting for 25%, compared to its previous 40%. Food and FMCG is now approximately 10% of sales, with this expected to increase in the future.
For subscribers wanting to learn more about the French business, read our Babou store report.
Jawoll placed in strategic review
The performance from Jawoll, Germany was disappointing, a strategic review of the business is now underway. Margins were lower than last year, mainly due to markdowns on seasonal products arriving late in stores.
Looking for more insight?
Read here about how B&M is looking to increase its grocery range.
For our subscribers, read more about B&M's chilled and frozen range in our Bristol store visit report.
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