B&Q ready to take fight to revitalised rival HomebaseComments Off on B&Q ready to take fight to revitalised rival Homebase
The owner of B&Q has come out fighting against a rival’s plan to revitalise the DIY chain’s main UK competitor, Homebase.
Kingfisher said it sent a team to Australia to assess Bunnings which, through parent company Wesfarmers, took over Homebase in a £340 million deal in January. Wesfarmers has already pledged to invest £500 million in the company, rebranding the stores with the Bunnings name.
“It is always good to have strong competition because it forces you to become stronger as well and there is no question Bunnings will be stronger competition than Homebase was in the UK,” chief executive Véronique Laury said. “Having said that we are following the plan closely. We sent people to Australia to do an in-depth analysis of what they do and we will work with that.”
She warned Homebase’s new owners, who bought the firm from Home Retail Group, that they “will have work to do because Homebase is today very different from what Bunnings is”.
Bunnings, which operates in Australia and New Zealand, is well known for its vast stores, huge product ranges and low prices. It also allows community groups to set up barbeques outside its stores in what’s known as the “sausage sizzle”.
Laury’s rallying cry came as Kingfisher reported a 20.5% fall in statutory, pre-tax profit to £512 million for the year to January 31. That included the proceeds from sale of a 70% stake in B&Q China. Today, it agreed to sell the remaining 30% holding to local operator Wumei.
Its five-year transformation plan, which involves the closure of around 65 B&Q stores in the UK, cost it £305 million in the period.
Sales fell 4.8% to £10.4 million. The dividend rose 1% to 10.1p.
The company, which also owns Screwfix and France’s Castorama, said the UK economic backdrop looked positive but it remained cautious on France.