Dis­counter B&M re­ports ‘pleas­ing’ end to year as it pledges to open more UK stores

The Daily Telegraph - Business - - Focus On Retail - By Char­lie Tay­lor-Kroll

B&M BAR­GAINS hailed a “pleas­ing fin­ish” to the year yes­ter­day af­ter re­port­ing a jump in fes­tive sales, and said it would look to open more UK stores de­spite un­cer­tain trad­ing con­di­tions.

To­tal sales at the dis­count re­tailer climbed 12pc to £1.08bn in the three months to Dec 28, while UK sales rose 4.5pc to £874.5m.

B&M’s De­cem­ber sales at stores open more than one year were up 1.2pc, but fell 1.6pc across the three months – a re­sult blamed on a “dif­fi­cult Novem­ber”.

The group en­joyed 3.9pc growth in the same pe­riod last year. Shares edged up 0.3p to close at 311p yes­ter­day. Chief ex­ec­u­tive Si­mon Arora, who founded the com­pany with his brother Bobby, said: “De­spite the broader eco­nomic un­cer­tainty over the last quar­ter, B&M is on track to de­liver a record year for both sales and earn­ings.

“The busi­ness’s abil­ity to man­age prof­itabil­ity through un­cer­tain trad­ing con­di­tions is tes­ta­ment to the re­silience of the busi­ness model.”

Mr Arora said B&M “didn’t need to re­sort to dis­count­ing” dur­ing the Black Fri­day pe­riod, ad­ding that the dis­count­ing day was no longer im­por­tant for bricks-and-mor­tar re­tail­ers.

Toy sales were in “good shape” in the quar­ter, aided by the col­lapse of com­peti­tors such as Toys R Us, he added.

B&M opened net 20 new stores in the pe­riod and plans an­other 56 by the end of this year, tak­ing its to­tal to 650.The com­pany has pre­vi­ously said it wanted to have 950 stores across the UK.

B&M Bar­gains has re­cently un­der­gone a Euro­pean ex­pan­sion plan buy­ing French dis­count re­tailer Babou for £80m. The busi­ness’s Ger­man chain, Ja­woll, en­joyed a sales in­crease of 4.9pc to £55.3m in the pe­riod.

Sales at the York­shire-based bud­get chain Heron Foods, which B&M bought last year, rose 12.9pc, ad­ding £89.9m in rev­enue.

Al­though it does not sell fresh food, B&M’s range of cut-price branded sta­ples such as bis­cuits, crisps and break­fast ce­re­als poses an ad­di­tional threat to the “big four” of Tesco, Sains­bury’s, Mor­risons and Asda, which are al­ready bat­tling with com­pe­ti­tion from Aldi and Lidl.

An­a­lysts at Nu­mis said B&M’s quar­terly re­sults were re­silient due to “trade pick­ing up strongly in De­cem­ber”, off­set­ting the poor Novem­ber sales.

‘Man­ag­ing prof­itabil­ity through un­cer­tain trad­ing con­di­tions is tes­ta­ment to the re­silience of the model’

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