UK discounter B&M says well set for Christmas with trading on improving trend
First half core earnings up 2% to 274 mln stg
Forecasts 620-660 mln stg for full year
Built up stock early for Christmas trading
Shares up 4%
Adds shares in paragraph 6, analyst in 8, details in 11-13
By James Davey
LONDON, Nov 14 (Reuters) -British discount retailer B&M BMEB.L said it was "well positioned" for the key Christmas quarter, having built up stock early to remove the risk of supply chain disruption.
The FTSE 100 retailer, which sells everything from garden furniture and electrical items to toys and food, on Thursday reported a 2% rise in first-half core earnings, with trading on an improving trajectory.
It said that although the consumer environment remained uncertain its focus on competitive prices was resonating with consumers at a time when disposable incomes remain under pressure and taxes are rising.
"With growing volume momentum, and with broadening strength in general merchandise, we are confident in our outlook for the second half and the full year," B&M said.
It said it exited the spring/summer season with a clean inventory position and had built its autumn/winter stock-holding early.
Shares in the group, which trades from 1,102 stores in the UK and 129 in France, were up 4%, paring 2024 losses to 27%.
B&M forecast adjusted earnings before interest, tax, depreciation and amortisation (EBITDA), its preferred profit measure, for 2024/25 in the range of 620 million pounds to 660 million pounds ($786-$837 million), versus 616 million pounds made in 2023/24.
Analysts, however, noted the mid-point of B&M's forecast was around 2% below analysts' consensus forecasts.
EBITDA in the first half to Sept. 28 was 274 million pounds, on revenue up 3.7% to 2.64 billion pounds, helped by 39 gross new store openings.
Like-for-like sales in B&M UK improved from a fall of 5.1% in the first quarter, when wet weather dented sales, to a fall of 1.9% in the second quarter.
B&M also said long-standing trading director Bobby Arora would retire in March 2025 and said it was reviewing its Luxembourg domicile to make it easier to return capital to shareholders, including through share buybacks.
Several UK retailers, including Primark ABF.L Tesco TSCO.L and Sainsbury's SBRY.L, have forecast strong Christmas performances.
However, retailers have warned that tax rises in last month's budget will stoke inflation.
($1 = 0.7885 pounds)
Reporting by James Davey. Editing by Sarah Young and Mark Potter
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