By Kingfisher, the home-improvement retailer, is set to release its financial results for the first half of the fiscal year on Tuesday. Here are the key details you should know:
Sales Forecast
Based on a consensus of twelve analysts’ forecasts, Kingfisher is expected to report sales of £6.86 billion ($8.49 billion) for the half-year ended July 31, which represents a slight decline from £6.81 billion in the first half of fiscal 2022. According to the company’s compiled consensus, like-for-like sales are projected to fall by 2.6% compared to the previous year.
Pretax Profit Forecast
The FTSE 100-listed company’s pretax profit is expected to be £355.8 million, as per the consensus collected by Visible Alpha. This would be a decrease from £474 million in the year-ago period. On an adjusted basis, the company-compiled consensus suggests a pretax profit of £359 million, down from £472 million in the previous year.
What to Watch
Free Cash Flow
UBS analyst Saranja Sivachelvam emphasized the importance of monitoring Kingfisher’s free cash flow in tomorrow’s interim statement. Visible Alpha’s consensus indicates that the company is likely to report free cash flow of £453.1 million, significantly higher than the £104 million recorded in the same period last year. Sivachelvam noted that while the FY23 free cash flow is expected to benefit from inventory unwind, the cash could be used for various purposes such as store rollouts and upgrades, potentially competing with the buyback story.
Shareholder Returns
AJ Bell investment director Russ Mould highlighted that shareholders and analysts will closely scrutinize Kingfisher’s interim dividend payout. According to Visible Alpha, the company is anticipated to declare an interim dividend of 3.8 pence, matching the payout from the previous year. Mould mentioned that while Kingfisher has recently completed its five-tranche, £300 million share buyback, there have been indications of a new buyback scheme on the horizon.
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