Variety retailer B&M has issued a profit warning following a 1.1% decline in UK like-for-like sales during its second quarter. The company now expects half-year underlying earnings to fall 28% to around £198 million.
© Craig Russell | Dreamstime
Rising costs contributed to the drop, including £30 million in higher wages and a £14 million hit from the new packaging tax under extended producer responsibility rules. B&M forecasts full-year underlying earnings of £510 million to £560 million, an 18% decline from the previous year.
CEO Tjeerd Jegen, appointed in May, stated that while B&M's value proposition remains strong, operational execution has been weak, impacting trading performance. He outlined plans to improve store ranges, on-shelf availability, and overall customer experience, cautioning that results from these initiatives could take up to 18 months to materialise.
Despite the challenges, B&M saw a 4.4% sales increase in its first quarter in July, boosted by demand for garden and outdoor furniture driven by warmer spring weather. The company remains focused on restoring consistent like-for-like sales growth over time.
Source: www.retailgazette.co.uk
