Kingfisher Lifts Guidance as Screwfix Offsets Home-Improvement Slump

Kingfisher raised its 2026/27 profit and cash flow guidance after Screwfix drove a 9.9% rise in first-half adjusted pre-tax profit to GBP 404 million.

Kingfisher's trade-focused banner Screwfix has once again proved to be the engine of the business, powering the European home-improvement group to a stronger first half and prompting management to raise its full-year targets. The update, covering the six months to 31 July 2026, landed well with investors, who sent the stock sharply higher in today's session.

Profitability improves despite subdued consumer demand

Group revenue for the half came in at GBP 6.86 billion, with like-for-like sales edging up 0.3%. Gross margin widened by 70 basis points to 38.4%, helping adjusted pre-tax profit climb 9.9% to GBP 404 million. That figure includes a one-off refund of British business rates worth GBP 14 million.

The headline profit gain masked a clear split in performance. Screwfix, which serves professional tradespeople, delivered a 5.6% rise in like-for-like revenue. B&Q, the group's flagship UK chain, went the other way, posting a 2.9% decline as customers held back on big-ticket kitchen and bathroom projects. France followed a similar pattern, with sales down 2.3%, while market-share gains in Poland and Spain took some of the sting out of those losses. Summer heatwaves also weighed on footfall at the French subsidiary Brico Dépôt.

Management raises the bar for the full year

Citing the resilience of the first-half performance, Kingfisher nudged its outlook higher. Adjusted pre-tax profit for the 2026/27 financial year is now expected to land between GBP 595 million and GBP 635 million, compared with the previous range of GBP 565 million to GBP 625 million. Free cash flow guidance was also lifted, from GBP 450 million–510 million to GBP 480 million–520 million.

Analysts at Peel Hunt, who reaffirmed their "Add" rating and a 350 pence price target, said the upgrade reflects the operational strength of the store network. The broker pointed to growth in the online channel and the group's focus on trade customers as factors that successfully cushioned the softer periods in consumer renovation activity.

Buyback rolls on as dividend holds steady

Alongside the results, Kingfisher pressed ahead with its capital-return programme. The interim dividend was left unchanged at 3.8 pence per share, payable in November. The company also launched the third tranche of its existing share buyback, worth up to GBP 50 million, which will be executed through Morgan Stanley and completed by mid-December at the latest.

The move forms part of a broader GBP 300 million repurchase programme, with shares bought back to be subsequently cancelled. Meanwhile, the top job is set for a change: chief executive Thierry Garnier announced in May that he will leave to join Dutch retailer Ahold Delhaize. He will continue to run Kingfisher as normal until a successor is named, with a twelve-month notice period applying until the formal handover.