Kingfisher upgrades profit guidance as Screwfix drives growth
The home improvement retailer raised its adjusted pre-tax profit forecast to a range of £595 million to £635 million
Kingfisher (KGF) has upgraded its full-year profit and cash flow guidance following a half-year period marked by strong performance from its Screwfix banner and expansion in digital channels. The home improvement retailer now expects adjusted pre-tax profit for the 2026/27 financial year to reach between £595 million and £635 million, up from a previous range of £565 million to £625 million.
Adjusted pre-tax profit for the six months ended 31 July 2026 rose 9.9% to £404 million. This growth was supported by a 70 basis point expansion in gross margin to 38.4%, which the company attributed to buying and sourcing scale, retail media, and foreign exchange tailwinds. Results were further aided by a one-off £14 million business rates refund in the UK.
Screwfix emerged as a primary growth driver with like-for-like sales increasing 5.6%. The company also reported market share gains at Screwfix, as well as in Poland and Spain. In contrast, Brico Dépôt France saw its performance impacted by heatwaves due to its category mix.
Digital and trade penetration continued to accelerate. Group trade sales penetration increased by 3 percentage points to 31%, while e-commerce penetration rose 2 percentage points to 22%. The company's marketplace gross merchandise value grew 42% to £372 million, contributing £13.4 million in profit compared to £7 million in the first half of the previous year.
Operating costs rose 0.4%, reflecting new store openings and higher staff pay rates, including increased UK employer National Insurance contributions. These costs were partially offset by structural reductions, including a 15% reduction in distribution centre space at Castorama France.
Free cash flow for the period was £339 million. The company maintained its interim dividend at 3.8p. Kingfisher is currently executing a £300 million share buyback programme, with £125 million purchased to date. The company is commencing a third tranche of £50 million this week, which it expects to complete by December.
Looking ahead, the company has raised its free cash flow guidance to a range of £480 million to £520 million, up from £450 million to £510 million. Management noted that while the consumer environment remains mixed, the company expects a sales impact of approximately 1% from new space, primarily across B&Q, Screwfix, and Castorama Poland.