B&Q owner warns on uncertainty over Brexit and French election

Shares (Berlin: DI6.BE - news) in B&Q and Screwfix owner Kingfisher (Frankfurt: 812861 - news) have fallen after it warned of uncertainty over Brexit and the French election - and indicated that UK price increases were in the pipeline.

The FTSE 100 group, which owns French firms Castorama and Brico Depot as well as its British brands, was 5% down in afternoon trading.

Pre (Shanghai: 600048.SS - news) -tax profits for the year to the end of January, excluding one-off items, rose 8% to £743m, helped by a 3.5% like-for-like sales increase for B&Q and a 13.8% rise for Screwfix.

But the collapse in the value of the pound since the Brexit vote will mean low-to-mid single digit price increases on selected products for UK shoppers.

Latest results showed profits saw a £52m boost from the weak pound, which flattered the value of the group's overseas earnings.

But Kingfisher admitted its French division had underperformed, with like-for-like sales down 2.7%.

Chief (Taiwan OTC: 3345.TWO - news) executive Veronique Laury said it had been a "productive and important year" but sounded a note of caution over the impact of political events.

She (Munich: SOQ.MU - news) said: "Looking forward, the EU referendum has created uncertainty for the UK economic outlook and we remain cautious on the outlook for France, especially in light of the forthcoming presidential elections."

The company said customers in the UK would also face "modest price increases" on selected products after the fall in the pound, which makes imports more expensive.

It comes a day after official figures showed UK inflation at its highest in three and half years following the collapse in the pound after the Brexit vote - which makes imported goods more expensive.

Kingfisher said a closure programme over the last couple of years had seen 65 B&Q stores shut, helping boost same-store comparisons for those still open.

The DIY chain, which has just under 300 UK and Ireland (Other OTC: IRLD - news) stores, had also improved the availability of products via click-and-collect, helping digital sales grow by 45%.

Trade-focused Screwfix, with more than 500 stores, is continuing to expand and is aiming for a long-term target of 700 sites.