LONDON -B&M, the British discount retailer, reported a fall in underlying sales in its home market in its latest quarter, reflecting a very tough comparison with the same period last year when shoppers stocked-up for a first COVID-19 lockdown.
Shares in the FTSE 100 listed group, which sells everything from food to homewares, do-it-yourself and gardening products, were down 2.7% on Thursday after it said like-for-like revenue at its B&M UK business fell 4.4% in the 13 weeks to June 26, its fiscal first quarter.
That compared with growth of 24.5% in the second half of its 2020-21 year.
However, comparing the period to the first quarter two years ago, before the pandemic impacted trading, like-for-like revenue was up 21.3%.
“As expected, trading throughout the first quarter was volatile as we annualised against the high comparatives from last year,” said CEO Simon Arora.
The group, whose full name is B&M European Value Retail, has performed well during the pandemic. Its stores were allowed to stay open through multiple UK lockdowns because they sell some food, and its low prices and out-of-town locations chimed with consumers.
B&M said a pull-forward in gardening demand boosted revenue in the final two weeks of the 2020-21 year and early weeks of 2021-22, and depressed the subsequent weeks.
It said overall group revenue in the quarter rose 3.1% on a constant currency basis to 1.19 billion pounds ($1.64 billion).
The group also trades as Heron Foods in the UK and has a business in France. It has a total of 1,097 stores.
B&M said that while it was too early to predict likely revenue and profit outcomes for 2021-22, it was on track with its plans for the year and expected the two-year like-for-like measure in the core B&M UK business to remain strong.
Analysts are on average forecasting group core earnings (EBITDA) for 2021-22 of 666.5 million pounds, according to Refinitiv data, up from 626 million pounds in 2020-21.
The stock, up 13% so far this year, was down 15.4 pence at 562.1 pence at 0750 GMT, valuing the business at 5.6 billion pounds.
($1 = 0.7262 pounds)