B&M European Value Retail (BME) H1 2026 earnings summary

Executive summary

• H1 performance was below expectations due to flat UK like-for-like sales, gross margin decline, and cost increases impacting profitability.

• Group revenue grew 4.0% year-over-year to £2,749m, driven by new store openings and strong trading in France.

• The "Back to B&M Basics" plan was launched to restore UK like-for-like growth, focusing on price, range, promotions, and availability.

• Management team strengthened with new appointments, including a new CFO, Group Trading Director, and CEO.

• Cash discipline and capital allocation support healthy free cash flow and return on capital employed.

Financial highlights

• Adjusted EBITDA (pre-IFRS 16) declined 30.2% year-over-year to £191m, mainly due to UK margin pressures and cost inflation.

• Group revenue: £2,749m (+4.0% YoY); B&M UK revenue: £2,196m (+3.5% YoY); B&M France: £280m (+13.4% YoY); Heron Foods: £273m (-0.9% YoY).

• Adjusted operating profit dropped 31.5% to £177m; statutory profit before tax fell 55.6% to £75m.

• Free cash flow was £51m despite £74m CapEx investment.

• Leverage ratio (pre-IFRS 16) ended at 1.6x, above the 1.0–1.5x target range.

Outlook and guidance

• FY26 Group adjusted EBITDA (pre-IFRS 16) guidance reiterated at £470m–£520m.

• Full impact of "Back to B&M Basics" expected in 12–18 months, aiming to restore UK EBITDA margin to low double digits.

• Early Q3 trading is within LFL sales guidance, albeit at the lower end.