B&M European Value Retail (BME) H2 2025 earnings summary

Executive summary

• Revenue reached £5.6bn, up 3.7% year-over-year, driven by new store openings across the group despite negative like-for-like sales.

• Adjusted EBITDA increased to £620m, reflecting resilient profit and strong cost control.

• 70 gross new stores opened across the Group, including 45 in B&M UK, 11 in France, and 14 in Heron Foods.

• Cash generation remained robust, with £311m post-tax free cash flow and a leverage ratio of 1.26x.

• Redomicile process to Jersey underway, expected to complete within the year and unlock potential for share buybacks.

Financial highlights

• Like-for-like sales declined by 3.1% year-over-year, with Q4 underlying like-for-likes at -1.8%.

• Gross profit margin increased from 37.1% to 37.6%, driven by favorable mix and cost reductions.

• Adjusted EPS was £0.335, down from £0.359 last year due to higher depreciation and interest costs.

• Final dividend proposed at £0.097, full-year dividend at £0.15 per share, up 2% from 2024.

• Capex was £111m, down from £124m, reflecting timing of store investments and completion of energy efficiency programs.

Outlook and guidance

• No explicit profit guidance for FY2026; consensus EBITDA is £621m, with management pointing to analyst consensus as a reasonable starting point.

• Significant cost headwinds of £75m expected in B&M UK for 2026, including wage and tax increases, with ongoing efforts to offset these through efficiency.

• Actions underway in Q1 FY26 to improve LFL performance, including FMCG execution and restoring average selling prices in General Merchandise.

• Expectation to open 45 gross new B&M UK stores in FY26, maintaining disciplined expansion.

• EBITDA margin of 12-13% may be a stretch in the near term but could recover as efficiencies and volume growth are realized.