B&M European Value Retail (BME) Q1 2025 TU earnings summary

Executive summary

• Group revenue for Q1 FY25 rose 2.4% year-over-year to £1,345m, driven by volume and new store openings across all businesses, with France delivering nearly double-digit like-for-like growth and the UK maintaining profitability despite weather challenges.

• B&M UK opened 19 new stores in Q1, all performing ahead of expectations, and is on track for 45 new stores this year; France added 2 new stores and targets 11 for the year.

• General Merchandise, especially Home and DIY Paint, performed strongly, offsetting Garden category weakness due to poor spring/summer weather.

• Operational execution remained robust, with clean stock exits, strong shelf availability, and high seasonal sell-through, positioning the business well for Q2.

• Heron Foods contributed to growth and targets 20 new store openings this year, with acceleration expected in Q2.

Financial highlights

• B&M UK revenue: £1,080m, up 1.5% year-over-year; B&M France: £126m, up 7.5%; Heron Foods: £139m, up 2.7%.

• Group revenue growth of 2.4% at constant FX rates; B&M France local currency growth was 9.6%.

• B&M UK like-for-like sales declined (3.5)% after adjusting for Easter timing, against a strong +9.2% prior year comp; underlying LFL sales were roughly flat after weather and calendar adjustments.

• Gross margin in B&M UK was flat to up compared to Q1 last year and in line with expectations, despite adverse weather and a shift in product mix.

• No markdown or margin risk was carried into Q2, and inventory levels remained lean.

Outlook and guidance

• Management remains confident in delivering a positive like-for-like sales number for the full year, with profitable, cash-generating growth expected and EBITDA margin guidance for B&M UK at 12%-13%.

• The business expects to open close to 30 new stores by half-year, with disciplined expansion in both the UK and France.

• Everyday Value range launched with 500+ new lines in UK and France to support value proposition as household incomes remain pressured.

• Full year guidance to be provided with half-year results on 14 November 2024.