It's been a busy couple of days for Véronique Laury, Kingfisher's new chief executive. Yesterday, after almost a year of talks, she abandoned a plan hatched by her predecessor to acquire the DIY chain Mr Bricolage. It seems the involvement of the competition authorities unsettled the company's largest shareholder ANPF, which then derailed the deal.
Then today Laury, who took the helm in December, delivered her first annual results - and they're a mixed bag. The most eye-catching revelation is the news Kingfisher plans to slash the number of B&Q stores from 360 to around 300 over the next two years, reducing the chain's total floor space by around 15%.
'Kingfisher has said for some time that B&Q UK & Ireland can adequately meet local customer needs from fewer stores and that some of the stores should be smaller,' it said today in a statement. Extra space in stores that are too big will be disposed of through a combination of sell-offs and subletting.
'Home improvement is a great market with huge potential and Kingfisher has a strong position within it with further scope to grow in a sustainable way,' said Laury. 'However, it is clear to me that we need to organise ourselves very differently to unlock our potential.'
Her determination to make a mark extends way beyond closing a few B&Q stores. Today Laury set out a plan to '[take] what is essentially a locally managed set of businesses and [create] instead a single, unified company where customer needs come first.' Out goes B&Q's current UK boss Kevin O'Byrne, in comes a shiny new 'international leadership team' with responsibility across all the brands.
Closing 60 stores sounds dramatic but should come as no surprise in a market like DIY. In October, B&Q's big rival Homebase announced plans to close 25% of its stores thanks to a slump in the amount of people who felt confident doing DIY. 'People have less time and less skill,' said Homebase owner Home Retail Group's chief exec John Walden. 'They are more likely to look to a third party for help.'
That perhaps explains the success of Kingfisher's other brand, the more trade-focused Screwfix. Like-for-like sales were up 13.4% and it opened 60 new stores last year. In fact the whole of Kingfisher's UK & Ireland performance was broadly positive – sales were up 5.4% to £4.3bn and profit was up £16.2% to £276m. Kingfisher's CFO Karen Witt said she hoped the redeployment of B&Q staff to Screwfix and other stores would prevent most of the 3,000 affected by store closures from losing their jobs.
It's the company's other major market, France, where the problems lie though. Combined sales at its Castomarama and Brico Depot stores were down 6.6% to £4.1bn and profits dipped 11.8% to £349m. This wasn't helped by poorly performing Euro though, and the same figures calculated on a constant currency basis were markedly better, though still in decline.
Laury better hope her new plan pans out better than that to buy Mr Bricolage if she wants to return the business to solid growth.