Following today’s release of B&M FY figures for 2019/20, Hannah Richards, Retail Analyst at GlobalData, comments: ‘‘Despite the global disruption of COVID-19, B&M has emerged as one of retail’s most resilient players, delivering admirable revenue growth amid challenging times. B&M fascia revenue increased by £350.7m to £3.1bn in FY2019/20, while it also achieved strong sales growth at both its Heron Foods and Babou fascias (+10.1% and +119.4% respectively), with group profit before tax up 3.2% to £252.0m. B&M UK l-f-l sales growth increased by 2.6ppts on the year to 3.3%, with the retailer excelling in Q4 recording l-f-l sales growth of 6.6%, making up for a disappointing Q3. FY2019/20 top line growth has also been aided by continued UK physical expansion with 36 net new B&M openings during the period, with a further 30 planned for FY2020/21 despite the prolonged COVID-19 impact on physical retailing.
“Recent trading indicates B&M will however deliver an impressive Q1 FY2020/21 owing to strong l-f-l sales growth in the UK of 22.7% across the eight weeks to 23 May 2020. While the DIY & gardening categories have outperformed during this period, excluding these sectors l-f-l growth remained at 10.3%. Although footfall has been severely impacted by lockdown, l-f-l average transaction value rose 72.5% across the eight week period, highlighting the ongoing appeal of its wide offer. Though current levels of trading are not expected to continue, B&M’s outlook is favourable as its out of town locations will serve it well as consumers continue to avoid busy shopping centres. Furthermore, its value positioning is a real strength as consumer confidence will remain marred by the woes of COVID-19 and the significant rise in unemployment cements consumer appetite for value goods.
“Category growth in DIY & gardening, driven by the partial closure of some specialist retailers and favourable weather conditions, and the strong growth of groceries as consumers deviated from supermarkets has benefitted B&M in early Q1 trading, but momentum is unlikely to be sustained. As more specialists and non-essential retailers re-open and supermarkets conquer product shortages, B&M will face greater competition and category mixes will shift.”