11 November 2021
B&M European Value Retail S.A.
FY22 Interim Results Announcement
Strong sales and profit growth versus pre-pandemic levels
B&M European Value Retail S.A. (“the Group”), the UK's leading variety goods value retailer, today announces its interim results for the 26 weeks to 25 September 2021.
HIGHLIGHTS
- Group revenues increased by +1.2% on prior year to £2,268.0m (+1.4% constant currency1) or +26.8% on a two-year basis versus H1 FY20
- B&M UK fascia2 revenue up +1.3% on prior year, with like-for-like3 (“LFL”) revenues decreasing by (5.0)%
- On a two-year basis vs H1 FY20, LFL revenues were +16.8% as sales densities remained significantly higher than pre-pandemic levels.
- Gross margin in the B&M UK business was particularly strong, driven by a change in the sales mix towards General Merchandise and high sell-through across Spring/Summer seasonal ranges leading to limited markdown activity
- Group adjusted EBITDA4 of £282.2m on a pre-IFRS16 basis versus £295.6m5 in the prior year, or £255.7m in the prior year on a comparable basis when reflecting the voluntary charge relating to business rates subsequently made in H2 FY21
- On a two-year basis versus H1 FY20, Group adjusted EBITDA4 increased +86.4% due to higher sales densities and a favourable sales mix
- Group statutory profit before tax (post-IFRS16) increased +2.4% to £241.4m (H1 FY21: £235.6m5) and Group adjusted profit before tax4 (pre-IFRS16) decreased by (6.2)% to £238.0m (H1 FY21: £253.6m5)
- Statutory diluted earnings per share of 19.0p (H1 FY21: 18.7p) and adjusted diluted earnings per share4 of 18.7p (H1 FY21: 20.1p)
- 14 gross new B&M UK store openings and 9 store closures in H1 FY22
- More challenging trading conditions in Heron Foods as average transaction values for grocery shopping normalise to pre-pandemic levels, but satisfactory earnings through careful cost control and cash discipline
- Strong strategic and financial progress in France, with 100 out of 104 stores trading as B&M and adjusted EBITDA4 of £11.4m (H1 FY21: £2.7m)
- Group cash generated from operations was £201.7m (H1 FY21: £403.2), reflecting a strong EBITDA performance and the impact of an earlier build of inventory compared to the prior period
- Ordinary half year dividend6 increased by 16.3% to 5.0p per share (H1 FY21: 4.3p), to be paid on 17 December 2021
- Good stock availability heading into peak trading having deliberately taken delivery of imported General Merchandise earlier than normal, with supply chains across the Group remaining robust
- Ongoing evaluation of current leverage and cash position, in line with our capital allocation framework
Simon Arora, Chief Executive, said,
“The Group has performed strongly throughout the first half of our financial year, with customers continuing to be drawn to our value for money offer .
We have responded decisively to supply chain challenges by leveraging our strong supplier relationships and we have improved in-store execution. As a consequence, we are fully stocked heading into the Golden Quarter, with stores already showcasing our excellent Christmas ranges. To colleagues across the Group, I express my gratitude for their dedication, skill and commitment, which have made these results possible.
Although the pathway to a 'new normal' remains uncertain and the industry faces a number of supply and inflationary pressures as we enter the second half of the financial year, we are very confident that the B&M Group is well positioned to navigate these and will continue to be successful both in the UK and in France.”
Financial Results (unaudited)
|
|
H1 FY22
|
H1 FY21
|
Change
|
|
Number of stores
Group
B&M UK
Heron Foods
France
|
1,097
686
307
104
|
1,059
657
299
103 |
+3.6%
+4.4%
+2.7%
+1.0%
|
|
Total Group revenues
B&M UK
Heron Foods
France
Total Group revenues at constant currency1 |
£2,268.0m
£1,909.5m
£203.1m
£155.4m
–
|
£2,242.1m
£1,885.4m
£216.2m
£140.6m
–
|
+1.2%
+1.3%
(6.1)%
+10.6%
+1.4%
|
|
Group adjusted EBITDA 4
B&M UK
Heron Foods
France |
£282.2m
£257.4m
£13.4m
£11.4m
|
£295.6m5
£274.7m
£18.3m
£2.7m
|
(4.6)%
(6.3)%
(26.7)%
+324.9%
|
|
Group adjusted EBITDA 4 margin %
|
12.4% |
13.2% |
(75) bps |
|
Group adjusted profit before tax4
|
£238.0m
|
£253.6m
|
(6.2)%
|
|
Group statutory profit before tax
|
£241.4m
|
£235.6m |
+2.4%
|
|
Adjusted diluted EPS4
|
18.7p |
20.1p |
(7.2)%
|
|
Statutory diluted EPS
|
19.0p |
18.7p |
+1.7%
|
|
Ordinary dividends6
|
5.0p |
4.3p |
+16.3%
|
1. Constant currency comparison involves restating the prior year Euro revenues using the same exchange rate as that used to translate the current year Euro revenues.
2. References in this announcement to the B&M business includes the B&M fascia stores in the UK except for the 'B&M Express' fascia stores. References in this announcement to the Heron Foods business includes both the Heron Foods fascia and B&M Express fascia convenience stores in the UK.
3. One-year like-for-like revenues relate to the B&M UK estate only (excluding wholesale revenues) and include each store's revenue for that part of the current period that falls at least 14 months after it opened compared with its revenue for the corresponding part of FY21. This 14 month approach has been adopted as it excludes the two month halo period which new stores experience following opening. Two-year like-for-like revenues also relate to the B&M UK estate only, and includes each store's revenue for that part of the current period that falls at least 26 months after it opened compared with its revenue for the corresponding part of FY20.
4. The Directors consider adjusted figures to be more reflective of the underlying business performance of the Group and believe that this measure provides additional useful information for investors on the Group's performance. Further details can be found in notes 3 and 4 . Adjusted figures exclude the impact of IFRS16.
5. In the prior year, H1 FY21 Group adjusted EBITDA of £295.6m did not include a charge relating to business rates amounting to approximately £40m. Subsequent to the H1 FY21 reporting period, the Group announced it would forgo the UK Government business rates relief, with this amount being charged in H2 FY21. Further details can be found in note 3.
6. Dividends are stated as gross amounts before deduction of Luxembourg withholding tax which is currently 15%.
7. Net capital expenditure includes the purchase of property, plant and equipment, intangible assets and proceeds of sale of any of those items. These exclude IFRS16 lease liabilities.
8. Net debt was £654.6m at the period end. This reflects £746.9m of gross debt netted against £92.3m of cash.
Analyst & Investor webcast & conference call
An Analyst & Investor only webcast and conference call in relation to these FY22 Interim Results will be held today at 9.45am (UK).
The conference call can be accessed live via a dial-in facility on:
UK & International: +44 330 336 9128
US: +1 929 477 0402
Confirmation code: 5209689
A simultaneous audio webcast and presentation will be available via the B&M corporate website at www.bandmretail.com
Enquiries
B&M European Value Retail S.A.
For further information please contact +44 (0) 151 728 5400 Ext 5763
Simon Arora, Chief Executive
Alex Russo, Chief Financial Officer
Jonny Armstrong, Head of Investor Relations
Investor.relations@bandmretail.com
Media
For media please contact +44 (0) 207 379 5151
Sam Cartwright, Maitland