Kingfisher to close about 60 B&Q stores

Kingfisher, the owner of DIY chains B&Q and Screwfix, is to close about 60 B&Q stores in the UK and Ireland over the next two years.

But it plans to open 60 new outlets under its Screwfix brand this year.

"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 in a statement.

Kingfisher also announced a 15.2% fall in pre-tax profit to £644m for 2014.

And in a separate announcement, it said that Kevin O'Byrne, chief executive for B&Q UK & Ireland, would leave the firm on 15 May 2015 "allowing a smooth handover of his responsibilities" with further details to be announced "in due course".

The store closures, which will result in a £350m one-off cost, mark Veronique Laury's first major move as chief executive. The former Castorama boss took over from Sir Ian Cheshire as chief executive last September.

The firm, which currently has 360 B&Q stores, has so far confirmed the locations of six store closures: Southampton, Dundee, Baums Lane in Mansfield, Station Road in Stechford in Birmingham, Hyde in Greater Manchester, and Barnsley.

But it said the impact on jobs from the B&Q store closure plan is expected to broadly neutral due to the planned Screwfix openings, which will create 900 new jobs, and plans to redeploy staff to other parts of the business.

Ms Laury said it was "clear" the firm needed to organise itself "very differently to unlock our potential", and described the move as part of a set of "first sharp decisions" she was taking.

She said the group could achieve "significant benefits" from unifying the group, noting that "customers needs are already largely the same" with the markets it serves "fundamentally more similar than different".

B&Q said top executives' roles would now be more focused on the entire company, it would cut the number of products it sold, as well as unify its IT platform across the group.

Other plans include making the most of its vacant store space and it said it was in discussions with several retailers about sub-letting opportunities.

"We are getting on with this at real pace," it added.

The announcement comes a day after the group, which also owns Castorama and Brico Depot in France, walked away from its planned €275m purchase of French DIY chain Mr Bricolage after one of the latter's shareholders opposed the deal.

The firm's performance in France continued to be weak, with sales down 6.6% for the year, which it blamed on "an ongoing soft market", driven by weak consumer confidence and a declining housing and construction market.

But in the UK and Ireland, sales rose 5.4%, which it said reflected a stronger UK economy and more buoyant housing construction.