Home improvements retailer Kingfisher posted a 23 per cent fall in first-half profits today and announced a £200 million revamp of its British B&Q operation.
As it grapples with what it said were the toughest markets for many years, Kingfisher will take a one-off charge in the second half as it closes 22 stores, shrinks 16 others and cuts operating costs.
Adjusted pre-tax profits at Kingfisher fell to £254.3 million compared with a consensus forecast of £260 million.
Rising energy costs, higher tax and pension contributions, increasing household debt and a weak housing market have all sapped consumer confidence and retail profits in Britain.
In response, B&Q is to spend £200 million on revamping stores, cutting costs and closing 22 stores in areas that have access to other B&Q outlets. The company said the vast majority of staff would be redeployed.
Kingfisher shares have recently been supported by takeover speculation after US investor Warren Buffett's Berkshire Hathaway bought shares in the firm. Berkshire has also bought shares in US firm Home Depot, rumoured to have looked at a takeover of Kingfisher in the past.