B&Q set to reveal impact of cost-of-living crisis on DIY demand

B&Q will next week reveal the impact of the cost-of-living crisis on demand for DIY amid predictions of a cooling market.

Kingfisher, which owns the chain along with the Screwfix business, is due to publish interim results on Tuesday with analysts keen to see if the group still expects to hit previous adjusted profit guidance of £770 million for the full year.

But the City will also be keen to find out what the implications of the spending squeeze and soaring inflation will be on the craze for home improvements.

Shares in Kingfisher, which also owns Castorama and Brico Depot in France and across Europe, has seen its shares cool by about 30 per cent in the past year.

Shoppers returning to a B&Q branch in Scotland during summer 2020 following the initial lockdown as stores were classified as essential. Picture: Lisa Ferguson

Analysts at investment platform AJ Bell noted: “Worries over the cost-of-living crisis and its impact on consumer spending are key issues here, especially as rival Wickes flagged back in July that it had seen a softening in the DIY market in the wake of the boom in home improvement that took place during lockdowns and the pandemic.

“Kingfisher’s shares are now back to where they were in summer 2020 and the effects of inflation can be seen in how the share price and the monthly results of GfK’s UK consumer confidence survey seem to track each other.

“At least you could perhaps say things can hardly get much worse, which is a start I suppose, even if the past is by no means a guarantee for the future.”

Susannah Streeter, senior investment and markets analyst at Hargreaves Lansdown, said: “The owner of B&Q and Screwfix had been hammering out a resilient performance despite supply chain problems, which have hit the sector with product availability improving on shelves.

“Although the surge in sales during lockdowns has dropped off, first-quarter sales were significantly ahead of the group’s performance pre-pandemic.

“This shows that a sizeable chunk of customers that picked up a hammer for the first time were still coming back, thanks to their new-found skills and a shortage of labour in the building trade. But there are now tentative signs that the number of amateur builders, painters and carpenters hanging up their tool kits is growing.”