By Yadarisa Shabong
(Reuters) -Discount retailer B&M lowered the top end of its annual profit forecast on Thursday after its UK like-for-like sales dropped 2.8% in its third quarter as cash-strapped shoppers limited spending over the key Christmas period.
Shares in B&M, which lost more than 30% of their value last year, dropped 10% to their lowest since November 2022.
B&M, which offers a wide range of products from hats and heaters to toys and food, has been focussing on increasing the number of items sold by keeping prices competitive to attract in value-conscious customers during challenging economic times.
Like-for-like sales at B&M’s UK business dropped 2.8% in the quarter ended Dec. 28, though there was growth in the last month of the period, compared with a 1.9% fall in the second quarter.
January has continued a positive like-for-like trend, it said.
“The business remains undistracted by the current economic headlines,” CEO Alex Russo said in a statement.
The company, on course to open new stores in Britain and France this fiscal year, declared a special dividend of 15 pence per share after group revenue rose 2.8% in the quarter.
British businesses are grappling with a rise in costs this year following a budget in October that increased employers’ National Insurance contributions and the national minimum wage.
The company now expects annual adjusted core earnings within a range of 620 million to 650 million pounds ($763-$798 million), compared with 620-660 million pounds previously.
B&M said it planned to keep its London listing as the retailer reviews options to potentially relocate its parent company’s domicile to either Jersey or Ireland from Luxembourg.
Several London-listed businesses over the past couple of years have ditched their primary listing in Britain in favour of overseas markets, where company valuations are often higher.
($1 = 0.8127 pounds)
(Reporting by Yadarisa Shabong in Bengaluru. Editing by Sherry Jacob-Phillips and Mark Potter)
