By Pushkala Aripaka
(Reuters) – Discount retailer B&M on Tuesday forecast annual profit above the midpoint of its outlook range, buoyed by sales from new stores and robust French operations, with cost cuts also helping it mitigate cautious demand from customers.
Its shares rose as much as 7.5% to 321.7 pence by 0738 GMT as investors took solace in the upgrade after B&M cut its profit forecast in February, having already narrowed the range previously.
B&M, which sells everything from hats and heaters to toys and food, operates more than 1,100 stores across Britain and France under its eponymous brand and Heron Foods.
Its UK operations have been pressured as cash-strapped shoppers limit spending at a time when B&M has looked to increase the number of items it sells while keeping prices competitive.
It reported total group sales of 5.6 billion pounds ($7.40 billion) for the year ended March 29 and said that it was taking steps to boost performance from fast-moving consumer goods.
Most of Britain’s major retailers, including M&S and Next, have warned of a tough year ahead. And the government’s proposed employer tax increases are expected to saddle companies with higher costs. Uncertainties surrounding U.S. tariffs are also weighing on sentiment.
B&M has projected annual adjusted core earnings of 605 million pounds to 625 million pounds, implying a midpoint profit of 615 million pounds.
“End of a tough year but huge value on offer,” Panmure Liberum analysts said in a note.
B&M shares lost more than 30% of their value last year.
The retailer on Tuesday also said it was making progress in its search for a successor to CEO Alex Russo, who will be retiring at the end of this month.
B&M has been reviewing options to potentially relocate its parent company’s domicile from Luxembourg to either Jersey or Ireland. On Tuesday, it said that process was progressing to plan and is expected to complete within the calendar year.
($1 = 0.7569 pounds)
(Reporting by Pushkala Aripaka in Bengaluru; Editing by Mrigank Dhaniwala, Sherry Jacob-Phillips and Joe Bavier)
