B&M profits at top end, but lack of guidance disappoints

Annual operating profits at B&M European Value Retail came in at the top end of guidance, but shares fell sharply on Wednesday after the discount retailer offered no firm guidance for the current financial year.

Adjusted EBITDA totalled £629m in the year to 25 March, up 10.9% on the year before, helped by higher volumes and strong cost control. This was at the top end of the company's forecast of £620m to £630m.

Group revenues rose by 10.1% to £5.5bn, helped by the opening of 78 gross new stores across the group, with 19.2% growth in B&M France, 15.3% in Heron Foods and 8.5% in B&M UK.

"FY24 has been another good year for B&M. The three key components of our business - buying, logistics and retail, are working in balance and we continue to deliver excellent products at everyday low prices to our consumers," said chief executive Alex Russo. "We are well set for the years ahead."

Despite the solid results, Shore Capital analyst Clive Black labelled the publication as a "curious statement" given its absence of guidance for the year ending March 2025. "We [...] point out that there seems to be no current trading statement, which may not be especially helpful in some quarters," Black said.

One thing the company did say about the future was that it plans to open at least 45 gross new B&M stores in the UK per annum over the next three years, plus a "meaningful number" in France and for Heron Foods. It recently announced new, long-term store target of at least 1,200 B&M UK stores, a significant increase from the 950 we had guided to previously.

B&M recommended a final dividend of 9.6p per share, bringing the full-year payout to 14.7p, up from 14.6p previously, in additional to the 20p special dividend paid in January.

In a separate statement, B&M also announced that it had appointed senior independent director and chair of its remuneration committee, Tiffany Hall, as its new board chair, replacing Peter Bamford who is set to retire after six years.