Wickes report stable trading in Q3 with LFLs up 2.6%

Wickes reports stable trading in Q3 with LFL sales growth of 2.6%, compared with the 0.8% reported for the first half.

There was no split of volume and price inflation so it can be assumed that volume declined YoY.

Key points:

• Core sales growth for the third quarter stabilised at the levels noted in the July trading statement.
• LFL sales were flat on a one year basis, and remain 27.3% ahead on a three year basis.
• Sales have strengthened since the beginning of September, following the impact of extreme heat seen in July and August.
• Aided by reductions in the cost of timber, there has been some moderation in the rate of retail price inflation since the first half.
• Local Trade sales performed strongly, with TradePro customer base increasing by 10k per month to c720
• DIY sales remain below last year although with no signs of further softening since our July trading update

Do it For Me (DIFM)

• DIFM LFL delivered sales in the Q3 were 12.2% ahead on a one year basis as we successfully work through the elevated order book.
• Orders in the third quarter are down versus last year; in line with our July update, customers are taking longer to commit ticket projects.

Stores

• During the third quarter we completed 3 refits and rolled out our 30 minute to big click & collect service nationally.
• On 7 October we opened a new store in Bolton, with further new store openings in the pipeline for 2023.

Costs

• Following this stable third quarter performance we continue to expect full year adjusted PBT to be in the range of £7282m.
• Looking further ahead, uncertainties remain regarding consumer confidence and operating cost inflation.
• In particular, our costs will be impacted by rising energy prices once our energy contract ends in March 2023.
• If energy costs were to remain at the current price cap for businesses, then our FY2023 energy costs would be c£7.5m higher than FY2022.

David Wood, CEO of Wickes, commented: “This has been a period of further progress across all parts of the business, with customers and tradespeople continuing to come to Wickes on the strength of our value, availability and service. “While we are watchful of external headwinds, we are continuing to focus on our growth levers and on maintaining rigorous control of our costs. Our uniquely balanced business model leaves us well placed to continue to outperform the market.”

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