Wickes Group maintained its annual guidance in spite of a sharp drop in quarterly sales, as consumers shied away from purchasing more expensive products and services such as bespoke cabinets.
Home improvement retailer, said that like-for-likes sales were down 4.2% compared to the same period last year in a consumer environment it called “challenging”.
Sales of the design and installation service (formerly Do It For Me), which allows customers design their own kitchens and bathrooms for Wickes staff to install, fell by 18.2 percent compared to the same period last year.
Retail sales at Wickes did better, with a 0.6% increase in 16 weeks. This was the fourth consecutive positive period for the division.
Wickes attributes the increase in revenue to a higher volume of sales, and adds that “customers are still enthusiastic about home improvements but they’re focusing on smaller jobs”.
TradePro, the company’s loyalty discount program, has seen a 12 percent increase in revenue. It now includes 57,000 new members.
The shares of the company have dropped by 40 percent since April 2021 when it separated from Travis Perkins, a builder’s merchant. They closed Wednesday at 143 1/4p, down 2 1/2p or 1.65 percent.
Wickes, while warning of the uncertain trading environment, reaffirmed their guidance of an adjusted profit of £43.6m before tax on the strength of its retail performance and its focus on costs.
Analysts at Liberum stated that the current valuation of the company was based on its “robust dividend and buyback program” — the company announced its second tranche for its £25 million buyback program in March. The company added that “it is difficult to see what will drive the share price higher at this point”.