B&M Shares Fall on Weak Sales, Rising Costs

B&M European Value Retail reported a 0.6% rise in core profit to £620 million for the year, but its shares fell over 5% as group sales of £5.6 billion missed expectations due to weak UK demand and persistent inflation. Like-for-like UK sales dropped 3.1%, especially in fast-moving consumer goods, and the company warned of further profit pressures from increased national insurance, minimum wage hikes, and input cost inflation. Growth was mainly driven by 70 new store openings, but this was insufficient to counteract a tough retail environment and rising competition. Heron Foods underperformed by missing both sales and EBITDA targets, while B&M France also fell short of revenue forecasts despite a marginal improvement in like-for-like sales. The company increased its full-year dividend to 15p per share, noting that price cuts on general merchandise lifted volumes but lowered overall sales value. B&M anticipates continued challenges for the UK retail sector as the cost-of-living crisis persists.