DAVY VIEW

Kingfisher has been running hard but its profits have stood still. Despite all the efforts of the ‘ONE Kingfisher’ project, the group’s retail profits in the year to end-January 2019 were little changed from where they were at the outset of the programme. France in particular remains a persistent headache and continues to place downward pressure on forecasts. We believe the latter limits the stock’s potential to re-rate despite screening attractively from a value perspective. The disruption at senior management level – with a CEO succession process now underway – adds a further layer of uncertainty.