Wickes reports stable Q3 trading but warns of energy costs
It said that if energy costs were to remain at the current price cap for businesses, then its FY23 energy costs would be £7.5m higher than FY22
Wickes has reported stable trading in its third quarter, with sales rising by 2.6% against the 0.8% growth reported for the first half, but has warned of rising energy costs in FY23.
As trading stabilised in the period, sales were flat on a one year basis, but remained 27.3% ahead on a three-year basis. According to the group, sales have strengthened since the beginning of September following the impact of extreme heat seen in July and August.
Local Trade sales performed particularly strongly in the quarter, with the group’s TradePro customer base increasing by 10k per month to around 720k.
Nonetheless, DIY sales remained below last year, although with no signs of further softening since its July trading update.
Its DIFM business delivered sales that were 12.2% ahead on a one year basis however as it “successfully worked” through an elevated order book. Orders in the third quarter were down against the prior year as customers took longer to commit to big ticket projects.
During the period the group completed three refits and rolled out its 30 minute click and collect service nationally. On 7 October it opened a new store in Bolton, with further new store openings in the pipeline for 2023.
Following its stable third quarter performance, it continues to expect its full year adjusted PBT to be in the range of £72-82m. Looking further ahead though, it warned that “uncertainties remain” regarding consumer confidence and operating cost inflation.
In particular, it warned its costs will be impacted by rising energy prices once its energy contract ends in March 2023. It said that if energy costs were to remain at the current price cap for businesses, then its FY23 energy costs would be £7.5m higher than FY22.
David Wood, CEO of Wickes, said: “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.”
