Discount retailer B&M has posted robust annual results as cash-strapped shoppers turned to value-oriented retailers to help manage their budgets.
Over the year to 25 March 2023, B&M’s total revenues climbed 6.6 per cent to £4.98bn. This was despite the group lapping strong growth during the Covid crisis, with its sales now 30.7 per cent ahead of pre-pandemic levels.
In the UK, the B&M fascia saw revenues increase by 4.0 per cent to £4.07bn, driven by like-for-like growth of 0.7 per cent and new store openings. However, the group noted that it exited the final quarter of the year with a like-for-like run rate of 3.2 per cent.
At the year-end, they were 707 B&M outlets operating in the UK after 21 gross new store openings were offset by 15 closures and relocations.
Meanwhile, discount convenience chain Heron Foods saw revenues in its 319 stores jump 18.1 per cent to £485m, boosted by new openings and increased consumer demand across all categories.
Chief Executive Alejandro Russo stated that it had been “another year of strong underlying progress” for B&M and added that the long-term future of the business looked “very positive”.
However, GlobalData has pointed out that inflated material costs have dampened profits for B&M despite success with consumers.
"Although consumers have flocked to the value retailer throughout the cost-of-living crisis in search of its low-priced items, the retailer has been unable to overcome the other effects of inflation with rising costs and material prices offsetting this growth in sales," Sophie Mitchell, Retail Analyst at GlobalData, said.
Mitchell added that sales growth of highlights the attraction of the retailer’s offer of high-quality groceries at low prices throughout the cost-of-living crisis.
“FY2023-24 looks bright for the retailer, with UK l-f-l sales increasing by 8.3 per cent in the first nine weeks of the financial year. The broad customer support base the retailer has built throughout the pandemic and the cost-of-living crisis, combined with falling product costs as inflation declines, bodes well for the retailer as it continues to expand both in the UK and France.”
