Wickes says home-working fuelling DIY demand despite sliding profits

Wickes has reported higher sales as hybrid working encourages more home improvement projects, despite the retailer revealing shrinking profits.

The DIY chain, which also trades as a builders’ merchant, said sales over the first half of the year edged up due to more normal weather conditions, which influences the products people choose to buy.

It was also bolstered by sales for its Do-It-For-Me (DIFM) division, its kitchen and bathroom showroom business, which jumped by nearly 6% .

“Many businesses have retained or fully incorporated hybrid working practices, increasing the dwell time at home, fuelling further desire for homeowners and tenants to invest in their properties,” the company said.

But the retailer’s reported profit before tax slid by 37% to £21.1 million over the period as it took a hit from separating and upgrading its IT systems from former owner Travis Perkins.

Excluding the one-off IT costs, its adjusted pre-tax profit still shrank by more than 15%.

The DIY market continued to be affected by pressure on people’s disposable income, rising mortgage rates and a decline in house sales, the firm said.

But it said other cost-of-living strains, such as higher petrol and energy costs, have started to unwind, while food price inflation has slowed from the very high levels.

It suggests that people have more confidence to spend on home improvement projects than last year, when Wickes said demand for DIY faded as living costs increased.

Chief executive David Wood said: “We achieved a sales uplift and strong conversion rates in DIFM, while delivering another strong performance in local trade due to our market-leading value on the lines that matter most.

“While we remain mindful of the external environment, we are seeing customers turn to Wickes for our great value proposition.

“We are well on track for the remainder of the year and we have the right strategy in place to make further market share gains within the large home improvement sector.”

Wickes said trading in July and August has been in line with its expectations, and stood by its full-year guidance of adjusted pre-tax profit between £45 million and £48 million.