Careers Shop Wickes

Full Year Results 2021

Wickes Group plc - Full Year Results 2021

for the 53 week period to 1 January 2022

Excellent full year performance, accelerating investment for growth

Financial Highlights

  • Revenue up 14.0% to £1.53bn (2020: £1.35bn) driven by
    • Further market share gains in Core, supported by range development, enhanced service proposition and strong digital performance
    • Strengthened Trade position with over 80,000 new TradePro customers, taking the base to over 630,000
    • Resilient performance in DIFM despite Covid disruption, supported by virtual customer journey and new ranges
  • Like-for-like sales* up 13.0% on 2020 and 18.6% on 2019
  • Adjusted profit before tax increased to £85.0m** (2020 £49.5m)
  • Reported profit before tax increased to £65.4m (2020 £28.9m)
  • IFRS net debt of £618.7m; leverage reduced to 2.8x (see Appendix)
  • Final dividend declared of 8.8p, a total of 10.9p for the full financial year representing 40% of adjusted profit after tax

Strategic Highlights

  • Significant outperformance, growing at over twice the rate of the market
  • Strength of our market position and returns give confidence to accelerate investment to drive growth; investing an incremental £15m per year
  • Accelerating the store refit programme, now expected to be completed within five years, with 12-15 stores refitted p.a.
  • New store opportunities identified with potential for up to 20 new stores over the next 5 years
  • Setting out capital allocation policy supporting accelerated investment for growth, enhanced ordinary dividend of 40% of adjusted profit after tax and targeting IFRS net debt leverage consistently less than 2.75x - with excess capital available to be returned to shareholders over time
  • Repositioned all of our ESG work under the banner of Responsible Business. Three pillars cover People, Environment, and Homes, supported by strong governance, safety and wellbeing, and responsible sourcing

Current Trading and Outlook

  • Trading in the first 11 weeks is in line with last year
  • As we annualise strong 2021 comparatives, Core sales are down 6.7% year on year and 26.3% ahead YO2Y, notably driven by buoyant demand from local trade with trade customer order books at record levels
  • DIFM has had a positive start to the year and the order pipeline has continued to build strongly through our key winter sale trading period. Together with our significant carried forward order book, double that of a year ago, this gives us confidence that delivered sales will be ahead of 2019
  • We expect to make further progress in the year ahead, being mindful of recent geopolitical events and macroeconomic uncertainty

David Wood, Chief Executive, said:

"I am delighted to report a year of excellent growth. Our performance is testament to the resilience and hard work of our colleagues, our strong supplier relationships, uniquely balanced business model and market leading customer proposition.

Our strategy is delivering strong growth and return on investment. The results we are seeing, plus these strong returns, give us confidence to accelerate our investments to drive further growth.

Looking ahead, we expect to continue outperforming the market and are well-placed to capitalise on the ongoing requirement for home improvement – namely an ageing housing stock, favourable consumer trends, and the increased focus on insulating and retrofitting homes. While we recognise the pressure that consumers will be facing in 2022, we have the right model, a strong pipeline and order book, and remain confident of making further progress in the current year driven by a material increase in DIFM revenues."

David Wood Chief Executive

Summary financial results

£m

53 weeks to

1 Jan 2022

52 weeks to 26 Dec 2020

Change

Revenue

  Core

  DIFM

1534.9

1234.7

300.2

1346.9

1072.4

274.5

14.0%

15.1%

9.4%

Gross profit

  Gross profit %

568.5

37.0%

509.1

37.8%

11.7%

Adjusted** operating profit

  Adj operating profit %

116.3

7.6%

81.6

6.1%

42.5%

Adjusted** profit before tax

85.0

49.5

71.7%

Adjusted** basic earnings per share

27.2p

16.1p

68.9%

Reported operating profit

  Operating profit %

96.7

6.3%

61.0

4.5%

58.5%

Reported profit before tax

65.4

28.9

126.3%

Basic earnings per share

23.3p

10.4p

124.0%

Full Year Dividend

10.9p

n/a

*Branches contribute to LFL sales when they have been open for more than 12 months. See note 4

**Adjusted measures represent results on an IFRS basis and exclude adjusting items which comprise significant restructuring, significant write downs or impairments of current and non-current assets, the costs of demerging and listing the business, the associated costs of separating the business from the Travis Perkins Group’s IT systems, and the effect of changes in corporation tax rates on deferred tax balances. These measures have been explained, reconciled and calculated in notes 6 and 8 and presented on the income statement.

Investor & Analyst meeting

A live webcast for investors and analysts will be held today at 9.00am (UK time), followed by a Q & A with the Wickes management team. The webcast can be accessed at: https://webcasting.brrmedia.co.uk/broadcast/620bd8c126d01a4c0553db21

A recording of the webcast will be available on the Wickes Group plc website later today: https://wickesplc.co.uk

Contacts

Wickes                                                             Headland +44 (0) 0203 805 4822

Investor Relations                                           PR Adviser to Wickes

Andy Hughes +44 (0) 776 736 5360                   Lucy Legh, Will Smith, Charlie Twigg

investorrelations@wickes.co.uk                          wickes@headlandconsultancy.com

About Wickes

Wickes is a digitally-led, service-enabled home improvement retailer, delivering choice, convenience, value and best-in-class service to customers across the United Kingdom making it well placed to outperform its growing markets. In response to gradual structural shifts in its markets over recent years, Wickes has a balanced business focusing on three key customer journeys - Local Trade, DIY (together "Core") and Do-it-for-me ("DIFM").

Wickes operates from its network of 232 right-sized stores, which support nationwide fulfilment from convenient locations throughout the United Kingdom, and through its digital channels including its website, TradePro mobile app for trade members, and Wickes DIY app. These digital channels allow customers to research and order an extended range of Wickes products and services, arrange virtual and in-person design consultations, and organise convenient home delivery or click-and-collect.

Forward-looking statements

This announcement may include statements that are, or may be deemed to be, forward-looking statements. By their nature forward-looking statements involve opportunity, risk and uncertainty since they relate to future events and circumstances, and actual results may differ materially. Any forward-looking statements in this announcement reflect management’s view with respect to future events as at the date of this announcement.