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Discount retail group B&M European Value grew annual revenues by over 10% to £5.5bn, but the rate of growth has slipped back in the final quarter of its financial year.

The B&M Bargains owner posted group revenues of £5.5bn in the year to 30 March, up 10.1% year on year.

It said this performance was driven by volume growth and like-for-like sales improvements, while it also benefited from an extra week of trading and an early Easter.

Full year B&M sales were up 8.5% to £4.4bn, up from 4% growth in 2023, while B&M France was up 19.2% to £514m and Heron Foods up 15.3% to £560m.

On a quarterly basis, B&M UK was up 2.9% in the 14 weeks to 30 March as it saw strong volume performance across both fmcg and general merchandise.

That represented a step back from full year like-for-like sales growth of 3.7%, which was aided by increased customer transaction numbers.

Headline sales were helped by 47 new B&M UK stores, two ahead of previous guidance.

The openings were “trading well”, including those Wilko stores acquired in the year, which were “performing ahead of expectations”.

Full year group adjusted EBITDA is expected to be at the top end of guidance at £629m, a 9.8% year-on-year increase and 83.9% higher than pre-Covid 2020.

CEO Alex Russo commented: “The Group has performed well in the year, delivering strong operational execution. We serve our customers through a relentless focus on everyday low prices (EDLP), great product ranges and excellence in operational standards. This delivers profitable, cash generating growth for our shareholders.

“The business and team are well set up for the year ahead, our pipeline remains on track to open not less than 45 UK B&M stores in each of the next two financial years and our French and Heron businesses continue to demonstrate significant profitable growth potential.”

B&M shares have fallen 2.9% to 495.7p.

Morning update

Winemaker Chapel Down grew sales and profits last year as English wine continues to grow as a category and the company’s own sparkling wines win market share.

The UK’s largest winemaker posted full year net sales revenue of £17.9m in the year to 31 December, which represented growth of 15% year on year.

In particular, its traditional method sparkling wines continued to grow strongly with net sales revenues increasing 25% to £12m on volumes up 13% to 887,000 bottles.

The growth of its sparkling wines helped grow average sales price by 13% during the year, evidencing the continued premiumisation of the Chapel Down brand.

Chapel Down said it had seen strong growth across all UK and international trade channels, as well as the direct-to-consumer business, which it said showed the benefits of scale and breadth of distribution.

Off-trade, which is its largest distribution channel, was up 9% to £9m driven by 21% growth of traditional method sparkling wines.

On-trade was up 26% to £2.2m, while exports were up 67%, although only account for 5% of its sales. E-commerce sales were up 18% to £3.1m.

Chapel Down said it remains strongly profitable at all levels, driven by profitable trading and an exceptional harvest.

Gross profit increased 16% to £8.9m, with an increase in gross profit margin to 52%. EBITDA was up 87% to £5.4m.

The group said current trading is in line with management expectations and its outlook for 2024 remains positive, with expectations of double-digit sales growth in the year.

Underlying profitability is expected to return to normalised levels, with an increased proportion of still wine and ‘A Touch of Sparkle’ in the sales mix as a consequence of the exceptional 2023 harvest, a more typical harvest yield in 2024, and continued brand investment.

CEO Andrew Carter commented: “2023 was a landmark year for English wine and Chapel Down. It is great to see the strategic and operational progress that we have delivered, and the continuing sales momentum that we have.

“In line with our 2023 targets, the business achieved double-digit net sales revenue growth, driven by the exceptional performance of our traditional method sparkling wine and growth across all of our UK and international trade channels and our direct-to-consumer business.

“Chapel Down continues to grow profitably – a core strength which, along with our strong balance sheet, makes us resilient and underpins our ambitious future growth plans.”

“Chapel Down is the market leader in an industry which is enjoying rapid and sustained growth. We have the leading brand, the deepest distribution which we continue to expand at pace, and we continue to win international acclaim for the quality of our wines. Our continued outstanding performance, and the fantastic, record-breaking 2023 harvest, means our passionate and highly skilled team carries significant momentum into the new financial year.”

On the markets this morning, the FTSE 100 has sunk 1.4% to 7,852.1pts after weakness in the US overnight due to jobs numbers.

Risers include Nichols, up 1.6% to 985p, Bakkavor, up 0.9% to 116p and Kerry Group, up 0.1% to €79.40.

Fallers include Naked Wines, down 3.1% to 56.7p, SSP Group, down 2.3% to 201.2p and Greencore, down 2.3% to 131.3p.

Yesterday in the City

The FTSE 100 started the week down 0.4% to 7,965.5pts.

Risers included Virgin Wines, up 5.6% to 47.5p, Fevertree Drinks, up 2.1% to 1,090p, Ocado, up 2% to 363.9p, B&M European Value Retail, up 1.9% to 510.6p and Greencore, up 1.8% to 134.4p.

Fallers yesterday included Tate & Lyle, down 2.2% to 621.5p, Nichols, down 2% to 970p, THG, down 1.6% to 60p, Just Eat, down 1.6% to 1,256p and C&C Group, down 1.3% to 163.4p.