B&M European Value Retail S.A.

Good day and thank you for standing by. Welcome to the BNM Q3 Trading Update conference call. At this time, all participants are in a listen-only mode. After the speaker's presentation, there will be a question and answer session. To ask a question during the session, you will need to press star 1 1 on your telephone. You will then hear an automated message advising the hand is raised. To withdraw your question, please press star 1 1 again. Please be advised that today's conference is being recorded. I would now like to hand the conference over to your speaker today, Alex Rosso, CEO. Please go ahead.

Good morning, everyone. Thank you for joining us. What we'll do today, I'll hand it over briefly to Mike for two or three minutes to set out a quick summary, and then I will take it over in terms of some more color, and then we can go straight into Q&A. So, Mike, with you.

Thank you, Alex. Good morning, everybody. So look, I'm going to take the statement as being read and add a couple of key headlines that I'd touch on. The first point is that we've had a very profitable golden quarter that provides the right underpin to our full year outturn that we're guiding to here. I think secondly, critically, momentum has continued to build within our business. That's been driven by volumes, and in particular, the good performance that we've seen of our seasonal ranges both in December, but also as we begin sale in January. Diving into some details, we've narrowed the profit outlook range to £620 million to £650 million. That, of course, compares to the £616 million that we delivered over 52 weeks last financial year. So today, we're trimming the top end of our outlook range slightly. Critically, though, We are seeing the building momentum in like-for-likes in December and early January. Those have just taken longer to come through than perhaps a best-case outcome. And in particular, the sale ranges that we launched in January have begun well. We've gone through transition well. We've got the right availability on shelf, the right stock to support this momentum continuing. And we've ended the period, we've ended December, with a clean, close-to-zero position on our seasonal range stocks. And as you all know, this underpins our gross margins, looking both backwards, but also looking at future trading periods. The final profit outturn, as always, will principally depend on the timing of the start to the garden season, which actually starts to hit our shots from this weekend. But with costs and margins in the right place to get to the middle of the range, we really require an undemanding like for like that we feel comes from a normally timed start to the garden season to the period. The final point I'd make here is that our balance sheet continues to be very healthy. So our borrowing maturities, first of all, now range from November 2028 onwards. We're going to end this year with leverage near the middle of the one to one and a half times corridor that we normally operate within. And that is after payment of our increased ordinary dividend of 45% return profits that we've pointed to before, but also the payment of a 15 pence per share special dividend totaling 151 million pounds that we're announcing today. So that will mean that over the last five years, we expect to have returned 2.2 billion pounds in total to shareholders through dividends. And critically though, we're taking into account that special dividend and increased ordinary dividend, our balance sheet will continue to be in a robust position that gives us the flexibility to take advantage of this current environment, whether that may be pockets of store leases or indeed share buybacks once the redomicile process completes. So that's really all I was going to draw your attention to. I think to conclude, there's a key reminder. Firstly, we've exited the golden quarter in a strong profit position. Secondly, we are seeing that growing trading momentum that we touched on back in November, and that is underpinned by the volumes we're offering as a discounter. And finally, the cash generation continues, meaning that we're going to pay the £151 million special dividend, and we're well set now to take advantage of opportunities coming from the environment. Alex. Thank you, Mike.