Mixed update - UK standout performance, with France and Polish markets still weak Total 1Q26 Group sales were up 1.6% (+2.2% CC) with LFL sales up 1.8%. This includes a -0.9% calendar impact (reversal of a Leap year), so underlying total sales grew 3.1%. Growth was driven by volume and transactions. Retail price inflation was flat. Continued market share gains in the UK & Ireland, France and Poland. UK & Ireland were the standout performance, with France still weak and Poland impacted by ongoing geopolitical volatility. Castorama turnaround action plan on track. By main divisions, UK total sales were up 6.1% (consensus 0.8%; Q4 +1.3%) with B&Q LFLs up 7.9% (cons. 0.9%; Q4 +1.3%) and Screwfix LFLs +2.9% (cons. -0.9%; Q4 -0.1%) respectively. In France, total sales were down 4.9% or -3.2% at CC (cons. -3.9%; Q4 9.4% or -5.9% CC) with Castorama LFLs down 3% (cons. -4.2%; Q4 -6%) and Brico Depot LFL down 3.3% (cons. -5.4%; Q4 -5.4%) respectively. Poland total sales were down 0.4% (-1.1% CC) with LFL sales -3.2% (cons. 0.3%; Q4 +0.6%). Reiterating FY26 guidance On the outlook, management have reiterated guidance for an FY26 PBT range of £480m - £540m (FY25 PBT £528m) at constant currency which includes the elimination of a £10m loss from selling Romania. Company-compiled consensus FY26 PBT is £512m (INVe £531m). Long term value, but still need stronger performance in France/Poland for the shares to push on short term As discussed in our note Recovered Earnings Potential (published 22/10/24), we believe the market is materially underestimating where Kingfisher’s margins could recover to, with our scenario analysis suggesting a recovered EPS range of 38p to 43p (FY25 EPS of 20.4p). Our TP is based on the present value of recovered earnings on a 12x multiple. However, given the recent short term rally in the shares, we believe a better performance was needed from France and Poland for the shares to push on today.