FY24 PBT in-line with November’s downgraded guidance For the 52 weeks to 31st January, Kingfisher has reported a 25.1% decline in underlying FY24 PBT to £568m (FY23 £758m) versus lowed company guidance of £560m at November’s Q3 (INVe £560m/company compiled consensus £557m). By key division, UK & Ireland retail profits fell 8% to £555m (cons £567m), with France down 28.8% to £139m (cons £129m), while Poland EBIT fell 44.5% to £82m (cons £72m). A flat full year DPS of 12.4p is proposed (FY22 12.4p). Management has reaffirmed its commitment to last year’s announced £300m share buyback programme (£50m completed to date). Q4 UK & Ireland LFL sales were down 1.6% (1H 1.7%; 2Q +4.1%; 3Q +1.1%) with France Q4 sales down 8% (1H down -3.8%; 2Q -3.5%; Q3 -8.6%) and Poland LFL sales down 6.6% (1H -10.9%; 2Q -11.5%; 3Q -9%). Overall, Group Q4 LFLs down 4.3%. Guiding to a 7% cut in consensus FY25 PBT at mid point – France + Poland challenging. UK recovery pushed out On the short term outlook, management is cautious on the overall market given the lag between housing demand and home improvement demand, with repair maintenance and renovation on existing homes resilient. Sales trends were better in Q1 to date than Q4, with Group LFL sales -2.3% and an improved sales trend in UK & Ireland, France and Poland versus Q4. Management’s guidance is for FY25 adjusted PBT of c.£490m to £550m versus company compiled consensus adjusted PBT of £560m (INVe £595m). Plans for £120m of cost savings/efficiencies are expected to partially offset cost headwinds. There is a clear plan to improve operating performance in France and a medium-term retail profit margin target of 5% -7% has been announced. FY25E forecast and TP under review. Cashflow remains resilient Kingfisher is well-positioned to benefit from operational leverage when demand comes back. We believe the market is approaching the end of the downgrade cycle, but we recognise that the shares are unlikely to outperform materially until investors are prepared to look through the current weak consumer environment. Cashflow remains resilient with management targeting FCF of £350m-£410m in FY25, c.£450m in FY26, then ‘more than £500m per annum’ from FY27.