FY22 PBT guidance range is £910m to £950m Management last guided in November to FY22 PBT coming in at the top end of its guidance range of £910m-£950m. We forecast FY22E PBT of £955m versus company-compiled consensus of £950m. We forecast a FY22E DPS of 12p (consensus 12.5p). For FY23, the market is already anticipating a decline in PBT, mainly due to a return to full UK business rates and LFL sales decline. Company-compiled consensus is for FY23 PBT of £789m vs INVe at £761m. Focus will be on sales momentum, strategic developments and capital allocation Given the material inflationary headwinds for consumers from April and elevated demand for home categories during the pandemic, the main debate focuses on what ongoing demand could be and what an appropriate sustainable margin is as trading normalises. While many of Kingfisher’s markets were impacted by various COVID restrictions at some point in 1H21, Kingfisher also faces tough comps from the elevated demand for home categories, so it will be interesting to see if sales have continued to slow. Kingfisher last reported Q4 Group LFL sales to 13 November up 13.2% on a 2-year basis. The update on the ‘Powered by Kingfisher’ strategic priorities will be of interest in understanding the scale of any self-help opportunities available. In particular, fixing the historic range/logistic issues in France, the Tradepoint re-launch, the results of compact store/new format trials, the ability to mitigate inflationary pressures, and the development of the Group mobile/online proposition, such as the recently launched marketplace. Capital priorities will be in focus given balance sheet strength. Kingfisher completed £225m of a £300m share buyback programme in March. Valuation reflects uncertainty over outlook; we will revisit forecasts, TP and recommendation post FY results Valuation (CY22E PE 9.4x) appears to reflect the expectation of lower FY23 profits, though given how fast market drivers are changing, uncertainty remains as to what ‘normalised’ future earnings could look like and whether KGF can be a sustainable growth story. Ultimately, KGF is still a big box retailer and the structural challenges from the shift online, the rise of the discounters, and the underlying ‘do it for me’ trend have not gone away, in our view.