Impressive trading continues in Q2. Since last update to mid June, UK & ROI sales growth has slowed from mid-20%’s to high teens; France from the 30’s to high 20’s and Poland accelerated from low to mid-teens (see Figure 1). Group Q2 LFL was +21.8% though YTD Group LFL still down 3.7%. We caution against reading too much into current high demand. DIY has definitely been popular during lockdown with consumers having time to consider the state of the home. Those in a job/on furlough have been saving as they not been able to spend on leisure/holidays. However, pent up demand is likely to fall away over the remainder of the year and consumer spending shift back to other categories as retail and leisure reopens. In addition, we expect the macro environment to deteriorate and hit retail spending in 2021. Upgrade FY21E PBT by 19% but maintain FY22E PBT. The upgrade to FY21E reflects company guidance that 1H21 PBT will be higher yoy due to strong trading & cost reduction, some of which is non-recurring (e.g. UK rates/furlough payments). INVe 1H21E PBT £375m (1H20 £338m). We have increased UK profitability reflecting higher gross margin (low promotional activity) and a reappraisal of the opex base. This has more than offset lower profitability in France and Poland where pricing has been more competitive. Reiterate Sell. The new team has much to fix and while ‘Powered by Kingfisher’ is looking to reposition Kingfisher for a more digital word, the group faces structural pressures in all its major markets and potentially a FX headwind when there is clarity over Brexit trade talks. As set out in our note Challenging Times Ahead (published 30/6/20), we struggle to see where sustainable long-term growth will come from, given the shift online, rise of the discounters and ‘do it for me’ trend. Our TP, based on high single digit CY21E PE, is unchanged at 170p.