B&M
B&M has presented its recent results, which, while below usual expectations, should be analyzed in the context of a challenging retail market in the UK.
Key Financial Highlights:
Revenue: Revenue reached £5,571 million, showing a 1.6% growth year-on-year (FY25: 52-week, FY24: 53-week). On a 52-week comparable basis, revenue grew by 3.7%.
Operating Profit (FY25: 52-week, FY24: 53-week): Operating profit was £566 million, a 6.6% decrease. This is attributed to one less week in the comparable period and an increase in Depreciation & Amortization (D&A) related to new store openings.
Net Profit: Net profit decreased compared to last year, reaching £319 million (vs. £367 million in 2024), influenced by a £27 million increase in financial costs and one less week in the period.
Balance Sheet: The company's balance sheet is strong, with a net debt/EBITDA of 1.5x.
Free Cash Flow: B&M generated free cash flow of £258 million.
Dividends: The company has proposed a final dividend of 9.7p, which implies an annual dividend of 15p plus a special dividend of 30p. This would represent a payout of 94.5% and, at current prices, a dividend yield exceeding 10%.
Segment Results:
B&M UK: Sales reached £4,483 million, growing by 1.7%. This growth was driven by new store openings, as Like-for-Like (LFL) growth was negative at 3.1%. On a positive note, the company met its target of 45 gross new B&M UK store openings per year, aiming to reach 1,200 stores in the UK (currently 777). Adjusted EBITDA decreased by 2% year-on-year, reaching £545 million in 2025, with a margin of 12.2% (vs. 12.6% in 2024).
B&M France: In France, results were significantly better, with revenue of £542 million (a 5.4% growth) and positive LFL growth of 3%. They continue to progress with store openings, with 11 gross new store openings. Adjusted EBITDA was £48 million, with a margin of 8.86% (vs. 9.14% in 2024). With a population similar to the UK, the company sees long-term potential to achieve a similar number of stores and improve margins to levels comparable to B&M UK.
Heron Foods: Revenue reached £546 million, a decrease of 2.5%. However, the company met its goal of opening between 10 and 15 stores annually, with 14 openings in 2025. Adjusted EBITDA was £30 million, with a margin of 5.5%, placing it at the lower end of its historical range.
Summary and Outlook:
B&M's results were below expectations, partly due to a challenging retail environment in the UK. The company acknowledges "poor execution" (which likely led to the CEO change) and is implementing measures to improve LFL sales for 2026, including better store organization and introducing new brands to expand their offering. Store expansion remains a fundamental pillar.
Despite the difficult retail market in the UK, B&M is trading at an 8.5 P/E in a challenging year. If it maintains the dividend for 2026, the yield would exceed 10%. The current valuation is very attractive for a company that consistently generates an ROIC (excluding goodwill, as it's not an active M&A company) of over 30%. Furthermore, insider buying, especially the new CEO's purchase of £523,559.60 worth of shares, are very positive signs, as other insiders have also made small purchases.
Esautomoion Spa
Insider Buying:
Franco Fontana, chairman of the board, has acquired shares in the market. In his public appearances and in meetings, he has been very bullish on the company this year. This could be an important signal.
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May Revenue:
May revenue grew by 8.33% compared to the previous year. Accumulated revenue for the January to May 2025 period was 7.46%.
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Share Buybacks:
Macfarlane launched a £4 million share buyback program in May. Throughout June, the company has been actively repurchasing its shares.