'Back to B&M Basics' on Track; Flat UK LFL Sales

• Profits at the midpoint of current guidance. Back to B&M Basics execution on track  

B&M European Value Retail plc (“the Group”), the UK’s leading variety goods value retailer, today announces its preliminary results for the 52 weeks to 28 March 2026. 

Tjeerd Jegen, Chief Executive Officer, said: 

“FY26 was a difficult year that saw profits fall due to a challenging market and execution issues. We launched our Back to B&M Basics plan in October to restore like-for-like sales growth at B&M UK, which was flat overall versus FY25 while showing sequential improvement. The past six months has seen us sharpen our pricing, improve onshelf availability in best-selling brands and revamp our in-store promotions. We cleared discontinued lines well in Q4 and are now embarking on SKU count reductions across all our FMCG categories. Cash conversion remained strong in FY26 and net debt has fallen, returning Group leverage back within our 1.0 to 1.5x target range, and I am pleased to report adjusted EBITDA (pre-IFRS 16) at the midpoint of our current guidance. 

FY27 remains a year of investment as we work hard to deliver growth under Back to B&M Basics and balance new store growth with investing in our store formats under Phase 2 of our strategic plan. We are confident we can offset rising energy costs in the year ahead through cost mitigation, the benefits of which will flow through to our bottom line once we have returned B&M UK like-for-like sales to growth. In the medium term, we continue to see no reason why B&M UK cannot return to double-digit EBITDA margins.”   

Highlights

• Group revenues increased by 3.6% to £5,775m (+3.4% constant currency5), driven by total value and volume growth in both B&M businesses and partially offset by a 0.3% revenue decline at Heron Foods
  
  
• B&M UK6 total sales growth of 2.9%. Like-for-like (“LFL”)1 sales broadly flat (-0.1%), with positive value and volume LFL performance in General Merchandise offset by a narrowing decline in FMCG LFL sales. B&M UK LFL sales growth in Q4 of 0.1% (H2: -0.4%), reflecting continued FMCG improvement
  
  
• B&M France total sales growth of 13.4%, driven by 2.9% LFL sales, higher transaction volumes and 12 new store openings. B&M France gained market share, finishing FY26 with 8.4% share of the discount market versus 8.1% at the end of FY257
  
  
• 64 gross new stores opened across the Group (33 net), with 41 in B&M UK (22 net), 12 in B&M France and 1 net closure in Heron (11 openings, 12 closures)
  
  
• Group adjusted EBITDA2 (pre-IFRS 16) of £459m, down 25.9% (FY25: £620m), driven by lower trading margins8 and operating cost inflation in the UK. Group adjusted profit before tax2 of £284m (FY25: £455m)
  
  
• Statutory profit before tax of £227m (FY25: £431m), including an impairment charge of £36m versus £3m in FY25
  
  
• Post-tax free cash flow3 of £321m (FY25: £311m), reflecting working capital inflows as inventory reduced through accelerated clearance activity and range refocus, in line with our Back to B&M Basics plan
  
  
• Net debt4 to adjusted EBITDA2 (pre-IFRS 16) leverage ratio of 1.4x (FY25: 1.3x). Net debt including leases was 2.9x (FY25: 2.6x)
  
  
• The redomicile of our Group from Luxembourg to Jersey was completed on 27 February 2026, which simplifies our administrative processes and will enable greater flexibility in returning capital to shareholders, including share buybacks when excess cash is available
  
  
• Final dividend of 6.1p per Ordinary Share will be paid on 31 July 2026 to shareholders who are on the register at close of business on 12 June 2026, in line with our dividend payout ratio of 40% to 50%
  
  
• In B&M UK, we experienced a slower start to our garden season compared with last year, when unusually early warm weather drove double-digit LFL sales in April 2025. Better weather in late May this year has since driven a recovery in sales of seasonal categories
  
  
• B&M France has made a good start to FY27, with higher footfall and market share driving positive LFLs. Heron LFL sales have made a positive start to the year and we continue to make improvements to in-store merchandising and ranging to bring about a broader recovery in Heron’s sales performance 

Future change in financial guidance metric From FY27, the Group intends to use adjusted profit before tax (PBT) for financial guidance, rather than adjusted EBITDA (pre-IFRS 16). This change will bring our guidance in line with our UK industry peers and will aid comparison of financial performance across the sector. For FY26, we continue to reference adjusted EBITDA (preIFRS 16) given it is the current guidance metric and is the basis of targets in our FY26 management incentive programme.  The Group will provide adjusted PBT guidance with FY27 Interim results. For at least the next financial year, we will continue to reference EBITDA (pre-IFRS 16) but will reduce its prominence in our disclosures.  

Chief Executive’s review

I am delighted to have been appointed as CEO in June 2025 and to be leading B&M at such an important time for our company. FY26 was a key transition year for B&M as we started to implement a comprehensive plan to restore our UK business to sustainable LFL sales growth following a prolonged period of underperformance, which had seen our grocery price proposition drift, our trading margins fall and on-shelf availability in key brands dip to unacceptable levels. This is clear in our FY26 results, where despite delivering Group revenue growth of 3.6% through new store openings and positive like-for-like sales at B&M France, flat sales at B&M UK and insufficient cost mitigation materially impacted Group profits.

Under our Back to B&M Basics plan, we have moved at pace to diagnose, devise and implement a set of immediate actions to correct drift in key elements of our UK retail execution relating to price, promotions, our ranges and onshelf availability. Early results from the changes we have implemented have been encouraging:

• Price: we are now sharper on price following a realignment across our key FMCG lines in Q2 and further adjustments across our FMCG ranges since to maintain our price competitiveness.
  
  
• Promotions: Revamping our in-store promotions has helped us to deliver strong seasonal sales and trade customer moments more effectively, especially Christmas which resulted in 3% like-for-like sales growth in December 2025. We have continued to trade this front-of-store space with clearance lines, Valentine’s Day, Easter and, more recently, elements of our Garden ranges.  
  
  
• Ranges: results from our seven FMCG category trials to reduce SKU count have equipped us successfully to begin the rollout of leaner, sharper ranges across all FMCG categories, which we expect to complete in Q3 FY27. We cleared discontinued lines well in Q4 FY26, providing us with cleaner stocks from which to embark on this important adjustment that will remove complexity from our business and for our customers. 
  
  
• Availability: on-shelf availability in our key brands has risen from 86% at H1 FY26 to 93% at H2 FY26 following changes to our replenishment processes, which are now fully implemented for these categories. Trials with store-specific automated stock alerts are on the way to extend this process to our entire FMCG ranges. 

The year ahead will see further progress as we complete the full implementation of all Back to B&M Basics initiatives. We remain confident these actions can restore sustainable like-for-like sales growth at B&M UK while we embark on a multi-year plan of innovation, reinvestment and growth for our company.   

Our business remains highly cash generative. We maintained our post-tax-free cash flow at a slightly higher level than last year despite lower profits (£321m in FY26 versus £311m in FY25). This reflects our ongoing working capital discipline and the inventory reduction we achieved through stock clearance in Q4, ahead of reducing our SKU count more broadly in the year ahead. At 1.4x, I am pleased to see our leverage ratio back within our target range of 1.0x to 1.5x at financial year end, despite our lower Group adjusted EBITDA (pre-IFRS 16) outcome. This is a solid financial base from which to move forward with our growth plan and enable future shareholder returns.

Building foundations for future growth

Back to B&M Basics is not the limit of our ambition. It is Phase 1 of a multi-year plan to deepen B&M’s growth foundations while ensuring we evolve our offer as customer needs and preferences change. 

Phase 2 includes smarter use of use of data and customer insights and simplifying many of our in-store processes in order to mitigate cost increases. It also involves flexing the format of our stores to best suit their location, especially town centre sites where the customer shop can vary and ensure our in-store experience for customers is one that drives footfall. At the same time, we see opportunities to update and upgrade our store base as part of a refresh cycle to ensure we offer our customers a great in store experience.

We are already preparing for Phase 2 through trialling new store formats that better reflect the customer base and shopping missions of our many different store locations. Drawing on geospatial and customer data, six format clusters have been identified that share similar characteristics, around which new store formats are being tailored. Within these, we are drawing on new layout and fit-out elements of our new Store 2.0 concept, for which we plan to open the first store at the end of Q2 FY27. Results from this will help determine investment options for our existing store estate in the year ahead based on demonstrated sales outcomes.

With these foundations in place, we also see a third phase of opportunity to accelerate growth by fully investigating longer-term opportunities in private label, and potentially eCommerce and loyalty programs, as well as further investing in the success of B&M France, which is performing well in a competitive marketplace. 

Investing in our store estate

B&M continues to expand its retail presence and deliver our value retail proposition to a growing customer base. This year, we recommitted our long-term ambition of growing the UK estate to around 1,200 stores. For B&M UK, we expect an organic growth rate of circa 25-35 gross new stores annually, topping this up from time to time with opportunistic acquisitions as portfolios come to market. In the year ahead, we are as keen to invest in our existing store estate as we test and deploy new design concepts while ensuring we offer our customers a great in-store experience.

B&M France

We see an exciting growth runway for B&M France, which is performing well in a highly competitive marketplace. LFL sales continued to grow in FY26 (+2.9%) as we expanded our store estate and saw a rise in customer footfall. I was pleased to see B&M France gain market share during the year, ending FY26 with an 8.4% share of the discount market, up from 8.1% the year before. With 150 stores as of end-May, B&M France is less than a fifth the size of B&M UK. France has an addressable market that shares many similarities with the UK, both in size and cost-ofliving challenges, and we see many years of growth ahead. Our organic growth rate is to open at least 15 new stores per year in France.

Investing in our people

Our people are our greatest asset. Without their hard work and dedication, we would not be able to bring the B&M store experience to five million customers each week in the UK alone. With close to 40,000 employees across our Group businesses, B&M is often a key employer in the communities it serves. In Bedford, UK, where our largest Distribution centre is located, B&M is the town’s largest single employer after the NHS. Wherever we locate, we are committed to providing employment opportunities to all. B&M is one of the UK’s largest providers of retail work experience, extending this opportunity to 3,172 individuals in FY26, more than 60% of which went on to become B&M employees.

How we embody our culture and values as a company is vitally important. Alongside B&M Back to Basics, we have recently restated our purpose, ambition and values to provide greater clarity and alignment across the business. These will begin rolling out across our stores, support centres and distribution centres over the coming months.

Our ambition is simple: to be everyone’s favourite place to shop. Our purpose is the foundation of everything we do: we make everyday life more affordable, with every visit full of surprises.

Our colleagues continue to bring our values to life every day by delighting our customers, behaving like owners, working as one team, keeping things simple and agile, and creating opportunity for all. These values will play an important role in shaping our culture, supporting our strategy and helping us deliver a better experience for customers and colleagues alike.

Current trading and outlook In B&M UK, we experienced a slower start to our garden season compared with last year, when unusually early warm weather drove double-digit LFL sales in April 2025. Better weather in late May this year has since driven a recovery in sales of seasonal categories. B&M France has made a good start to FY27, with higher footfall and market share driving positive LFLs. Heron LFL sales have made a positive start to the year and we continue to make improvements to in-store merchandising and ranging to bring about a broader recovery in Heron’s sales performance.   

FY26 underscored the importance of a cost-out mindset. One certainty of retail is that costs will always rise. In the past year, it was statutory costs in wages and environmental charges that challenged us. In the year ahead, the Middle East conflict will place upward pressure on our international freight, fuel and energy costs. We are confident we have sufficient levers to offset this impact with cost mitigation. Over time, these benefits will flow through to our bottom line once we have returned B&M UK LFL sales to growth. In the medium term, we continue to see no reason why B&M UK cannot return to double-digit EBITDA margins. 

For our customers, value retailing has a vital role to play as cost-of-living pressures intensify. B&M stands ready to serve our current loyal customers alongside new ones as more people discover both the benefits and delights our stores can offer. Longer term, I strongly believe that the discount segment will continue to grow, both in the UK and in Continental Europe. B&M is well positioned to be a leading beneficiary of this. Our focus right now is ensuring we continue to prepare B&M for that growth opportunity and the benefits it offers all our stakeholders. 

Source : B&M

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