B&M Share Price Plunges to Lowest Level in Years as Q1 Update Disappoints

The B&M European Value Retail (LON: BME) share price plummeted over 12% on Tuesday, hitting 220.8p, their lowest level since November 2016, after the discount retailer’s latest trading update seemingly disappointed investors.

While group revenue for the 13 weeks to 28 June rose 4.4% year-on-year to £1.41 billion, market reaction was sharply negative, possibly driven by concerns over margins and the performance of its FMCG division. 

Like-for-like sales in B&M’s core UK business rose just 1.3%, with FMCG sales still in decline for the quarter.

Chief Executive Tjeerd Jegen, who recently joined the business, said: “While B&M UK’s like-for-like sales are growing, I see a significant opportunity and requirement to sharpen our commercial and operational execution as we move towards and beyond the Golden Quarter.”

The company acknowledged that deflation in average selling prices across some general merchandise categories had weighed on trading gross margins, though it expects margin pressure to ease in the second quarter as new, higher-margin ranges are rolled out.

Heron Foods posted a slight year-on-year sales decline of 0.4%, while B&M France saw stronger momentum with revenues up 7.6% and like-for-like growth of 1.1%.

“Looking ahead, my focus is on building on our strong foundations, leveraging our market position, and continuing to deliver exceptional value for our customers,” added Jegen.