British do-it-yourself chain owner Kingfisher has announced it will close 60 B&Q stores in the UK and Ireland over the next two years, at the cost of hundreds of jobs. This comes a day after the company announced it had failed to takeover French DIY business Mr Brocolage.
Kingfisher also announced a 15.2% fall in pre-tax profit to £644m ($951m, €887m) for 2014.
Kingfisher's new chief executive Véronique Laury also announced that Kevin O'Byrne, B&Q's UK and Ireland chief executive, will step down on 15 May.
However, the firm said it plans to open 60 new Screwfix outlets.
"Kingfisher has said for some time that B&Q UK & Ireland can adequately meet local customer needs from fewer stores and that some of the store should be smaller," the company said in a statement.
Kingfisher has had the rug pulled out after months planning to buy French home improvement firm Mr Bricolage, valuing the chain at €275m (£201m).
France's competition regulator required Kingfisher to close 44 of the 500 Mr Brocolage stores in France, which stymied the deal. Kingfisher is said to be mulling legal action.
Kingfisher's biggest business geographically is not in the UK, but in France; with the Castorama and Brico Depot DIY chains of stores. Laury, who is also based in France, took the reins in January after previous boss Sir Ian Cheshire stepped down.
Kingfisher's performance of late can be best described as somewhat schizophrenic. On the one hand, its two UK businesses have been performing well, in particular Screwfix, which posted 25% year-on-year total sales growth in the third quarter, to end-September 2014.
On the other hand, the French Castorama and Brico Depot DIY chains of stores have suffered from a weak French DIY market, hit by a triple-whammy of fragile consumer confidence, higher taxes and declining house prices. These factors have led to an 8% fall in French retail profit in the third quarter.
Edmund Shing, global equity fund manager at BCS AM, told IBTimes UK: "The buoyant nature of the UK housing market and record high UK consumer confidence (at its highest level in 10 years) should continue to propel continued growth in the UK B&Q and Screwfix divisions, after strong 11% UK retail profit growth in the third quarter."
As part of ongoing restructuring, Kingfisher has already taken action to curb its money-losing operations outside of Europe, agreeing late in 2014 to sell 70% of its China operations (including 39 B&Q home improvement stores) to local supermarket giant Wumei for £140m.
This sale has allowed Kingfisher to launch a £200m dividend and share buyback program spanning fiscal year 2014-15, with £180m already spent in 2014, and more to be spent going forwards.
B&Q UK & Ireland's total sales were up 1.9% to £3.7bn. Sales of outdoor seasonal and building products were up 4%.
B&Q has 360 stores in total. Laury said some of the group's loss-making stores in Europe would also close.