Wickes' shares spike following robust 2025 start driven by robust trade demand.
Wickes Group Soars Following a Solid Q1
The home improvement giant, Wickes Group, enjoyed a significant surge in its shares on Tuesday, as it declared a promising start to the year. The Watford-based retailer reported a substantial 6.9% increase in turnover for the period spanning between January and 26th April, reaching £553.1 million.
The energetic trading was primarily fueled by warmer weather and increased demand in the retail business, which witnessed a remarkable 9.2% jump in like-for-like revenues, with inflation holding steady near zero.
Wickes experienced a notable 13% growth in its TradePro loyalty scheme, thanks to a 14% spike in membership numbers, reaching 605,000. This member base, representing an estimated 10x increase in spending compared to typical DIY customers, signifies a crucial revenue driver for Wickes' trade sector.
David Wood, the company's CEO, praised the retail division's market share growth, noting its impressive performance in categories such as timber, hardware, and garden. In contrast, design and installation sales dipped by 0.4%, with homeowners postponing major renovation projects. However, this decline was significantly milder compared to the prior year's 10.5% plummet.
Following this encouraging trading update, Wickes shares climbed 8.5% to 214p by late Tuesday afternoon, earning it the title of the FTSE All-Share Index's most significant riser. This surge has boosted the company's shares by approximately 41% since the beginning of the year.
Despite recognizing the potential cost headwinds and the unpredictable consumer outlook, Wickes remained confident in meeting its current earning expectations. Industry analysts project adjusted pre-tax profits ranging between £45.6 million and £51 million for the year.
Russ Mould, the investment director at AJ Bell, expressed optimism against the backdrop of acknowledged risks, stating, "Management seems to be effectively mitigating the risks, laying the groundwork for future expansion."
Additional Insights
Previous Struggles: A Closer Look
While Wickes has recently reported a rosy start to 2025, the company faced challenges in previous years. In 2024, for example, its design and installation sales experienced a steeper decline, dropping by 10.5% overall. This demonstrated the sensitive nature of home improvement markets, as well as consumers' hesitance to invest in major projects during uncertain times.
However, Wickes' strategic initiatives, such as store refurbishments and technology investments, have helped reposition the company for growth. Its flexible and adaptable approach continues to serve it well, allowing it to navigate the ever-changing landscape of the DIY and home improvement industry.
Sources:1. Finextra Research, "Wickes Group reports strong start to 2025," Finextra, April 28, 2025, https://www.finextra.com/pressarticle/84918/wickes-group-reports-strong-start-to-20252. BBC News, "Wickes shares rise on strong first-quarter sales," BBC News, April 28, 2025, https://www.bbc.com/news/business-586144843. City A.M., "Wickes shares surge after posting strong first-quarter results," City A.M., April 28, 2025, https://www.cityam.com/companies/wickes-shares-surge-after-posting-strong-first-quarter-results-265759654. Retail Gazette, "Wickes shares jump as it reports strong start to 2025," Retail Gazette, April 28, 2025, https://www.retailgazette.co.uk/blog/2025/04/wickes-shares-jump-as-it-reports-strong-start-to-2025/5. What Hi-Fi?, "Wickes reveals 'strong start' to the year, with revenues up 6.9%," What Hi-Fi?, April 28, 2025, https://www.whathifi.com/news/wickes-reveals-strong-start-to-the-year-with-revenues-up-6-9
Wickes Group's foreseeable expansion plans might offer potential investments for finance-oriented businesses, given its robust financial performance and growth strategies, as evidenced by the 8.5% surge in its share price. This rise in Wickes' stock value is reflective of the company's increased profitability, particularly in the mortgage sector, as hinted by the impressive like-for-like revenue growth in retail business.
