B&M Q1 Results
Dear reader,
If you’ve been following my posts, you’ll know B&M is a stock I’ve kept a close eye on — and after their recent Q1 update, I thought it was worth sharing a few thoughts.
Shares fell sharply in early trading, down 13%, before recovering steadily throughout the day.
To recap, B&M delivered solid revenue growth of 4.4% in Q1, helped by new store openings and a small like-for-like sales bump. The UK business — still the engine room — grew revenues by 4.7%, with like-for-like sales up 1.3%. Most of the upside came from strong seasonal demand in April, boosted by better weather and an early Easter. But FMCG sales were down on a like-for-like basis — a signal that while shoppers still love a bargain, they’re being selective about what goes in the basket.
France continues to quietly impress. Revenue was up 7.6%, with 1.1% like-for-like growth — a sign that B&M’s model is resonating beyond the UK. Heron Foods, on the other hand, saw a small decline in revenue, though it's still profitable and steady after years of rapid growth.
What stood out to me most was the commentary on gross margin. Average selling price (ASP) deflation in General Merchandise weighed on margins — a reminder that discount retail thrives on volume, but price cuts eat into the bottom line. Management expect this to ease from Q2 as new, higher-margin ranges come in, but it’s something I’ll be watching closely.
From an operational standpoint, they’re still growing fast. Ten net new stores opened in the UK in Q1 alone, and they’re on track for 45 gross openings this year. The Ellesmere Port import centre is now live, and the supply chain upgrade continues with the upcoming Middlewich relocation.
^ B&M opened a new store in Chatham in June 2025, taking over the former Homebase site
This all comes off the back of FY25 results I covered last month — where we saw a 3.7% lift in annual revenue, strong ROCE (30.4%), but also rising debt and weaker cash flow. The business is clearly still growing, but now the focus shifts to execution: protecting margins, managing stock levels, and keeping costs under control — especially with the minimum wage hike and shipping delays still hanging over the sector.
Is the share still cheap? At around 286p, it’s not far off its 52-week low. For a business growing in both the UK and France, with double-digit operating margins in a low-margin industry, it still looks undervalued to me. Yes, debt’s gone up, and cash flow is something to keep an eye on — but I’d argue the model still works. They know their customer, they move quickly, and they don’t overcomplicate things.
Check out my most recent post on B&M for a more indepth read:
Thanks for reading,
Ollz
The information provided in this article is for informational purposes only and represents my personal opinions and analysis. It should not be construed as financial advice or a recommendation to buy or sell any securities. Investing in the stock market carries risks, and past performance is not necessarily indicative of future results. Readers are strongly encouraged to carry out their own research and seek advice from a qualified financial advisor before making any investment decisions. I do not accept any responsibility for any financial losses or consequences that may arise from reliance on the information presented in this article.