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B&Q expansion `a smoke screen'

Nigel Cope
Tuesday 07 February 1995 00:02 GMT
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Kingfisher, the embattled Woolworths to Comet retail group, announced a £20m expansion programme at its B&Q DIY subsidiary yesterday, but City analysts said the news was a smoke screen to deflect from the company's problems. City analysts were more concerned with the failure to disclose company-paid tax advice given to Sir Geoff Mulcahy, chief executive.

Details emerged over the weekend that Kingfisher had been paying the tax advice bills for Sir Geoff and Nigel Whittaker, corporate affairs director, every year since they joined the company in 1982 and 1983. It has also failed to include the £4,000 a year payments among the directors' remuneration which is published in the annual report. The company has said this was "a mistake".

B&Q Warehouse is Kingfisher's mammoth store concept aimed at trade customers and serious DIY buffs.

Kingfisher first announced plans to expand its B&Q chain last September as part of its interim figures statement.

Yesterday's announcement included little more than the number of 8,000 new jobs the expansion will create.

B&Q is opening 50 of its B&Q Warehouse outlets over the next five years . Six will open this year creating 2,00 new jobs.. Twenty B&Q outlets will be revamped during the year, with an average of 30 extra jobs created in each.

Three new B&Q outlets are also being opened during 1995. B&Q plans to focus more attention on customer service, with free advice from in-store specialist advisers and designers.

Commenting on the expansion programme, Jim Hodkinson, B&Q's chairman and chief executive, said: "We've already proved how our new and revamped stores with their new levels of customer service standards have had a direct effect on sales."

The announcement is part of a wave of activity in the British DIY market. Last month Sainsbury completed its takeover of the Texas Homecare stores which it will convert into branches of Sainsbury Homebase.

Do It All, the joint venture between WH Smith and Boots, is also refurbishing stores to improve their image and lay-out.

However, B&Q remains the market leader with nearly 14 per cent, but the chain is clearly under pressure to respond to the increased competition.

Outlook, page 26

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