Liverpool-based B&M European Value Retail said its first quarter group revenue declined 2.2% to £1.161 billion on a constant currency basis “but with an improving trend during the quarter.”

B&M gave the news in a trading update for the first quarter of its current financial year (FY23) relating to the 13 week period to June 25, 2022.

B&M said there is no change to the guidance it issued on May 31, 2022, with FY23 group adjusted EBITDA expected to be in the range of £550 million to £600 million.

Keith Bowman, investment analyst at Interactive Investor, said: “B&M’s trading update offers few surprises given the announcement of annual results in late May.

“Same store UK sales fell significantly (-19.1%) in April as they compared to pandemic fuelled trading the year before, to then return to more normal trading through May and June, falling by just 1.6%.

“Total sales for its Heron Foods and French businesses both grew, with previous guidance for full-year adjusted profit of between £550 million to £600 million being left unchanged.

“As for the share price, a fall of 40% year-to-date coming into this latest update is similar to other retailers who’d benefited from the pandemic, including the likes of Ocado and Amazon.

“In all, an uncertain economic outlook and a cost-of-living crisis for consumers make for a tough backdrop.

“The previous loss of its chief executive of over a decade cannot be brushed aside, while costs for businesses generally are on the rise.

“More favourably, its store numbers are expanding, with over 900 B&M UK general stores targeted compared with 705 currently.

“Its track record for controlling costs is strong, its discount offering may become especially attractive in tougher times, while a forecast future dividend yield of around 4% is not derisory in an environment of still low if rising interest rates.

“On balance, analyst consensus opinion continues to point towards a strong hold.”