To capitalize on the success, he now plans to open up to 45 stores by March. It had previously planned to open around 30.
B&M, which was promoted to the FTSE 100 this month, said the strong sales picture meant it now expects to post underlying half-year profits of £ 285million. This compares to his previous forecast of between £ 250m and £ 270m and this is the second time he has increased his profit forecast this year.
Simon Arora, Managing Director of B&M, said his business model “is proving to be well suited to changing customer needs”.
Discounters such as B&M, along with private rivals Home Bargains Wilko and Poundstretcher, have fared far better than many large retail chains after being allowed to remain open during the UK’s 12-week lockdown.
The no-frills chain is a far cry from its roots in Blackpool where it was founded by Malcolm Billington in 1976. The initials originally stood for Billington & Mayman, then Bargain Madness. When it was acquired by the entrepreneur brothers Arora in 2005, it only had around 20 stores and was in loss. Today, B&M has more than 600 stores in the UK and generates over £ 3 billion.
Businessmen transformed B&M, which followed a similar formula to the now-defunct Woolworths chain, introducing housewares, toys, toiletries and even pet supplies and clothing. They sold a stake to private equity investors before going public in 2014. The low budget retailer is still headquartered in Luxembourg.
B&M shares, which changed hands for as little as 256p in March, have doubled in value in the past six months. On Tuesday, shares closed up 4% at a new high of 510p, giving the discount chain a market value of over £ 5bn – more than double that of Marks & Spencer.
Amy Higginbotham, retail analyst at GlobalData, said the UK lockdown provided the conditions for B&M to thrive. Its low prices have wowed shoppers during the current economic uncertainty, while its out-of-town department stores “allow shoppers and staff to meet social distancing guidelines,” she said..