Kingfisher, the do-it-yourself retailing group, said it would shut down its Trade Depot stores and use the resources to boost its B&Q chain in a weakening high street environment.

The home improvement group, which operates the Castorama retail chain in France suffered a profits slump in the UK during the third quarter but gained ground in its French operations where sales rose in a weak market.

Overall, Kingfisher’s sales were flat at £2.6 billion, adjusted for currency effects but down 5 per cent on a like-for-like basis in the 13 weeks to November 1. Shares in Kingfisher fell 6.61 per cent to 111.6p today.

In France, sales were up 4 per cent, after adjusting for the strength in the euro but in the UK, Kingfisher suffered a 6 per cent sales dip, down 9 per cent on a like-for-like basis. Group profit for the third quarter was down 4 per cent to £176 million, excluding currency gains.

Ian Cheshire, Kingfisher’s chief executive, said that consumer confidence had been shaken by the recent economic events and he said that Kingfisher would concentrate on managing its working capital while keeping tight control on cash and costs.

“There are clearly more challenging times ahead,” he said.

Trade Depot’s nine outlets are to be closed at a cost of £20 million in the current year. The retail format, aimed at the building trade, was launched in 2005 but failed to take off and the Trade Depot units suffered a loss of £5 million in the last financial year.

Euan Sutherland, head of Kingfisher UK said that resources would be applied to developing B&Q and the Screwfix chain. B&Q sales fell by 8 per cent on a like-for-like basis over the period due to the weakening economy and poor weather in August, the company said.

In France, both Castorama and Brico Depot gained ground and revenues in the group’s French operations rose by 3.7 per cent in local currency. KIngfisher said that overall sales in the French DIY sector were currently flat , suggesting that Kingfisher had outperformed the market.

Like-for-like sales in China, however, plunged by 32.2 per cent and losses reached £17 million as trade in the region tumbled and margins shrunk when the company was forced to clear stock.

Kingfisher has closed four of its stores in the region and has downsized another in relation to a store reorganisation announced earlier in the year.

Times Recommends

• Minister in talks with Saudis to protect creditors
• Premier Inn hits back in £29-a-room row
• Bankers hit back at 'populist' bonus supertax