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B&M has cut its profit guidance for the second time in a month, after failing to properly account for an extra £7 million in costs.
The discount retail firm’s finance chief also said he planned to step down from the business in a surprise update on Monday.
It came after the London-listed firm said £7 million of overseas freight costs were “not correctly recognized in cost of goods sold” in its results update two weeks ago.
B&M said it was linked to an operating system update earlier this year.
It told investors the underlying issue has been resolved, but it will have a financial impact on its results this year.
Adjusted earnings for the half to September are set at around £191 million, down from its previous estimate of £198 million.
B&M said group adjusted earnings are now set at between £470 million and £520 million for the financial year, up from between £510 million and £560 million previously.
Bosses at the retail firm said they intended to launch a comprehensive “third-party review” of the incident.
It said it still expects like-for-like sales growth in the second half of the year to be “between low-single-digit negative and low-single-digit positive levels.”
The update comes just two weeks after B&M blamed rising costs and falling sales as it issued a profit warning.
It reported a bigger-than-expected 1.1% decline in UK like-for-like sales in the second quarter of the year.
Meanwhile, the company also said it had been hit by a £30 million rise in wage costs and a £14 million rise in packaging taxes in the latest half.
So it introduced a series of turnaround measures in an effort to improve its performance, including cutting prices of some of its key value items.
On Monday, B&M also confirmed that Chief Financial Officer Mike Schmidt has said he will step down from the role.
It has begun a search for his replacement, with Mr Schmidt remaining in the post until a new finance chief is appointed.
Dan Coatsworth, Market Head aj bellSaid: “Just when it seemed like life couldn’t get any worse for B&M, an accounting error occurred which ultimately cost the finance chief his job.
“The situation is extremely embarrassing for the board and even worse for the shareholders.
“Although CFO Mike Schmidt has not been removed, given the severity of the error found in the retailer’s accounts there was no way he could have remained at the company.”
shares They fell 17.9% to 178.1p on Monday morning, slipping to a record low.