Kingfisher, Europe's largest home improvement retailer, reported an unexpected rise in first-half profit while taking a cautious view on the second half, given the economic and competitive backdrop in Britain and France.
The stronger first-half performance, maintenance of full-year earnings guidance and the group's assertion that its five year restructuring plan was on track sent its shares as much as 8% higher.
Before today's update, the stock had fallen 15% over the last year on concerns over the scale of the restructuring and the company's ability to deliver on it.
Kingfisher runs B&Q and Screwfix in Ireland and the UK and Castorama and Brico Depot in France and elsewhere.
It is two years into a plan to boost annual profit by £500m from 2021.
The plan, costing £800m over five years to deliver, includes unifying product ranges and improving e-commerce capabilities.
Kingfisher also wants to return £600m to shareholders through share buybacks.
Chief Financial Officer Karen Witts said the company's second-half caution reflected two different dynamics.
"The caution in the UK is more around the macro economic backdrop and in France it’s more about the progress that we need to make ourselves," she told reporters.
She said the company had not yet seen any significant change in British consumers' behaviour with regard to spending on 'big ticket' items such as kitchens and power tools despite a squeeze on their spending power as inflation rises and wage growth is subdued.
Separately today official data showed British retail sales unexpectedly surged in August, boosting the chance that the Bank of England will raise interest rates in November.
Analysts said tha while the company did outperform already-low expectations, they still saw substantial longer-term challenges as it progresses in its five-year plan.
Kingfisher said it remained "comfortable" with analysts' consensus earnings expectations for its full 2017-18 year - earnings per share (EPS) of 26 pence versus 25.9 pence in 2016-17.
The group made an underlying pretax profit of £440m in the six months to July 31 - ahead of analysts' average forecast of £426m and 1% higher than the £436m made in the same period last year.
Total sales rose 4.5% to £6 billion and the interim dividend was raised 2.5% to 3.33 pence.
The outcome reflected solid growth at Screwfix and in Poland, which was offset by weak French markets and disruption from the restructuring, particularly as new product ranges were introduced and old ones cleared.
"We are acting on the causes of this disruption, which we are confident will ease," the company's chief executive Véronique Laury said.
"We have self-help plans in place to support our overall performance and remain comfortable with full-year profit expectations," she said.
Laury dismissed analysts' suggestions that value could be unlocked by breaking-up Kingfisher rather than restructuring it.
"The power of the group is to be together," she said.
