𝓤𝓷𝓲𝓽𝓮𝓭 𝓝𝓮𝔀𝓼

B&M has cut its profit guidance for the second time in a month, after it failed to properly account for an extra £7 million in costs.

The discount retail firm’s finance chief also said he plans 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 recognised in cost of goods sold” in its results update two weeks earlier.

B&M said this was linked to an operating system update earlier this year.

It told investors that the underlying issue has been resolved, but that it will have a financial impact on its results this year.

Adjusted earnings for the half year to September are set to have been around £191 million, reducing its previous estimate of £198 million.

B&M said group adjusted earnings are now set to be between £470 million and £520 million for the financial year, having previously guided to between £510 million and £560 million.

Bosses at the retail firm said they intend to launch a comprehensive “third-party review” into the incident.

It added that it still expects like-for-like sales growth to be “between low-single-digit negative and low-single-digit positive levels” over the second half of the year.

The update comes only two weeks after B&M blamed soaring costs and a slump in sales as it warned over profits.

It had reported a worse-than-expected 1.1% drop in UK like-for-like sales in the second quarter of the year.

Meanwhile, the firm also said it was impacted by a £30 million jump in wage costs and a £14 million hit in packaging taxes over the latest half-year.

It therefore launched a series of turnaround measures in an effort to help 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 launched a search for his replacement, with Mr Schmidt staying on until the new finance boss is appointed.