Cashbuild’s latest trading update shows that revenue growth in the second quarter of its 2026 financial year was largely generated by new stores and recent acquisitions, while sales at established outlets declined, highlighting the pressure facing household spending in the building materials sector.
The group reported a 1% increase in revenue for the quarter, but once new shops are excluded, turnover at existing stores fell by 2%. The 15 additional outlets opened during the period contributed around 3% to growth, effectively compensating for weaker performance across the mature store base. This pattern points to expansion rather than stronger demand as the primary driver of reported growth.
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Transaction volumes reflected a similar trend. Total till transactions rose by 2% in the quarter, but activity at established shops declined by 1%. New outlets again accounted for the difference, adding roughly 3% to transaction growth. Analysts say this suggests that fewer customers are spending at long-standing Cashbuild locations, while the company is relying on geographic expansion to protect volumes.
For the half year, group revenue increased by 3%, supported by the opening of new stores and the inclusion of Amper Alles, which was acquired during the period. Excluding these additions, underlying growth would have been materially weaker. Selling inflation of just 0.8% indicates limited scope for price-led revenue growth, with volumes carrying most of the burden in a market where consumers remain cost-conscious.
At the end of the half year, Cashbuild operated 322 stores. During the quarter, the group opened one new outlet, refurbished seven, relocated one and closed a poorly performing store. It also acquired three Amper Alles shops and exited its Malawi operations, reducing exposure to markets that were not meeting performance expectations. Management has previously said the strategy is to prioritise profitable expansion while trimming operations that dilute returns.
READ – Cashbuild Reports 5% Revenue Growth
Market analysts note that Cashbuild’s focus on low-income and rural customers leaves it particularly exposed to shifts in grant income and informal sector earnings. While expansion into underserved areas can deliver incremental growth, declining performance at established stores raises questions about the sustainability of relying on new openings to offset weaker core demand.
Retail groups with similar exposure have reported mixed results, with larger chains using acquisitions and network growth to sustain headline revenue despite subdued underlying volumes, as reported by Bloomberg. This has intensified competition in smaller towns and peri-urban areas, where store density is rising faster than household incomes.
Cashbuild’s update suggests that while its expansion strategy is providing short-term support to revenue, the deterioration in like-for-like sales signals a more fragile consumer environment. The company’s ability to maintain margins and generate returns from new stores will depend on whether demand stabilises in existing locations and whether infrastructure investment and housing activity recover in the coming year.