“There is always pressure on management when things are tough and this is no exception,” he said.In the past year, trading at B&Q has steadily worsened against a backdrop of a slowing housing market, prompting the group to reshuffle its top executives, sack staff and shut obsolete stores. “We expect the market to remain very competitive and B&Q to continue to have to promote,” he added, admitting that margins “could slip further”.Shares in Kingfisher fell 1.75p to 226p yesterday after analysts downgraded their profits forecasts for the year to January 2007 to reflect the further threat to margins. Britain’s biggest DIY retailer unveiled another poor quarter, which saw underlying sales in its fourth quarter to 28 January fall 9 per cent. This was despite a drive to lower prices and slash the cost of kitchens and bathrooms, which hammered margins at B&Q. One retail analyst called B&Q’s strategy a “transfer of wealth from shareholders to consumers”.
Gerry Murphy, the group’s chief executive, said prices had further to fall at B&Q as he held out little hope of an imminent recovery. It broke into the American market in 2000 with the purchases of the electricity transmission and distribution companies, NEES and EUA, for a total of $5.6bn. Two years later it unveiled the $9bn acquisition of Niagra Mohawk..

Kingfisher, the do-it-yourself giant under pressure in the UK, admitted profit margins at its struggling B&Q chain would slump further this year as it battled intense competition. The network overlaps almost entirely with National Grid’s electricity distribution company in Rhode Island which supplies 477,000 customers.This latest deal is the fourth that National Grid has pulled off in the US – all on the north-east seaboard. A National Grid spokesman said there would be savings to be made from reducing the number of call centres and distribution sites on Rhode Island. But he said that all 600 staff employed by the Southern Union subsidiary would be offered jobs by National Grid and any redundancies would be achieved through natural wastage.The Rhode Island company serves 245,000 customers through 3,000 miles of gas mains. The company is buying Southern Union’s Rhode Island gas distribution business for £285m in cash and taking on a further £44m of debt. The deal comes less than a fortnight after National Grid’s chief executive-designate, Steve Holliday, served notice that it planned further US expansion and brings the amount that National Grid has invested in the US over the past five years to more than $15bn (£8.6bn). The US market accounts for about 40 per cent of the group’s operations.
The Rhode Island business overlaps with National Grid’s existing electricity distribution network in the area, meaning that there will be scope for substantial savings.

National Grid, the owner of the UK’s gas and electricity transmission networks, further strengthened its presence in the American market yesterday with the £329m acquisition of a gas distributor based in the north-east of the US. Mr Karabelas flew to Switzerland last Friday accompanied by his new chief executive, Frank Condella. Mr Karabelas was quietly confident HBM would back the board, saying: “It was a very successful meeting.” NAV has also been to Switzerland to try to win HBM’s support.Mr Karabelas admitted: “Clearly there is disappointment about what’s happened to the share price That’s something I’m very sympathetic to.”. It is the single largest shareholder in SkyePharma, with a 9.3 per cent stake.