Kingfisher, Europe's largest home improvement retailer, said on Monday it was targeting a £500 million(€660m) increase in sustainable annual profit in five years time.

In a statement released ahead of a presentation to investors and analysts on the firm’s long term strategy the firm also said it planned a capital return of £600 million over the next three years in addition to annual dividend payments.

Kingfisher trades as B&Q and Screwfix in Britain and Castorama and Brico Depot in France, its most profitable market.

The group estimated that its plan, which entails improving its operational and online capabilities and driving efficiencies, would cost £800 million. It said the plan would hit its profits in the first year by about £50 million and in the second year by about £70-100 million.

Kingfisher chief executive Veronique Laury has been in the job since December 2014. In March last year she detailed plans to reshape Kingfisher, including closing 60 B&Q stores while expanding the number of Screwfix outlets, cutting the number of product lines, merging the garden and bathroom businesses and revitalising its big stores across Europe.

“With a clear roadmap now in place alongside clear long-term targets, the size of the five year opportunity is significant,” said Ms Laury.

Prior to Monday’s update analysts were on average forecasting a 2015-16 pretax profit of £667 million, down from £675 million in the previous year.

Reuters