Travis Perkins plc announces 2021 half year results

Reporting for the six months ended 30 June 2021, Travis Perkins plc has described an “excellent operational performance” in a period that has seen the execution of the “successful Wickes demerger” and its Plumbing & Heating business sold to H.I.G. Capital for £325m (with completion expected in Q3).

In its half year report, the Group described a “robust revenue performance driven by strong operational delivery and broad-based, RMI led recovery”. Like for like revenue in continuing businesses grew by 44.1% and was 14.5% ahead of a ‘more realistic benchmark” of 2019.

Adjusted operating profit of £164m (2020: £17m) was up 14% vs 2019, resulting from “higher volumes with solid gross margins, improved customer proposition and restructuring benefits”.

Strong revenue and operating profit performance in Merchanting was reported, following the “decisive actions” to refocus the business. A “challenging period” of inflation and materials shortages are being “navigated well”. Market share gain are said to be continuing at Toolstation, with an ongoing rollout programme of expansion “on track in both the UK and Europe”.

The statement also noted “increasing guidance for the full year 2021 to at least £310m of adjusted operating profit for the continuing businesses”, whilst the Group also outlined “continued progress on setting industry leading sustainability targets consistent with the 1.5 degree pathway of the 2016 Paris Agreement.”

Nick Roberts, Chief Executive Officer, said: “I am delighted with our performance during the first half of 2021. To have executed our planned strategic portfolio actions whilst delivering an excellent trading performance in ever changing market conditions is testament to the hard work and capability of our colleagues across the Group.

“I am particularly pleased with the agility that our teams have shown in responding to rapidly evolving market dynamics whilst always maintaining their focus on customer, colleague and supplier safety.”

He continued: “This has been particularly noticeable in the Travis Perkins General Merchant where decisive actions taken during the previous two years have enabled us to respond rapidly to customer needs at a local level. Toolstation UK, meanwhile, is on course to deliver another excellent year of growth and our European rollout continues to gather pace.

“Our businesses have continued to play a critical role in the construction sector’s ongoing recovery and, while some uncertainty still remains, the end markets for our trade-focused businesses remain robust.”

Nick concluded: “As a result, I am cautiously optimistic around the outlook for the business and confident in our ability to make further progress in the second half of the year. We look forward to updating shareholders on our future plans in September.”

The full company update noted that The Group “continues to invest in both physical networks and technology to meet changing customer needs and exploit market opportunities. Larger branches, with greater capability, are being added to the General Merchant portfolio while the rollout of Toolstation continues at pace in both the UK and Europe.

“Alongside enabling growth in core businesses, the Group is also focused on identifying emerging opportunities, such as TF Solutions, the Group’s air conditioning and refrigeration distributor, where network capacity has been doubled in the last twelve months.

“Alongside investment in the branch network, the Group also continues to focus on enhancements to both customer facing and back office technology. Customer Apps are being rolled out, starting with Toolstation and the General Merchant, and the delivery management system has been fully implemented across CCF and Keyline as well as around half of the General Merchant network. Internally, work continues to replace manual processes with digital solutions to improve efficiency.”

Click here to view the full report from the Travis Perkins plc website.