REG-Travis Perkins Travis Perkins plc - Q3 trading update for the three months to 30 September 2024

Travis PerkinsAnnouncement

24/10/2024 07:15

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   Travis Perkins (TPK)
   Travis Perkins plc - Q3 trading update for the three months to 30
   September 2024

   24-Oct-2024 / 07:00 GMT/BST

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                                24 October 2024

                                        

        Dissemination of a Regulatory Announcement that contains inside
           information according to REGULATION (EU) No 596/2014 (MAR)

                                        

                               Travis Perkins plc

                                        

          Q3 trading update for the three months to 30 September 2024

    

     • Group revenue down (5.7)%, driven by the Merchanting segment
     • Robust performance from Toolstation, with revenue +2.9% in the UK  and
       Benelux like-for-like sales +9.6%
     • Loss-making operations in Toolstation  France have ceased trading  and
       remain on track for full closure by the end of FY24
     • FY24 adjusted operating profit expected to be around £135m

    

   Pete Redfern, Chief Executive of Travis Perkins plc commented:

    

   “My first few weeks at Travis Perkins Group have reaffirmed that this is a
   business with  many  strengths –  the  quality of  our  nationwide  branch
   network, strong customer  and supplier  relationships and,  above all,  an
   experienced team  of branch  managers and  commercial leaders  within  the
   business.

    

   Travis Perkins Group plays a  critical role in the construction  industry.
   Connecting our  customers  with  the  products and  tools  they  need  and
   removing the friction from  fragmented and complex  supply chains will  be
   core to our strategy.

    

   However, it  is  clear  that  the  Group  has  allowed  itself  to  become
   distracted  and  overly   internally  focused   which  has   led  to   the
   underperformance in recent periods.  We now need to get back to a focus on
   operational execution  –  delivering  great products  and  great  customer
   service and better leveraging our reach and scale.

    

   Over the last nine months the team has made good progress on  implementing
   cost  discipline,  improving  working   capital  management  and   exiting
   Toolstation France. In  addition to supporting  these ongoing actions,  my
   immediate priorities are driving and incentivising branch-led  performance
   and motivation, identifying  further ways  to make the  business run  more
   efficiently and ensuring that we turn and face the anticipated recovery in
   the UK construction market.

    

   During this important  period, I  will combine  the roles  of Group  Chief
   Executive and Managing  Director of  the Travis  Perkins General  Merchant
   business. This will allow  me to shorten reporting  lines and develop  our
   new strategy,  working  closely  with  the  operational  leaders  of  this
   business as  well  as the  Group  Leadership  Team. I  am  confident  that
   together we  can bring  significant improvements  in performance  and  the
   execution of change.

    

   I look forward to working with Geoff, Duncan and the wider Board over  the
   coming months  to shape  the future  of the  business. We  will provide  a
   further update with the full year results.”

    

   Business Performance

    

   Group revenue declined by (5.7)% in the quarter with like-for-like revenue
   down by (6.8)%.

    

   In the Merchanting  segment revenue  was (8.2)% lower  on a  like-for-like
   basis, driven by  the General  Merchant which has  seen a  loss of  market
   share over the summer. Both volume and margin in the General Merchant have
   underperformed expectations  with  volume continuing  to  decline  despite
   recent changes to optimise pricing. More widely the market remains  mixed,
   with ongoing  competitive  intensity in  some  of the  Group’s  Specialist
   Merchanting businesses but early signs of returning confidence in others.

    

   Toolstation delivered  a robust  performance with  growth of  2.9% in  the
   quarter in the  UK and  Benelux like-for-like sales  up 9.6%.  Toolstation
   France remains  on track  for full  closure by  the end  of FY24,  with  8
   branches being sold  to Quincaillerie Angles  as a going  concern and  the
   remaining 43  branches, alongside  the transactional  website, having  now
   ceased trading.

    

   Outlook

    

   Given the shortfall in the Merchanting segment, the Board now expects FY24
   adjusted operating profit to be around £135m.

    

   Overall, the Group's key end markets are stabilising with some very  early
   signs of  recovery. Management  expects to  see positive  growth in  these
   underlying markets over the next twelve months, but that this growth  will
   be slow  and non-linear  at  the outset,  with  the benefit  to  financial
   performance starting to be realised in the second half of 2025.

    

    

    

   Q3 2024                                  Merchanting Toolstation Group
   Price and mix                              (0.8)%       0.6%     (0.6)%
   Like-for-like volume                       (7.4)%       0.4%     (6.2)%
   Like-for-like revenue growth / (decline)   (8.2)%       1.0%     (6.8)%
   Network changes                            (0.6)%       0.7%     (0.3)%
   Trading days impact                         1.7%        0.0%      1.4%
   Total revenue growth / (decline)           (7.1)%       1.7%     (5.7)%

    

   YTD 2024                                 Merchanting Toolstation Group
   Price and mix                              (2.7)%       1.6%     (2.0)%
   Like-for-like volume                       (4.2)%      (0.8)%    (3.6)%
   Like-for-like revenue growth / (decline)   (6.9)%       0.8%     (5.6)%
   Network changes                            (0.5)%       0.9%     (0.3)%
   Trading days impact                         1.1%        0.4%      1.0%
   Total revenue growth / (decline)           (6.3)%       2.1%     (4.9)%

    

   Note - Toolstation segment numbers include Toolstation France

    

    

    

   Pete Redfern and Chief Financial Officer  Duncan Cooper will be hosting  a
   call for  sell-side analysts  and institutional  investors at  8.30am  BST
   today.

    

   Details of how to join the  call are below. Participants are requested  to
   join 10  minutes before  the scheduled  start time  with  pre-registration
   encouraged.

    

   Advance registration

    

   https://www.netroadshow.com/events/login?show=890cbe67&confId=71746

    

   Alternatively use the numbers below:

    

   Operator Assisted Dial-In:

   United Kingdom (Local): +44 20 3936 2999

   United Kingdom (Toll-Free): +44 800 358 1035

   Access Code: 506120

    

   Enquiries:

   Travis Perkins                        FGS Global
   Matt Worster                          Faeth Birch / Jenny Davey / James
                                         Gray
   +44 (0) 7990 088548                   +44 (0) 207 251 3801
    1 matt.worster@travisperkins.co.uk   TravisPerkins@fgsglobal.com

    

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   Dissemination of a Regulatory Announcement, transmitted by EQS Group.
   The issuer is solely responsible for the content of this announcement.

   ══════════════════════════════════════════════════════════════════════════

   ISIN:           GB00BK9RKT01
   Category Code:  QRT
   TIDM:           TPK
   LEI Code:       2138001I27OUBAF22K83
   OAM Categories: 3.1. Additional regulated information required to be
                   disclosed under the laws of a Member State
   Sequence No.:   354746
   EQS News ID:    2014781


    
   End of Announcement EQS News Service

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References

   Visible links
   1. mailto:matt.worster@travisperkins.co.uk


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