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REG-Travis Perkins Travis Perkins: Q1 2019 trading update - positive start to 2019 despite uncertain market conditions

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   Travis Perkins (TPK)
   Travis Perkins: Q1 2019 trading update - positive start to 2019 despite
   uncertain market conditions

   08-May-2019 / 07:00 GMT/BST
   Dissemination of a Regulatory Announcement that contains inside
   information according to REGULATION (EU) No 596/2014 (MAR), transmitted by
   EQS Group.
   The issuer is solely responsible for the content of this announcement.

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

   08 May 2019

   Travis Perkins plc

   Q1 2019 trading update - positive start to 2019 despite uncertain market
   conditions

   Highlights

     • Positive start to 2019 with  Group like-for-like sales growth of  7.3%
       and total sales growth of 5.4% against a soft prior year comparative
     • Strong Merchanting like-for-like sales growth of 10.6%
     • Continued acceleration  of Toolstation  growth, with  25% total  sales
       growth
     • Good recovery in Wickes with 10.5% like-for-like sales growth
     • Given current uncertain market conditions  and the early stage of  the
       year, overall expectations for 2019 remain unchanged

   John Carter, Chief Executive, commented:

   "We have delivered strong sales growth  in the first quarter of the  year,
   which reflects both our focus on  excellent customer service and the  weak
   comparator in 2018. This performance is all the more encouraging given the
   impact of the on-going political uncertainty on our end markets.

   The Merchanting businesses  have maintained the  strong growth trend  from
   the end of 2018, and Toolstation continues to grow extremely well,  driven
   by  network  expansion  and   existing  stores  maturing.  Wickes   posted
   encouraging sales growth figures in both core DIY and showroom categories,
   demonstrating a strong turnaround in Kitchen and Bathroom performance.  In
   Plumbing & Heating the milder winter has impacted sales compared to  2018,
   but our branches and specialist online channels have continued to  perform
   well.  The  work  to  operationally  separate  Plumbing  and  Heating   is
   progressing to plan and is expected to be completed in Q2.

   The actions set out at our capital markets day in December 2018 to deliver
   best in class  service to trade  customers and to  simplify the Group  are
   well underway. We are  making good progress  on cost reduction  activities
   and  expect  to  meet  our  cost  reduction  targets  this  year.  Overall
   expectations for the Group in 2019 remain unchanged."

   Q1 2019 sales    Merchanting(1) Toolstation(2) Retail(2) Plumbing & Group
   growth                                                   Heating(1)
   Like-for-like        10.6%          19.1%        10.0%     (4.0)%    7.3%
   sales
   Net new space        (1.0)%          5.9%       (0.6)%     (3.4)%   (1.2)%
   and acquisitions
   Trading day          (0.9)%           -            -       (0.8)%   (0.7)%
   differences
   Total sales           8.7%          25.0%        9.4%      (8.2)%    5.4%
   Q1 2018              (0.5)%         10.6%       (7.9)%     19.7%     3.0%
   like-for-like(3)
   Two-year             10.0%          31.7%        1.3%      14.9%    10.5%
   like-for-like

    

   All businesses within Merchanting demonstrated good growth. Travis Perkins
   generated like-for-like sales growth of 8%, continuing the improving trend
   from the end  of 2018  and primarily driven  by sales  growth with  larger
   regional  and  national  customers,  and  through  the  Managed   Services
   business.  The  strategy  to  further  empower  branch  managers  is  well
   underway, with experienced managers being supplied with greater access  to
   information, the  simplification  of  pricing systems  and  more  customer
   focused support from the central functions.

   The specialist merchant businesses continue to drive strong  like-for-like
   sales growth, although the on-going political uncertainty poses a risk  to
   the outlook  for the  commercial construction  and housebuilding  markets.
   Keyline continues  to perform  strongly through  its targeted  civils  and
   drainage   product   categories,   particularly   through   direct-to-site
   deliveries. CCF  continues  to  win market  share  through  market-leading
   customer service and relationship management, although growth is likely to
   moderate through the year, partly due to product availability  constraints
   in the supply  chain. BSS has  maintained the good  sales growth  momentum
   from 2018, further leveraging its clear market-leading position. In  trade
   kitchens, Benchmarx sales  are growing  well, with  one additional  branch
   opened in the quarter.

   Toolstation continued its impressive  like-for-like sales and total  sales
   growth, underpinned  by  the continued  expansion  of the  store  network,
   alongside the  launch of  the  new website  at the  end  of 2018  and  the
   successful extension of online ranges which are helping to increase  sales
   density. We remain on track to open 60 new stores in the UK in 2019,  with
   encouraging progress in expanding the network in Europe. 

   Wickes had a  strong performance  in like-for-like sales  and total  sales
   growth from both core  DIY and the Kitchens  and Bathroom showroom  (K&B).
   K&B benefited from a continued improvement in execution and a strong order
   book carried over from  2018, partially aided  by competitor decisions  to
   exit the design & install service for end-consumers in the second half  of
   2018.  Improved core DIY sales  benefited from strong execution, but  this
   was partially offset by the  timing of Easter for  Q1 (two days of  Easter
   sales in Q1 2018).

   As expected, Plumbing  & Heating experienced  a slowdown in  like-for-like
   and total sales as the weather  conditions were notably milder in Q1  2019
   compared to 2018.  Branch network  and specialist  online channels  showed
   good sales  growth,  which  was  offset by  a  decline  in  the  wholesale
   business.

   The operational separation  of the  Plumbing & Heating  business from  the
   Group is progressing to  plan and is expected  to be completed within  the
   second quarter. The Group  remains on target to  achieve its planned  cost
   reductions in 2019,  with significant progress  made towards removing  the
   divisional structure above  the Merchanting businesses  which will  reduce
   complexity, lower the above-branch cost base and speed up decision making.

    

   Enquiries

   Investor / analyst enquiries

   Graeme Barnes | +44 7469 401 819 |  1 graeme.barnes@travisperkins.co.uk

   Zak Newmark | +44 7384 432 560 |  2 zak.newmark@travisperkins.co.uk

    

   Media enquiries

   David Allchurch | Tulchan Communications | +44 207 353 4200

    

   Footnotes

    1. Like-for-like sales growth for the  three month period ended 31  March
       2019 compared to the three month  period ended 31 March 2018  adjusted
       for the impact of extra one-half trading day in the 2018 period. Total
       sales growth for the three month  period ended 31 March 2019  compared
       to the  three  month period  ended  31  March 2018  not  adjusted  for
       the impact of extra one-half trading day in the 2018 period.
    2. Wickes like-for-like and  total sales  growth for the  13 week  period
       ended 30  March 2019  compared to  the 13  week period  ended 31 March
       2018.
    3. Q1 2018 like-for-like  figures restated  for the  new Group  segmental
       reporting structure, adopted from January 2019.

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

   ISIN:           GB0007739609
   Category Code:  QRF
   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.:   8539
   EQS News ID:    808315


    
   End of Announcement EQS News Service

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    3 fncls.ssp?fn=show_t_gif&application_id=808315&application_name=news&site_id=reuters6

References

   Visible links
   1. mailto:graeme.barnes@travisperkins.co.uk
   2. mailto:zak.newmark@travisperkins.co.uk


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