Housing market slowdown costs Travis Perkins profit, branches and 400 jobs

The UK’s biggest builders merchant, Travis Perkins, has posted  a fall in profits in the year to December 31 2022. The company reported adjusted operating profit of £295m, down 16.4%, hit by a £15m restructuring charge. Revenue grew 9% to £4.9bn. However, the expected lower levels of activity in the year ahead, meant the Group closed 19 branches, mostly smaller ones, at a cost of 400 jobs across the branches and central support functions.

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The group reported a solid performance by the Travis Perkins General Merchant, which increased market share, enhanced its digital capability and expanded value-added services  across its Hire, Benchmarx kitchens and Managed Services division.

There were strong performances from the specialist distributors – BSS, Keyline and CCF, while Toolstation returned to good growth in  the second half, after a tough first half. Significant investment in expanding infrastructure across both the UK and Europe.

“In the second half of the year we made some difficult decisions in response to the weaker trading environment and we continue to be watchful of market trends, working closely with our customers and suppliers to stay on the front foot,” said chief executive Nick Roberts.

“While the housing market slowed later in the second half, this did not feed through notably into volumes as completions continued but is expected to be seen in 2023 with new housing starts currently forecast to slow,” he said.

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“Investment continues in our strategic growth programmes including selectively exploring new destination branches for the Travis Perkins General Merchant, rolling out Toolstation in both the UK and Europe and investing in growing our value-added services, notably Hire, Benchmarx kitchens and our Staircraft business.

“Whilst it is early in the year and macroeconomic uncertainty remains, the combination of our diverse end market exposure, appropriate cost actions and further market share gains driven by continued strategy execution, will enable the Group to deliver another resilient trading performance in the year ahead. As a market-leading distributor of building materials products, we continue to benefit from long-term strategic growth drivers in our markets including new environmental and safety legislation and commitments from both public and private sector customers to deliver against net zero targets. We are committed to being at the forefront of both decarbonising the construction industry alongside developing the next generation of talent to create value for all of our stakeholders.”

About Fiona Russell-Horne

Group Managing Editor across the BMJ portfolio.

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