Travis Perkins sees marked March improvement as Wickes merger nears

Builders and plumbers merchant group Travis Perkins saw sales improving throughout January and February 2021, with a marked uplift in March, a report on the first quarter’s trading for 2021 has shown.

Travis Perkins

Thanks to pent-up demand and continued high levels of housing transactions fuelling higher RMI spend,  like-for-like sales in the Merchanting segment were up by 6.3% on a two-year basis, supported by the retention of sales from 2020 branch closures. In contrast, the new build housing and commercial sectors remain subdued.

Toolstation’s  like-for-like growth continued, driven by its digitally enabled and convenient sales proposition and plans remains on track to open 60 new branches in the UK in 2021.

The Plumbing & Heating business continued the positive momentum seen in the second half of last year with two year like-for-like sales up 9.1%. Similarly, to the Merchanting business, P&H has seen strength in its smaller, RMI focused customer base with the large contract segment slower to recover. Prices have risen on a number of core product raw materials, most notably timber, copper and steel,  and the group has seen shortages on some lightside products imported from Asia, as well as some key heavyside products moving onto allocation.

Nick Roberts, Chief Executive, said: “The Group has enjoyed an encouraging start to the year with robust like-for-like sales growth across our businesses, underpinned by strong demand in the RMI market. The Merchanting business has maintained the momentum seen in the second half of last year while Toolstation continues to outperform, driven by its convenient and trade focused proposition. I am also pleased to report that the Wickes demerger process remains on schedule to be completed at the end of April, leaving the business a simplified and trade focused group. We are encouraged by the robustness of the RMI market and the continued recovery in our other key end markets. However, at this early stage in the year, our expectations remain unchanged as we continue to make progress on the delivery of our longer-term strategic plans.”

Those strategic plans include the demerger of the DIY business Wickes. The Wickes demerger is due to complete this month, with trading in Wickes shares commencing on 28th April. Travis Perkins share consolidation will be effective following the market closure on 28th April, and trading in new Travis Perkins shares will begin on 29th April.

Wickes like-for-like sales performance continued to be strong at 19.7% in Q1, 25.6% ahead on a two-year basis. The excellent Core performance seen in the second half of 2020 continued into the current year with Q1 like-for-like sales at 38.5%, across a broad range of product categories and was driven by Wickes digital capability, with continued high levels of customer delivery and click and collect orders. With showrooms remaining closed throughout the key winter sale period, the group’s development of a digital showroom concept enabled it to mitigate some of the effects of those closures, though like-for-like sales declined by 25% on a delivered basis, and orders through the winter sale period were down by around 50%.

About Fiona Russell-Horne

Group Managing Editor across the BMJ portfolio.

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