BUILDERS MERCHANTS: A-Z


TRAVIS PERKINS T Travis Perkins


THE 2019 YEAR-END results from the Travis Perkins group were published too late to be included in the full Trailblazers calculations and tables. However, total Group revenues grew by 3.2% in 2019 to £6,956m, and by 3.8% on a like- for-like basis.


Sales growth was driven by a good performance from the merchant businesses in a challenging market environment, with continued very strong growth in Toolstation and a strong recovery in Wickes. Adjusted operating profits grew to £442m, an increase of 7.8%, driven by improvements in all segments, with the biggest increase coming from the strong recovery in Wickes. Toolstation UK also grew profits strongly, but this was offset by the consolidation of Toolstation Europe for the last three months of the year and the corresponding losses of around £4m. The transformation of P&H continued to make good progress, improving the balance of business and improving margins. In January 2020, the Group sold Primaflow F&P, the wholesale business within the Plumbing & Heating segment, for £50m. This means the remaining Plumbing & Heating branch and digital businesses can focus on delivering service to their direct trade customers. The Board paused the process to divest the P&H business in Q4 2019 at a time of significant political and economic uncertainty in the UK. The intention to divest the P&H business remains, the current uncertainty due to the coronavirus pandemic not withstanding.


Merchanting sales grew by 2.6% to £3,703m in 2019, and by 3.3% on a like-for-like basis. Good growth in the first quarter was followed by increasingly challenging market conditions as the significant levels of political uncertainty impacted consumer confidence, and led to larger projects being postponed or delayed. The specialist merchants continued to win market share in their respective markets. Sales in CCF and Keyline were, however, impacted by the slow down in larger projects in the fourth quarter.


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Pressure on operating margins was driven by changes to customer mix, with stronger sales growth to larger customers in Travis Perkins and a greater proportion of direct- to-site deliveries, also to larger customers, in Keyline and CCF, which represents comparatively lower margin business but at a lower cost to serve and a high return on capital. This mix effect was offset by a focus across the Merchant businesses on controlling the above-branch cost base, eliminating the divisional structure, making savings through the supply chain transformation plan in Travis Perkins with the ongoing closure of the heavyside range centre network, and working to improve efficiency across the business. The specialist merchants continued the ongoing trend of winning market share in their respective markets. For CCF a strong first half performance was followed by a flat second half, impacted by the market slow down and the constraints around plasterboard supply.


In 2019 Keyline continued to focus on core civils and drainage. Over the year, total sales grew modestly, but from five fewer branches with lower generalist sales and with share gains in all key product categories. The Rudridge brand was fully integrated into the Keyline branch network, simplifying and unifying business processes. BSS performed well in 2019, with positive growth in both halves of the year despite project delays continuing to impact the business across all regions. Growth was driven by the introduction of new product ranges into branches, and further development and growth of the specialist tool hire offering. Although total revenue in the plumbing and heating businesses fell by 4.1% in 2019, to £1,465m,


TRAVIS PERKINS


Lodge Way House Lodge Way, Harlestone Road Northampton NN5 7UG 01604 752424 www.travisperkinsplc.com


CEO: Nick Roberts Chairman Stuart Chambers


Chief Financial Officer Alan Williams


Chief Operating Officer Frank Elkins


CEO, Plumbing and Heating Andrew Harrison Group Human Resources Director Carol Kavanagh Managing Director, Wickes Simon King


Subsidiary businesses: Travis Perkins, Benchmarx, Tile Giant, PTS, CCF, City Plumbing Supplies, BSS, Toolstation, Keyline, Wickes


and by 1.7% on a like-for-like basis, the majority of the sales decline was concentrated in the low- margin PF&P wholesale business. The higher margin branch and digital businesses grew in like-for- like terms, with the branch-based merchant business demonstrating encouraging like-for-like growth of 3.3%.


Manging director Travis Perkins: Kieren Griffin Managing director City Plumbing Supplies John Frost Managing director Toolstation James MacKenzie Managing director Keyline: Paul Beaman


Managing director BSS: Angela Rushforth


Managing director Tile Giant: James Heese.


Branch numbers: 2050 Employee numbers: 30,000 (group)


Members of: BMF


TRAILBLAZERS


TRAVIS PERKINS THE NUMBERS


2016 Turnover £m Gross profit £m


Operating profit £k Net profit £k Staff


THE RATIOS Stockturn Gross margin %


Operating margin % Net margin %


Sales/employee £k Profit/employee £ Return on capital % BMJ INDEX


2016 5.7


29.8 1.6 1.2


228


3,686 1.5


2017 5.5


29.6 5.1 4.5


232


11,779 5.6


2018 5.6


28.6 nil nil


247


(795) nil -9


6,217.2 1,851.8 100,400 72,700 27,239


2017


6,433.1 1,905.6 326,900 289,700 27,753


2018


6,740.5 1,927.8 (21,700) (49,400) 27,301


% CHANGE


2017 3 3


226 298 2


2017 (2) (1)


215 285 2


220 282


2018 5 1


n/a n/a (2)


% CHANGE


2018 1


(3)


n/a n/a 7


n/a n/a


A supplement to Builders Merchants Journal April 2020


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