NEWSROUND
Burnley opening for Huws Gray
Grant & Stone buys up three more merchants
Builders merchant group Huws Gray has opened a new branch, at Eastham Place, Burnley. The new branch significantly strengthens Huws Gray’s presence in Lancashire and is perfectly located to connect with existing branches in the local area and is the latest strategic development of the group’s ambitious expansion plans, through acquisitions, and the redevelopment and enhancement of brownfield sites.
Plumbing & heating sales bounce back
Plumbing and heating merchants saw sales continue to bounce back at the end of 2020 from the low point earlier in the year caused by the first UK lockdown. That’s according to a new statistical Index compiled by the Builders Merchants Federation (BMF) in partnership with MRA Research and GfK.
The new Plumbing & Heating Merchant Index (PHMI) will set the gold standard in reliable market trends and analyses sales values through plumbing and heating outlets in Q4 2020, and provides an overview for the full year. Sales in Q4 2020 continued the bounce back from the low point in Q2. A direct comparison of Q4 sales in 2020 and 2019 found sales were down by just -0.4%, with one more trading day this year. Looking back, the impact of the first lockdown on 2020 Q2 results had seen year on year sales fall by -46.3% compared with Q2 2019. However, the start of the recovery was apparent in Q3 2020, where sales had grown so that they were down by -5.3% on the same period the previous year. .
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The largest independent merchant group in southern England has been created by the aquisition of RGB Building Supplies, Buildit Gloster and Total Plumbing Supplies by Grant & Stone Group. This is in addition to the purchase in September 2020 of Buckinghamshire-based 3Counties and in January 2021, of CRS Building Supplies, a 12 branch builders’ merchant in Somerset. The group will now have 74 branches stretching from West London to Cornwall, over 1,000 employees and turnover approaching £250m. The acquisitions used the backing of private equity firm Cairngorm Capital, which acquired Grant &
investor support, exceptional products, first-rate employees and a well-deserved reputation for superior service. We are excited about the opportunities that these acquisitions bring.”
Stone in November 2019. The businesses will continue to run as separate brands, under the umbrella of the Grant & Stone Group. RGB’s chief executive, Kevin Fenlon, is joining the Grant & Stone Group board.
Nick House, Grant & Stone’s Group Chief Executive said, “Grant & Stone is at a really exciting point in its development and we are fortunate to benefit from strong
Alex Bayliss, managing director at Cairngorm Capital, said: “As investors, we are actively engaged in the strategic development of our portfolio companies. Recognising the great skills and capability of Grant & Stone’s management team, we have been working together to identify suitable partners with strong reputations and performance that pair well with Grant & Stone. We are delighted with the acquisition of these three excellent businesses.”
Covid pushes Travis Perkins into the red
Revenue and pre-tax profits at builders merchant group Travis Perkins fell in 2020, thanks to the lockdowns caused by the Covid-19 pandemic. Total group revenue for the year ending December 31 2020 was £6,158m, down 11.5% from the same point a year earlier. The group posted a £7.7m pre-tax loss for the year, compared with a £181m pre-tax profit for the previous year. However, this shows how far trading and profit bounced back in the second half; the firm posted a £127m pre-tax loss in the first half. Total revenue in the Merchanting segment fell 17.2% to £3,065m while operating profit was down by 46.5% at £152m (2019: £284m). That said, in the Travis Perkins General Merchant, volumes were approaching 2019 levels by the end of the year. Toolstation revenues increased by £188m in the year, up 42.1%, with the
consolidation of Toolstation Europe (acquired Q4 2019) accounting for £48m of the increase. Like-for-like growth in Toolstation UK of 20.9% was described as an “exceptional performance”, considering the level of disruption from the lockdown in late March and April. The business added 60 branches to its total. Wickes, the demerger of which is now back on, also managed to increase sales, by 3.6% from £1,342m in 2019 to £1,391m at the end of 2020. The Plumbing & Heating division saw total revenue fall to £1,069m from £1,465m (-27.0)%. The group reports that this division was the most significantly impacted of the Group’s businesses with branches initially being forced to close, customers restricted to essential maintenance work and the subsequent challenges faced by installers who had to adopt a very careful approach to working
in domestic properties. A robust recovery in the second half, saw like-for-like sales up 0.9% driven by strong demand through the branch and showroom network. The specialist digital businesses - Underfloor Heating Store and Plumbnation - saw total sales of £51m during the year representing 7% growth. The group still plans to divest the Plumbing and Heating division when market conditions are right. Travis Perkins Group CEO Nick Roberts said: “2020 was a year of unprecedented challenges and I am full of admiration for the energy and determination of our colleagues to ensure the safety of our customers, suppliers and each other. Despite these challenges, we have shown great agility and versatility in adapting our working practices and reshaping our business to suit the changing demands of our markets.”
www.buildersmerchantsjournal.net March 2021
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