Significant construction supplier Travis Perkins has revealed slightly lower revenues in its full year results to 31 December 2023.
The group behind Toolstation, Travis Perkins General Merchants and others, said the progressive downturn in new build housing and private domestic RMI markets led to Group revenue (2.7)% lower than prior year.
Lower volumes, overhead cost inflation and rapid commodity price deflation in H2 resulted in full year adjusted operating profit of £180m (2022: £295m).
Despite the short-term challenges, Travis Perkins said that the long-term growth drivers of the industry remain robust, even if the timing of recovery in its end markets is uncertain.
There were market share gains for both Toolstation and Travis Perkins General Merchants, the group added.
Given the challenging market in the UK, Travis Perkins has been adjusting its model. There are plans afoot for a potential withdrawal of Toolstation France and a strategic review of options for Toolstation Benelux. In other Toolstation news, the UK supply chain was bolstered with the new Pineham distribution centre.
“Ongoing economic challenges have significantly impacted our trading performance, driven by weakness in the new build housing and domestic RMI sectors, and compounded by deflationary pressures on commodity products,” said Nick Roberts, Chief Executive Officer. “Faced with these challenges, we have invested to protect and build our leading market positions.
“With market conditions expected to remain a headwind through 2024, the business is fully focused on improving profitability and enhancing cash generation. We have successfully acted to optimise our cost base and are actively addressing the impact of our loss-making businesses. We are also accelerating changes to our operating model, leveraging our scale to create a simpler, more efficient business. This will be achieved by simplifying our operational structures, consolidating our supply chain, creating shared procurement capability, and embedding new technology.
“While the timing of recovery in our end markets is uncertain, the long-term growth drivers of our industry remain robust. The proactive steps we are taking to rebuild profitability and strengthen our balance sheet will create a more resilient business and, together with our strong customer relationships and differentiated offer, will see the Group well positioned to emerge stronger when markets recover.”
Other 2023 financials have seen the Würth Group report annual sales of more than EUR 20 billion for the first time in its corporate history (according to its preliminary financial statements), seeing growth despite the global economic and political situation. The Black Forest's fischer also managed to hit a record high turnover figure in 2023, but also noted the 'negative global influences'.
