Placing the Wickes demerger on hold is among the measures Travis Perkins is implementing in the face of coronavirus.
Travis Perkins had been due to demerge the Wickes DIY and trade brand and shops in Q2 2020, following a move to focus the business on more trade-focused elements of the group. With the stock market currently highly volatile thanks to impact of the coronavirus, the board has suspended the proposed full-year 2019 dividend as well as the Wickes demerger.
So far, 2020 trading performance has been in line with expectations, with solid trading in the Merchanting businesses and a strong start in Toolstation and Wickes. Total Group sales grew by 2.4% year-to-date, and recent trading has not yet shown a significant sales impact as a result of COVID-19.
The Group said it had a robust financial position, with "significant liquidity headroom" - at 19 March 2020 the Group held £185m of cash on deposit, in addition to an undrawn revolving credit facility (RCF) of £400m. The Group maintains a close relationship with its core lending syndicate. Overall, the Group's debt maturities are well spread with no immediate refinancing required. The Group said it will provide further updates on the impact of COVID-19 on the trading environment as the situation becomes clearer.
"Our highest priority is the health and safety of our colleagues, customers, suppliers and all other stakeholders, and we have taken decisive action to mitigate the risks we are facing as a business, and implementing contingency plans across the Group," said CEO Nick Roberts. "We are absolutely committed to fulfilling the essential role we play in the UK construction industry supply chain in keeping the UK dry, warm, maintained and operational; providing materials, working capital funding and support for our trade customers, large and small.
"Whilst there is unprecedented uncertainty on how the virus outbreak will directly impact our markets and our businesses, we enter this period from a position of strength and security, with a strong balance sheet and access to significant committed liquidity."
There's more on the coronavirus situation on Torque, here.
