The owner of Toolstation and Travis Perkins has seen revenue exceed 2019 numbers, noting that despite some market uncertainty, end markets "remain robust".
Travis Perkins Group saw like-for-like revenue in continuing businesses grow by 44.1% in H1 2021 and forge 14.5% ahead of H1 2019.
Adjusted operating profit of £164m (2020: £17m) was up 14% vs 2019 resulting from higher volumes with solid gross margins, its "improved customer proposition" and restructuring benefits. H1 2021 saw the group 'demerge' Wickes and sell its Plumbing & Heating business to HIG Capital.
Travis Perkins Merchanting & Toolstation
Toolstation's growth continued, increasing total revenue growth by 38.7%. In the UK, 30 branches opened in H1 2021, with 60 more to come in the second half of 2021. In the Netherlands, seven shops opened in H1 and revenue was up 52%. France saw Toolstation grow 74% with eight new shops opened. A new 100,000 sq ft distribution centre is to open just outside Lyon. Toolstation Europe made an overall loss due primarily to the early stage investment in France. This level of loss is expected to continue through H2 as the rollout programme, with 40 new shops planned for 2021, remains on track.
The Merchanting businesses delivered a strong first half performance, particularly the Travis Perkins General Merchant, underpinned by the strong recovery in domestic RMI demand. Overall Merchanting revenue was up 37.5% versus H1 2020, where closures due to the pandemic significantly affected trading, and 1.9% ahead of H1 2019. Factoring in the 2020 branch closure programme, like-for-like revenue growth was 47.3% and 11.0% up when compared to 2019
This strong top line performance, combined with robust gross margins and cost benefits from the restructuring programme, delivered an adjusted operating profit of £156m, up 11% versus 2019.
Price inflation
Price inflation accelerated through the first half of the year, with prices increasing by around 4%, Q1 being around 2% compared to Q2 at around 7%. Inflationary pressure is expected to persist in the near term with shortages on some key product lines, most notably in raw materials such as timber and plasterboard related products.
“I am delighted with our performance during the first half of 2021," said CEO Nick Roberts. "To have executed our planned strategic portfolio actions whilst delivering an excellent trading performance in ever changing market conditions is testament to the hard work and capability of our colleagues across the Group.
"I am particularly pleased with the agility that our teams have shown in responding to rapidly evolving market dynamics whilst always maintaining their focus on customer, colleague and supplier safety.
"This has been particularly noticeable in the Travis Perkins General Merchant where decisive actions taken during the previous two years have enabled us to respond rapidly to customer needs at a local level. Toolstation UK, meanwhile, is on course to deliver another excellent year of growth and our European rollout continues to gather pace.
"Our businesses have continued to play a critical role in the construction sector’s ongoing recovery and, while some uncertainty still remains, the end markets for our trade-focused businesses remain robust.
"As a result, I am cautiously optimistic around the outlook for the business and confident in our ability to make further progress in the second half of the year. We look forward to updating shareholders on our future plans in September.”
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