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Travis Perkins to return business rates relief amid 'robust' LFL growth
16th Dec 2020 07:52
(Sharecast News) - Builders' merchant Travis Perkins reported a rise in like-for-like sales in October and November amid "strong" demand in the DIY market, as it said it will repay the business rates relief it received for the Covid-19 crisis.
The company said on Wednesday that the end market trends seen in the third quarter continued into October and November, while it also make good progress on retaining sales from branches closed as part of the restructuring activity during the summer.
As a result of these factors, like-for-like sales growth was "robust", it said, at 8.6%, with Toolstation and Wickes driving the growth. Group sales were down 3.3%, however.
Toolstation and Wickes saw LFL sales growth of 32.4% and 19.3%, respectively. Merchanting and plumbing & heating saw much more modest growth of 3.8% and 1.9%, respectively.
"There continues to be strong demand across the DIY market, resulting in particularly strong sales in Wickes and Toolstation, as well as the continued encouraging recovery in domestic repair, maintenance and improvement across smaller trade customers in Travis Perkins and City Plumbing," It said.
"Volumes with larger customers continue to recover more slowly, impacting the rate of sales recovery in our specialist merchants in BSS, CCF, Keyline and the large contract side of the P&H business. Some larger customers were more impacted by the second national lockdown in November, alongside a negative impact on the kitchen and bathroom businesses as showrooms were forced to close."
Travis Perkins said that given Wickes' status as an essential retailer and the fact that Toolstation has benefited from a surge in DIY trade over the year, both businesses will return the business rates relief and repay monies received under the government's Coronavirus Job Retention Scheme.
This totals around £50m and will reduce group adjusted earnings before interest, tax and amortisation accordingly.
The company said on Wednesday that the end market trends seen in the third quarter continued into October and November, while it also make good progress on retaining sales from branches closed as part of the restructuring activity during the summer.
As a result of these factors, like-for-like sales growth was "robust", it said, at 8.6%, with Toolstation and Wickes driving the growth. Group sales were down 3.3%, however.
Toolstation and Wickes saw LFL sales growth of 32.4% and 19.3%, respectively. Merchanting and plumbing & heating saw much more modest growth of 3.8% and 1.9%, respectively.
"There continues to be strong demand across the DIY market, resulting in particularly strong sales in Wickes and Toolstation, as well as the continued encouraging recovery in domestic repair, maintenance and improvement across smaller trade customers in Travis Perkins and City Plumbing," It said.
"Volumes with larger customers continue to recover more slowly, impacting the rate of sales recovery in our specialist merchants in BSS, CCF, Keyline and the large contract side of the P&H business. Some larger customers were more impacted by the second national lockdown in November, alongside a negative impact on the kitchen and bathroom businesses as showrooms were forced to close."
Travis Perkins said that given Wickes' status as an essential retailer and the fact that Toolstation has benefited from a surge in DIY trade over the year, both businesses will return the business rates relief and repay monies received under the government's Coronavirus Job Retention Scheme.
This totals around £50m and will reduce group adjusted earnings before interest, tax and amortisation accordingly.