Travis Perkins slashes steering once more as service provider enterprise loses floor

Travis Perkins has slashed annual guidance for the second time in three months after the Toolstation owner suffered another disappointing quarter of sales.

The builders merchants and home improvement group told investors it expected full-year adjusted operating profits to come in at around £135million, down from August guidance of £150milllion and initial hopes of £180million.

Boss Pete Redfern, who joined last month from housebuilder Taylor Wimpey, said it was ‘clear’ that Travis Perkins ‘has allowed itself to become distracted and overly internally focused’, leading to underperformance.

Redfern outlined ‘immediate priorities’ to help return Travis Perkins to growth, including ‘driving and incentivising branch-led performance and motivation [and] identifying further ways to make the business run more efficiently’.

He plans to combine his chief executive role with responsibities as managing director of the firm’s struggling General Merchant business, thereby allowing him to ‘shorten reporting lines and develop our new strategy’ alongside operational leaders and group management.

Revenues slipped 5.7 per cent in the three months to 30 September, driven by a 8.2 per cent slump in its merchanting segment.

Travis Perkins said its General Merchant business had seen a loss of market share over the summer, with volumes and margins both falling.

Solid Toolstation growth of 2.9 per cent, driven by 9.6 per cent growth in the UK and Benelux, could not offset the decline.

Travis Perkins is on track to close its loss-making French Toolstation business.

The group said: ‘Overall, the group’s key end markets are stabilising with some very early signs of recovery.

‘Management expects to see positive growth in these underlying markets over the next 12 months, but that this growth will be slow and non-linear at the outset, with the benefit to financial performance starting to be realised in the second half of 2025.’

Travis Perkins shares were down 5.6 per cent to 870.5p in early trading, but have still added almost 20 per cent over the last 12 months. 

Redfern said: ‘My first few weeks at Travis Perkins Group have reaffirmed that this is a business with many strengths – the quality of our nationwide branch network, strong customer and supplier relationships and, above all, an experienced team of branch managers and commercial leaders within the business.

‘However, it is clear that the group has allowed itself to become distracted and overly internally focused which has led to the underperformance in recent periods.

‘We now need to get back to a focus on operational execution – delivering great products and great customer service and better leveraging our reach and scale.’