Travis Perkins reports strong RMI demand in Q3

22 October 2020


Travis Perkins has reported strong domestic RMI demand through Q3, driving a strong performance in its Wickes and Toolstation businesses.

But while local trade activity has “recovered well”, the group’s trade businesses continue to experience a lag in recovery from larger housebuilding and construction projects.

Group like-for-like sales growth in Q3 was 3.9%, with the merchanting division down by 3.1%, Toolstation up by 25.5% and retail (Wickes) growing by 18.3%.

In the year to date, group like-for-like sales are down by 11.8%. Merchanting is down by 18.4%, Toolstation up by 17.3%, retail up by 0.2% and plumbing & heating down by 15.6%.

“We have reported a positive overall like-for-like sales performance in the quarter as our markets have continued to recover following the impact of the national lockdown earlier this year,” said Nick Roberts, Travis Perkins chief executive.

“This has been driven by a strong recovery in demand across domestic RMI markets, benefitting the Travis Perkins, City Plumbing, Wickes and Toolstation businesses who serve these markets. Currently this domestic RMI trend remains strong.”

He said despite the lag in recovery for larger build projects there were “signs of increasing workflow” across these sectors as underlying demand strengthens as businesses have adapted to new and safe ways of working that enable them to keep sites open during periods of local lockdown.

During July, trade volumes picked up strongly as markets exited the lockdown period. Trading in August was modestly softer, impacted by a protracted holiday season, before then picking up again in September in line with schools reopening and many trades returning to a more normal work schedule.

“Continued buoyancy in the DIY markets and a more encouraging trend in trade focused markets in September has driven like-for-like growth of 8% for the month, with total sales growth, adjusted for trading days, of around 0.3%,” added Mr Roberts.

Both new housebuilding and commercial construction continue to run at levels some way below 2019, specifically impacting the specialist merchants and elements of the P&H business.

Across the Group there was no appreciable impact from price inflation, with the change in sales driven by volume.

Travis Perkins’ outlook cites uncertainty remaining from both the pandemic and the ongoing Brexit negotiations, making it hard to forecast performance in the near-term.

“Based on the assumption that current volume trends continue, including the ongoing strength in DIY sales, and that any further lockdown measures introduced do not have a significant impact on the Group’s end markets, the Group expects its EBITA performance for 2020 to be in the upper half of the current range of analysts’ expectations,” it said.