Repair maintenance and improvement (RMI) work has led the recovery at Travis Perkins during the first half of 2021 (H1). The group has unveiled H1 revenue of £2,299m in its continuing businesses, up 37.7% on 2020 and 10.7% ahead of 2019. However, the group warns that product availability remains an issue with several core products on restricted supply.
Travis Perkins’ H1 operating profit of £168m (2020: -£79m) reflected the rebuilding of revenue after last year’s first lockdown, alongside the benefits of the restructuring programme undertaken in 2020, resulted in a significantly increased operating profit.
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, which has posed a particular challenge for CCF.
Nick Roberts, Chief Executive Officer, said: “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.”
The Merchanting businesses delivered a strong first half performance, revenue was up 37.5% versus H1 2020, where enforced 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.
CCF’s marketplace remains challenging as the “late cycle” trades, specifically new housing and commercial, continue to lag and product availability remains an issue with several core products on restricted supply.
In all of the specialist businesses, Travis Perkins said difficult but decisive actions taken during 2020 to rationalise the cost base are delivering important benefits. All businesses are carefully rebuilding their capacity in line with market recovery and in a disciplined manner to ensure longer term efficiencies are locked in to create a more flexible cost base that enables operating leverage.