Revenue also down at building merchant

Pre-tax profit at Travis Perkins was 71.4% lower in 2023 than in the year prior, owing to a downturn in the new build housing and private domestic repair and maintenance markets. 

According to the firm’s results for the year to 31 December 2023, pre-tax profit was £70m, a significant drop on the £245m recorded in 2022. 

travis perkins

Savings made by the firm were offset by overhead increases

The group said there had been lower sales volumes, overhead cost infaltion and rapid commodity price deflation in the second half, resulting in the weaker performance. 

Nick Roberts, chief executive officer, said: “Ongoing economic challenges have significantly impacted our trading performance, driven by weakness in the new build housing and domestic RMI sectors, and compounded by deflationary pressures on commodity products. 

“Faced with these challenges, we have invested to protect and build our leading market positions.” 

The decline in revenue was driven by the merchanting business, with rising interest rates driving a reduction in new build housing activity. 

Roberts said market conditions were “expected to remain a headwind” through this year but said the business had successfully optimised its cost base and was “actively addressing” its loss-making businesses.  

A step change reduction in non-branch cost base has delivered £35m in annualised savings, according to the business, however these savings were “more than offset by overhead increases”, largely related to salary inflation and investment in new distribution centres.  

The firm is working on a potential exit plan for its Toolstation business in France.  

Travis Perkins said a recovery in the UK construction market was “unlikely to gather any momentum” before the UK general election.