Travis Perkins Group is still on track to demerge Wickes as Q3 reports show total sales growth in its retail division up by 8.3%.
The demerger of Wickes is set to be completed in Q2 of 2020. However, its divestment of the plumbing and heating side of the business has been put on hold because of “the current unprecedented level of uncertainty”.
Total sales growth in the plumbing and heating side of the business fell by 1% this quarter. In the merchanting division they were up by 2.6%, while Toolstation recorded the highest growth at 21.3%.
The K&B side of the market remained “robust” according to its Q3 interim statement. Travis Perkins said it saw an increase in lead generation through digital channels, good sales conversions and an increase in installation services.
Overall, the company has seen a growth of 3.8% in Q3 and 3.4% as like-for-like sales growth. The planned cost reductions throughout every sector of Travis Perkins are under way to achieve between £20 million and £30m annualised savings by mid-2020.
Travis Perkins last full results were to the end of June. In that half-year, overall sales were £2.77 billion for the group (operating profit £195m) and £695m for the retail division (operating profit £52m).
Recently appointed chief executive Nick Roberts, said: “Now in my third month since taking over as CEO of the group, I have spent a considerable amount of time in our branches, learning about our businesses and our markets from colleagues, customers and suppliers. This has confirmed my initial impressions that our businesses are well-positioned to compete strongly and win a greater share in their markets in the future.
“I am particularly impressed by the quality of our teams and their commitment to excellent customer service. The plan to simplify the group’s portfolio of businesses remains the right one, with good progress made through the quarter towards reducing cost and complexity and enabling greater focus and more disciplined capital allocation to our advantaged trade-focused businesses.”
He concluded: “The group delivered a solid performance in Q3, despite trading conditions becoming incrementally more challenging through the course of the summer as a result of the ongoing market uncertainty. Though the group maintains a cautious outlook for the near-term, full-year performance remains in line with our expectations.”