Travis Perkins’ consumer arm, largely comprising of Wickes, has posted rising sales in its first half, with “solid growth” expected for the year.
EBITDA was up 22.4% to £36m. Like-for-likes grew 6.8% and revenue jumped 8.8% to £638m in the six months to June 30.
The group reported “solid revenue growth” in the consumer arm in the first quarter driven in part by better weather and “despite intense promotional activity in the kitchen and bathroom market”, although this did impact gross margins. However, Travis Perkins said the hit to margins was offset by “well controlled” operating costs.
The retailer improved its promotional programme in the second quarter, helping margins to recover.
Wickes relocated two stores in the first half, “optimising space and improving profitability”. Three new stores are planned for Wickes in the second half, as well as a further relocation.
Eight new Toolstation branches were opened within Wickes stores. A further seven standalone Toolstation branches were also opened in the period. There are plans to open 25 stores across the year as a whole.
Tile Giant opened one new store and closed three in the half. “These estate changes are both profitable and return enhancing,” Travis Perkins said.
Wickes recorded “strong” growth in online sales. The retailer said it is aiming to enhance the efficiency of online delivery.
Travis Perkins group revenue rose 11.5% to £2.73bn. Adjusted pretax profit was up 19.4% to £162.5m.
Travis Perkins chief executive John Carter said: “A combination of improving market conditions, increasing customer confidence and the successful introduction of a number of self-help initiatives has driven a strong first-half performance.
“We have outperformed our markets and see good growth opportunities for stepping up our investment in the customer proposition, leveraging our superior scale, supply chain capabilities and for network expansion and format optimisation.
“These exciting organic growth opportunities along with a clear focus on return on capital should continue to create substantial shareholder value. Trading is consistent with our expectation and with lead indicators in our different markets encouraging, the Group is expected to show continued solid growth for the remainder of the year.”