Stronger sales momentum during Q3 for Travis Perkins

Travis Perkins, Britain's No. 1 supplier of building materials, posted accelerating sales growth in its third quarter, helped by an increase in construction activity on the back of government initiatives to stimulate the housing market.

The group also said on Thursday it was on track to meet analysts' consensus forecast for earnings per share of 100 pence in 2013 despite lower gains from property disposals.

Travis Perkins said that while the period saw stronger sales momentum in divisions serving builders - merchanting and plumbing & heating, its consumer businesses - Wickes and Tile Giant - lagged, receiving little benefit from the warmer summer weather as they sell a limited range of outdoor products.

"The recovery in activity, signalled by us in early 2013, looks set to continue into 2014 as owners' and occupiers' construction and maintenance activity increases from the very low levels encountered over the last five years," said Chief Executive Geoff Cooper, who is stepping down from the top job in January.

The number of property transactions in Britain is growing and mortgage approvals are ahead of last year as the government's "Help to Buy" mortgage scheme starts to kick-in.

Travis said sales at outlets open over a year rose 6.3 percent in the three months to Sept. 30, its fiscal third quarter, against the same period last year.

That compares with first half like-for-like growth of 0.9 percent, year-on-year.

Like-for-like sales were up nearly 11 percent in the merchanting businesses and up 5 percent in plumbing & heating, but flat in the consumer division.

Total group revenue rose 8.6 percent, having increased 1.6 percent in the first half.

Shares in Travis Perkins, which entered the FTSE 100 index of Britain's largest companies in June, have risen 60 percent over the last year.

They were down 0.7 percent at 1,765 pence at 0714 GMT, valuing the business at 4.4 billion pounds ($7 billion).Travis Perkins, Britain's No. 1 supplier of building materials, posted accelerating sales growth in its third quarter, helped by an increase in construction activity on the back of government initiatives to stimulate the housing market.

The General and Specialist Merchanting Divisions both recorded encouraging total and like-for-like sales growth, in-line with the two months to 30 June 2013. The Plumbing & Heating division performed well with 5.0% like-for-like sales growth, an improvement on the flat growth recorded in the two months to 30 June 2013.

Retail markets, however, remain challenging. The Consumer division recorded flat like-for-like sales growth in the quarter, a significant reduction from the 8.6% growth recorded in the two months to 30 June 2013. Both Wickes and Tile Giant received little benefit from the warmer summer weather given their limited range in outdoor categories. A continued focus on cost efficiencies partially offset the impact of weaker growth.

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Source : Travis Perkins PLC and Reuters
http://online.hemscottir.com/ir/tpk_new/ir.jsp?page=news-item&item=1618704454385664
www.reuters.com/article/2013/10/17/travis-perkins-sales-idUSL6N0I70NR20131017