Travis Perkins profits fall 16% as housing market slows down

The company reported adjusted operating profit of £295m, down 16.4%, hit by a £15m restructuring charge. Revenue grew 9% to £4.9bn.

"In the second half of the year we made some difficult decisions in response to the weaker trading environment and we continue to be watchful of market trends, working closely with our customers and suppliers to stay on the front foot," said chief executive Nick Roberts.

"While the housing market slowed later in the second half, this did not feed through notably into volumes as completions continued but is expected to be seen in 2023 with new housing starts currently forecast to slow."

Travis Perkins said it was "mindful" of the current macroeconomic uncertainty and forecast a decline in overall market volumes in the mid to high single digit range in 2023.

"This will vary across end markets with private domestic new-build and RMI more challenged while the commercial, industrial and public sectors are expected to remain more resilient," it added.

"Product cost inflation is expected to moderate into 2023 although management does not currently expect to see any notable deflation in manufactured products (and) expects to see mid-to-high single digit percentage product cost inflation overall driven by the rollover of prior year increases and further new increases already announced so far this year."

Reporting by Frank Prenesti for Sharecast.com