Travis Perkins (TPK)
Travis Perkins plc : Full year results for the twelve months ended 31st December 2020
02-March-2021 / 07:00 GMT/BST
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Travis Perkins plc
Full year results for the twelve months ended 31st December 2020
Resilient trading amidst significant uncertainty
? Continued progress on strategic agenda across digital enablement, customer fulfilment, process simplification and
branch network rationalisation despite the challenges of Covid-19
? Toolstation strong outperformance maintained with like-for-like growth of 22.2%; branch rollout continues at pace
in UK and Europe
? Robust H2 recovery in Merchanting and P&H driven by RMI demand
? Wickes taking market share in core DIY with like for like revenue growth of 19.3%**; demerger process recommenced
? Strong free cashflow generation; covenant net debt reduced by GBP304m to GBP40m; successful refinancing of September
GBPm (unless otherwise stated) Note FY 2020 FY 2019 Change
Revenue 6,158 6,956 (11.5)%
Like-for-like revenue growth1 18 (7.1)% 3.8% (10.9)ppt
Adjusted operating profit1 6a 227 442 (48.6)%
Adjusted earnings per share1 12b 42.4p 112.7p (62.4)%
ROCE1 16f 5.5% 10.1% (4.6)ppt
Covenant net debt1 15a 40 344 (304)
Dividend per share 13 0.0p 15.5p
Operating profit 77 232
Total (loss) / profit after tax (22) 123
Basic (loss) / earnings per share 12a (8.8)p 48.9p
(1) Alternative performance measures are used to provide a guide to underlying performance. Details of calculations can be found in the notes listed Financial headlines ? Total revenue from continuing businesses returned to growth in H2 at 1.4%*, demonstrating the resilience of the
Group's business models ? Adjusted operating profit of GBP227m reflecting lower volumes partially offset by actions to reduce operating costs,
including both short term controls and acceleration of longer term plans, coupled with appropriate government
support in the merchant businesses ? Delivered GBP120m annualised cost savings with the focus on strengthening the core business by closing smaller,
subscale branches and delayering management ? Net adjusting items of GBP140m, primarily relating to the restructuring programme
*Total Group revenue excluding Tile Giant and Primaflow F&P which were disposed during 2020. Toolstation Europe is included as if fully consolidated for both 2019 and 2020.
** On a calendar year basis. For the 52 weeks to 26th December 2020 Wickes Core like-for-like sales were +18.8%
Nick Roberts, Chief Executive Officer, commented:
"2020 was a year of unprecedented challenges and I am full of admiration for the energy and determination of our colleagues to ensure the safety of our customers, suppliers and each other.
Despite these challenges, we have shown great agility and versatility in adapting our working practices, further digitalising our engagement with customers and reshaping our business to suit the changing demands of our markets.
Our teams have also been able to make excellent progress on a number of key initiatives supporting our strategic objectives, particularly around simplifying commercial deals and refining our pricing architecture, which will drive future benefits.
In addition, I am pleased today to be able to confirm that the process to demerge Wickes has recommenced. The Wickes digitally-led model has proved highly effective during the pandemic and the business is in great shape to embark on its journey as a standalone entity.
Whilst uncertainty remains, we have seen a good recovery through the second half which gives us confidence that the fundamental drivers in our markets are robust. The continuing progress against our strategic plans leaves the Group well placed to outperform in those markets."
Management are hosting a virtual results presentation at 10.00am. Please register at the following link: https:// www.investis-live.com/travis-perkins/602407799a13881000ca64fe/nmsl
Travis Perkins Powerscourt
Matt Worster Justin Griffiths / James White
+44 (0) 7990 088548 +44 (0) 207 2501446
+44 (0) 7392 125417
This announcement contains "forward-looking statements" with respect to Travis Perkins' financial condition, results of operations and business and details of plans and objectives in respect to these items. Forward-looking statements are sometimes, but not always, identified by their use of a date in the future or such words as "anticipates", "aims", "due", "could", "may", "will", "should", "expects", "believes", "seeks", "intends", "plans", "potential", "reasonably possible", "targets", "goal" or "estimates", and words of similar meaning. By their very nature forward-looking statements are inherently unpredictable, speculative and involve risk and uncertainty because they relate to events and depend on circumstances that will occur in the future. There are a number of factors that could cause actual results and developments to differ materially from those expressed or implied by these forward-looking statements. These factors include, but are not limited to, the Principal Risks and Uncertainties disclosed in the Group's Annual Report and as updated in this statement, changes in the economies and markets in which the Group operates; changes in the legislative, regulatory and competition frameworks in which the Group operates; changes in the capital markets from which the Group raises finance; the impact of legal or other proceedings against or which affect the Group; and changes in interest and exchange rates. All forward-looking statements, made in this announcement or made subsequently, which are attributable to Travis Perkins or any other member of the Group or persons acting on their behalf are expressly qualified in their entirety by the factors referred to above. No assurances can be given that the forward-looking statements in this document will be realised. Subject to compliance with applicable law and regulations, Travis Perkins does not intend to update these forward-looking statements and does not undertake any obligation to do so. Nothing in this document should be regarded as a profits forecast.
Without prejudice to the above:
(a) neither Travis Perkins plc nor any other member of the Group, nor persons acting on their behalf shall otherwise have any liability whatsoever for loss howsoever arising, directly or indirectly, from the use of the information contained within this announcement; and
(b) neither Travis Perkins plc nor any other member of the Group, nor persons acting on their behalf makes any representation or warranty, express or implied, as to the accuracy or completeness of the information contained within this announcement.
This announcement is current as of 2 March 2021, the date on which it is given. This announcement has not been and will not be updated to reflect any changes since that date.
Past performance of the shares of Travis Perkins plc cannot be relied upon as a guide to the future performance of the shares of Travis Perkins plc. Summary
After an encouraging start to 2020, the first lockdown in the spring significantly disrupted both the Group's trading and supply chain. While the Group recovered well in the second half led by the domestic Repairs, Maintenance and Improvement (RMI) market, overall revenue in 2020 declined by 11.5% to GBP6,158m. Despite ongoing restrictions, performance was encouraging, demonstrating the agility and resilience of the Group's portfolio of businesses.
Throughout the pandemic, the health and safety of our colleagues, customers and suppliers has been our first priority. The Group continues to work with all parties involved in the construction industry, including government and trade bodies, to set standards to maintain safe working practices and support the ongoing recovery in the sector.
At the start of the initial lockdown in late March, the majority of the Group's businesses were closed and focus was solely on supporting essential projects, such as the construction of the Nightingale hospitals, with staffing reduced to a minimum to adhere to strict safety guidelines. Wickes and Toolstation, due to their advanced digital capabilities, were able to repurpose their branches as fulfilment centres to support the local trade either via click and collect or home delivery, although the Wickes showrooms business remained closed.
Through May and June, with the majority of the construction industry having been classified as essential and workers returning to building sites, all businesses across the Group began to cautiously reopen, adapting operating models to ensure compliance with Covid-19 safety requirements. Revenues over the first half of the year were thus down by 19%.
The high growth in the DIY market, which started during the first lockdown, has been sustained, benefiting Wickes and, to a slightly lesser extent, Toolstation. The broader domestic RMI market also recovered strongly, driven by the high number of housing transactions and homeowners having both the resources and need to invest in their properties as working from home has become far more prevalent. The Group has, however, seen a slower return to activity in new housebuilding and major commercial projects resulting from fewer new projects starting.
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