Given the resurgent housing market, you would expect Travis Perkins (TPK) to be doing well. "When people move it is good for us," remarks chief financial officer Tony Buffin. He says people tend to tidy up their house before they put it on the market, and they also do up their new property when they move in. That stimulates demand for the group's trade products, such as bricks and copper pipes, as well as business at its retail DIY chain Wickes.
The weather also lent a hand. Poor weather in the first quarter of 2013 meant that comparatives were always going to be a bit easier. But the management team is keen to point out that the group's solid first-half performance is not purely the result of these favourable tailwinds.
"We are also taking share. We are growing ahead of the market," claims Mr Buffin. Travis Perkins clocked up 10 per cent like-for-like revenue growth in the first half. The most striking turnaround came in the consumer division where like-for-like sales growth was 7 per cent, up from a measly 1 per cent in 2013. Mr Buffin says that indicates the new management team at Wickes has got off to a "very encouraging" start.
Citi is sticking to its pre-tax profit forecast of £373m for the full year, giving earnings per share of 117p (from £321m, 104p in 2013).
| TRAVIS PERKINS (TPK) | ||||
|---|---|---|---|---|
| ORD PRICE: | 1,700p | MARKET VALUE: | £4.2bn | |
| TOUCH: | 1,697p-1,700p | 12-MONTH HIGH: | 2,001p | LOW: 1,538p |
| DIVIDEND YIELD: | 2.0% | PE RATIO: | 15 | |
| NET ASSET VALUE: | 1,049p* | NET DEBT: | 11% | |
| Half-year to 30 Jun | Turnover (£bn) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2013 | 2.4 | 135 | 44.2 | 10 |
| 2014 | 2.7 | 154 | 50.5 | 12.25 |
| % change | +11 | +14 | +14 | +23 |
Ex-div: 9 Oct Payment: 11 Nov *Includes intangible assets of £2.2bn, or 900p a share | ||||
