Travis Perkins warns of more sector bankruptcies
TRAVIS Perkins, the builders merchants and owner of DIY chain Wickes, yesterday posted a better-than-expected 27 per cent fall in first-half profit, but warned the sector may see a further slew of bankruptcies before the year is out.
The group, which raised £300m in a rights issue in May, reported a pre-tax profit of £90.4m for the six months to 30 June, beating analyst forecasts of £60m-£71m.
Travis Perkins said it had received a boost from cost cutting and stock levels, a drive to avoid less profitable work and strong sales of kitchens following the demise of rival MFI.
“We think things are gradually settling down into the trough,” said chief executive Geoff Cooper. “However, we don’t think that we’re going to see any significant recovery until probably the end of next year.”
He added that the group expects “another rash of closures coming through over the winter”.