Travis Perkins profit nosedives as firm warns on timing of recovery

Travis Perkins said operating profit slumped to just £2m last year as the firm said it was unsure about when a recovery in construction would start to kick in.

The FTSE 250 listed building materials giant said operating profit plunged 99% to £2m with the firm’s pre-tax profit sinking to £77m loss from a £38m profit last time. The results, which were delayed from last month, said revenue was down 5% to £4.6bn.

Chairman Geoff Drabble – who is deputising in the place of a formal chief executive – said the results show “there are a number of areas where the business needs to refocus and change the way it operates”.

Drabble is overseeing the process to find a new chief executive after Pete Redfern stepped down last month after just six months in the role because of ill-health.

Drabble said: “It is clear to the management team that there are a number of areas where the business needs to refocus and change the way it operates in order to better serve our customers and effectively support our suppliers. Several initial steps have been taken under Pete Redfern’s leadership to begin rebuilding trust and confidence, both internally and externally, with focused leadership roles restored in all our businesses and actions taken to re-engage and motivate our teams.”

But he warned “uncertainty remains regarding the strength and timing of a recovery in UK construction activity”.

The firm’s results included £139m of adjusting items, compared to just £27m the previous year. The figure include £43m on closing several distribution centres and restructuring costs.

In a note, broker Investec said: “Outlook comments point to another difficult year with a mixed start to trading in 2025. There remains significant uncertainty around the outlook for the Group and the weak profit guidance for this year will not be helpful.”

And Julie Palmer, partner at corporate restructuring firm Begbies Traynor, said: “The results highlight just how tough things have been for the UK construction sector, with demand still weak and price deflation squeezing margins. The building materials supplier’s cost-cutting measures have helped soften the blow but with construction activity sluggish, the outlook remains uncertain.”