Timber and builders merchant giant Travis Perkins is celebrating “another very successful year”, with profits before tax ahead by nearly a quarter. The company also says that its sales of timber and wood products have continued to grow.
The company has reported earnings for 2002 at £137.6 million, a rise of 24.5% on 2001. Group sales were ahead by 10.8% at £1.417 billion.
Chief executive Frank McKay was upbeat about the year’s performance and about the company’s business into 2003: “After what has been another very successful year for the company, customer confidence in 2003 is so far holding up against the current background of global uncertainty. We continue to make progress with the main drivers of growth remaining positive.”
Another plus for the business in 2002, said Mr McKay, was a “significant improvement” in overall operating margin from 10.1% in 2001 to 11.2%. He said this was the result of “a variety of ongoing operational improvements throughout the group”.
Group planning director Ian Goldsmith said that timber products made up a lower proportion of overall sales than in 2001. “But that was because of strategic acquisitions in other areas. They actually performed well and comprised about 20% of total turnover.”
During the year, he added, Travis Perkins completed investment to improve efficiency in timber milling operations in south east branches. “And further spending in this area could be made.”
The assimilation of the DW Archer business and rebranding as Travis Perkins was also finalised.”And timber will remain a key part of their offer,” said Mr Goldsmith.
In addition the company continued to develop its “Keyline” chain , with the introduction of “broader timber and forest product and lightside” ranges.
Travis Perkins’ first big acquistion last year was the 48-branch plumbing and heating specialist CPS for £39 million. A further four were later added to this operation.
This takeover was followed by the £45.9 million takeover of drylining and ceiling specialist CCF.
The company also bought a further 29 merchant branches during the year and opened four more on greenfield sites. These took the total of new branches added over the year to 108 , boosting the group as a whole to 610 outlets.
Mr McKay said the company would continue to grow in 2003, particularly in areas “complementary” to Travis Perkins’ “traditional strengths as a builders merchant offering a full range of products”.
“We will continue to focus on our strategy of expanding in the UK , not only through the acquisition of independent merchants , but also through the opening of additional greenfield sites.”
Mr Goldsmith said that, despite the current international uncertainty, the construction market remains “reasonably postive”.
“That’s partly due to the level of public spending, which tends to be good for timber and wood products.”
