Following a comprehensive review of the business announced it July, the board of Travis Perkins concluded that the group will focus on “serving trade customers through advantaged businesses in attractive markets”, and will simplify the group to “reduce complexity and cost to drive returns”.
Travis Perkins set out plans for the chain as part of a strategy to focus on trade customers, which will initially see it divest its plumbing and heating division. It said it will concentrate on delivering “best in class service to trade customers through businesses with clear competitive advantages in their markets”.
The group added it aimed to deliver sales growth through market outperformance, “building on the momentum” in its contract merchanting businesses and continued growth in its Toolstation brand. In the short term, Travis Perkins said it will focus on strengthening the performance of Wickes and capitalising on its “clear competitive advantages in the DIY, small trade and kitchen and bathroom markets”.
It is rumoured that one of the options could be a sale of the brand. In the statement the company added: “As it is a predominantly consumer focused business, the board will also look to review the options for maximising the value of Wickes in the medium term.”
John Carter, CEO, said: “We have developed a clear plan to focus on delivering best-in-class service to our trade customers, and to simplify the group to reduce complexity, speed up decision making and reduce costs. Our trade businesses hold strong positions in attractive markets, and these initiatives will enable us to concentrate our management time and capital in the highest returning areas.
“Our strong balance sheet and free cash flow generation, driven by growing earnings and lower capital expenditure, will underpin our commitment to drive shareholder value and a progressive dividend.”