Travis Perkins withdraws Tool Station from France

According to its unaudited accounts for the year to 31 December 2023, Travis Perkins had a profit before tax of £70m, compared with £245m in 2022. Revenue was down just 3% to £4,862m (2022: £4,995m).

Approximately 20% of Travis Perkins’ revenue comes from Toolstation, with 163 new Toolstation branches opening in the UK between 2020 and 2022, increasing market share. Only 7 new stores (net) were added in 2023.

But in mainland Europe, where it has more than 100 stores in France, the Netherlands and Belgium, it’s not doing as well.

Toolstation has withdrawn from France and is considering a continued presence in the Netherlands and Belgium.

Toolstation France saw sales increase by 29% in 2023, but losses rose to £18m as six new stores were added at the same time. A further £20 million in losses is expected this year. “Management has concluded that the investments required to achieve profitability are no longer sustainable and today confirmed that it is working on plans for a potential exit from the business,” the board said. said.

Travis Perkins’ 2023 results include a £33m impairment charge on Toolstation France.

Toolstation Benelux also saw sales rise by 11%, but losses rose from £15m to £19m. Management expects losses in the Benelux countries to narrow to around £12m in 2024, with the Dutch business reaching breakeven by 2025 and Belgium by 2028. Expect.

Nick Roberts, Chief Executive Officer of Travis Perkins, said: “Ongoing economic challenges have had a significant impact on our trading performance, with weakness in new homes and the domestic RMI sector, and deflationary pressures on commodity products. It’s getting even worse.” In the face of these challenges, we have invested to protect and build on our leading market position.

“With market headwinds expected to continue into 2024, the business is fully focused on improving profitability and strengthening cash generation. We are also leveraging our scale to accelerate changes to our operating model to create a simpler and more efficient business. , achieved by integrating supply chains, building common procurement capabilities, and incorporating new technologies.

“While the timing of end-market recovery remains uncertain, the industry’s long-term growth drivers remain strong. A strong business has been created, which, together with our strong customer relationships and differentiated service, means the group is well placed to emerge stronger when the market recovers.”

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