Travis Perkins has confirmed that it is planning to spin-off DIY retailer Wickes as the builders merchant revealed it made a profit in its half-year results.
Like-for-like revenue grew eight per cent to £2.7bn.
Operating profit was £64m in the six months to 30 June up from a loss of £104m in the first half of the previous year.
Total profit after tax was £12m, up from a loss of £148m
Basic earnings per share were 6.9p from a loss of 57.2p per share last year.
The dividend per share remained the same at 15.5p.
Why it’s interesting
Wickes will be demerged from the Travis Perkins business as a standalone company, in order for the builders merchant to focus on trade customers. The company said the sale is expected to be completed in the first half of next year.
Last year Travis Perkins announced it intended to strengthen Wickes’ performance and “review the options” to maximise its value. Since then steps have been taken to give the retailer more autonomy in preparation for a sale, Travis Perkins said.
The confirmation that Travis Perkins is demerging the follows reports earlier this month that it had begun separating the retailer’s IT systems from the rest of the group.
Travis Perkins also put its plumbing and heating division up for sale last year, and today said the process was “well underway”.
What Travis Perkins said
Travis Perkins chief executive said: “The P&H sales process is well underway, and we are today announcing our intention to demerge Wickes as a separate business.
“This strategic progress has been underpinned by a strong trading period in the first half of 2019 albeit against softer trading conditions in H1 2018. Our trade merchanting businesses have outperformed their markets, through continued focus on delivering excellent customer service, and benefiting from the leaner, lower cost organisation now in place.
“Toolstation continues to deliver excellent growth through proposition improvements and network expansion. Wickes has delivered a strong turnaround in volume and profit performance, with gains in both core DIY and through the Kitchen & Bathroom showroom.”