Rising import costs because of the weaker pound put a squeeze on profits at Travis Perkins and prompted it to raise some of its prices.
Pre-tax profits at the builders merchants, which also owns Wickes, BSS and Toolstation, fell by 4.5 per cent to £168 million in the first half on revenues up 3.5 per cent to £3.2 billion.
John Carter, chief executive, said that it was a solid performance against a challenging market, including weaker housing transactions and consumer confidence, and a backdrop of cost inflation and market volatility.
Almost two thirds of the group’s products come from overseas — 90 per cent in the case of timber — and it was hit by sterling’s post-Brexit plunge and a resurgence in the price of commodities such as copper.
Mr Carter said: “The group made a conscious decision to recover input cost inflation selectively through disciplined pricing activity. Whilst this had some impact on trading volume, it enabled us to maintain group gross margins and positions the business well for the future.” The company unveiled a plan for its struggling plumbing and heating division, where profits fell by a third. It is to integrate its City Plumbing and PTS branch networks under a single management team, overhaul the product ranges and form a dedicated supply chain. It said it was too early to say what the impact on jobs would be.
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Mr Carter said that its merchanting division turned in a “workmanlike performance” thanks to the price rises, but that he was “pleasantly surprised” at higher sales and profits at the consumer division, which includes Wickes and Toolstation.