Shares in Travis Perkins (LSE:TPK) dropped 11.5% to 486.60p, their lowest since 2009, following the publication of the final results by the builders' merchant and a 2025 outlook that analysts said was below expectations.
The results for 2024, which showed a 99% fall in operating profits or 23% on an underlying basis, were "broadly as expected", said analyst Charlie Campbell at Stifel.
However, the guidance for 2025 guidance was "more cautious than expected", he said, with management saying the year has started slowly for the Merchanting arm, with pricing stable but a modest decline in volumes.
Overall 2025 guidance was for flat operating profit and low property profit of £3 million, which Campbell said implies adjusted operating profit of circa £144 million, 18% below his forecast.
The City consensus forecast, which had fallen a long way, was £181 million after property disposals.
He noted some caution from management on end-markets after a slow start to the year, with some acknowledgement of the group's own challenges, including the wait for a potential strategic reset with the appointment of a new CEO.
Sam Cullen at Peel Hunt felt it was a "mixed start to the year", with challenging conditions in the Merchanting business, related mainly to volumes, but Toolstation has started more positively.
"There is still some uncertainty about the rate and pace of recovery," he said, noting that expectations for the year have been "downgraded further", with around a 22% cut to the consensus.
Looking ahead, Cullen said: "The last few years have been challenging for the group, and there is much to do to execute a turnaround, not least finding a new CEO.
"However, the business still has a number of advantages, particularly around brand and scale. Over the medium term, reversing the increased centralisation of the business, and reallocating cost to the branches should help to improve service levels and win back share."