British builders’ merchant Travis Perkins (LSE:TPK) performed broadly in-line with first-half expectations, although slight downgrades are to be expected in the second half of 2022, according to analysts at Peel Hunt.
While revenues were up 7.9% on a like-for-like basis, operating profit was flat across all divisions, with European losses exceeding expectations by 50%.
Strong demand in the merchanting segment was offset by a softening of the Toolstation DIY segment.
Adjusted earnings per share grew by 11.7% and a 12.5p dividend was announced.
Price inflation was an eye-catching 14% according to the interim results posted on Tuesday, resulting in a 4% decline in volumes.
“The business remains confident in the underlying resilience of its end markets, which are supported by long-term renovation trends. While DIY demand at Toolstation is expected to continue to normalise, the strong performance in merchanting is expected to continue,” said Peel Hunt.
TPK shares took a 10% tumble to 949p on Tuesday morning, with year-to-date losses currently standing at -42%.