Key Points
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Group revenue was £4.6bn (broadly flat)while adjusted operating profit fell to £133m (-12.5%)and adjusted EPS to 30.8p (-15.8%); the board declared a final dividend of 7.5p, taking the full-year payout to 12p.
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Balance sheet and cash flow strengthened materially: the group delivered a £196mcash inflow, reduced net debt by £224mto £621m(net cash £1mbefore leases), cut leverage to 2.1x, refinanced a £250mbond via US private placement and ended the year with over £800mof available liquidity.
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Management booked significant adjusting items and restructuring— £111mof charges (including £67mof branch impairments) and a £44mCCF goodwill impairment—said Oracle ERP disruption is largely behind them, and flagged a three-tier portfolio with Toolstation Benelux remaining a "perennial loss maker" expected to produce a similar loss in 2026.
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Travis Perkins (LON:TPK) reported broadly flat revenue and a lower adjusted operating profit for the year, while highlighting a strengthened balance sheet and improved cash generation following a year that included disruption from an Oracle enterprise resource planning (ERP) implementation and leadership turnover.
Full-year results and dividend
Group revenue for the year was GBP 4.6 billion, down 0.9%year-on-year. Management said like-for-like revenue was up 0.3%, describing the top line as "broadly flat."
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Adjusted operating profitwas GBP 133 million, down 12.5%from the prior year and in line with company-compiled consensus, CFO Duncan Cooper said. Adjusted earnings per sharewere 30.8 pence, down 15.8%, which Cooper attributed to lower earnings and the "fixed nature of interest expense between years."
The board declared a final dividend of 7.5 pence per share, bringing the full-year dividend to 12 pence. Cooper said this was consistent with the group's policy to pay 30% to 40% of adjusted earnings.
Sales trends, pricing pressure, and competitive backdrop
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Cooper said the first half was affected by key vacancies and efforts to "grapple with" Oracle implementation, but sales performance improved in the second half with promotions and a more "front-footed" approach. In the merchanting segment, he said the general merchant business began reversing market share losses and "retake share," a trend he said continued into early 2026.
The company pointed to improving quarterly like-for-like sales in merchanting, from -3.2% in Q1to +2.1% in Q4as the group exited the year. The results also reflected one fewer trading dayin 2025 versus 2024 and the disposal of Staircraft, which management said was not material enough to be treated as a discontinued operation.
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In the operating profit walk, Cooper cited competitive intensityin a market "starved of volume growth," noting that manufacturers' price increases had been difficult to pass on in full. He said price investment had been needed in the second half to help drive volume recovery.
In Q&A, CEO Gavin Slark said last year the company demonstrated it could increase market share by being more price competitive, but said 2026 required a "more nuanced approach" balancing price and margin. He referenced recent manufacturer communications about energy and transport surcharges, and highlighted sensitivity to costs such as diesel, noting the group spends about GBP 15 million a yearon diesel within merchant businesses.
Asked about competitive behavior, Slark said the market has long been competitive and he did not see competitors behaving "less rationally" than in prior years.
Costs, overhead actions, and adjusting items
Cooper said total overhead inflation in 2025 was around GBP 40 million, driven by a part-year effect of the National Insurance increase, National Living Wage, and property rates and rental inflation. The company reinvested in frontline branch-based roles that had been removed at the end of 2023, onboarding most of about 350 colleaguesearly in the first half of 2025. Three new general merchant branches also contributed to headcount increases.
At the same time, Cooper said the group reduced central and regional management headcount, entering 2026 with over 300 fewer headsin areas including finance, company secretariat, sustainability, HR, corporate communications, procurement and marketing, and IT. In Q&A, management said there were no "live and significant programs" currently, but reiterated the business is reviewing resourcing and structure.
The company also detailed adjusting items, including:
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GBP 111 millionof charges that included GBP 67 millionof non-cash impairments across 196 branchesin merchanting, where carrying values exceeded forecast discounted cash flows.
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A GBP 44 millionnon-cash goodwill impairment in CCF, reflecting "structural challenges" in end markets and future profitability forecasts.
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Toolstation Europe impairment and restructuring charges tied to Toolstation Benelux performance and prior Toolstation France-related provisions.
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A GBP 12 millionrestructuring charge related to severance payments for headcount reductions.
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The sale of Staircraft for GBP 21 million, resulting in a GBP 3 millionloss on disposal.
Cash generation, leverage, and refinancing
Management emphasized cash flow and balance sheet strength. The group delivered a GBP 196 millioncash inflow for the year, which Cooper said was achieved despite lower year-on-year EBITDA. Working capital was a key contributor: trade debtors fell by GBP 130 millionas the company invoiced "much of the Oracle-related backlog" and tightened debt collection discipline; trade creditors rose by GBP 26 millionas payment terms were harmonized following Oracle's introduction.
Net debt fell by GBP 224 millionto GBP 621 million, and the group ended the year at net cash of GBP 1 million before leases. Slark described this as the best cash position the group has had in more than 25 years. Cooper said leverage reduced to 2.1x.
The balance sheet improvement also supported refinancing activity. Cooper said the company refinanced a GBP 250 millioncorporate bond due in 2026 using U.S. private placement funding, with a blended coupon of 6.27%. He said maturity timelines now run out to 2035, and the group has no significant refinancing events until 2028. The company ended the year with over GBP 800 millionof available liquidity including its undrawn revolving credit facility.
Business priorities and 2026 expectations
Slark, who said he has been CEO for 10 weeks, outlined an operating approach centered on being a "branch-based, sales-led organization" alongside disciplined cost, margin, and capital allocation. He said the Oracle transition pain was "principally behind us" and that branches were beginning to see benefits.
He described a three-tier view of the portfolio:
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Tier one:Travis Perkins General Merchanting (Green & Gold), BSS, Toolstation UK, and Keyline, which he said were delivering "sustainable financial return," with a focus on improvement and collaboration without "grand centralization."
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Tier two:CCF and TF Solutions, with combined revenues of around GBP 600 million, described as trading around break-even and requiring specific operational improvements.
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Tier three:Toolstation Benelux, described as a "perennial loss maker" and cash burn; Slark committed to providing "absolute clarity" on the plan for Benelux by the half-year results.
On guidance, Cooper said the group expects a ~30%effective tax rate, ~GBP 80 millionof capital expenditure, and ~GBP 5 millionof property profits. He said interest expense is expected to be around GBP 6 million higher per annumon a like-for-like basis due to refinancing, partly offset by higher interest income from the group's cash position. He also said the company expects a similar level of loss in Toolstation Benelux in 2026.
Asked about share buybacks, Cooper said capital allocation would be addressed alongside more developed strategy at the half-year update, adding that the company was currently "basking" in a relatively strong position given uncertainty in the environment.
About Travis Perkins (LON:TPK)
Travis Perkins plc engages in distribution of building material products in the United Kingdom. It operates through Merchanting and Toolstation segments. The company offers tools and building supplies. It also distributes pipeline products, as well as supplies managed services, and commercial and industrial heating and cooling solutions. In addition, the company provides in specialist civils and drainage solutions; and air-conditioning and refrigeration products and heat pumps. Further, it provides insulation and interior building products to interior building specialists, contractors, and builders; and kitchens and joinery products.
The article " Travis Perkins H2 Earnings Call Highlights " was originally published by MarketBeat.
