Wickes sales are down 2.5% amid a £246m write down as owner Travis Perkins Group reports a 2018 loss.
The firm said full-year sales at Wickes declined by 2.5%, and by 4.4% on a like-for-like basis against an “extremely challenging” UK DIY market environment.
In what has been a rollercoaster for both Wickes DIY, its owner Travis Perkins and the UK DIY and KBB sector in general news emerged in December that builders merchant Travis Perkins may have looked to sell sell the struggling Wickes chain in 2019 as part of plans to focus on trade customers.
However, sales in its consumer division, which includes Wickes, rose 5.6% in the final quarter of the year, relieving investors and sboosting shares up as much as 13% as a result.
What has since transpired is that a major cost-cutting exercise and business simplification initiatives across the group suggests that trading conditions have picked up at Wickes.
John Carter, chief executive, said that while “troubled” Wickes had recovered well in the second half, it had “The group delivered a solid performance overall in 2018 despite a challenging market backdrop but we had underperformed compared to where we would’ve hoped it to be. We were looking to improve its performance, which will give us some optionality but that is yet to be decided.."
Travis Perkins reported pre-tax losses for the year of £49m, down from £290m in 2017.
Kitchen and bedroom market activity at Wickes had reportedly picked up the pace in the final six months of 2018 which in return translated into improved sales in the final three months of the year.
Wickes have suggested that it was benefitting from B&Q’s decision to end its installation service, which gave the business a much needed respite to allow the restructuring efforts to gain momentum.
“This recovery can be attributed mainly to the level of cost reduction that was achieved in the year, with significant reductions in central support services, reduction in shrinkage and efficiency gains in the distribution network, as well as the improved trading in Q4,” Travis Perkins said.
The Travis Perkins company began life in 1797, when the Benjamin Ingram company of joiners and carpenters was founded and Benjamin Ingram subsequently merged with Perkins to become Ingram Perkins
Today, with some 28,000 employees across brands including Wickes, Travis Perkins (general builders' merchant & tools), Benchmarx (trade supplier of kitchens and joinery) plus PlumbNation and consumer brands TileGiant and ToolStation the Travis Perkins Group is a force in the UK KBB and DIY sector so news of its turnaround is welcome relief to the 28,000 employees across the group.