Building merchant's half-year profit falls 3.2% despite increasing market share in merchanting and retail

Travis Perkins has warned of a decline in trading in the second half of 2008 after it revealed a 3.2% fall in profit for the six months to 30 June 2008.

The building merchant, which owns the Wickes home improvement chain, said pre-tax profit fell to £124.5m

It said that it would employ 1,300 fewer people than planned by the end of 2008.

The group said that the slowdown in the housing market would result in faster than expected slowdown in the RMI market in the second half of 2008 and 2009. It said activity levels had been strong in the government and commercial construction sectors.

The groups said product cost inflation had risen by 4.9% in its merchanting division and 1.8% in its retail division.

The group said it increased first-half sales by 4.7% in its merchanting divsion and 6.3% in retail. This was despite activity levels falling about 5% in the overall merchanting market and 7% in the retail sector.