Builder's merchant cites downturn-related costs of restructuring, lease provisions and asset write-offs and says it is set to weather the storm
Full-year profit at builder's merchant and DIY store Travis Perkins slumped 22.5% in 2008, the firm has announced. Profit before tax and charges was £202.5m.
The firm said it had “incurred an exceptional charge of £56.2m associated with the severe downturn in the construction markets.” The charge, explained the firm, included a cost of redundancy and reorganisation (£10.5m), property lease provisions (£39.5m) and asset write-offs (£6.2m).
Covenantable net debt stood at £1.02bn. “Covenantable net debt is calculated after eliminating the £80.2m impact of an exchange rate movement that is offset by an equal and opposite debit balance in fixed assets,” the firm said.
Geoff Coopers, chief executive, said the group had been prepared for the problems ahead in the “unusually challenging” economic environment.
“We took early action in 2008 to deal with the increasingly tough trading environment and have set our business ready to manage continuing difficult market conditions in 2009,” he said.
The businesses “continue to outperform competitors,” added Cooper, pointing out that some rivals had closed.
Travis Perkins said the firm had cut net debt by £14.9m during 2008 and pledged to reduce it by a further £125m in 2009.
The firm confirmed it will not be paying a final dividend.