Britain's Travis Perkins sees trading improve as markets recover

LONDON (Reuters) - Travis Perkins <TPK.L>, Britain's biggest seller of building materials, upgraded its full-year earnings guidance and reported improved trading in its latest quarter as its markets recovered following the impact of the national coronavirus lockdown.

The group, which trades from more than 20 businesses including Travis Perkins builders merchants and the Wickes home improvement chain, said total revenue fell 3.4% in the three months to Sept. 30, its fiscal third quarter, following a first half decline of 20.2%.

On a like-for-like basis revenue was up 3.9%.

The group said the outcome was driven by a strong recovery in demand across domestic repair, maintenance and improvement (RMI) markets, benefitting the Travis Perkins, City Plumbing, Wickes and Toolstation businesses which serve them.

It said that while local trade activity had recovered well, its trade businesses continued to experience a lag in recovery from larger housebuilding and construction projects.

The group forecast core earnings for 2020 in the upper half of the current range of analysts' expectations of 222-261 million pounds.

That forecast assumes current volume trends continue and that any further lockdown measures do not have a significant impact on the group’s markets.

The pandemic has forced Travis Perkins to restructure. In June it said it would cut around 2,500 jobs.

In March the group put the planned demerger of Wickes on hold until markets become more stable.

Shares in Travis Perkins, down 24% so far in 2020, closed on Wednesday at 1,219.5 pence, valuing the business at 3 billion pounds. They were up 2.2% at 0706 GMT.

(Reporting by James Davey; Editing by Mark Potter)