Travis Perkins Group, the DIY to builders merchant group, is to reign in its expansion in 2009 unless landlords are more ‘realistic’.

In its interim results this morning for the six months to the end of June it said its expansion programme will be reduced.


Property market looks backwards
Travis Perkins’ group property director Martin Meech, said: ‘The property market takes longer to react. The monthly rents argument is a classic example. The property market looks backwards at historic evidence in terms of rent reviews and valuations where as retailers look forward at where the market is going. We are still opening and committed to stores in 2009 but all new stores will be on new, more realistic terms.'

He added: ‘Store openings in 2009 will be down on 2008. There is no target for 2009 and it depends on whether the property market adjusts and whether the schemes we have committed to actually get built.’

'Significant reduction in expansion'

In a statement to the stock exchange this morning Travis Perkins said: ‘Our disciplined approach will lead to a significant reduction in our rate of expansion, with only previously approved projects already in our pipeline providing further expansion of our network in 2008 and 2009.’

The group, which runs chains including Wickes, trades from 1,206 locations. It acquired Toolstation chain this year which added a further 20 branches bringing the total number of new stores in 2008 to 101 stores.

Pretax profit down

In its results, pretax profit was down 3.2% to £124.5m from £128.6m but revenue was up 5.4% to £1.6bn. It experienced like-for-like sales growth of 0.8% and an operating profit up 0.2% to £156m.

The group is continuing to seek planning permission to develop trade parks on its existing landbank, as revealed by Property Week in August 2007.

It now has planning permission for trade parks in eight locations including sutton and Solihull.

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