The new boss of Travis Perkins has said the building supplies firm has allowed itself to become “distracted” as the group slashed its profit outlook for the second time in three months after another hefty sales fall.
Pete Redfern – the former chief executive of housebuilder Taylor Wimpey, who took on the role heading Travis last month – said he would also take direct control of the general merchant division, which has been hit particularly hard by trading woes, alongside the top job as part of turnaround efforts.
Travis, which also owns the Toolstation chain, reported a 6.8% drop in like-for-like revenues over the third quarter, with sales at the general merchant arm down 8.2%.
It is clear that the group has allowed itself to become distracted and overly internally focused which has led to the underperformance in recent periods
It cut its outlook for full-year underlying operating profits to around £135 million after the third quarter woes, having only trimmed it in August to about £150 million.
Mr Redfern said: “It is clear that the group has allowed itself to become distracted and overly internally focused, which has led to the underperformance in recent periods.
“We now need to get back to a focus on operational execution.
“My immediate priorities are driving and incentivising branch-led performance and motivation, identifying further ways to make the business run more efficiently, and ensuring that we turn and face the anticipated recovery in the UK construction market.
“During this important period, I will combine the roles of group chief executive and managing director of the Travis Perkins General Merchant business.
“This will allow me to shorten reporting lines and develop our new strategy, working closely with the operational leaders of this business as well as the group leadership team.”
Shares in the firm fell as much as 7% in early trading on Thursday after the profit alert.
Travis has been taking action to make its organisation more efficient and trim costs over the past year, including cutting staff in its head office and regional branches, while it is also closing its loss-making Toolstation business in France.
It has also moved to shut down two Toolstation warehouses in Bridgwater, Somerset, and Daventry, Northamptonshire.
