DAVY VIEW

Travis Perkins’s (TPK) trading statement is notable as it is the first update since Pete Redfearn recently started as CEO. To no surprise, the update confirms that end-market conditions remained challenging during Q3 but with the added disappointment that the performance of the Merchanting division deteriorated. This has prompted a further cut of full year adjusted operating profit guidance and this is likely to result in a circa 10% cut to full year consensus estimates. If there was any doubt that TPK needed a reset and a change of direction, the latest cut to expectations underlines this.