Travis Perkins (LSE:TPK) reported revenue of £2.26 billion for the first half of 2026, a decline of 1.8% from the previous year as UK construction activity remained subdued and following the earlier disposal of its Staircraft business. Despite lower sales, adjusted operating profit increased to £67 million, supported by an £11 million improvement in gross margin and higher gains from property transactions.
Performance varied across the group’s divisions during the period. General Merchant delivered stronger margins through improved pricing discipline and procurement efficiencies, while Toolstation UK achieved growth in both revenue and profitability. Trading conditions in the Benelux remained challenging, although the group’s specialist businesses proved resilient as infrastructure-related demand helped offset weakness in residential new-build markets.
Travis Perkins also strengthened its financial position, ending the period with net cash of £55 million before lease liabilities. Leverage fell to 1.9 times adjusted EBITDA, returning to the company’s target range of 1.5 to 2.0 times and supporting its investment-grade financial profile. The improvement reflected disciplined capital expenditure, effective working capital management and continued optimisation of the property portfolio.
Although operational performance continued to improve, the Board reduced the interim dividend to 4.0 pence per share in line with its policy of distributing between 30% and 40% of earnings. Management expects market conditions to remain broadly unchanged during the second half of the year as the construction sector continues to face weak demand and fluctuating building material costs.
Chief Executive Gavin Slark said the group’s turnaround programme is making encouraging progress, citing greater stability within the senior leadership team and a renewed emphasis on customer service. He added that the stronger balance sheet provides the flexibility to invest selectively while positioning the business to benefit when construction markets recover.
The company’s investment outlook remains constrained by the weaker profitability recorded during 2024 and 2025, together with negative technical indicators, including trading below key moving averages and a bearish MACD. However, stronger operating cash flow, improved free cash flow and moderate leverage provide some support. Valuation remains mixed, with the absence of positive earnings offset in part by a dividend yield of around 2.3%.
More about Travis Perkins
Travis Perkins plc is the UK’s largest distributor of building materials, supplying professional tradespeople and construction businesses through its General Merchant network, Toolstation stores and specialist operations. The company serves a broad range of residential, commercial and infrastructure markets across the UK, with a smaller presence in the Benelux region.
Its business combines traditional builders’ merchanting with trade-focused retail and specialist distribution, making the group an important indicator of activity across the UK construction sector. Alongside its nationwide branch network, Travis Perkins manages an extensive property portfolio and vehicle fleet, using disciplined capital allocation and operational efficiency to support long-term financial performance.
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