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UK DIY News

Retail market may boom as consumers face spending review

The boss of Travis Perkins, owner of the Wickes DIY chain, has said next week's Comprehensive Spending Review could boost the retail market because it will allow consumers to "come to terms" with the scale and shape of public spending cuts.

Geoff Cooper said the "uncertainty" around spending cuts had been reflected in the retail market all year. "I think since the election people have been second guessing the spending cuts," the Travis Perkins chief executive said. "It has been difficult to open a newspaper without hearing about them. We need to get it [the review] out so people can come to terms with it and get on with their lives."

A trading update from Travis Perkins yesterday revealed like-for-like sales per trading day at Wickes were down 0.1pc in the 39 weeks to October 2. This compares to 7.1pc like-for-like growth in Travis Perkins' builders' merchant division, where increased activity from housebuilders boosted the company.

However, despite the growth Mr. Cooper stood by his previous warnings about "false starts" in the economic recovery, cautioning that there will be "a bit less building" by residential developers this winter as the industry battles with an overhaul of planning regulations.
"It is important not to get carried away with short-term indicators," he said. Shares in Travis Perkins fell 9½, or 1pc, to 854½p following the statement, which showed overall sales were up 6pc.

The company has agreed to buy rival BSS for £557.6m and is expecting the takeover to be cleared by the Office of Fair Trading next week.

Source : Graham Ruddick - Telegraph.co.uk

12 October 2010
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