October 19, 2017 / 6:43 AM / a year ago

UPDATE 1-Travis Perkins to meet expectations after step-up in growth

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LONDON, Oct 19 (Reuters) - Travis Perkins, Britain’s biggest supplier of building materials, said it was on track to achieve full year expectations as it reported a step-up in underlying sales growth in its latest quarter.

The group, which trades from over 20 businesses including Travis Perkins, Wickes, BSS, Toolstation and Tile Giant, said like-for-like sales rose 4.1 percent in the third quarter of 2017, having increased 2.7 percent in the first half. Total sales growth was maintained at 3.5 percent.

However, the group said it remained cautious on the market outlook and continued to carefully manage its underlying cost base.

Travis Perkins’ customers include local authorities, big building firms, traders such as plumbers and kitchen fitters and regular consumers, with its fortunes closely tied to housing transactions and consumer confidence.

It said volumes were broadly flat in the quarter with inflation driven price increases the main component of like-for-like growth.

“Trading conditions in our markets continue to be mixed, with consumer discretionary spending under pressure from rising inflation and on-going uncertainty in the UK economy,” said Chief Executive John Carter.

Prior to Thursday’s update analysts’ average forecast for adjusted operating profit in 2017 was 386 million pounds ($510 million), down from 409 million pounds in 2016.

That outcome would be a second straight fall in profit.

Shares in Travis Perkins, flat over the last year, closed Wednesday at 1,472 pence, valuing the business at 3.7 billion pounds. ($1 = 0.7576 pounds) (Reporting by James Davey, Editing by Paul Sandle)

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