Wickes sales slide after rush to beat VAT rise
Sales of kitchen and bathrooms at DIY chain Wickes slumped by more than a third this month, after tradesmen rushed to buy materials ahead of January’s VAT rise, builders’ merchant Travis Perkinssaid today chief executive Geoff Cooper said that smaller tradesmen working on houses had stocked up before VAT was hiked to 20%. Increased competition from rivals also meant sales were down 36% on last year, so far in February.
Kitchens and bathrooms only account for around 5% of the company’s turnover and it saw a strong start to the new year overall as building activity brought to a halt by December’s snow was pushed forward to January.
Like-for-like sales across the group were up 11% so far in 2011, Cooper added.
Travis expects merchanting to drive business in 2011 rather than Wickes, where sales edged forward 0.2% in a DIY market which declined around 6% last year.
Merchanting sales are still around 20% below their pre-recession peak and the firm expects a “gradual recovery”.
Cooper added: “Retail will be more difficult this year as people have not got a lot of money now, but we may see more people looking to improve their homes.”
Pre-tax profits were up 20% to £217 million, with shares adding 5p to 1044p.
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