By Michael Susin

Travis Perkins shares fell after the company swung to a pretax loss, cut its dividend, and reported a disappointing outlook as the backdrop remains challenging.

Shares in European morning trade were down 12% at 486.2 pence and have fallen nearly a quarter since the start of the year.

The U.K. building-materials retailer said Tuesday that its pretax loss for 2024 was 38.4 million pounds ($49.6 million) compared with a profit of 121.4 million pounds a year earlier.

The drop was mainly due to 139 million pounds related to impairments in its stair business Staircraft and certain Merchanting branches and restructuring actions, it said.

Adjusted operating profit--a company-preferred metric that strips out exceptional and other one-off items--was 152 million pounds. This compares with 198 million pounds a year ago, but was ahead of the company's compiled market expectations of around 135 million pounds.

Over the past three years, the company has been struggling with a progressive deterioration in demand due to high inflation, rising interest rates and weak consumer confidence, it said.

The group also said it has become "distracted in a challenging market", with eroding returns, sharp profit declines and increased debts during this period.

Revenue fell to 4.61 billion pounds from 4.84 billion pounds in 2023, in line with market expectations. The result was dragged by price deflation, continued decline in market volumes, and underperformance in the Merchanting segment.

The board declared a dividend of 14.5 pence a share, down from 18.0 pence a share in 2023.

Looking ahead, the company said it expects adjusted operating profit excluding property profits for 2025 to be broadly in line with the 141 million pounds reported for 2024, as the market backdrop remains challenging. This is below market expectations of 171 million pounds.

Travis Perkins said that 2025 has had a mixed start, with continuing challenges in its Merchanting businesses.

"It is encouraging to see a more robust demand backdrop for some elements of the construction market. However, the pace and rate of an overall recovery in construction activity levels remains uncertain and will likely need further cuts to interest rates and an uplift to consumer confidence levels to stimulate a meaningful increase in demand," it said.

Write to Michael Susin at michael.susin@wsj.com

(END) Dow Jones Newswires

April 01, 2025 04:05 ET (08:05 GMT)

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