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Travis Perkins to cut costs following grim outlook

Builders' merchant Travis Perkins said today it is considering writing down the value of some of its assets as the company warned it was facing “more difficult conditions”.

In a trading statement today bosses said like for like turnover per day for the first nine months of 2008 in its merchanting division was down by 1.2 per cent.

But for both September and October it had deteriorated sharply by 10 per cent.

Trading at its Wickes business is also getting worse, with like for like sales per trading day down 2.6 per cent in the nine months to late September, with core products down 2.6 per cent and showroom sales 2.5 per cent lower.

The group is hoping to cut costs by £65 million by the end of the year and reduce capital expenditure to under £140 million in 2008 and no more than £50 million in 2009.

It will also consider writing down the value of some of its assets.

A statement said: “In recent weeks, trading has been below earlier expectations with both the merchanting and retailing businesses experiencing more difficult conditions as sentiment in construction markets has reacted to the extraordinary turmoil in financial markets.

“This, together with continuing negative trends in leading indicators, leads us now to expect a more rapid decline in market activity, although our view of the scale of the likely downturn has not materially changed.”