BMF
KPI Report For the 12 months ending April 2016
Key Performance Indicators Benchmarks for the UK Builders Merchants Sector BMF Business Reporting
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BMF KPI REPORT For 12 months ending April 2016 2013
Overview Slower Growth yet still Confidence in the Market The BMF’s Key Performance Indicators Report for 2015/16 indicates how the trading performance of builders merchants fared over the twelve months ending April 2016 compared with the two previous years. The building materials market during the period of this report has had strong growth. The BMF Sales Indicators reported that for the 12 months ended April 2016 compared with the previous 12 month period, total sales by merchants had increased by 6.2%. A strong positive sales growth figure of an 8.4% increase is also seen in the sales increase/decrease graph in this report. Compared with April 2015, output in the construction industry decreased by 3.7% in April 2016. The underlying pattern as suggested by the 3 month on 3 month movement in output in the construction industry decreased by 2.1%. There was a decrease of 3.3% in all repair and maintenance compared with the same period last year; housing and non-housing repair and maintenance reported decreases of 4.2% and 2.5% respectively. However on the year, total housing increased by 0.9% compared with April 2015. The main contributor was private new housing which increased by 5.8%, offset by public new housing which decreased by 20.7%. This was the 12th consecutive period of year-on-year decreases in public new housing. [Source: ONS 2016] The report shows that: • Growth of 8.4 % as reflected in the report still proves the market is strong and continued expansion from new branches and company acquisitions is still occurring however not at the pace it was in the last two years. • Trading Margins at 31.0% had decreased by 0.1 percentage point from last year. • Percentage sales from stock are following the same trend as in previous years declining 0.7 percentage points from last year. Therefore the proportion of direct sales followed the same trend as in previous years and increased by 0.7 percentage points. • Small increase in net profitability of 0.2 percentage point • Small decrease in salaries as % of gross profit of 0.4 percentage points. • Number of employees increased however sales did not increase as much as in previous years and therefore sales per employee decreased by 0.3%. This affected gross profit employee which decreased by 0.5%. However average cost per employee decreased by 1.5%, possibly because less bonuses were paid out due to lower performances when compared to last year.
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• Lower oil prices could explain why transport costs overall decreased by 0.2 percentage point for the second consecutive year. However Heavyside and Lightside Transport costs have increased by 1.2 percentage points and 0.1 percentage points respectively compared to last year. This increase in operating costs show that companies are paying more to retain their drivers which has been offset in the fall in diesel price. • Debtor Days were also decreased with a year on year fall of two day in the last two years to 48.
These numbers are based on the most recent publication at financial year ends but subsequent to the formulation of this report some members are reporting an easing off in the market however members remain cautiously optimistic. The figures within this report cover the period prior to ‘Brexit’ and therefore it will be interesting to see how the market reacts to the results from the EU referendum.
John Newcomb, Managing Director of the BMF, said:
“Economic and political uncertainty in the run-up to the EU referendum was expected to cause a slow-down in the construction sector.
However, sales data from our builders’ merchant members is telling a very different story. 2015/16 sales were up on last year and the merchant market experienced an 8.4% increase between April 2016 and April 2015.
We are confident that our members will continue to perform strongly, and the BMF will work with the Government to ensure the best outcomes for our members as the Brexit deal is negotiated.”
Methodology The BMF 2016 Key Performance Indicators Survey was carried out among BMF merchant member companies in mid-2016. Member’s returns covered the periods to their year ends that fell between 1 May 2016 and April 2016. It should thus be noted that the results are not for the full 2016 calendar year. The following ratios are a selection from the full survey findings. They give a bench mark of how the merchanting sector performed. The BMF Key Performance Indicator Report uses a core sample of participants that enables a true like for like comparison with previous year’s ratios. This core sample for 2016 has been further revised and enlarged from last year. This has caused the results for previous years to have changed from those stated in previous reports.
BMF KPI REPORT For 12 months ending April 2016
Percentage difference between total sales for current year and sales for the previous year
8.4%
Percent Increase/Decrease
Sales Increase/Decrease 18 16
Unadjusted sales were down at 8.4%, a reduction of
15.0% 13.5%
6.6 percentage points.
14 12
8.4%
10 8
% points 2015/16 v 2014/15
4 2 0
2013/14
2014/15
Percent Increase/Decrease
31.0%
Gross margins reduced by 0.1 points compared to the previous
33
31.1%
32 31
31.0%
30
% points 2015/16 v 2014/15
29
Percent Increase/Decrease
- 0
1
28
2014/15
2015/16
Sales from Stock
82.5%
year.
30.5%
2013/14
Ex stock sales as a percentage of total sales
6
2015/16
Trading Margins Gross Margins as a percentage of total sales
- 6
The proportion of ex-stock sales to total sales decreased by 0.7 85
percentage points compared with
84.3%
2014/15.
84
83.2% 82.5%
83
% points 2015/16 v 2014/15
82
81
2013/14
2014/15
- 0
7
2015/16
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BMF KPI REPORT For 12 months ending April 2016 2013
Sales Direct
17.5%
Percent Increase/Decrease
Direct sales as a percentage of total sales
The proportion of direct sales 17.5%
18
16.8% 15.7% 16
% points 2015/16 v 2014/15
15
14
2014/15
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Net profit after interest improved
Net profit after interest as a percentage of total sales
5.5
4.8%
5.0%
by 0.2 percentage points.
Percent
5.0 4.5 4.0
3.6%
% points 2015/16 v 2014/15
3.5 3.0
2013/14
2014/15
+ 0
2
2015/16
Bad Debts
Bad debts as a proportion of credit sales reduced by 0.01
Bad debts as a percentage of credit sales
percentage points compared with
Percent
0.55
0.5
2014/15. 0.47%
0.43%
0.45
0.42%
0.4
2013/14
4
+ 0
2015/16
Net Profitability
0.42%
percentage points compared with 2014/15.
17
2013/14
5.0%
to total sales increased by 0.7
2014/15
2015/16
% points 2015/16 v 2014/15
- 0 01
BMF KPI REPORT For 12 months ending April 2016
Salaries as % of Gross Profit Salaries and related costs as a percentage of gross margin
a percentage of gross margin
50 49
Percent
46.9%
Salaries and related costs as decreased by 0.4 percentage
49.8%
points over 2014/15.
47.3%
48
46.9%
47
% points 2015/16 v 2014/15
46 45
2013/14
2014/15
decreased by 0.3% over £202,525
210
1000’s
£201,857
Sales by each employee
220
200
£201,857
2014/15.
£186,645
190
% 2015/16 v 2014/15
180 170
2013/14
2014/15
- 0
3
2015/16
Profitability of each employee
Gross Profit per Employee Gross profitability of each employee
4
2015/16
Sales per Employee Total sales by each employee
- 0
decreased by 0.4% over 2014/15.
65
£62,915
£62,614
60
1000’s
£62,614
£56,971 % 2015/16 v 2014/15
55
- 0
5
50
2013/14
2014/15
2015/16
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BMF KPI REPORT For 12 months ending April 2016 2013
Average Cost per Employee Salary and wages costs of each employee 1000’s
£29,345
employee decreased by 1.4%
30
29
The average payroll cost per £29,789
£29,345
£28,379
28
% 2015/16 v 2014/15
27
2013/14
2014/15
Percent
8.9%
9.1%
all merchants decreased by 0.2 percentage points compared with
9.1% 8.9%
2014/15.
9.0 8.5
% points 2015/16 v 2014/15
8.0 7.5
2013/14
2014/15
- 0
2
2015/16
Transport Costs – Mixed
Mixed merchants’ transport
Road transport costs for mixed merchants as a percentage of delivered sales
percentage points compared with
8.5
Percent
7.2%
costs remain decreased by 0.6 2014/15.
8.1% 7.8%
8.0
7.5
7.2%
7.0
2013/14
6
5
Road delivery costs overall for
10.0 9.5
- 1
2015/16
Transport Costs Overall Road Transport costs for all merchants as a percentage of delivered sales
over 2014/15.
2014/15
2015/16
% points 2015/16 v 2014/15
- 0
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BMF KPI REPORT For 12 months ending April 2016
Transport Costs – Heavyside
costs rose marginally over
17.0 16.0
Percent
Road transport costs for Heavyside merchants as a percentage of delivered sales
Heavyside merchants’ transport
14.6%
2014/15 by 1.2 percentage 16.6%
14.6% 13.4%
14.0
% points 2015/16 v 2014/15
13.0 12.0
2013/14
2014/15
2
Lightside merchants’ transport costs increased slightly by 0.1
6.7%
percentage points over 2014/15.
6.7
Percent
6.5%
6.8
+ 1
2015/16
Transport Costs – Lightside Road Transport costs for all Lightside merchants as a percentage of delivered sales
points.
15.0
6.6
6.5%
6.5
6.4%
% points 2015/16 v 2014/15
6.4 6.3
2013/14
2014/15
+ 0
1
2015/16
Debtors outstanding days were
Debtor Days
reduced by 2 days over 2014/15
Trade debtor days outstanding
53
52
52
50
Days
51
48 days
50
48
49 48 47
2013/14
2014/15
days 2015/16 v 2014/15
- 2
0
2015/16
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BMF KPI REPORT For 12 months ending April 2016 2013
The 15 ratios within this document are just highlights from the findings of the full BMF KPI Report which are available exclusively to BMF Members. The Builders Merchants Federation Ltd (BMF) is the only trade association representing and protecting the interests of builders’ merchants and suppliers to the merchanting industry in the UK. Total membership at 1 September 2016 stands at 560 merchant and supplier companies who together have combined sales of over £22bn and employ over 109,000 people in the building materials industry. BMF’s 300+ merchant members operate in around 4,500 branches across the UK.
Head Office 1180 Elliott Court, Coventry Business Park Herald Avenue, Coventry CV5 6UB Tel: 02476 854980 Fax: 02476 010390 Email: info@bmf.org.uk www.bmf.org.uk
© The Builders Merchants Federation, 2016. MF863
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