Summary of H122 results: Travis Perkins H122 adjusted operating profit declined by -0.6%, a 9% miss versus consensus estimates due to higher than expected inflationary pressures including fixed-cost inflation and utility cost pressures in the Toolstation division not fully compensated by resilient trends in the core merchanting division. Key news: Whilst management is calling for improving trends in H222 as the comparison effect normalises in H2 vs. H1 and RMI activity remains firm, lower profitability and margins for Toolstation has led the group to increase its net loss expectation for the business to GBP30m from GBP20m previously. Although group guidance for FY22 is to deliver a performance in-line with market expectations, we see increased risk of consensus earnings downgrade with adjusted operating profit likely to reduce by around 10-15m towards GBP340m from GBP353m pre-results. We forecast GBP337m 2022 adjusted operating profit. Earnings: We trim our FY22 EPS by -7% and by -2% after integrating the miss and lower profitability for Toolstation not fully compensated by the stronger buyback programme in 2022. Rating and target price: We reiterate our Outperform rating but trim our target price to GBp1,300/share after integrating a higher cost of capital amid increased macroeconomic uncertainty. Our target price is derived using a 8.5% FCF yield ex-growth capex in 2023 (discounted back one year at 10%) vs. 7.5% previously. Investment case: A successful turnaround story with attractive FCF generation and a capital return focused mind-set.