Grafton Group, the parent company of DIY retailer Woodie’s, said full-year operating profit would be in line with expectations as the company maintained a strong financial position, and flagged a new £100 million share buyback programme.
In a trading update for the period between July 1st and October 31st, the group said average daily like-for-like revenue was slightly stronger year on year, rising 1.8 per cent compared with 2021. However, measured against pre-pandemic figures, the growth was more pronounced, rising more than 17 per cent.
Group revenue from continuing operations, which excludes the traditional merchanting business in Britain that was sold at the end of last year, was 9.5 per cent higher at £1.93 billion over the 10 months to October 31st, 2022. In 2021, that figure was £1.76 billion and, pre-pandemic, in 2019, it was £1.39 billion.
More than half of the revenue is now accounted for by the business in Ireland, the Netherlands and Finland, with favourable first-half revenue trends in the distribution businesses in Ireland and the Netherlands continuing. Chadwicks in Ireland continued to operate at high activity levels, with the market showing significant price inflation.
The UK business saw softer trading as households reduced discretionary spending on home improvements.
In the DIY sector, trading normalised in line with the prior year, with like-for-like revenue down 0.2 per cent. However, it was up more than 21 per cent on pre-pandemic levels. Demand in Woodie’s DIY, home and garden business in Ireland remained strong.
Grafton is set to launch another share buyback programme, with a value of up to £100 million, following the completion of its previous programme in September.
There are further changes ahead for the company, with chief executive Gavin Slark stepping down at the end of the month, with Eric Born appointed to succeed him.
“Grafton delivered a solid performance in the period, demonstrating the benefit of its balanced spread of operations across geographic markets and sectors. Notwithstanding macroeconomic challenges, particularly in the UK, the Group is confident that it will deliver its expectations for the year,” Mr Slark said. “Grafton is in a very strong financial position, enabling the Group to increase returns to shareholders through a new share buyback programme announced today, which is our second buyback programme of 2022, whilst also retaining the financial flexibility to fund suitable acquisition opportunities.”
