Grafton Group reports healthy start to the year

Building materials group Grafton has reported a positive start to the year with revenues for the four months to the end of April up 13 per cent to £654 million.

This compares to revenues of £576 million for the same period a year earlier.

Grafton, which has operations in Britain, Ireland and Belgium and owns the Woodie’s DIY retail chain said underlying revenues were up almost 11 per cent versus the first four months of 2013. Like-for-like revenues rose 11.4 in Ireland and were up 9.9 per cent and 15.8 per cent in the UK and Belgium respectively.

In an interim management statement issued ahead of the group’s annual general meeting in Dublin, Grafton said profitability for the period to the end of April was “significantly ahead of last year.”

“The Group remains in a strong financial position supported by the underlying cash generation from operations, low levels of debt and significant resources at its disposal in the form of cash and undrawn bank facilities,” it said.

Grafton said its UK Merchanting business, which accounts for three quarters of Grafton’s revenue, recovered from the weather-related set-back that impacted on the business in early 2013. It also benefited from a recovery in the new build housing market and increased growth in the home improvements sector.

The group said recovery in its Irish Merchanting business gathered pace from the very low levels of the downturn with evidence of a pick-up in activity.

Grafton’s DIY retailing business in Ireland also had a positive start to the year due to a higher demand for season products. However, it said that despite a rise in consumer sentiment, the recovery in core retails sales had been moderate due to continuing pressure on disposable incomes.

"We have had a positive start to the year against weak comparables from 2013. We are encouraged by the economic recovery and the continuing improvement in our principal markets and we look forward to building on the progress to date through volume growth in our markets, internal initiatives and an ongoing focus on efficiencies, said chief executive Gavin Stark.