25th Feb 2021 10:26
(Alliance News) - Grafton Group PLC on Thursday reported a "resilient" performance throughout 2020 despite falls in revenue and profit.
The Dublin-based building materials distributor and DIY retailer recorded revenue of GBP2.51 billion, a 6.1% drop from GBP2.67 billion in 2019.
Pretax profit for 2020 was GBP166.4 million, a decrease of 7.4% from GBP179.5 million in 2019.
Grafton said the worsened results reflect the heavy impact of branch closures in the first half of the year in response to the Covid-19 pandemic. Chadwicks, its Irish distribution business, noted the recovery in house building progressed through the second year-half, while the non-residential construction market remained "weak".
Back in August, Grafton had decided to suspend dividend payments as a precautionary measure to preserve liquidity. In January, it said it would reinstate the 12.5 pence second interim dividend that had been due to be paid last April, and this was paid on February 19.
The 12.5p second interim payout replaced a final dividend for 2019 and took that year's total to 19.0p, which was up 6% from 18.0p the year before. Grafton followed this by declaring a 2020 final dividend of 14.5p on Thursday, to be paid in May. It paid no interim dividend for 2020, so 14.5p is the total for 2020.
Shares in Grafton were down 0.6% at 980.50 pence in London on Thursday.
"Grafton today is a stronger, more resilient, more digitally and sustainability savvy business than it was before the outset of the Covid-19 pandemic. That evolution reflects not just the commitment and hard work of our colleagues and the agility and resolve of our businesses in a challenging year, but also our multi-year transformation and investment journey principally targeting the more resilient construction sectors of repair, maintenance and improvement, underpinned by an improved customer proposition across all of our businesses," said Chief Executive Gavin Slark.
Looking ahead, Grafton said it expects to see "modest" revenue growth in the current year. This is due to construction activity being allowed to continue in the UK despite the Covid-19 restrictions imposed on other parts of the economy and the group's branches continuing to trade, it noted.
"We are very encouraged by the group's strong performance through the second half of last year and while we remain cautious about first year-half revenue trends in our markets in light of Covid uncertainty, we expect to make further progress in the current year and are confident that our 11,000 colleagues will continue to deliver for our customers. We finished last year in an excellent financial position that provides a strong platform for the future growth and development of our group," Slark added.
By Zoe Wickens; [email protected]
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