7th Nov 2013 12:32
LONDON (Alliance News) - Builders merchants and DIY company Grafton Group PLC Thursday said it is on track to report a full-year operating profit in line with its expectations, after reporting a 7.4% increase in revenues during the first ten months of the year as its Irish merchanting business stabilised following five years of volume declines and a UK government scheme helped revitalise the UK housing market.
The owner of brands including Selco, Buildbase and Plumbworld, which last month completed a move to the London market from Dublin in a bid to stimulate more international investor interest, said revenues were GBP1.60 billion up to the end of October, compared with GBP1.49 billion a year earlier.
It said like-for-like sales were up 4.1% in its UK merchanting business in the last four months, 5.6% at its Irish merchanting business, 4.1% at Irish retailing and 25.5% in its small manufacturing business.
The UK merchanting business, which makes up 74% of revenue, reporting a 6.2% rise in total revenue in the first 10 months, as the UK housing market recovery drove sales. It was helped by the opening of two new Selco stores.
"The housing market in the UK is benefiting from Government backed initiatives and confidence is slowly but surely returning," Grafton Chief Executive Gavin Slark said in a statement.
The Irish merchanting business, which has reported declining volumes for five years due to the massive economic downturn and contraction in the construction sector in that country, stabilised, Grafton said. Total revenues are now up 1.1% for the first ten months.
"There were indications in recent months of a recovery in some regional markets led by improved demand in the greater Dublin area, Cork and the Mid-West region," it said in a statement.
However, Irish consumers remain cautious, and revenues at Grafton's Irish retail business are still down 1.7%, despite the pickup in like-for-like sales.
Grafton shares were up 0.6% at 625 pence midday Thursday.
By Steve McGrath; [email protected]; @stevemcgrath1
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