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RNS Number : 3933Q Grafton Group PLC 10 July 2025
Grafton Group plc
Trading Update
Grafton Group plc ("Grafton" or "the Group"), the international building
materials distributor and DIY retailer, issues this trading update for the
period from 1 January 2025 to 30 June 2025 ("the period") ahead of the release
of the half year results on 4 September 2025.
Trading and Performance
Grafton traded in line with expectations in the period, with Group revenue of
£1.25 billion (2024: £1.14 billion), 10.1 per cent higher than the prior
year and up 11.1 per cent in constant currency. Group revenue reflects six
months of trading from Salvador Escoda in Spain, which was acquired on 30
October 2024, and one month's trading from the acquisition of HSS Hire
Ireland, which completed on 31 May 2025. All our businesses had one fewer
trading days compared to the same period in the prior year, except for the
Netherlands, Spain and Finland, which each had two fewer trading days.
Group average daily like-for-like revenue for the first half of the year was
2.4 per cent higher than the prior year. Following a slow start to the year,
trading activity gained momentum but eased from mid-May and into June,
coinciding with a spike in global uncertainties which may have impacted
customer confidence. We will continue to closely monitor trading patterns
over the summer months.
The following table shows the changes in average daily like-for-like revenue
for the period from 1 January 2025 to 30 June 2025 compared to the same period
in the prior year.
Segment Average Daily Like-for-Like Revenue Change
in Constant Currency
1 January to
30 June
2025 v 2024
Distribution
- Ireland 3.7%
- UK 0.2%
- Netherlands 2.8%
- Finland (4.2%)
Retailing 7.6%
Manufacturing 5.2%
Group 2.4%
Distribution
In Ireland, Chadwicks delivered like-for-like revenue growth of 3.7 per cent
in the period as trading activity continued to recover from the impact of
Storm Éowyn in January. The outlook for growth in the construction sector
remains positive, supported by strong policy continuity and backing from the
new Government to boost housing completions. However, persistent external
challenges, including planning delays, utility connection issues, and labour
shortages, continue to constrain the pace of supply expansion. The
integration of HSS Hire Ireland is underway with initial trading in line with
expectations.
Average daily like-for-like revenue in the UK was 0.2 per cent higher in the
period supported by a slight pick up in product price inflation to c. 2 per
cent. RMI demand remains soft, especially in and around the London area, as
consumer confidence remains weak. However, the medium-term fundamentals
remain positive, underpinned by the UK Government's plans to significantly
increase new housing activity.
In the Netherlands, average daily like-for-like revenue increased by 2.8 per
cent during the period, primarily driven by strong branch-related sales
supported by growth from sales to national key accounts.
In Finland, IKH's average daily like-for-like revenue declined by 4.2 per cent
in the first half, with performance significantly weaker in May and June. We
were delighted to appoint Anu Ora as the new CEO of IKH with effect from 1
June. Anu is a highly experienced business leader who, together with recent
appointments to the senior management team, will be focused on further
strengthening and developing IKH's proposition in the marketplace.
In Spain, the integration of Salvador Escoda, a leading national distributor
operating in a highly fragmented market, continues to progress well. On a
pro-forma basis, average daily like-for-like revenue in the period was up 6.9
per cent, supported by the timing of strong project-related sales and
favourable market conditions.
Retailing
Woodie's DIY, Home and Garden business in Ireland had a strong start to the
year with average daily like-for-like revenue up 7.6 per cent in the period
helped by growth in both the number of transactions and average transaction
values.
Woodie's focused customer proposition supported strong growth across its
business as consumer spending remained resilient in Ireland despite
macroeconomic uncertainties. Favourable weather conditions underpinned a
particularly strong performance in plants and garden related products with
some seasonal demand pulled forward into the spring trading months.
Manufacturing
In Manufacturing, average daily like-for-like revenue was 5.2 per cent higher
compared with the same period last year.
CPI EuroMix reported positive sales growth in the period supported by
increased volumes from its housebuilding customers on existing sites.
Although momentum slowed in the second quarter, the medium-term outlook
remains positive, supported by anticipated interest rate cuts and ongoing
government efforts to boost housing supply.
StairBox experienced good sales growth in the first half although demand in
the RMI market in the UK remains relatively weak.
Share Buyback
A sixth programme was launched on 6 March 2025 to buy back ordinary shares in
the Company for an aggregate consideration of up to £30 million. This
programme completed on 8 July 2025 and involved the repurchase of 3.29 million
ordinary shares.
Cash of £403.3 million has been returned to shareholders through share
buybacks completed between 9 May 2022 and 8 July 2025 reflecting the
repurchase of 46.54 million ordinary shares at an average price of £8.67 per
share. The number of shares bought back by the end of the sixth programme
amounted to 19.4 per cent of the shares in issue when the first buyback
programme commenced.
Outlook
As anticipated, many of our markets remain challenging and we are not
expecting a significant increase in volumes this year. Our experienced
management teams continue to actively manage both gross margin and our cost
base through-the-cycle and position our market leading brands to provide a
strong value proposition to customers.
Despite macroeconomic uncertainty, the medium-term outlook for Grafton remains
positive, supported by housing shortages across all our markets and an
anticipated recovery in RMI demand. We continue to invest in and strengthen
our market positions supported by a robust balance sheet and strong cash flow
generation.
Eric Born, Chief Executive Officer of Grafton Group plc commented:
"We are pleased that our trading performance was in line with our expectations
for the first half. Trading activity recovered strongly after a subdued
start to the year however there was a slow down in momentum from mid-May and
into June as a spike in geopolitical uncertainty appeared to dent consumer
confidence in the period. Though we remain cautious about the timing of a
broader recovery, particularly in the UK and Finland where markets remain
challenging, we remain very well positioned to capitalise on our market
leading positions as the cycle turns.
"The integration of our platform acquisition, Salvador Escoda, in Spain is
progressing apace, with continuing scope to leverage its scale and national
presence in what remains a highly fragmented market. We successfully
completed the bolt-on acquisition of HSS Hire Ireland in the first half of the
year which will broaden the offering of our Chadwicks business in the Republic
of Ireland.
"We continue to actively evaluate growth opportunities in all our markets and
to strengthen our position both organically and, where appropriate, by
acquisition using the strength of our free cash flow conversion and balance
sheet."
Ends
For further information please contact:
Investors Media
Grafton Group plc +353 1 216 0600 Murray pwalsh@murraygroup.ie (mailto:pwalsh@murraygroup.ie)
Eric Born Chief Executive Officer Pat Walsh +353 1 498 0300/+353 87 226 9345
David Arnold Chief Financial Officer
Burson GraftonGroup@buchanancomms.co.uk
Buchanan
Helen Tarbet +44 (0) 7872 604 453
Simon Compton +44 (0) 7979 497 324
Toto Berger +44 (0) 7880 680 403
About Grafton
Grafton Group plc is an international distributor of building materials to
trade customers and has leading regional or national positions in the
distribution markets in the UK, Ireland, the Netherlands, Finland and Spain.
Grafton is also the market leader in the DIY, Home and Garden retailing market
in Ireland and is the largest manufacturer of dry mortar and bespoke timber
staircases in the UK.
Grafton trades from c. 470 branches and has c. 10,000 colleagues. The Group's
portfolio of brands includes Selco Builders Warehouse, Leyland SDM, MacBlair,
TG Lynes, CPI EuroMix and StairBox in the UK; Chadwicks and Woodie's in
Ireland; Isero and Polvo in the Netherlands; Salvador Escoda in Spain and IKH
in Finland.
For further information visit www.graftonplc.com (http://www.graftonplc.com)
Forward-looking statements
This press release may include forward-looking statements. These
forward-looking statements can be identified by the use of forward-looking
terminology, including the terms "outlook," "believe(s),"expect(s),"
"potential," "continue(s)," "may," "will," "should," "could," "would,"
"seek(s)," "predict(s)," "intend(s)," "trends," "plan(s)," "estimate(s),"
"anticipates," "projection," "goal," "target," "aspire," "will likely result"
and other words and terms of similar meaning or the negative versions of such
words or other comparable words of a future or forward-looking nature. These
forward-looking statements include all matters that are not historical facts
and include statements regarding Grafton's or its affiliates' intentions,
beliefs or current expectations concerning, among other things, Grafton's or
its affiliates' results of operations, financial condition, liquidity,
prospects, growth, strategies and the industries in which they operate. By
their nature, forward-looking statements involve risks and uncertainties
because they relate to events and depend on circumstances that may or may not
occur in the future. Readers are cautioned that forward-looking statements are
not guarantees of future performance and that Grafton's or its affiliates'
actual results of operations, financial condition and liquidity, and the
development of the industries in which they operate may differ materially from
those made in or suggested by the forward-looking statements contained in this
press release. In addition, even if Grafton's or its affiliates' results of
operations, financial condition and liquidity, and the development of the
industries in which they operate are consistent with the forward-looking
statements contained in this press release, those results or developments may
not be indicative of results or developments in subsequent periods. The
directors do not undertake any obligation to update or revise any
forward-looking statements, whether because of new information, future
developments or otherwise.
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