Strong performance from Grafton Group in the first six months of 2017
The performance was helped by growth in the Irish and Dutch market
Grafton Group builders has announced a strong performance for the first half of 2017.
Group revenue increased by 6.2pc in constant currency to £1.34bn (€1.52bn) in the six months to 30 June 2017, according to the groups trading update.
In its merchanting segment, which accounts for 92pc of group revenue, its Selco stores reported double digit revenue growth driven principally by the rollout of new branches.
The builders warehouse chain now trades from 54 branches and remains on course to open at least 10 new branches this year.
The international distributor of building materials performed especially well in Ireland and the Netherlands where total revenue grew 10.6pc and 38.1pc respectively in constant currency terms in the six months to June 2017.
The residential market in Ireland continued to register good volume growth and the recovery in the residential and commercial new build markets gathered pace.
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Similarly there was good growth in the Dutch economy and increased house building and housing transactions.
"We are pleased with the group’s first half trading performance which was better than we anticipated and provides a good platform for the full year.
We expect to continue to benefit from both our strong market positions and exposure to multiple geographies and for the positive trends in the Irish and Netherlands businesses to continue in the second half," Gavin Slark, Chief Executive Officer of Grafton Group, said.
Meanwhile the traditional UK merchanting businesses reported good like-for-like revenue growth and also benefited from the restructuring implemented in the last quarter of 2016.
However the company did issue a warning in respect of the UK market, saying that they were "cautious" about the shorter term impact of what it described as "current uncertainty and pressure on real incomes" which the company said may temper growth in spending on housing RMI.
In its revenue segment - which accounts for 6pc of its overall revenue - Grafton recorded strong growth in the Woodie’s business which was driven by employment and incomes growth and, what the group said was, a focus on improving the shopping experience for customers.
Monthly revenue trends in the second quarter were markedly influenced by the timing of Easter and demand for seasonal products.
The group generated a profit of approximately £2.0m in the first half of 2017 from surplus property disposals and full year property profit is expected to be around £3.0m.