Woodie's DIY owner hails 'strong' Irish market
The Woodie's DIY arm of Grafton Group delivered a “strong” trading performance here in the key fourth quarter of 2019 and for the full year overall.
Meanwhile, the merchanting business here saw volumes recover in the “seasonally important” month of November, and the group's Chadwicks business finished the year on a firmer note, according to a trading update from the group.
In the Irish market Grafton expects to report a 6.2pc constant currency increase in revenue for 2019, when compared to the prior year.
Overall, trading across each of Grafton’s markets in November and December was better than the group had expected, and while end markets “remain subdued” Grafton now expects to report full year adjusted operating profit of circa £202m (€235m).
Revenue from continued operations increased by 2.7pc to £2.67bn (€3.1bn) for the 12 months.
However, in the UK households remain “very cautious” about discretionary spending as uncertainty persisted during the last three months of the year, and sentiment continued to weigh on demand in the merchanting market, Grafton said.
The weak markets of September and October continued into November and December but did not deteriorate further.
Grafton’s focus in the UK remains on tight control of costs, driving efficiency and delivering productivity gains.
Elsewhere, in the Netherlands, the impact of softer fourth quarter trading in the merchanting market was largely offset by positive gross margin trends supported by procurement gains and integration benefits.
Gavin Slark, CEO of Grafton Group, said: “2019 was a year of significant strategic progress with the acquisition of Polvo in July which increased our scale and consolidated our market leading position in the Netherlands.
We also reshaped our portfolio of businesses with the successful disposal of Plumbase and the Belgian Merchanting business in October.”
Looking to this year, Mr Slark said that while the group “remain cautious” regarding the timing of a recovery in the UK merchanting market, “our expectations for 2020 are positive for the overall group and we are optimistic about growth opportunities.”
Grafton will release its final results for the year on 27 February.