Business World

Monday 17 June 2019

Woodie's DIY owner expects 2018 earnings to be 'ahead of expectations'

Grafton CEO Gavin Slark
Grafton CEO Gavin Slark
Ellie Donnelly

Ellie Donnelly

Woodie's DIY owner Grafton Group said it expects to report earnings before interest, taxation, depreciation, and amortisation (EBITA) “slightly ahead” of the top end of analyst expectations for 2018.

Compiled analyst forecasts show consensus EBITA for 2018 of £185.1m (€205m), with the top end of the range £188.5m (€208.6m), the group said in a trading update for the year ended 31 December 2018.

The company, which generates the biggest share of its revenue and profits in the UK, reported revenue of £2.95bn (€3.26bn) for 2018, an increase of 8.7pc from £2.72bn (€3bn) in 2017.

Revenue growth in constant currency was 8.4pc, and average daily like-for-like revenue increased by 4.3pc.

The rate of growth moderated in November and December, which the group expected, following above trend growth in September and October. 

In Ireland, where Grafton owns merchanting businesses including Chadwicks and Heiton Buckley, revenue grew 9.3pc in the merchanting division over the 12 month period.

"We are pleased with the strong performance over the year, with contributions from both organic growth and the Leyland SDM acquisition," Gavin Slark, CEO of Grafton Group, said.

"The group continues to benefit from its exposure to multiple geographies and its diverse customer base.  The group's cash generative businesses, strong balance sheet and low level of net debt support our development strategy for the year ahead," he added.

During the year the group also disposed of two small non-core UK businesses which contributed revenue of £40m and EBITA of circa £1.4m in 2018.

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