Revenue at Grafton Group fell 5 per cent in the early months of 2024, as bad weather, macroeconomic concerns and price deflation weighed on the company.
The building materials company, which owns the Woodies DIY and Chadwicks brands here, said group revenue between January 1st and April 24th was £669.2 million (€782 million), down 5 per cent year on year. Like-for-like revenue fell 4.5 per cent. The group said exceptionally wet weather in the UK and Ireland was in part to blame for a fall-off in demand, and said overall activity in the group’s businesses remained subdued.
Woodies DIY had a more positive start to the year, with revenue growing despite challenging market conditions. Chadwicks saw materials price deflation of around 6 per cent but benefited from an improving trend in volumes and a favourable macroeconomic backdrop.
Grafton said its UK renovation, maintenance and improvement market showed weak demand, with materials price deflation of 3.5 per cent compounding the adverse weather conditions that also contributed to a decline in revenue.
Grafton’s merchanting business in the UK, the Netherlands and Finland saw revenues fall by between 6.2 per cent and 8.5 per cent, while manufacturing experienced a revenue decline of 17.2 per cent.
The company completed its fourth share buyback programme on April 30th, with 11.1 million shares repurchased at an average price of £9.02 per share.
“Trading in the period continued to be challenging in most of our markets and revenue trends were also impacted by price deflation and exceptionally wet weather in Ireland and the UK. Looking ahead, while we are not expecting a sustained recovery in our markets in the short term, we do expect profitability to be slightly more weighted than usual to the second half,” chief executive Eric Born said.
“We remain focused on being the providers of choice for our customers, investing in our brands and maintaining tight control of costs. We are confident in the underlying demand fundamentals and the medium-term outlook for our markets and on the opportunities provided by our cash-generative business and a healthy balance sheet.”
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