Grafton revenue tops €1bn

Revenue at builders merchanting and DIY group Grafton passed €1 billion in the first six months of 2012, rising 4.6 per cent.

In an interim statement this morning, the group said underlying profit before tax, which excludes restructuring charges and amortisation, was 18.1 per cent higher at €23.8 million.

“The half-year performance demonstrated the resilience of the group's brands and the benefit of a range of internal initiatives taken to improve profitability and returns in a difficult trading environment,” Grafton said in a statement.

Adjusted basic earnings per share rose 11.6 per cent to 8.1 cent.

A fall in revenue in the Irish merchanting business was offset in part by a series of cost-cutting measures that helped stem a fall-off in operating profit. However, the retailing business was hit by shrinking consumer spending.

In the UK, Grafton said its merchanting business put in a strong performance, despite a recession that hit volumes in the residential repair, maintenance and improvement market.

Grafton’s UK business accounts for 76 per cent of revenue, up from 72 per cent in 2011.

"Although we still see the outlook as a little bit uncertain and it's still a bit challenging, there is certainly more stability in the UK market than there was this time last year," chief executive Gavin Slark said. "There is still a degree of uncertainty, as there is right across Europe and I think the UK is included in that."

Cash flow from operations rose to €54.8 million, from €46.2 million a year earlier.

“The group ended the half-year in a strong financial position with good liquidity and lower net debt that is refinanced out to 2016,” Grafton said.

Interim dividends were increased by 9 per cent to 3.0 cent for the period.

Additional reporting: Reuters