The owner of the 60-strong building providers and DIY chain Homevalue Hardware has more than doubled its pretax profits on the back of strong activity in the construction sector, writes Emmet Oliver

Associated Hardware Ltd owns Homevalue Hardware and also acts as its central buying arm. Homevalue is made up of independent retailers scattered throughout the State.

According to results for 2004, which were lodged with the Companies Office in recent weeks, Associated Hardware saw an increase in turnover to €152 million, up from €120 million the previous year, a jump of 26 per cent. A gross profit of €3.8 million was achieved, up from €3 million the year before.

The company experienced rising costs in the period under review, which reduced its gross profit figure. Costs reached €148 million, up from €117 million.

Operating profits were up to €1.1 million from €642,960, while pretax profits reached €979,645, up from €458,122. The level of business done by the company clearly increased in the period, with trade debtors rising to €23 million from €17 million.

The Irish DIY sector is believed to be worth over €1 billion a year, and the main players are Woodies and Atlantic Homecare.

However, Homevalue Hardware is believed to have a strong position behind these groups.

The company also has a strong presence in the building providers sector, which is worth more than the DIY industry. Grafton/Heiton is a major player in this market, but Homevalue is estimated to have a large share too.

The accounts reveal that Bank of Ireland holds a debenture over the company's properties, its debts and over all the other assets.

A debenture is loan raised by a company, paying a fixed rate of interest and secured on the assets of a company.

The company had tangible assets - which normally refers to land, buildings and equipment - of €9.1 million, which was virtually static on the year before.

The accounts reveal that in early 2005 , a decision was taken at an extraordinary general meeting for Associated to become a public limited company. This means that, in theory, its shares can be offered to the public.

The company had staff costs during the period of €1.5 million, while directors' remuneration came to €173,106, and this was split among 11 directors.