Figures for the first quarter of 2002 at building products group Grafton have matched market expectations with growth in the region of 15 per cent, chairman Mr Michael Chadwick said yesterday.

At the annual general meeting in Dublin, he said Woodies DIY continued to perform well, growing its turnover and profits. However, trading conditions in Ireland had been less favourable in the construction sector, which had affected the results of the building materials business in the first quarter.

In Britain, where Grafton is the fourth-biggest builders providers and which is its most important market, the merchandising businesses had experienced strong growth in a favourable trading environment. "Like for like, sales have increased and since year-end the group has added seven branches, bringing its merchandising network to over 180 locations," Mr Chadwick said.

Grafton trades as HomeBase, BuildBase and Plumbase in the UK.

Managing director Mr Norman Kilroy said the Irish construction industry had slowed significantly since autumn 2000. "It's only since December 2001 that housing starts have begun to pick up. In general, the whole housing sector is beginning to slow down because the heavy growth of the late 1990s had to return to more normal levels of sustainable growth. Overall the Irish economy is really positive going forward," he said.

However, he did not expect the construction sector to do anything exciting until perhaps the end of this year.

"Until foreign direct investment - American investment - begins to show confidence and invest, it will be somewhat slow overall. In 2003 people are forecasting a considerably better year," added Mr Chadwick.