Heiton profits rise 29% to €18.7m

HEITON Group has posted a 29% rise in first-half profits, driven by the strength of the housing market and its DIY arm Atlantic Homecare.

Pre-tax profits for the six months to end October rose to €18.7 million from €14.3m. Group turnover for the half year was up by 4% to €255m, though the retail division, which includes Atlantic Homecare and the Panelling Centre, was ahead by 10%.

The profit figure was flattered by a €1.7m gain on the sale of a property in North Dublin.

Chief executive Leo Martin said yesterday that the profit were driven the continued growth in the housing market in both new developments and from repairs, maintenance and improvements (RMI) to existing homes. Turnover in the total arm was up from €42m to €46m.

He said Atlantic had continued the positive sales performance over the Christmas period. The company's builders' merchants division Heiton Trade had also seen strong momentum over the six months turnover ahead from €159m to €173m.

Mr Martin said he expected some decline in house building activity this year, but the builders' merchants would still benefit from a buoyant repair, maintenance and improvement (RMI) market and from spending on national infrastructure projects.

Mr Martin said competition was tough in the DIY market, though Atlantic was holding its own against competitors like B&Q.

Heiton plans to open more Atlantic outlets this year, will stores planned for Tullamore, Waterford and Limerick with two to three more in the pipeline for next year. In addition, it will open three more Panelling Centres outlets

The British businesses posted a 10% operating profits rise to €1m, but profits and turnover were hit by the strength of the euro against sterling. Sales fell some 17%, though the currency shaved only 7% off this figure, with the rest of the decline due to restructuring of its British units.

The company increased its interim dividend by 13% to 7 cents per share, which will be paid out of earnings per share of 27.3c. EPS was ahead by 23%, while group debt was reduced from €79.5m to €53.5m.