Grafton success continues with €102m profits

BUILDING materials group Grafton continued its impressive growth story yesterday when it announced pre-tax profits of €102 million last year, a 27% increase on 2002.

Sales went up 30% to €1.5 billion as the group added to its British operations and built on its success in Ireland with the Woodie's DIY and Chadwicks builders' merchants chains.

Executive chairman Michael Chadwick said Grafton's growth was accelerated during the year by a programme of 10 acquisitions. The group spent €135m on Jackson Building Centres, a leading merchant in Britain's east midlands. Mr Chadwick was upbeat about the Jackson deal and said it had turned out to be a stronger business than originally thought.

Financial controller Charles Rinn said there was considerable scope for Britain, where Grafton has almost 8% market share, to deliver even better results. Britain accounts for more than €1 billion, or three quarters of total sales, and will be the main driver of Grafton growth in the future. Sixty-four percent of Grafton's operating profit comes from Britain.

Grafton's Irish operations continued to perform strongly. Woodie's DIY recorded a 5% increase in like-for-like sales despite a challenging environment. Woodie's has 17 stores around the country and plans are in place to open a further four in Limerick, Kilkenny, Naas and Dublin's Naas Road. Overall turnover in Ireland went up by 12% to €385 million, while operating profit grew 16% to €44.8 million.

Davy stockbrokers said results were ahead of expectations and were particularly impressive given weakness in sterling and the refinancing activity associated with the Jackson acquisition.