Grafton turnover remains stable

GRAFTON Group, the builders merchants and DIY group, said the stabilisation of turnover previously reported has continued to the year end.

While the second half showed some signs of improvement in both its key markets, Grafton said it was still cautious about the 2010 outlook overall.

It said the group will benefit from the cost reduction and integration programmes of the last 18 months and it “is well placed to capitalise on any improvement in its markets. The group has operations in Ireland and Britain and owns the Woodies DIY chain in Ireland.

Sales in the second half of the year were in line with those in the first half.

Group sales for the year to end December 2009 at €1.98 billion are in keeping with market expectation, the trading update said. That figure represented a fall of 26% or €690m on 2008.

Shares in the group closed up 1.9% to €3.20.

In the second half turnover was down 14% compared with 24% in the first half, measured on a constant currency basis.

Its DIY turnover dipped 18%, or no change on the first half outturn.

Sales in the manufacturing division fell 36% against a 49% plunge in the first six months.

Overall, Grafton said like-for-like sales per working day in the British businesses, which now account for over two thirds of total sales, continued to improve. On a constant currency basis they were down 7% in the second half of the year compared to 18% in the first half.

Grafton said “trading conditions remain challenging in this market”, although “green shoots” of recovery have started to show in Britain.

In Ireland, like-for-like sales per working day in the second half were down 32%, somewhat better than the 37% fall that hit turnover in the first half.

The group is cautious about the current outlook.