Woodie's DIY owner Grafton eyes German and Scandinavian expansion push

Chief executive Gavin Slark expects a continued healthy performance from Grafton Group in the first half of this year.

Irish building supplies group Grafton is actively eyeing more acquisitions in mainland Europe.

Speaking on the back of a record set of annual results, group chief executive Gavin Slark said the business is in “really good shape” financially and is well-positioned to execute deal opportunities.

As well as its core markets of Ireland and Britain, Grafton has a strong business in the Netherlands and expanded into the Nordic region through the €200m acquisition of Finnish workwear company IKH last year.

Mr Slark said Grafton is keen on expanding, through acquisition, into Scandinavia, Germany, Austria, and Switzerland as part of growing its presence in northern Europe. 

He didn’t rule out further bolt-on acquisitions in existing markets, either. Grafton has already taken in €50m worth of sales through smaller bolt-on purchases in Ireland and the Netherlands since the turn of the year.

Grafton posted a 25.6% increase in annual group revenues to just over £2.1bn (€2.5bn), with adjusted pre-tax profit ahead by more than 83% at £268.6m.

'Very strong performance'

The results, hailed as “excellent” by Grafton’s management, were ahead of expectations and featured a “very strong performance” across all businesses.

Its Woodie’s DIY retail chain here and the UK-based merchanting business Selco turned in record contributions, while the likes of Irish building supplies chain Chadwicks and the Isero chain of builders’ suppliers in the Netherlands showed strong gains.

Grafton said the £520m sale of its traditional merchanting business in Britain last year provides funds for further investment capacity.

Mr Slark said trading in the early part of 2022 has been “encouraging” and said the outlook for the first half of the year is “positive”, thanks to strong housing and RMI (repair, maintenance and improvement) markets and future investment opportunities.

He said strong housing demand in each of its main markets remains strong, which should continue to fuel growth. Mr Slark also said Grafton expects a normalisation of raw material costs, having seen huge volatility in timber and steel prices last year. 

Regarding consumer inflation, he said the company would continue to look at price changes across the Woodie's DIY chain on a product-by-product basis and not across the board.