Grafton sees building merchant Chadwicks performing at 'high levels of activity'    

The performance of businesses like Grafton that are exposed to housing markets and consumer spending are being closely watched, as households across Europe struggle for the first time in years with soaring inflation and with large hikes in interest rates. File picture: Robbie Reynolds

Building materials merchant Grafton said its Chadwicks distribution business in Ireland is performing at "high levels of activity", despite interest rate hikes and inflation that is weighing on some other parts of its European operations.                                 

In an update covering the last two months of 2022, the group also said that spending on housing improvements in Britain had led to a softening in demand at its Selco business there, but that other European markets, including the Netherlands and Finland, were doing well. 

The shares, which trade in London, rose by over 3.5%.   

Grafton also owns in Ireland the Woodie's DIY retail stores, which it said recently posted a small decline in home and garden revenue that partly reflected "a more cautious approach by consumers to discretionary spending in the run-up to Christmas".   

The performance of businesses like Grafton that are exposed to housing markets and consumer spending are being closely watched, as households across Europe struggle for the first time in years with soaring inflation and with large hikes in interest rates. 

The update appears to reflect that conditions in some markets are better than others.                                    

“It is pleasing to note that despite mixed macroeconomic and market conditions, we expect full-year operating profit to be slightly ahead of the top end analysts’ forecasts for 2022. We look to the future with confidence supported by our market-leading businesses and very strong financial position,” its recently appointed chief executive Eric Born said in the update.