Grafton Group plc, the international building materials distributor and DIY retailer has announced its half year results for the period ended 30 June 2024.
The group had a first half adjusted operating profit of £83.1million (H1 2023: £105.1million) reflective of weaker market conditions outside the Group’s home market in Ireland. There was strong cashflow generated from operations of £161.1 million (H1 2023: £191.3 million). And £104.8 million (H1 2023: £132.7 million) was returned to shareholders in dividend payments and share buybacks in the first half.
Overall Group gross margin broadly unchanged and overheads continued to be tightly controlled. The performance of Irish businesses, Chadwicks and Woodie’s was good, where outlook for growth remains positive.
Product price deflation had a negative impact overall on sales in the Irish and UK Distribution businesses, however, its adverse effect is moderating.
Volumes lower across the UK, Netherlands and Finland but there is continued focus on being the providers of choice for customers and driving operational efficiencies to position for market improvement. There was resilient performance by the Group’s UK Manufacturing businesses despite backdrop of challenging UK housing market volume declines.
Eric Born, Chief Executive Officer said: “This has been a robust first half performance despite challenging conditions in several of our markets. We are pleased with the performance and outlook of our Irish businesses in particular, and we continue to drive efficiencies and innovations in our other markets to capitalise on what we see as significant positive operating leverage opportunities as these markets turn.
“Whilst uncertainties remain in the short term, our medium-term outlook remains positive, supported by strong demand fundamentals, not least in the demand for new housing as markets normalise and consumer confidence improves. At this point in the year, with the important Autumn trading season yet to come, we continue to anticipate delivering adjusted operating profit for 2024 in line with analysts’ expectations.
“The Group has continued to be highly cash generative through a challenging period in the cycle, which has enabled us to return cash to shareholders whilst preserving a strong balance sheet to invest in organic and inorganic development opportunities. We continue to actively pursue opportunities to strengthen our existing market positions as well as platform acquisitions, and we remain optimistic that we can execute on some of these opportunities in the near term.”
