Grafton Group strong though Brexit fears linger

Builders merchanting and DIY company Grafton Group updated the market on its operations to the end of April on Tuesday, as investors gathered in Dublin for it annual general meeting.

The FTSE 250 firm said it had a positive start to the year with broadly favourable economic conditions in the UK, continuing growth momentum in Ireland and an improving trading environment in the Netherlands.

Volume growth was seen in divisions serving trade customers in the residential repair, maintenance and improvement, and new build markets.

Group revenue during the four months increased by 13.2% over the same period a year earlier, to £790m, and by 11.9% at constant currencies.

Total revenue growth in the UK was 9% at constant currencies, Ireland was 11.1% and the Netherlands saw 8.5% growth. Belgium was the odd one out, with a 13.9% decline in revenue over a year ago.

Outside of the merchanting business, Grafton’s retail division saw total revenue growth of 2.2% and its manufacturing surged ahead 16.5%.

"We are positive about the prospects for the group and expect the recent trends in its markets in Ireland and the Netherlands to be sustained over the remainder of the year,” said Grafton Group chief executive Gavin Slark.

“Strong market fundamentals should support activity in the UK housing and RMI markets although uncertainty over the outcome of the referendum on continued membership of the EU appears to be having a bearing on current activity levels,” he added.