Intensity of the downturn has moderated, says Grafton
Published: 7 September 2009
Builders merchant and DIY group sees 31% drop in turnover but has witnessed more "stable sales" in recent months.
Grafton Group plc saw a 31% drop in turnover for the six months ended June 30, 2009. The group, which owns the Buildbase and Plumbase merchanting chains, as well as Woodies DIY and Atlantic Homewares in Ireland, also saw a 93% decrease in pre-tax profit to €3.7m compared with €52.4m in 2008.
However, Grafton believes things are starting to pick up in the UK housing market, which accounts for 60% of its turnover, and that sales levels are beginning to stabilise. The company has also reduced its net debt by €56m to €380, while a cost reduction programme has achieved annual savings of more than €70m.
Commenting on the results, Grafton executive chairman Michael Chadwick said: "Grafton's focus remains firmly on maximising operational efficiencies and cash generation. The intensity of the downturn in our markets has moderated and recent months have seen more stable sales levels. In the UK, housing starts are rising and leading indicators for repair, maintenance and improvement work are positive."
He added: "The Group is confident of trading successfully through this major cyclical downturn and is well positioned to capitalise on upturns in activity in its markets."