Grafton group, which operates the Woodies DIY and Atlantic Homecare chains in Ireland, has posted sales falls of 32% in its first quarter - 22% in constant currency.
Sales totalled €470m, a drop of €220m compared with the same quarter in 2008. However, the DIY retail arm of the business fared better than the merchanting arm, showing a 17% decline in the period compared with 25%.

In a statement released yesterday, the company said: "During the period the group faced the most challenging trading conditions in decades.

"The trading environment so far this year was very much weaker than the group experienced in the first four months of 2008. As expected housing starts and completions have fallen and, combined with lower RMI spending, have significantly impacted the Group's merchanting and manufacturing businesses. Sales have also been affected by the poor weather in the early part of the year and the 15% decline in the average value of sterling against the euro in the period."

Seven new locations were opened in the period, although no acquisitions were made as "capital and acquisition expenditure has been curtailed significantly."

Moving forward, the group said it: "expects to benefit from the seasonally stronger trading period and the reduced cost base is on target to yield savings of up to €55m in 2009."