Woodie's and Chadwicks owner Grafton Group has reported higher revenues for the six months to the end of June but its adjusted profits before tax dipped.
Grafton said its revenues for the six month period rose by 12.2% to £1.153 billion from £1.028 billion the same time last year.
But its adjusted profits before tax fell by 3.6% to £143.4m from £148.8m as sales at its British Selco business fell.
The company noted an "excellent" performance in its distribution businesses in Ireland and the Netherlands and also reported a "normalisation" of revenue and profitability in its Woodie's DIY, Home and Garden retail business here.
Woodie's saw lower revenue and operating profit - as anticipated - compared to the exceptional Covid related gains made in the first half of last year when the business continued to trade as an essential retailer while Ireland was in lockdown.
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But its revenue and profitability were materially ahead of the pre-pandemic level and the operating profit margin was 11.7%.
Grafton said its building materials distributor Chadwicks produced an "exceptionally strong performance" in a market that returned to more normalised trading conditions in the half year.
Revenue and operating profit grew strongly and the operating profit margin advanced by 80 basis points to 12.4%.
It noted that strong demand was driven by increased spending on housing RMI, an acceleration in the construction of housing scheme developments and one-off houses and an increase in non-residential private and public sector construction.
The Sitetech business bought in February also made an excellent contribution to profit, it added.
Grafton said its Board has decided to pay an interim dividend for 2022 of 9.25p per share, an increase of 8.8% on last year's interim dividend.
In its results statement, Grafton said that trading patterns normalised in all of its markets in the first half of 2022 as building materials shortages and supply chain pressures eased considerably.
But it noted that building materials prices continued to rise sharply, including the carryover effects of price increases implemented in the second half of last year. This softened volumes in more competitive markets.
Gavin Slark, Grafton's chief executive, said the company's first half performance saw a significant normalisation of activity levels following exceptional pandemic related spikes in trading in the first half of 2021.
"While inflation remains a continuing feature in our markets, we saw improved supply chain consistency as trading patterns normalised and building materials shortages eased," Mr Slark said.
"Though potential macro-economic headwinds remain, Grafton is uniquely placed to outperform given its leading market positions, geographic diversity and the relative resilience of its core repair, maintenance and improvement market," he said.
"Given the strength of our brands and their market positions together with an exceptionally strong financial position, our focus remains on delivering a strong financial outcome for the year despite the uncertainties in our markets," he added.
Gavin Slark last month said he plans to step down as chief executive of Grafton Group later this year after 11 years in the job.
The company said today that the search for a new group CEO is progressing with the support of an executive search firm. Mr Slark will continue in his roles as CEO and Board Director until 31 December 2022.
Grafton also said today that after nine years in the role as CEO of Woodie's, Declan Ronayne will retire at the end of the year.
After an externally led search process that involved internal and external candidates, Damien Dwyer, who has been Commercial Director of Woodie’s since 2013, was appointed as its new CEO.
Looking ahead, Grafton said that while the outlook for all its markets is weaker now than it was at the start of the year, it remains on track to deliver full year profit in line with current consensus analysts’ forecasts - adjusted EBITA of about £267m.
But it said this remains dependent on the usual seasonal upturn in the important trading months of September to the end of November.
Grafton noted that households have experienced cost of living increases in recent months and the shorter term outlook across its markets is more uncertain given potential impacts on disposable income. Significant building materials price inflation has also impacted construction costs and affordability.
"In the UK, housing RMI is expected to remain soft as households reduce discretionary spending on improvements and housing transactions slow. Housing demand continues to remain strong and a near term fall-off in house building is not anticipated," the company said.
"In Ireland, key indicators are positive, and the economy is forecast to continue on a growth path that is among the strongest in the EU. A more moderate rate of activity is expected in the housing RMI and DIY markets and house building is expected to finish the year strongly," it added.
Shares in the company were lower in London trade today.
