The owner of DIY and building materials brands Woodie's and Chadwicks said today that its average daily revenues were 2.1% higher in the ten months to the end of October, adding that it was on track to deliver its full year trading expectations.
In a trading update, Grafton Group reported revenues of £2.13 billion for the ten months to October 31, an increase of 11.5% year on year.
The company said its revenues were boosted by acquisitions, including Salvador Escoda in Spain and HSS Hire in Ireland.
Grafton said that both Chadwicks and Woodie's in Ireland saw slightly softer activity levels in the seasonally important trading months of September and October.
It said that while the outlook for growth in the construction market remains positive - underpinned by strong government support and the revised National Development Plan - Grafton is seeing some weakness in the published Construction PMI over recent months.
It said this coincides with a dip in housing commencements after a reduction in planning permissions in the first half of the year.
"The acute housing shortage however continues to underpin the medium-term outlook for construction activity in Ireland with the Government expected to publish its long-awaited National Housing Plan imminently," it added.
Meanwhile, average daily like-for-like revenue in its UK distribution business declined by 0.5% in the 10 month period with a weakening of trading activity in October which is likely a consequence of consumer and homeowner concerns leading into the November Budget.
In the Netherlands, average daily like-for-like revenue increased by 0.7% as momentum in the market has eased in the second half. Grafton said the slower rate of growth compared to the first half was mainly driven by weaker branch and project-related sales partially offset by continued growth in sales to national key accounts.
Grafton said it had completed the integration of Salvador Escoda in Spain and it continues to actively explore growth opportunities in the attractive and fragmented Iberian market.
It said that average daily like-for-like revenue in the ten months to the end of October rose by 5.7%, supported by a strong summer sales campaign focused on air conditioning and ventilation products and favourable market conditions.
In Finland, IKH's average daily like-for-like revenue decreased by 6.4% due to continued weak market conditions, but Grafton said the decline has eased significantly in comparison with the period from May through to August
Eric Born, the chief executive of Grafton Group, said the strength of the company's business model was evident in its performance year to date.
"Overall revenue increased by over 11% supported by continuing growth in building materials distribution in Ireland, Spain and the Netherlands and in retailing and manufacturing, helping to offset market weakness in the UK and Finland," Eric Born said.
"Progress in the period means Grafton remains on track to deliver adjusted operating profit for the full year, in line with expectations," the CEO said.
"Though momentum has slowed somewhat in the period, the outlook for Grafton remains positive, supported by structural tailwinds, strong market positions in all geographies, significant recovery potential in the UK and Finland, a robust balance sheet and encouraging acquisitions pipeline," he added.
