Grafton Group have issued a pre-close period trading update for the year ended 31 December 2007. However, the final results for 2007 will be announced on March 10.
According to the announcement turnover for the year exceeded €3.2 billion, an increase of 10% compared with 2006.
“The UK economy performed strongly in 2007 although there are some signs that growth slowed in the final quarter,” the company stated. “The generally positive economic background and strong market position enabled the first half improvement in like for like sales and operating margin in the UK business to continue.”
It was a slightly different story in Ireland as the merchanting business encountered “more challenging trading conditions reporting a small decline in like-for-like sales in the second half”. However, the Irish DIY business continued to grow like-for-like turnover supported by increased consumer spending and strong brands.
The Group made 14 acquisitions in the period adding annual sales of over €100 million and 32 branches in the UK and one in Ireland. The acquisitions were completed at a total cost of €74 million. Organic developments during 2007 included the opening of thirteen branches in the UK and three in Ireland.
Looking ahead, say the company, the outlook is generally positive. “The long term growth and stability of the UK economy place it in a strong position to cope with an expected slowdown and it should continue to be a market which presents sound growth and development opportunities in the merchanting sector.
“In Ireland, new residential construction is expected to continue to weaken in the first half. However, strength in the rental market points to continuing good underlying demand which should lead to an improvement in housing starts. The residential RMI and non-residential construction markets in Ireland are expected to be positive this year.”