Grafton expecting profit of €70m
The owner of the Woodies DIY and Atlantic Homecare chains expects to announce profits of at least €70 million when it publishes its 2012 results in March.
DIY and builders’ merchant group Grafton released a trading statement yesterday which said sales in 2012 increased by almost 6 per cent to €2.17 billion.
The figure included a €105 million boost from translating sales in sterling to euro. Around 70 per cent of Grafton’s revenues are in sterling.
The group said yesterday that it expected operating profits, before restructuring costs and other charges for 2012, would “not be less than €70 million”, a 22 per cent improvement on the €57 million reported for 2011.
The boost to operating profits was down to improved trading in the closing months of 2012, Grafton said.
During the year the High Court approved a restructuring plan for its Atlantic Homecare business which Grafton placed in examinership in June.
The arrangement resulted in a saving of between €4-5 million a year on its rent bill and a writedown of a portion of its debts. Atlantic owed €53 million to other group companies.
The figures released yesterday showed that conditions in its Irish business remained tough.
Sales in its retail operations – Woodies and Atlantic – were down 9.2 per cent in 2012, although the decline was around half that figure in the months of November and December.
Similarly, sales from its Irish builders’ merchants operations, including Chadwicks and Heiton Buckley, were down 8.5 per cent, but the rate of decline eased to 2.7 per cent during the final two months of the year.
Its UK builders’ merchants operations, including Buildbase, Plumbase and Jackson, saw sales rise by 3.1 per cent overall, and by 3.7 per cent in November and December.
“The immediate outlook for demand in the group’s markets remains challenging and the timing and extent of any recovery is unclear,” Grafton said.
Flor O’Donoghue, analyst with Dublin stockbroking firm Davy, described the statement as “very encouraging”.