Grafton Group revenues hit €2bn

Building materials firm Grafton Group has reported an 88 per cent rise in pre-tax profits to €25.6 million for the 12 months to December 31st.

The group, which has operations in the UK and Ireland, said revenues increased by 1 per cent to €2 billion and that its net debt fell from €322 million to €255 million last year.

Grafton Group said improved market conditions in the UK helped to increase its turnover and profits and that turnover had trended towards stabilisation in its Irish merchants businesses.

Shares in Grafton Group were trading down 5 per cent on the Dublin market at 3pm at €3.625.

Earnings before interest, tax, depreciation and other charges came to €95 million last year, up from €74.1 million a year earlier.

The firm posted an adjusted operating profit of €50.6 million, up 93 per cent year on year. However, this was before a €2.2 million amortisation charge, an impairment charge of €10 million and restructuring costs of €5.3 million.

It said cost saving measures and restructuring had reduced overheads by €27.4 million and that debt refinancing had been completed with the introduction of a new three year facility.

Grafton, which owns the Woodie's and Atlantic Homecare stores, is the largest DIY retailer in Ireland and has 41 stores nationally. It is also the biggest builders and plumbers merchanting business in the country, operating 28 Heiton Buckley branches and 24 Chadwicks stores.

Executive chairman Michael Chadwick said the firm expected further improvement in profits as the market recovered.

"Group turnover for the first two months of 2011 is encouraging with a continuation of like for like sales growth in the UK and signs of stabilisation in Irish turnover," he said.

Mr Chadwick said the UK economy appeared to be growing modestly but that the outlook for Ireland remained "unpredictable".

Mr Chadwick announced last month that after 26 years at the helm he will step down as executive chairman in July. Briton Gavin Slark will join it on April 1st as chief executive designate.