Grafton warns of challenging market

Builders merchant Grafton Group increased its turnover by 10 per cent in 2007 but warned that profit may come in slightly below expectations.

The market had predicted earnings per share of 86 cent, but the company said today it was expecting adjusted earnings per share "in line with or a little below the consensus". Turnover for the year was over €3.2 billion.

The slowing property market in Ireland created more challenging conditions for the firm in the second half of the year, with the Irish merchanting business recording a slight decline in like-for-like sales.

"The Irish new housing market experienced a decline in activity and is currently in a period of transition to a more stable pricing and supply environment following a prolonged period of strong growth," it said.

In Britain, a strong economy saw Grafton's like-for-like sales and operating margin improve, despite indications of a slowing in growth.

Grafton is due to announce its final results for 2007 on March 10th.