Grafton Group: 'Resilient Performance In Challenging Markets'

Grafton Group plc ("Grafton"), the international building materials distributor and DIY retailer is pleased to announce its half year results for the period ended 30 June 2023.

Financial Highlights

• Full year adjusted operating profit expected to be in line with Analysts’ expectations1
• Decline in first half adjusted operating profit (before property profit) as anticipated
• Strong operating profit margin and return on capital employed
• Excellent cashflow of £191.3 million from operations
• £132.7 million returned to shareholders in dividend payments and share buybacks
• Interim dividend growth of 8.1% on lower number of shares in issue following buybacks
• Net cash at 30 June 2023 of £438.4 million (before IFRS 16 lease liabilities) was almost unchanged from the year end position after returning cash to shareholders
• New share buyback programme for up to £50.0 million announced

Operational Highlights       

• Underlying market fundamentals remain strong despite current challenges
• Resilient first half performance despite challenging Distribution markets
• Volumes lower across the Group’s distribution businesses
• Woodie’s DIY, Home and Garden retail business performed strongly
• Notably strong performance by UK Manufacturing businesses
• Further progress made on sustainability agenda 

1 Grafton compiled consensus Analysts’ forecasts for 2023 show adjusted operating profit of circa £202.6 million and a range of £194.6 million to £209.4 million.

2 Supplementary financial information in relation to Alternative Performance Measures (APMs) is set out on pages 43 to 47.

3 The term “Adjusted” means before exceptional items, amortisation of intangible assets arising on acquisitions and acquisition related items in both periods.

Eric Born, Chief Executive Officer Commented:  

“The strength of the Group’s market positions and our experienced management teams have underpinned a resilient performance in the face of challenging conditions during the first half.  Grafton’s robust cash generation has enabled us to return £132.7 million to shareholders in the half year by way of share buybacks and dividends whilst leaving our net cash position broadly unchanged.  This strong balance sheet, together with our nimble operating structure, will allow us to take advantage of organic and acquisitive growth opportunities.  Whilst uncertainties remain in the short term, we are confident that Grafton is exceptionally well positioned to benefit as the cycle turns, markets normalise and consumer confidence gains momentum.”

Source : Grafton Group

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