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Grafton operating profits marginally higher in Q1 than last year

Building materials group Grafton has said that its operating profit for the first four months of the year was marginally ahead of the same time last year.

In an interim management statement ahead of its AGM today, the company said the rise in operating profit came despite the fact that it continues to see below normal activity levels in its UK merchanting market.

It also noted the ''difficult'' macro-economic environment in Ireland.

Revenues for the four months to the end of April came to €677m, which compares to revenue of €676m the same time last year.

The company said that trading was affected by adverse weather conditions and continued economic weakness in its markets.

Grafton said that its Irish merchanting business increased like for like revenues by 1%. This was ''an encouraging development and the first period since the first half of 2007 to record turnover growth'', the company said.

It said its Irish business benefited from an improvement in its competitive position and from an increased turnover of plumbing and heating products and promotional campaigns.

But revenues in its Irish retailing business fell by 8.7% due to falling demand caused by weak consumer sentiment and record low temperatures in March and April which delayed the start of the ''outdoor season''.

The company also said that average daily like for like sterling revenue in its UK merchanting business was marginally higher for the first four months of the year. It said that while weather conditions reduced volumes in March, activity levels recovered last month.

''While turnover growth in the first two weeks of May has seen some improvement, the group remains cautious about the near term outlook for its businesses and is looking to a continuing reliance on internal initiatives to improve profitability,'' the company said.

The Group also announced the appointment of Mr Frank van Zanten as a Non-Executive Director on 13th May 2013.

Mr. van Zanten (46), who is a Dutch national and resident, is Managing Director of the Continental Europe business area of Bunzl plc, the FTSE 100 UK international distribution and outsourcing Group with operations across the Americas, Europe and Australasia. He was previously Chief Executive of PontMeyer N.V., the Dutch Builders Merchants. Mr. van Zanten has extensive pan European business experience in the distribution sector. He holds an MBA degree from Rotterdam School of Management.

Source : RTE News
www.rte.ie/news/business/2013/0514/392106-grafton-trading-statement/

14 May 2013
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