Grafton Group foresees continued housing market improvement despite recording reduced annual operating profits in its UK merchanting business of €43.5m (2008: €73.6m).
The business, which includes Buildbase, Jacksons, Selco and Plumbase, saw sales decline by 20% to €1.32bn (2008: €1.64bn). Average daily like-for-like sales reduced by 6.5% during the year.
But the contraction in sales seen throughout 2009 returned to “modest growth” by the end of the year, with good increases recorded in the new housing sector.
The Selco trade-only warehouse, comprising 28 stores, performed strongly, achieving like-for-like turnover growth in mature stores and recently opened units increasing sales in line with expectations.
Grafton said it expects housing market conditions to continue improving over the course of 2010, with RMI demand benefiting from the gradual recovery in household confidence.
“Overall, the sharp fall in merchanting volumes over the past two years, combined with the longer-term prospects of the UK construction market, driven by long-term demand, provide an opportunity for growth over time at above trend rates while at the same time demand in the RMI market remains structurally intact,” it said.
Overall, the group recorded pre-tax profits of €13.6m (2008: €64.1m) from sales of €1.98bn (2008: €2.67bn).
