The outlook for the Republic’s construction sector remains positive, Grafton Group has said, with strong house-building activity feeding into higher sales volumes at the Woodie’s DIY and Chadwicks owner in the first half of the year.
Overall revenues at the London-listed group declined 4.4 per cent to £1.14 billion (€1.34 billion) in the first six months of 2024 compared with the same period last year, despite better fortunes in its Irish segment.
In a trading update on Wednesday, Grafton said average daily like-for-like revenues at Chadwicks returned to growth in the three months to the end of June after a decline of 0.2 per cent in the first quarter. Sales volumes grew 5.4 per cent in the first six months of the year, “strongly ahead of the comparable period last year”, the group said.
Grafton said the Government’s policy agenda “is strongly supportive of increasing the development of new homes”, contributing to its positive outlook for the Republic’s construction sector. “The outlook for growth in construction in Ireland remains positive and the deflationary pressures seen in steel and timber have continued to moderate with overall price deflation of circa 4.9 per cent in the first six months.”
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Sales at Woodie’s DIY, meanwhile, remained weaker, “but good margin management and cost control has delivered an improvement in profitability over the same period last year,” it said.
Grafton previously said bad weather in the UK and Ireland had weakened demand in the early part of the year, hampering sales.
In the UK, the group said business remained subdued in the second quarter of the year with customers remaining “cautious” when allocating discretionary spending.
Eric Born, chief executive of Grafton, said the group is pleased with the performance in Ireland, where the outlook remains positive. “Elsewhere the repair, maintenance and improvement, and new build markets remain more challenging, but our management teams will continue to actively manage both our gross margins and cost base in response to market conditions.”
He said the group is also “actively progressing” its acquisitions strategy in Europe and in new markets.
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