Irish builders' merchant Grafton (GFTU) delivered a solid performance last year, underpinned by an improving economic climate in its principal markets in Ireland, the UK and the Netherlands.
UK merchanting, which accounts for three-quarters of group turnover, pushed revenue ahead by 9 per cent to £1.66bn, while operating profits were up nearly 14 per cent at £106m. However, stripping out exceptional items, including a pension credit, left operating margins unchanged at 6 per cent. This was due to competitive pricing pressure, principally in its plumber merchants chain Plumbase. Revenue here was a little down as a result of a softer residential heating market, and 11 branches were closed down and a further 6 consolidated into properties shared with other group businesses.
Profits were up in Ireland, on the back of like-for-like sales growth of 10 per cent, and underpinned by a stronger residential repair, maintenance and improvement sector. However, this activity was weaker in Belgium, which conspired with pricing pressures to turn the previous year's modest operating profit was turned into a £1.81m loss.
Analysts at Peel Hunt are forecasting adjusted pre-tax profits of £138m and EPS of 46.8p in 2016, compared with £119m and 41p in 2015.
| GRAFTON (GFTU) | ||||
|---|---|---|---|---|
| ORD PRICE: | 666.5p | MARKET VALUE: | £1.57bn | |
| TOUCH: | 666.5-668p | 12-MONTH HIGH: | 868p | LOW: 614p |
| DIVIDEND YIELD: | 1.9% | PE RATIO: | 16 | |
| NET ASSET VALUE: | 419p* | NET DEBT: | 11% | |
| Year to 31 Dec | Turnover (€bn) | Pre-tax profit (€m) | Earnings per share (¢) | Dividend per share (¢) |
|---|---|---|---|---|
| 2011 | 2.05 | 10 | 1.1 | 7.5 |
| (£bn) | (£m) | (p) | (p) | |
| 2012 | 1.76 | 25 | 13.6 | 7 |
| 2013 | 1.90 | 68 | 26.8 | 8.5 |
| 2014 | 2.08 | 101 | 34.4 | 10.8 |
| 2015 | 2.21 | 120 | 41.6 | 12.5 |
| % change | +6 | +19 | +21 | +16 |
Ex-div: 17 Mar Payment: 15 Apr *Includes intangible assets of £554m or 236p a share | ||||
