Grafton : 2016 Half Year Results

31 Aug 2016

Grafton Group Plc

(1) As amounts are reflected in £'m some non-material rounding differences may arise
(2) The term 'adjusted' means before intangible asset amortisation on acquisitions and restructuring costs
(3) Additional information in relation to these Alternative Performance Measures (APMs) is set out on pages 31 to 36

Highlights

• Revenue up 13% to £1.23 billion (12% in constant currency) - growth was broadly split between existing business and acquisitions
• Adjusted Group operating profit before property profit growth of 18% to £64.8m (2015: £55.1m) reflected strong contributions from Ireland, the recent acquisition of Isero in the Netherlands and Selco in the UK
• Adjusted Group operating margin before property profit increased by 20bps to 5.3%
• Ongoing investment in Selco store opening programme - 50% increase in store numbers expected in the three years to June 2017
• Robust cash generation from operations of £108.0 million (2015: £73.2 million)
• 6% increase in dividend in line with progressive dividend policy
• Investment of £40.1 million on acquisitions and capital expenditure in H1 to support future growth
• Challenging backdrop in UK merchanting market but organisational restructuring to provide sustainable benefits in 2017
• Net debt of £95.7m was £17.9m lower than at 31 December 2015 resulting in gearing of 9%

Gavin Slark, Chief Executive Officer commented:

'Despite the more uncertain and competitive market conditions in the UK, Grafton continued to make good progress in its key markets enabling the Group to record revenue, profit and earnings per share growth as well as strong cash generation. Both Ireland and the Netherlands continue to show strong growth with ongoing development opportunities. Grafton will continue to invest in areas of its business which combine good long term growth prospects and the opportunity to improve the Group's operating margin and return on capital employed.'

Webcast Presentation of Results

A results presentation hosted by Gavin Slark and David Arnold to analysts and investors will take place today 31 August 2016 at 9.30 am (GMT) at the London Stock Exchange, 10 Paternoster Square, London EC4M 7LS. A live webcast will be available on www.graftonplc.com/webcast/ and we recommend you register in advance. A recording of this webcast will also be available to replay later in the day. The results presentation can be viewed/downloaded at http://www.graftonplc.com

Enquiries:
Grafton Group plc +353 1 216 0600

Gavin Slark, Chief Executive Officer

David Arnold, Chief Financial Officer

Murray +353 1 498 0300
Pat Walsh

MHP Communications +44 20 3128 8100
James White

Cautionary Statement

Certain statements made in this announcement are forward-looking statements. Such statements are based on current expectations and are subject to a number of risks and uncertainties that could cause actual events or results to differ materially from those expressed or implied by these forward looking statements. They appear in a number of places throughout this announcement and include statements regarding the intentions, beliefs or current expectations of Directors and senior management concerning, amongst other things, the results of operations, financial condition, liquidity, prospects, growth, strategies and the businesses operated by the Group. The Directors do not undertake any obligation to update or revise any forward-looking statements, whether as a result of new information, future developments or otherwise.

View the full 2016 Half Year Results in PDF format