Belfast Telegraph

MacBlair owner sees £2.7bn revenue boost during strong growth

By John Mulligan

Robust economic momentum in the Republic has helped builders' merchanting group Grafton, which owns MacBlair in Northern Ireland, post a strong performance in 2017.

Group revenue surged 6.8% to £2.7bn in constant currency rates, and Grafton said that both its merchanting and retail arms in Ireland experienced a lift from an economic recovery that will continue this year.

Business employers' group IBEC predicts 4.2% growth for 2018.

Grafton owns the Woodies DIY chain in Ireland, as well as merchanting businesses that operate as Chadwicks and Heiton Buckley.

It also runs builders' merchants MacBlair, formerly MacNaughton Blair, which has around 16 branches here.

Woodies accounts for just 6% of Grafton's sales, but revenue at the unit last year was 7.4% higher in euro terms.

In the UK, which generates the majority of the group's revenue and profits, Grafton said trading conditions in the home repair, maintenance and improvement (RMI) segment, were mixed and impacted by general economic and household uncertainty, and a competitive pricing environment.

Shares in the company jumped more than 4.4% yesterday as it said that it expects its earnings before interest, tax and amortisation (EBITA) for 2017 to be "slightly ahead" of analyst expectations.

In 2016 Grafton generated adjusted EBITA of £142m.

Analysts had been expecting adjusted EBITA of £158m for 2017.

Grafton, whose chief executive is Gavin Slark, said that its market-led merchanting business in Ireland completed its fourth successive year of double-digit, like-for-like revenue growth "in a favourable economic and construction market".

"Demand was driven by growth in the residential RMI market and recovery in house building from a low base that is expected to gain momentum in the current year," according to Grafton.

Grafton's former chief financial officer Colm O'Nuallain, who retired from the company in 2013, warned as far back as 2010 that the country's recession had seen house building slump to an unsustainably low level and that a new price bubble was likely to emerge in future years.

Belfast Telegraph

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