Grafton sales growth limited by margin pressures

12th May 2015 07:44

Builders merchant and DIY group Grafton Group has had a positive start to the year, though margin pressures in its UK business partially offset top-line growth.The company, with operations in the UK, Ireland and Belgium, reported 9.6% year-on-year growth in constant-currency revenues over the four months to 30 April.Average daily like-for-like (LFL) revenues in merchanting were up 5.2%, with 4% growth in the UK and a 15.7% surge in Ireland outweighing a 1.7% fall in Belgium.Grafton noted UK margin pressures in general merchanting, which accounts for 91% of group sales, which "started the year on a much more competitive note and the revenue mix was less favourable".Nevertheless, the company said the first four months of the year are generally "seasonally quieter" and operating profits will be more heavily weighted towards the second half.Elsewhere, retailing LFL sales were up 3% and manufacturing LFL revenues gained 15.5%."The group is well positioned to benefit from growth in its markets and from ongoing development activity that will support further progress towards the delivery of its medium-term targets outlined earlier this year," said chief executive Gavin Slark.The stock was down 1.6% at 829.5p by 08:43.