Grafton Group, the building materials company that owns Chadwick’s & Woodie’s in Ireland, reported record half year profits this morning thanks to surging materials prices and “exceptional demand” from builders.
Danni Hewson from AJ Bell said: “If record results from DIY retailer and construction materials group Grafton are anything to go by then the home renovation boom which started in the pandemic has further to run.
“With impressive cash flow underpinning the resumption of dividends, the company is clearly looking forward with some confidence.
“The strength of demand from UK homeowners for expanding and improving indoor and outdoor space to live and work remotely in more comfort has led to issues with availability and been affected by rising raw material prices.
“This could well result in a steady stream of projects coming through as these pressures start to ease.
“For its part Grafton has streamlined its operations with the sale of its lower margin UK builders’ merchant arm.
“The main remaining parts of the business including its Selco distribution arm and Woodies DIY chain in Ireland are in excellent shape, with the company scoring highly in areas like accessibility and flexibility of service.
“Selco’s self-select operating model and good management of stock levels has left it well placed to capitalise on the strong demand and across the board Grafton’s businesses are generating strong returns thanks to their leading market positions and focused offerings.”