By Padraic Halpin
DUBLIN, March 5 Building supplies group Grafton
said renewed activity in Irish construction appeared
to be sufficient to support a sustained recovery, after it
reported a 27 percent rise in operating profit last year.
Grafton, which has cut its workforce by a quarter and more
than halved its net debt over the past five years, responded to
the crisis in Ireland by building up its business in Britain,
where it is now the third largest building supplies merchant.
Grafton said on Wednesday that its operating profit rose to
77.2 million euros last year from revenues of 1.9 billion euros,
three quarters of which came from Britain where the economy has
been performing strongly for a year.
However, the group's main merchanting business returned to
growth in Ireland in the second half and grew by another 7
percent in the first two months of the year, catching up with
the near 10 percent seen in Britain.
Ireland's economy has been gradually improving since it
became the first euro zone country to complete a bailout in
December and is expected to grow by about 2 percent in 2014.
"The UK didn't crash and burn by anything like the scale we
had in Ireland, but you're probably something like a year behind
where the cycle is," Chief Executive Gavin Slark told Reuters in
"The most important thing about the Irish numbers for us, is
that growth and the beginning of the recovery seems to be
sustained. Hopefully as we go through 2014 and beyond, we can
see sensible, sustained growth patterns in Irish construction."
Slark, the former boss of British plumbing and heating firm
BSS, said the main pick-up in Ireland was among smaller builders
- one and two-man businesses - and that the recovery was
spreading to major towns and cities outside Dublin.
He added that Grafton was looking at further acquisitions in
Belgium, a market it entered recently, and potentially at other
opportunities further afield.
"Acquisitions are something that is absolutely on the
Grafton announced a 21 percent dividend increase to 8.5
pence per share for 2013. Grafton shares were trading 4.0
percent higher at 1125 GMT.