Strong EPS growth supported by operational execution and capital allocation strategy
Grafton Group plc ("Grafton" or “the Group”), the European multinational distributor of construction related products and solutions, is pleased to announce its half year results for the period ended 30 June 2026.
Financial Highlights
- First half adjusted operating profit increased by 8.2% to £98.5m (H1 2025: £91.0m) supported by strong underlying trading and acquisitions in Iberia and on the Island of Ireland
- Group operating margin of 7.4% (2025: 7.3%) reflects active gross margin management
- Adjusted earnings per share grew strongly by 10.8% to 39.4p (2025: 35.5p) reflecting our capital allocation strategy including the positive impact of share buybacks
- Balance sheet remains strong with £78.3m net cash (before lease liabilities) (2025: £245.8m), despite recent acquisitions, maintaining firepower for further capital deployment
- The Board has declared an interim dividend of 11.00 pence per share, an increase of 2.3% on last year’s interim dividend of 10.75 pence
- Full year adjusted operating profit guidance of £190m - £200m maintained1
Operational Highlights
- Recent Capital Markets Event (see Group Strategy section) set out the positive impact of the ‘Grafton Way’ in driving performance, combining local agility and accountability with the benefits of Group-wide collaboration, shared expertise and operational excellence
- Limited disruption from geopolitical developments - continued proactive management of supply chain for strong product availability
- Strong performances on the Island of Ireland and in Iberia, driven by continued progress in executing organic and inorganic growth opportunities
- Early trading in recently acquired Cygnum and Mercaluz in line with expectations, with integration plans progressing well and the Group additionally benefiting from Mercaluz's seasonally stronger trading period
- Challenging market conditions in Great Britain continue to weigh on profitability with market conditions expected to remain broadly consistent with those experienced in the first half
- Timing of a sustained recovery in Northern Europe remains uncertain, although early signs of self-help led improvement are emerging in Finland
| Total Operations2 | H1 2026 | H1 2025 | Change |
| Revenue | £1,336m | £1,252m | +6.7% |
| Adjusted3 operating profit | £98.5m | £91.0m | +8.2% |
| Adjusted operating profit before property profit | £98.3m | £91.0m | +8.0% |
| Adjusted operating profit margin before property profit | 7.4% | 7.3% | +10bps |
| Adjusted profit before tax | £93.0m | £86.8m | +7.1% |
| Adjusted earnings per share | 39.4p | 35.5p | +10.8% |
| Interim dividend | 11.00p | 10.75p | +2.3% |
| Adjusted return on capital employed (ROCE) | 10.7% | 10.9% | (20bps) |
| Net (debt) (including IFRS 16 lease liabilities) | (£315.2m) | (£147.3m) | (£167.9m) |
| Net cash (before IFRS 16 lease liabilities) | £78.3m | £245.8m | (£167.5m) |
| Statutory Results | H1 2026 | H1 2025 | Change |
| Operating profit | £82.9m | £87.7m | (5.4%) |
| Profit before tax | £77.7m | £83.5m | (6.9%) |
| Basic earnings per share | 32.8p | 35.1p | (6.4%) |
Outlook
The Group remains on track to deliver full year adjusted operating profit of £190m - £200m recognising that the important Autumn trading season is still to come.
Trading conditions in the second half are expected to remain broadly consistent with those experienced in the first half. The trading environments in Iberia and the Republic of Ireland (“ROI”) remain favourable, supported by attractive underlying demand fundamentals. In Northern Europe, market conditions are expected to remain subdued and the timing of a sustained recovery across Finland and the Netherlands remains uncertain. In Great Britain, the market is expected to remain challenging, with market conditions expected to remain broadly consistent with those experienced in the first half.
Our experienced management teams remain relentlessly focused on delivering value to customers, optimising cost-to-serve, driving efficiency and maintaining tight cost control. While geopolitical uncertainty, related inflationary and supply chain risks persist, the medium-term outlook for Grafton remains positive. Key growth drivers include structural housing undersupply across all its markets and an anticipated recovery in RMI demand after an extended period of restrained consumer spending. While market conditions remain challenging in certain regions, the ‘Grafton Way’ helps ensure our businesses are well positioned to win the recovery. Supported by a resilient balance sheet and significant financial flexibility, the Group remains well positioned to invest in organic growth opportunities, pursue value-enhancing acquisitions and return capital to shareholders.
Group average daily like-for-like revenue from 1 July 2026 to 23 August 2026 was 1.5% ahead of the comparable period last year. Momentum remained strong on the Island of Ireland, where all businesses delivered positive growth during the period. In Great Britain, conditions showed little change from those experienced in the first half, with activity remaining subdued across both the RMI and housebuilding markets. In Northern Europe, trading improved in Finland, reflecting the early stages of economic recovery, while the Netherlands delivered positive sales growth supported by price inflation and stronger project activity. Iberia continued to perform strongly, with the positive momentum seen in the first half extending into the late summer period.
| Average Daily Like-for-Like Revenue Change in Constant Currency |
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| H1 2026 | 1 July 2026 – 23 August 2026 |
|
| Island of Ireland Great Britain Northern Europe Iberia Total Group Iberia pro forma4 |
+3.4% (5.1%) +0.8% +6.6% +0.6% +8.2% |
+4.9% (5.6%) +2.7% +7.8% +1.5% +7.0% |
Eric Born, Chief Executive Officer Commented:
“Despite a relatively slow start to the year, we are pleased to have grown revenue, adjusted operating profit and margin in the first half of 2026 and to be in a position to reaffirm that we remain on track to deliver full year adjusted operating profit of £190m - £200m, whilst recognising the important Autumn trading season is still to come.
“Our outlook for the second half is not dissimilar to H1, with Iberia and Island of Ireland strong, Northern Europe mixed and continuing weakness in Great Britain. Our medium-term outlook remains very positive supported by structural housing deficits in each of our markets and, in many cases, pent up demand for RMI.
“We remain well positioned to achieve our medium-term growth and strategic ambitions out to 2030 as set out in our recent Capital Markets Event. Our first half result underpins the rationale of exposure to diverse markets and of investment through the cycle to support sustainable growth across geographies whose economies are operating at different speeds.”
1 Grafton compiled consensus Analysts’ forecasts for 2026 show adjusted operating profit of circa £194.2m and a range of £191.0m to £199.0m.
2Supplementary financial information in relation to Alternative Performance Measures (APMs) is set out on pages 39 to 44.
2 The term “Adjusted” means before exceptional items, amortisation of intangible assets arising on acquisitions, acquisition related items and unwinding of discount applicable to contingent consideration receivable in both periods, which are defined on page 39.
4Like-for-like results are presented on a proforma basis to reflect the performance of Mercaluz, which was acquired by the Group on 30 April 2026, as though it had been part of the Group for the entire comparative period.