Capital Markets Event
Grafton Group plc (“Grafton” or “the Group“), the international building materials distributor and DIY retailer, will hold a Capital Markets Event for pre-registered analysts and institutional investors at 15:00 today at the offices of Numis in London.
The event will focus on the Group’s core values and growth ambitions over the medium term. We will discuss the importance of sustainability to our businesses, with reference to a document which has been published on our website today setting out our sustainability achievements and objectives for the future.
The afternoon will include presentations and videos covering several of Grafton’s businesses, organic growth, the role of digital and our acquisition framework, led by Group Chief Executive, Gavin Slark and Chief Financial Officer, David Arnold and including a number of senior colleagues.
The presentation today will set out the Group’s new medium term financial return targets of 10% operating margin and 13% return on capital employed. In addition, the Group’s capital allocation strategy, including Grafton’s medium term financial leverage target of 1–2 times net debt to lease adjusted EBITDA will be discussed. This leverage target translates into capital available for acquisitions over the next few years in the range of £750m to £1.25bn once the proceeds from the disposal of the GB traditional merchanting business have been received.
Given the Group’s balance sheet strength, the Group will be targeting a slightly lower range of 2-3 times dividend cover going forward compared to an average of 3.5 times over the last twenty years. We expect that the full year 2021 dividend coverage ratio will be at the top end of that 2–3 times range.
No new information will be provided on current trading further to the Group's latest trading update, which was published on 9 November 2021.