2022 Final Results

Final Results for Year Ended 31 December 2022

Strong Trading Performance from Diversified Earnings Base

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Grafton Group plc ("Grafton"), the international building materials distributor and DIY retailer is pleased to announce its final results for the year ended 31 December 2022.

Continuing Operations1

2022

20212

Change

Revenue

£2,301m

£2,110m

+9.1%

Adjusted3 operating profit

£285.9m

£288.0m

(0.7%)

Adjusted operating profit before property profit3

£260.5m

£271.2m

(4.0%)

Adjusted operating profit margin before property profit

11.3%

12.9%

(160bps)

Adjusted profit before tax3

£273.3m

£268.6m

+1.7%

Adjusted earnings per share3

96.6p

93.0p

+3.9%

Dividend

33.0p

30.5p

+8.2%

Adjusted return on capital employed (ROCE) 3

17.2%

19.4%

(220bps)

Net cash (before IFRS 16 leases)

£458.2m

£588.0m

(£129.8m)

Net cash – (including IFRS 16 leases)

£8.9m

£139.0m

(£130.1m)

Statutory Results – Continuing Operations

2022

2021

Change

Operating profit

£264.3m

£269.2m

(1.8%)

Profit before tax

£251.7m

£249.8m

+0.8%

Basic earnings per share

89.3p

86.4p

+3.4%

1 Supplementary financial information in relation to Alternative Performance Measures (APMs) is set out on pages 42 to 47.

2 The 2021 results do not include the traditional merchanting business in Great Britain that was divested in 2021 and classified as discontinued operations.

3 The term “Adjusted” means before exceptional items, amortisation of intangible assets arising on acquisitions and acquisition related items in both years.

 

Operational Highlights       

  • Excellent performance in distribution businesses in Ireland and the Netherlands
  • Volumes and profitability lower in Selco against a strong comparative period and softer backdrop
  • Good profit contribution from IKH in Finland
  • Revenue and profitability normalised in Woodie’s DIY, Home and Garden retail business
  • UK Manufacturing businesses performed well
  • Further progress made against sustainability targets
  • Diversified revenue base with over half generated in Ireland, the Netherlands and Finland

 

Financial Highlights

  • 11.3% operating profit margin before property profit
  • Adjusted return on capital employed of 17.2%
  • Slight decline in adjusted operating profit (before property profit) to £260.5 million as expected
  • Double digit/high single digit operating profit margin in all businesses (before property profit)
  • High cash conversion with cashflow of £278.8 million from operations
  • £208.9 million returned to shareholders during year through share buybacks and dividends
  • Net cash at 31 December 2022 of £458.2 million (before IFRS 16 lease liabilities)
  • Annual dividend per share growth of 8.2%

"In my first set of results as Chief Executive, I am pleased to report a strong performance by the Group which is ahead of market expectations. This is a great achievement by my new colleagues across the business and is testament to their dedication and professionalism. It has also confirmed the qualities of the business which attracted me to join Grafton. 

"We still face many of the external challenges that we faced in 2022, but I am encouraged by the quality of the Group’s portfolio of higher margin businesses that are sensibly positioned with both market leading brands and geographic diversity. We now have more than half of our revenues coming from outside the UK in Ireland, Finland and the Netherlands. 

"Importantly, with a very strong balance sheet, Grafton is well positioned to invest in future growth opportunities and we look forward with confidence."

Eric Born Chief Executive Officer