Grafton Group (LSE:GFTU) reported a steady start to 2026, with group revenue increasing 3.2% to £830.1 million while like-for-like sales remained broadly unchanged. Growth across Iberia, the Island of Ireland, and Northern Europe helped offset a 5% sales decline in Great Britain.
The company is continuing to expand in key growth markets through the acquisitions of Irish timber-frame specialist Cygnum and Spanish HVAC distributor Mercaluz. The deals are expected to strengthen Grafton’s exposure to residential construction activity and the growing Iberian air-conditioning market.
Higher Profit Guidance and Continued Share Buybacks
Management said the group continues to manage inflationary pressures and supply chain risks linked to tensions in the Middle East while maintaining strict cost and margin controls. Supported by contributions from the recent acquisitions, Grafton now expects adjusted operating profit for the full year to range between £190 million and £200 million.
The company also completed its eighth share buyback programme since 2022, bringing total capital returned through repurchases to £453.3 million. The programmes have reduced Grafton’s issued share count by 21.6%, reflecting management confidence in the strength of the balance sheet and longer-term demand trends driven by housing shortages and delayed repair and maintenance spending.
Financial Position and Market Outlook
Grafton Group continues to benefit from strong cash generation and a conservatively managed balance sheet, while valuation metrics remain relatively supportive with a moderate price-to-earnings ratio and a dividend yield of around 4%.
However, technical indicators remain weaker, with the share price trading below key moving averages and momentum indicators such as MACD remaining negative. Management also acknowledged that trading conditions in early 2026 remain subdued, with ongoing regional weakness and persistent cost inflation continuing to affect the operating environment.
More About Grafton
Grafton Group is a multinational distributor of construction-related products and services operating across the Island of Ireland, Great Britain, Northern Europe, and Iberia.
Its portfolio includes builders’ merchants, DIY retail operations, HVAC distribution businesses, and timber-frame construction specialists. The group has increasingly focused its growth strategy on expanding in higher-growth regions such as Ireland and the Iberian market.
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