Grafton Group (LSE:GFTU) has delivered higher first-half revenue and reaffirmed its full-year profit guidance, with acquisitions and strong performances in Ireland and Iberia helping to offset weaker trading conditions in Great Britain and Northern Europe.
The building materials distributor also announced a new share buyback programme, continuing its strategy of returning excess capital to shareholders.
Acquisitions and Regional Growth Support Revenue
Group revenue increased 6.7% to £1.34 billion during the first half of the year, benefiting from recent acquisitions in Ireland and Spain as well as continued strong trading across Iberia and the Island of Ireland.
On a like-for-like basis, average daily revenue rose 0.6%, with improving demand in Ireland and solid growth in Iberia balancing more challenging market conditions in Great Britain and softer activity across Northern Europe.
Company Reaffirms Full-Year Profit Outlook
Grafton maintained its guidance for adjusted operating profit of between £190 million and £200 million for the 2026 financial year.
Management expects trading conditions in the second half to remain broadly consistent with those seen during the opening six months, with ongoing resilience in Ireland and Iberia expected to offset continued weakness in the UK market.
The company also noted that it does not anticipate a significant recovery in Great Britain in the near term.
Share Buyback Continues Capital Return Strategy
Alongside its trading update, Grafton announced a new share repurchase programme of up to £25 million.
Including the latest initiative, the group will have returned approximately £457.6 million to shareholders since 2022, reducing its issued share capital by almost 22%.
Management said the buyback reflects its disciplined approach to capital allocation, balancing shareholder returns with targeted investment opportunities that support long-term growth.
Strong Financial Position Offsets Market Headwinds
Grafton continues to benefit from healthy cash generation and a conservative balance sheet, supporting both investment and shareholder distributions.
The shares also offer a moderate valuation alongside a dividend yield of around 4%.
However, technical indicators remain relatively weak, with the share price trading below key moving averages, while management continues to highlight cost inflation and subdued demand in several regions as near-term challenges.
About Grafton Group
Grafton Group plc is a leading European distributor of construction products and building materials, operating across the Island of Ireland, Great Britain, Northern Europe and Iberia.
The company trades through around 470 branches and employs approximately 10,000 people. Its portfolio includes well-known brands such as Chadwicks, Woodie’s and MacBlair in Ireland, together with Selco, Leyland SDM, T.G. Lynes, CPI EuroMix and StairBox in Great Britain.
Through its combination of trade distribution and consumer-facing home improvement businesses, Grafton has established a diversified platform serving both professional customers and retail markets across Europe.
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