Woodie’s online sales more than double
ONLINE revenue more than doubled at Woodie’s in the first half of this year, and was the fastest-growing segment of the business.
It’s a sign of potential trouble ahead for bricks–and-mortar retailers here as counterparts in the UK struggle. Woodie’s is part of the Grafton Group, a UK-listed business which posted results yesterday.
CEO Gavin Slark said that despite the fact that online was its fastest-growing sales channel, the company was still seeing a strong performance at its physical retail outlets.
“We are still seeing real growth coming through in terms of the number of customers coming through the door, and the amount they’re spending when they do come through the door.”
He said the business is “constantly looking at that retail portfolio, constantly making sure that what we’ve got is relevant to 21st century Irish consumers.”
Shares in Grafton were up more than 4.6pc at lunchtime yesterday, on the back of an 18pc year-on-year increase in profit before tax in the first half.
The bulk of the company’s activity is in so-called builders’ merchanting – selling building products to builders. It has a substantial presence in the UK and Ireland and also operates in the Netherlands and Belgium.
Its ratio of net debt to ebitda (earnings before interest, depreciation and amortisation) is low at 0.46 – implying plenty of room to spend.
“We recognise that we do have quite a lot of spending capacity in terms of the balance sheet, and it’s not always a case of keeping the debt low, it’s a case of making sure that you spend the money wisely,” Mr Slark said, adding that the company is always looking at potential acquisitions.
“We don’t feel constrained by geographic borders – it’s more a case of where are the good markets and where can we find good businesses, he said.”
On Brexit, Mr Slark said that was one factor behind expectations of flat market performance in UK merchanting for the rest of the year.
He said the company has done some planning work around various scenarios that might occur.
“It is a little bit like planning for the unknown because we still don’t know which scenario is going to land on us. And I’m still hopeful come March next year that there’ll be something sensible that businesses can work with.
“We don’t move an awful lot of products across the borders, we tend to trade in the countries in which we operate.”