Woodie’s on­line sales more than dou­ble

Irish Independent - Business Week - - Front Page - Gavin McLough­lin

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.”

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