Grafton Group Plc · LSE:GFTU
Grafton — FY2024 Earnings Presentation
39 slides from Grafton's earnings presentation, March 2025
Slide 1: Grafton Group plc Final Results
Financial Year Ended 31 December 2024 Grafton Group plc Final Results
Slide 2: Agenda
FY 2024 highlights 5 FY 2024 financial review 7 Business update & outlook 27 Appendices 35 Agenda Grafton Group plc – Final Results 2024 2
Slide 3: Forward-looking statements & notes
Forward-looking statements & notes Forward-looking statements This presentation may include forward-looking statements. These forward-looking statements can be identified by the use of forward-looking terminology, including the terms "outlook," "believe(s),"expect(s)," "potential," "continue(s)," "m
Slide 4: Presenting today
Presenting today Eric Born David Arnold Chief Executive Officer Chief Financial Officer Grafton Group plc – Final Results 2024 4
Slide 5: FY 2024 highlights
FY 2024 highlights Eric Born, Chief Executive Officer
Slide 6: 2024 highlights
2024 highlights • Full year adjusted operating profit slightly ahead of analysts’ expectations 1 • Resilient result despite challenging macroeconomic backdrop in several markets • Supported by geographic diversification and cost mitigation actions • Pleasing progress on Group development but ambitio
Slide 7: FY 2024 financial review
FY 2024 financial review David Arnold, Chief Financial Officer
Slide 8: 2024 financial highlights
2024 financial highlights £’m 2024 2023 Change Revenue £2,282m £2,319m (1.6%) Adjusted operating profit £177.5m £205.5m (13.6%) Adjusted earnings per share 71.8p 77.9p (7.8%) Full year dividend 37.0p 36.0p +2.8% Adjusted operating profit margin pre property profit 7.6% 8.8% (120bps) Adjusted return
Slide 9: Income statement
Income statement £’m 2024 2023 Change Revenue 2,282.3 2,319.2 (1.6%) Adjusted operating profit pre property profit 173.5 204.2 (15.0%) Property profit 4.0 1.3 Adjusted operating profit 177.5 205.5 (13.6%) Amortisation1 and acquisition related items (24.9) (22.4) Statutory operating profit 152.6 183.
Slide 10: Income statement
Income statement £’m 2024 2023 Change Revenue 2,282.3 2,319.2 (1.6%) Trading result slightly ahead of Adjusted operating profit pre property profit 173.5 204.2 (15.0%) expectations Property profit 4.0 1.3 Gross margin broadly unchanged Adjusted operating profit 177.5 205.5 (13.6%) Amortisation1 and
Slide 11: Revenue bridge – 2023 to 2024
Revenue bridge – 2023 to 2024 2,400 2024 acquisition of Salvador Escoda 2,350 together with effect of 2,319 47 2023 bolt-on 2,300 2,282 acquisitions in (37) Northern Ireland, (47) 2,250 Finland, the UK and Ireland 2,200 £’m 2,150 Negative FX impact due to weakening of 2,100 the Euro against GBP 2,05
Slide 12: Analysis of organic movement in revenue (constant currency)
Analysis of organic movement in revenue (constant currency) Like-for-like Irish businesses performing well Declines across other countries with UK being key driver £’m 10 10 Thirteen new branches added (4) across the Group in (42) (7) 4 2023/2024 in the (47) Netherlands, Ireland, (18) the UK and Fin
Slide 13: Adjusted operating profit – 2023 to 2024
Adjusted operating profit – 2023 to 2024 Like-for-like 210.0 205.5 business down 205.0 £29.2m mainly driven 200.0 by decline in the UK 195.0 2023 & 2024 acquisitions 190.0 generating profits in 185.0 2024. Salvador £’m 2.7 Escoda – 2 months 180.0 1.8 177.5 trading only. 0.2 175.0 (29.2) (3.5) Proper
Slide 14: Analysis of movement in adjusted operating profit in like-for-like business
Analysis of movement in adjusted operating profit in like-for-like business Like-for-like Irish businesses performing well Operating profit decline in other countries driven by 1.6 challenging markets (15.8) Rate of decline moderated in H2 (5.7) 2.8 Tight control of (4.5) central costs (6.6) (1.0) (
Slide 15: Ireland distribution
Ireland distribution £’m 2024 Constant 2023 Change currency Revenue 632.8 631.0 +0.3% 3.0% Revenue (£’m) Adjusted operating profit1 61.5 60.9 +1.0% 3.6% 700.0 632.8 631.0 600.0 500.0 Adjusted operating margin1 9.7% 9.7% - - £’m 400.0 300.0 200.0 2024 2023 • Overall construction market in Ireland was
Slide 16: UK distribution
UK distribution £’m 2024 2023 Change Revenue 780.8 818.1 (4.6%) Revenue (£’m) Adjusted operating profit1 32.4 47.3 (31.3%) 780.8 818.1 750.0 550.0 Adjusted operating margin1 4.2% 5.8% (160bps) £’m 350.0 150.0 2024 2023 • RMI demand remained weak – more pronounced in London Adjusted operating profit1
Slide 17: Netherlands distribution
Netherlands distribution £’m 2024 Constant 2023 Change currency Revenue 337.6 351.5 (4.0%) (1.3%) Revenue (£’m) Adjusted operating profit1 26.4 33.4 (21.0%) (18.7%) 400.0 337.6 351.5 300.0 Adjusted operating margin1 7.8% 9.5% (170ps) - £’m 200.0 100.0 0.0 2024 2023 • Market conditions remained chall
Slide 18: Finland distribution
Finland distribution £’m 2024 Constant 2023 Change currency Revenue 131.8 139.8 (5.7%) (3.1%) Revenue (£’m) 139.8 Adjusted operating profit1 8.9 14.2 (37.0%) (35.2%) 160.0 131.8 80.0 Adjusted operating margin1 6.8% 10.2% (340bps) - £’m 0.0 2024 2023 • Performed well against overall Finnish market wi
Slide 19: Retailing
Retailing £’m 2024 Constant 2023 Change currency Revenue 261.1 258.2 +1.1% +3.9% Revenue (£’m) Adjusted operating profit1 34.7 32.7 +6.0% +8.9% 261.1 258.2 240.0 160.0 Adjusted operating margin1 13.3% 12.7% +60bps - £’m 80.0 0.0 2024 2023 • Strong trading performance in Woodie’s with higher H2 activ
Slide 20: Manufacturing
Manufacturing £’m 2024 Constant 2023 Change currency Revenue 108.6 120.6 (10.0%) (9.8%) Revenue (£’m) Adjusted operating profit1 24.3 30.3 (19.7%) (19.4%) 108.6 120.6 80.0 Adjusted operating margin1 22.4% 25.1% (270bps) - £’m 0.0 2024 2023 CPI EuroMix StairBox • New housing sector • RMI market remai
Slide 21: Balance sheet
Balance sheet 31 December 31 December £’m 2024 2023 Goodwill and intangible assets 769.2 784.0 Right-of-use assets 377.7 401.3 Tangible assets 395.4 396.2 Working capital 280.7 224.1 Other liabilities (96.5) (94.6) Pension asset/(deficit) 1.3 (5.8) Capital employed 1,727.9 1,705.1 Net cash excluding
Slide 22: Balance sheet
Balance sheet 31 December 31 December £’m 2024 2023 Goodwill and intangible assets 769.2 784.0 Right-of-use assets 377.7 401.3 £’m Tangible assets 395.4 396.2 Opening 224.1 Working capital 280.7 224.1 FX and interest (8.0) Other liabilities (96.5) (94.6) Salvador Escoda 79.5 Pension asset/(deficit)
Slide 23: Cash from operations
Cash from operations £’m 2024 2023 Profit before taxation 152.5 183.5 (Deduct)/Addback Net finance costs/(income) 0.1 (0.4) Operating profit 152.6 183.1 Depreciation & amortisation of software 114.5 106.3 Amortisation of intangible assets arising on acquisitions 20.3 19.7 Property profits (total) (4
Slide 24: Cash flow
Cash flow £’m 2024 2023 Cash from operations 298.3 334.3 Interest and tax (28.0) (37.3) Payment of lease liabilities (71.6) (67.7) Deferred acquisition consideration paid (2.1) (2.6) Replacement capex net of asset disposals (18.2) (23.7) Free cash flow 178.2 203.0 Development capex (22.9) (25.4) Div
Slide 25: Cash flow
Cash flow £’m 2024 2023 Cash from operations 298.3 334.3 Interest and tax (28.0) (37.3) Payment of lease liabilities (71.6) (67.7) Deferred acquisition consideration paid (2.1) (2.6) Replacement capex net of asset disposals (18.2) (23.7) Free cash flow 178.2 203.0 Development capex (22.9) (25.4) Str
Slide 26: Cash flow
Cash flow £’m 2024 2023 Cash from operations 298.3 334.3 Interest and tax (28.0) (37.3) Payment of lease liabilities (71.6) (67.7) Deferred acquisition consideration paid (2.1) (2.6) Replacement capex net of asset disposals (18.2) (23.7) Free cash flow 178.2 203.0 Development capex (22.9) (25.4) Div
Slide 27: Business update & outlook
Business update & outlook Eric Born, Chief Executive Officer
Slide 28: Market and company drivers
Market and company drivers Attractive building materials and home Grafton’s structure is geared for growth improvement market based on its strengths • Structure • Structure • Large, fragmented and growing industry • Lean corporate centre, focused on strategy, governance, leveraging best practice and
Slide 29: Market entry to Iberian peninsula
Market entry to Iberian peninsula • Spain/Portugal Market Size • Building Materials Distribution c. €30bn • HVAC Distribution c. €2.7bn • Ambition to build a substantial presence in Building Materials Distribution in Iberia • Fragmented market – opportunities in both HVAC and other growth segments •
Slide 30: Salvador Escoda – attractive market exposure
Salvador Escoda – attractive market exposure • 92 branches & 4 Warehouses • 2024 FY revenue of €233.1m with operating profit margin of 6.4%1 • Sales CAGR of c. 7% pa since 2019 • Grafton integration plan: 12 • Accelerate organic growth – room to open another 50+ branches • Upgrade IT infrastructure
Slide 31: Current trading
Current trading Average daily like-for-like revenue change • Disruptive weather in Ireland and UK in January 1 Jan 2025 – and unseasonably mild weather in Finland Q4 2024 28 Feb 2025 • Recovery in trading activity in February after Distribution slow start in January Ireland +5.0% +0.3% UK (2.9%) (4.
Slide 32: 2025 outlook
2025 outlook Economic growth expected. Ireland Construction market outlook remains positive with pick-up in RMI expected. Government commitment to housing growth – completions expected to increase. Cautious on near term outlook for a recovery in RMI demand. UK Gradual recovery expected in housing bu
Slide 33: Investment case reflects attractive recovery and growth potential
Investment case reflects attractive recovery and growth potential • Strong growth potential • Market leading brands • High operational leverage • Experienced and strengthened management teams • Excellent position to benefit from market recovery • Very ambitious to grow organically and via M&A • Attr
Slide 34: Questions
Questions
Slide 35: Appendices
Appendices Grafton G Group pic £
Slide 36: Appendix 1 Notes & definitions
Appendix 1 Notes & definitions Notes As amounts are reflected in £’m some immaterial rounding differences may arise. Definitions • Adjusted earnings per share is earnings before exceptional items, • Adjusted operating profit (pre property profit) margin is adjusted acquisition related items, intangi
Slide 37: Appendix 2 2025 technical guidance
Appendix 2 2025 technical guidance Finance Charge: c.£9-£10m but dependent on rate of reduction of interest rates by Central Banks together with impact of corporate development activity Tax Rate: c.20.4% and trend likely to be upwards toward 21.5% in subsequent years Depreciation and asset amortizat
Slide 38: Appendix 3 Revenue change – 2024 v 2023
Appendix 3 Revenue change – 2024 v 2023 Average Daily Like-for-Like Revenue Change FY Total Revenue Q1 Q2 H1 Q3 Q4 H2 2024 1 Jan – 31 Dec 2024 Constant Distribution Sterling Currency UK (7.3%) (8.2%) (7.7%) (4.8%) (2.9%) (3.9%) (5.9%) (4.6%) (4.6%) Ireland (0.2%) 1.1% 0.5% 0.7% 5.0% 2.8% 1.6% 3.0% 0
Slide 39: Thank You.
Thank You.