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Investing.com -- Shares of Grafton Group PLC (LSE:GFTU) climbed 5.2% as the building materials retailer reported a solid start to the year, with group revenue showing a 7.8% increase on a year-on-year (YoY) basis.
The company’s trading update for the period ending April 27 highlighted a revenue of £773 million, which also marked a like-for-like (LFL) growth of 2.7%, slightly ahead of full-year 2025 consensus expectations for a 2.3% LFL increase.
The positive market response comes after Grafton indicated that it remains on track to meet full-year expectations despite a slight LFL decline of 0.3% in its UK distribution segment, which the company attributed to improved trading with price inflation of 1-2%.
The firm’s performance reflects an overall stabilization and acceleration in trading, particularly in Ireland, as the company navigates a challenging market environment.
RBC described the results as encouraging overall but noted that conditions remain challenging, with lingering uncertainty around tariffs.
As a result, the firm does not expect changes to consensus forecasts. It added that Grafton’s strong balance sheet continues to be a key part of its investment case.
The outlook for Grafton remains cautiously optimistic as it continues to navigate the uncertainties of the market, including tariff concerns.
However, with a robust balance sheet and the potential for strategic mergers and acquisitions, as well as share buybacks, the company is positioned to maintain its growth trajectory and deliver value to shareholders.
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