On 24 March 2020, Grafton Group announced that, as a precautionary measure to preserve liquidity in light of Covid-19, it was suspending the second interim dividend for 2019 of 12.5p per share, which was due to be paid on 6 April 2020. On 21 January 2021, the Group announced the reinstatement of this dividend and it was paid on 19 February 2021 in the amount of £29.9 million.
The Board is aware of the need to balance the interests of all stakeholders and of the importance of dividends to the Group's shareholders. Following the decision not to declare an interim dividend, and in light of the Group's profitable trading in the second half of 2020 and net cash position at the end of the year, the Board has given much consideration to the payment of a final dividend for the 2020 financial year. A final dividend for the year ended 31 December 2020 of 14.5p per ordinary share in Grafton Group plc is proposed for approval by shareholders at the AGM on 28 April 2021. This is down 23.7 per cent on total dividends of 19.0p paid for 2019. Dividend cover was 3.9 times (2019: 3.3 times).
Other financial highlights include:
Revenue in continuing operations down 6% to £2.5 billion, reflecting the impact of first half branch closures in response to the pandemic
Operating profit in continuing operations down 6% to £193.3 million and 4% before property profit, exceeding management expectations outlined in January trading update
Strong recovery in profitability in second half with adjusted operating profit up 47%, reflecting robust residential repair, maintenance and improvement markets in the UK and Ireland:
o Exceptional performance by Woodie's DIY, Home and Garden business in Ireland
o Particularly strong second half recovery by Chadwicks in Ireland and Selco in the UK
o Strong second half recovery in Buildbase aided by increased margin and cost control
Netherlands business traded successfully through the pandemic and Polvo acquisition increased scale and profitability
Over 90% of Group profit derived from businesses with reported operating margin in excess of Group's 7% target
Record cash generated from operations of £377.7 million included the benefit of strong day-to-day management of working capital
