Grafton Group said on Wednesday revenues for last year increased by almost 6 per cent as the company's merchanting business grew.
In a trading statement for the year end of December, the group reported revenues of €2.17bn compared to €2.05bn the previous year.
The firm anticipated operating profits for 2012 at no less than €70m, up from €56.9 the year before.
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"The anticipated operating profit outcome reflects an improvement in trading in the final months of the year and the benefit of a relentless emphasis on improving performance through self-help measures against the backdrop of difficult market conditions," Grafton said in a statement.
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The builders merchants and DIY group - which has operations in the UK, Ireland and Belgium - said trading ended on a strong note with an increase in average daily UK like-for-like merchanting turnover.
UK merchanting sterling turnover increased by 3.1% in the year while average daily like-for-like sterling turnover climbed 1.7% including a growth of 3.7% in the last two months of the year.
However turnover in the Irish retailing business declined 9.2%.
"The immediate outlook for demand in the group's markets remains challenging and the timing and extent of any recovery is unclear," the company said in a statement.
"There will be a continued focus in 2013 on operational initiatives to improve profitability."
Grafton added that its strong portfolio and revenues have left the group well placed for growth and development this year.
Shares soared 4.33% to €4.10 at 10:40 Wednesday.
Preliminary results for 2012 are expected to be announced on March 7th.
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