The company, which owns Buildbase and Selco in the UK, also reported operating profits up 16% to £79.1m (2016: £68.4m).
In its half-year report Grafton says the UK merchanting business performed well during during the six months, reporting a 1.2% increase in adjusted operating profit to £51.1m (2016: £50.5m).
Buildbase achieved improved results in a market facing “significant price increases” by suppliers related to sterling’s weakness and increased commodity prices.
Selco recorded double-digit growth, driven largely by the opening of nine branches, and consolidated its position as the UK’s fourth largest general builders merchant.
“The Selco builders merchanting model continued to be the focus for development capital in the UK with the opening of nine new branches so far this year,” the report said.
“The traditional UK merchanting business reported good growth in profit and benefited from the restructuring implemented in the last quarter of 2016."
MacBlair in Northern Ireland also improved revenue and profit, following investment in recent years, while the Woodie’s DIY business in the Republic of Ireland also delivered strong growth. Grafton expects the growth to continue for the second half.
“Recent softer trends in the UK economy are likely to be sustained over the remainder of the year. The strength of housing starts should support housebuilding activity while the residential RMI market is expected to be broadly flat with continuing competitive pricing conditions.
“Expansion of the Selco branch network reflects our confidence in the medium term outlook for the UK economy,” the company said.
“The outlook for the Irish economy is positive with the pace of growth projected to remain strong and to provide a favourable trading environment.
“Growth in employment and incomes should continue to be supportive of household spending in the residential RMI and DIY markets.
“The new housing and non-residential newbuild markets are still in the relatively early stages of a recovery that is expected to gather pace in response to strong underlying demand.”