Dulux Comment: Q2 2023

June this year included 22 working days compared with just 20 for June 2022 on account of the late Queen’s Platinum Jubilee, with the late May 2022 bank holiday moved to June 2022. The extra day for the Jubilee made a total of two bank holidays in June 2022. Because of this, the rolling quarterly figures provide a fairer measure of performance as both Q2 2022 and Q2 2023 have exactly the same number of working days (60 in total).

On this basis, decorative trade paint litreage was 3% higher in the last 3 months with woodcare up 8%. In the case of paint this was the best quarterly outcome since January this year while for woodcare it was easily the best improvement for over two years. For the last month alone, trade paint sales increased 8% in June being the second consecutive monthly improvement. In woodcare, trade woodcare was 67% higher.

Looking at longer term measures, this year-to-date, volume was 1% higher than in the first six months of 2022, while the MAT figure shows that over the last 12 months as a whole, there has been a 0.6% increase compared to the same period a year earlier. All of these metrics are indicating a more positive market as we enter the second half (H2) and with Exterior being supressed in H1 2022 due to poor weather there is still room to grow.

In terms of sales by sector, sales to builders’ merchants were down 9% in Q2 2023 compared to Q2 2022. There are some signs that raw material prices are coming down which should inspire new work starts and, with that, bring more volume to the builders’ merchant sector.

According to ONS, monthly construction output is estimated to have decreased 0.2% in volume terms in May 2023. This is the third consecutive fall in the month-on-month series, with the monthly value in level terms at £15,360 million. The decline in monthly output came solely from a decrease in new work (0.4% fall), with repair and maintenance being flat (0.0%) on the month.

Anecdotal evidence continued to indicate a slow-down in private housing, referencing customers’ economic worries. However, some businesses across other sectors continued to report an easing in inflation.

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