Builders merchant Wolseley sees profits fall 77%
Profts hammered at builders merchant
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Monday, 22, Sep 2008 10:05
Builders merchant Wolseley has seen a profit slump of 77 per cent and expects jobs to be lost.
Pretax profits at the firm – whose UK brands include Brandon Hire and the Plumb Centre – dropped to £145 million from £634 million a year ago, as the firm has taken a hit from property slowdowns in the US and the UK.
However Wolseley maintains it is holding its market share "against a backdrop of significant market deterioration".
Over the coming year, the firm now expects to lose 600 staff as it cuts costs and restructures – following some 7,100 job cuts already made.
Chip Hornsby, Wolseley group chief executive, said: "We have continued to take action to reduce costs and drive working capital improvements in response to challenging market conditions.
"While these conditions have impacted many of our businesses significantly during the year, our employees have done a good job at responding to the tough markets and we are seeing the benefits of our actions with market outperformance in many areas."
He added "financial discipline" remains the primary focus to the firm is well positioned for any market recovery.
Wolseley's share price rose 5.07 per cent at 9:35BST to 435p – buoyed by US plans to buy bad mortgage-backed securities, which it is hoped will allow the American property market to start to grow again.