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Wolseley hit by challenging conditions, profits down 80%

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by Kay Mitchell

Wolseley, which is one of the UK’s largest suppliers to builders, has reported a massive drop in profits today sending its shares plummeting by 15%.

The company, which owns the Plumb Center and Build Center chains, said that in the nine months to 30 April, pre-tax profits fell by 80% compared with the same period a year ago.

In March this year, Wolseley tapped shareholders for an extra £1 billion via a rights issue.

The company has been severely hit by the housing market downturn in the UK and the US, which has led to a slump in demand for building products.

As a result, the company has reduced headcount by more than 13,000 worldwide, including 2,819 in the UK and Irish Republic.

Furthermore, according to The Times, it is likely that further jobs will go in France and Sweden.

Chip Hornsby, Wolseley’s chief executive, said: “Recent trading conditions have proved extremely challenging and we continue to anticipate this will be the case until at least early 2010.”

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News posted: May 28, 2009

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