Cost-cutting narrows Wolseley losses

The Reading-based firm, which trades as Build Center and Plumb Center, saw pre-tax losses narrow to 261 million in the six months to January 31 from 464 million a year earlier.

It said further costs cutting in the half-year claimed more than 1,900 jobs - including 745 in the UK - on top of the 10,000 shed the previous year and added it would continue to keep a tight control on costs.

But the firm is seeing improvements in its markets, which last month led it to increase guidance for full-year trading profits.

And it confirmed today it was seeing "stabilisation in many of our markets", with sales declines continuing to ease.

Last year Wolseley closed a small distribution centre in Ripon, although still has a larger distribution centre in Melmerby, near Ripon, which employs 200 people. It moved its UK head office from Ripon in 2005.

Wolseley, which also owns bathroom specialist Bathstore in the UK, reported revenues down 15.1 per cent to 6.3 billion in the first six months of its year, although it claimed to have improved its market share across most divisions.

Like-for-like sales falls are lessening, helped by a recovery in business and easier comparatives.

The US division - accounting for 43 per cent of group revenues - saw declines in the Ferguson plumbing and heating chain improve to 18 per cent from 22.6 per cent in the previous six months.

The UK arm recorded a like-for-like sales fall of 4 per cent compared with 13.1 per cent at the end of the last financial year.

Wolseley's US business has taken the brunt of job losses after the recession and housing market slump hit the group hard, with Ferguson's workforce being slashed by nearly 7,000 or 30 per cent over the past two-and-a-half years.

Ian Meakins, group chief executive, said: "The results for the first half reflect good progress on cost reductions which were delivered ahead of schedule.

"Market conditions remain challenging, though we are now seeing stabilisation in many of our markets."