Wolseley under pressure as profits tank

The building supplies group, which has a base in Ripon, suffered from a weak UK home improvement market in the year to the end of July, while its heating business looked set “to remain competitive with very little growth”.

The US, which represents the bulk of Wolseley’s earnings, saw trading profits rise but suffered a tough period for industrial markets in the fourth quarter, which the group said was expected to continue.

Overall full-year group trading profits for ongoing businesses were 14 per cent higher at £857 million, while like-for-like revenues grew 7.1 per cent.

But bottom line pre-tax profit fell by a quarter to £508 million largely as a result of a £234 million write-down in the value of underperforming operations in Denmark, Finland and Sweden.

Wolseley said it expected like-for-like revenue growth in the first half of its new financial year to slow to 4 per cent. In June it had predicted growth of 6 per cent for the six months ahead. Shares fell 9 per cent.

Chief executive Ian Meakins highlighted the performance of US plumbing supplies business Ferguson.