Profits up at Wolseley despite decline in UK sales

PLUMBING and heating merchant Wolseley revealed higher profits today as a strong first half performance in its heavyweight US arm overshadowed a struggling UK division.

Wolseley reported a 3% fall in like-for-like sales in the UK, where it trades as Plumb Center, BCG and Bathstore, for the six months to January 31, while its US division – which represents 43% of group revenue against 15% for the UK – recorded a 9% increase.

Overall, Wolseley reported a 28% jump in group pre-tax profits to �250million, with revenue 3% up at �6.8billion.

The company, which has around 20 Plumb Center and Bathstore branches in Suffolk and north Essex and employs around 6,670 staff in the UK, said the heating market was subdued in Britain but other categories performed well.

Ian Meakins, Wolseley chief executive, said: “Wolseley has delivered another decent performance, despite challenging economic conditions in Europe.”

Mr Meakins warned that like-for-like growth since the end of the period had been slightly lower than the first half with “the US a little better and Europe a little weaker”.

He pledged: “We will continue to invest selectively in the business where we can exploit growth opportunities and generate good returns.”

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Wolseley said it made “considerable progress” in replacing the volumes from last year’s loss of a national boiler supply contract worth �70million a year.

In the US, where the group trades as Blended Branches, Waterworks and Ferguson, the company benefited from levels of new construction.

The US has shown improved signs of recovery in recent months, including better home sales, boosted housebuilder confidence and lower unemployment.