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In The News:

Wolseley Sales Up 3% in Fiscal Year 2011

Switzerland-based Wolseley plc reported sales for the fiscal year ended July 31, 2011, were £13.6 billion (US$21 billion), up 3 percent over sales in fiscal 2010. Like-for-like sales increased 5 percent. The company reported profit of £391 million (US$602.5 million), compared to a year-ago loss of £328 million (US$505.4 million).

Wolseley is the parent company of Ferguson/Wolseley Canada, No. 1 on MDM's list of top industrial distributors.

"We have delivered another decent set of results despite challenging economic conditions, with better customer service driving sales and strong trading profit growth," Chief Executive Ian Meakins said. "… Our disposal program is now substantially complete, enabling us to focus on our great businesses in attractive markets."

Brandon Hire (UK), Electric Center (UK) and Italy were sold in the year. The sale of Build Center (UK) and Brossette (France) was agreed though completion is subject to clearance from the relevant competition authorities. Encon (UK) is also for sale.

Sales in the U.S., which accounts for about 40 percent of group sales, was £5.5 billion (US$8.5 billion), up 6 percent over the same period a year ago. Like-for-like sales increased 9 percent. Trading profit improved 31 percent to £314 million (US$483.8 million).

In the first half of the year, Ferguson completed the acquisition of a small Waterworks acquisition in Alabama. Since year-end, two more acquisitions in the U.S. have been completed.

Sales in Canada – 6 percent of group sales – were £811 million (US$1.25 billion), up 6 percent over sales in fiscal 2010. Like-for-like sales increased 2 percent. Trading profit fell 5 percent to £39 million (US$60.1 million).

UK sales – 18 percent of group sales – were £2.4 billion (US$3.7 billion), down 3 percent in a year-over-year comparison, due primarily to disposals and an earlier reported contract loss. On a like-for-like basis, sales increased 3 percent. Trading profit increased 20 percent to £109 million (US$167.9 million).

In the Nordic region – 16 percent of group sales – sales grew 6 percent to £2.1 billion (US$3.2 billion). On a like-for-like basis, sales grew 4 percent. Trading profit was up 12 percent to £113 million (US$174.1 million). Wolseley completed two small bolt-on acquisitions in Denmark during the year.

Sales in France – 14 percent of group sales – were £1.9 billion (US$2.9 billion), flat compared to fiscal 2010. On a like-for-like basis, sales increased 4 percent, primarily due to commodity price inflation. Trading profit climbed 77 percent to £53 million (US$81.7 million).

In Central Europe – 6 percent of group sales – sales declined 9 percent to £772 million (US$1.2 billion). Like-for-like sales declined 2 percent. Sales in Central Europe were impacted by the exit of unprofitable business in Holland and the disposal of the group's Italian business earlier in the year. Trading profit was £30 million (US$46.2 million), compared to a £9 million (US$13.9 million) a year ago.

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