Wolseley Sales Up 1% in Third Quarter

Global HVAC, plumbing and building materials distributor Wolseley plc, Zug, Switzerland, reported sales for the third quarter ended April 30, 2011, were £3.27 billion (US$5.36 billion), an increase of 1 percent over the same period a year ago. Like-for-like growth was 6 percent.

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Trading profit for the period increased 30 percent to £131 million (US$214.7 million). Trading profit is defined as operating profit before exceptional items and the amortization and impairment of acquired intangibles.

"The group continued to make progress in the third quarter broadly maintaining the revenue growth trends achieved in the first half despite tougher comparatives," Chief Executive Ian Meakins said. "New residential construction, which accounts for 20 percent of group revenue, remained subdued in most regions, while demand in repair, maintenance and improvement (RMI) segments held up well in most markets."

For the nine months ended April 30, sales were £9.9 billion (US$16.2 billion), up 3 percent in a year-over-year comparison. Trading profit increased 51 percent to £406 million (US$665.6 million).

Third-Quarter Sales By Region
Sales in the U.S. increased 2 percent to £1.33 billion (US$2.2 billion). Sales improved 10 percent on a like-for-like basis. The difference is primarily the result of a weakened U.S. dollar. Demand in residential and RMI markets held up well and the business made good progress in the industrial and commercial segments including Fire and Fabrication, though from a low comparable base.

In Canada, sales declined 2 percent to £175 million (US$286.9 million), but were flat on a like-for-like basis. Growth rate has declined over the year and market conditions remain challenging. Wolseley reported focus in this area will be on protecting market share and gross margins.

U.K. sales fell 4 percent to £601 million (US$985.2 million), but were up 1 percent on a like-for-like basis. The difference is primarily a result of the disposal of Brandon Hire in September 2010.

The Nordic region reported a sales of £488 million (US$800 million), an increase of 8 percent (6 percent on a like-for-like basis). The market in Denmark showed signs of improvement and the builders merchant businesses in Sweden, Finland and Norway all continued to trade well.

Sales in France increased 2 percent to £509 million (US$834.4 million). Like-for-like growth was 8 percent. This stronger performance primarily reflected increased activity in new residential construction markets.

Central Europe reported sales were down 15 percent to £170 million (US$278.7 million).