Wolseley plc has reported it will close 24 more Stock Building Supply branches, primarily in the Midwest. The closures include a 370 headcount reduction.
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The announcement comes after closing 22 branches and reducing headcount by about 4,500 in the past year, or a quarter of total employees.
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Wolseley reported sales at Stock were down nearly 15% in the first 11 months of the fiscal year; commodity price deflation caused revenues to decline a further 10%. Profit was down two-thirds.
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Lumber and structural panel prices, when combined, account for 45% of Stock’s revenues; they have fallen by 21% and 27%, respectively.
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Stock’s results were offset by strong organic growth in the U.S. plumbing and heating business, improved performance in continental Europe and acquisitions. Ferguson revenue was up by around 15%, of which approximately 6% was organic growth. Profit was up by 20%.
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Wolseley, London-based distributor of plumbing and heating products to professional contractors and a supplier of building materials, reported overall group sales for the first 11 months of the year to June 30, 2007, were up by nearly 15%. The profit was up about 2% for the same period. Wolseley is the parent of Ferguson and Stock in the U.S.
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Results for the full fiscal year ending July 31, 2007, will be announced Sept. 24, 2007.
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Wolseley Canada achieved modest local currency revenue growth, although profit was lower compared to the same period in the prior year, primarily due to lower activity levels in the exploration industries in Western Canada. From Aug. 1, 2007, Wolseley Canada will be integrated into Ferguson, operating within the same business group structure which focuses on specific customer types.
Europe
In Europe, revenue increased by more than 45% in the 11 months, and profit was up by around 35%. Excluding recently acquired DT Group, European revenues and trading profit were up by about 15% and more than 5%, respectively.
Wolseley UK, including Ireland, achieved strong revenue growth of more than 15%, including around 10% organic growth. Profit, including acquisitions, was up more than 5%.
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Wolseley France achieved double-digit revenue growth, approximately half of which was organic.
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DT Group first nine-months (under Wolseley) revenue increased by 15% and profit increased by more than 20%, compared to the comparable period in the prior year.
Central and Eastern European businesses showed strong revenue growth, despite most principal markets remaining broadly flat. Overall, revenue was up more than 20%, with double-digit organic growth.
