Wolseley cost cutting measures will continue

LEAMINGTON Spa building products distributor Wolseley has said it will continue to implement measures to cut its cost base.

The firm has seen an increase in revenues and profits in its ongoing businesses. But the total revenue figure was down and profits before tax also took a nosedive.

Reporting its results for the year ending July 31, Wolseley recorded ongoing business revenues of £12.716bn, a 5.4% increase on 2011’s £12.061bn figure.

But the total revenue figure was down from £13.558bn to £13.421bn.

Trading profit for its ongoing businesses was £658m, a 10.4% increase on 2011’s £596m figure but profit before tax was down from £391m to £198m.

Wolseley said it had seen good growth in the US and Canada, recovery in the UK and weakness in Continental Europe.

The group is continuing its restructuring programme. Having disposed of Build Center, Brossette, Encon, Bathstore and Woodcote it is reviewing its future strategic options in France, as announced in July.

Ian Meakins, chief executive, said: “The group continued to make progress in a year of slowing economic growth and considerable uncertainty in the Eurozone.

“Underpinning this were three main factors: a continued focus on customer service in all of our business units, implementation of successful initiatives to drive like-for-like revenue growth, and our on-going focus on operational efficiency which has delivered further improvements in the trading margin.

“Demand across our markets remains mixed and the economic outlook continues to be uncertain. Revenue growth rates in the new financial year have been similar to the fourth quarter of last year. We will continue to reduce our cost base to protect profitability but also to make investments in our businesses that will improve the quality of our operations and generate growth in the future.

“Whilst we remain cautious about the outlook for our markets, we are confident that Wolseley will make good progress in the year ahead.”