Wolseley (LON:WOS) has updated investors on its performance in the three months to April 30. The results come after the company disclosed last week that its chosen finance chief would not be joining after all.
**Highlights from Wolseley’s statement:**
During the quarter the Group generated revenue from the ongoing businesses of £3,658 million, 5.9% ahead of last year at constant exchange rates and 2.8% ahead on a like-for-like basis including 1.4% price deflation. Trading profit of £230 million was 12.2% higher than last year at constant exchange rates and the trading margin was ahead of last year by 40 basis points at 6.3%. There was one more trading day in the period which represented £6 million of trading profit and there will be one fewer trading day in Q4. Exchange rate movements increased revenue by £153 million and trading profit by £11 million.
Commenting on the results, Ian Meakins, Chief Executive, said:
“Wolseley generated decent revenue growth in the third quarter in mixed market conditions and against continued deflationary headwinds. The commercial and residential markets in the US held up well and we achieved good volume growth, though this continued to be partly offset by weaker Industrial markets and the ongoing impact of commodity price deflation which reduced the US growth rate by 2.3%. The UK heating market continued to be challenging and we continue to take actions to protect profitability. In the Nordics, after an encouraging first half, construction markets were more challenging in the third quarter. Recent revenue growth trends have been weaker and we have continued to manage costs and productivity very carefully while driving better customer service and strong cash conversion.”
Demand in several of the Group’s markets remains subdued and we continue to experience the adverse impact of commodity deflation, particularly in the US. Like-for-like revenue growth in the weeks since the end of the quarter has been 1%. We have committed to further restructuring in the UK and Europe bringing the total expected costs for the full year to about £20 million. We expect trading profits for the full year, before restructuring costs, to be in line with analyst expectations at current exchange rates.
As of 07:07 BST, Wednesday, 01 June, Wolseley plc share price is 4,051.00p.
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