Wolseley posts £766m pre-tax loss

Building materials giant Wolseley has posted a pre-tax loss of £766m in 2009 as a result of heavy restructuring costs and goodwill writedowns.

Turnover at the company fell 2.5% from £14.8bn to £14.4bn for the year to 31 July 2009.

The restructuring costs relate to the more than 10,000 jobs Wolseley has axed since the peak of the market in 2006.

On the plus side it reduced debt by £1.5bn to £959m following a £1bn rights issue in March.

Ian Meakins, who succeeded Chip Hornsby as chief executive in June, said: “Our final results reflect the harsh impact of the economic downturn on the construction industry and consequently Wolseley’s business.”

He added: “Overall, we remain cautious as to the outlook for our markets in financial year 2010, although profit trends in the second half are expected to improve.”

The company said residential markets were continuing to stabilise while the repair, maintenance and improvement sector was now declining at a slower rate. On a more negative note, it said the commercial and industrial markets would decline at a faster rate.

In the UK and Ireland, trading profit plunged 69% from £176m to £55m and turnover fell 15.8% from £3.2bn to £2.7bn.

Wolseley has closed 284 branches in the UK and Ireland and now has 1,643 outlets (31 July 2008: 1,927), which resulted in 3,083 job losses.