US growth helps boost profits at Wolseley
Plumb Center owner Wolseley has reported rising third quarter profits, driven by growth at its US division.
The firm said trading profit rose 9.5% to £254 million in the three months to April 30, while sales rose 16.7% to £4.3 billion, helped by a £423 million exchange rate benefit.
Ferguson, Wolseley's US plumbing and heating business, saw like for like sales rise 8.5% in the period.
However, like for like sales in the UK slipped 0.4% and revenue dipped from £529 million to £506 million.
Wolseley boss John Martin said: "Revenue growth in the quarter was good with US residential and commercial markets growing well and industrial markets improving. The Nordics returned to growth and the UK was broadly flat."
Shares fell almost 2% in morning trading on Tuesday to 4,798p as investors fretted over the lacklustre UK performance.
Neil Wilson, senior market analyst at ETX Capital, said: "The diverging performance of the US and UK economies was clear to see in the Q3 trading update from Wolseley this morning.
"As the US continues to expand at a decent clip, there are clear signs of a significant slowdown in the UK."
Wolseley has recently announced plans to rename itself Ferguson and pull out of the Nordics.
Wolseley said the group will take the Ferguson moniker - which now accounts for 84% of group trading profits - to "align the group's name with our most significant brand in our largest market".
The firm will continue to use the Wolseley name in the UK and Canada.
Mr Wilson added: "No wonder Wolseley is renaming itself Ferguson, the name of its US business that it is increasingly leaning on for any kind of revenue or profit growth."