Plumbing products and building materials supplier Wolseley PLC (LSE: WOS) issued a rather downbeat pre-close trading statement ahead of its full-year results, saying it expects market conditions will continue to deteriorate with trading remaining challenging until at least the end of the calendar year.
Revenue from continuing operations in the 11 months to end-June 2009 were down 1.5 percent, or 16 percent in constant currency. Pretax profit before exceptionals and amortisation from continuing operations was down 60 percent.
Though worrying, the figures did not cause investors to head for the hills. Wolseley shares were flat in midday trade as the bad news was already priced in after a trading statement in May 2009 when the group warned of ongoing very challenging conditions in all its major markets.
It alsos said today it has completed the review to determine the future strategy for the Lightside plumbing and heating businesses in Central and Eastern Europe (CEE), and has decided to sell the Belgium, Slovakian and Czech Republic businesses. For the foreseeable future market conditions across the CEE region will remain very challenging, and the businesses that are to be sold as a going concern lack the scale, market positions and potential to deliver an appropriate financial return.
A number of third parties have recently expressed an interest in the possibility of acquiring these businesses. A disposal process has now commenced and is expected to be concluded over the next few months, it said.
The company has decided to retain a Lightside presence in Switzerland, Austria, Luxembourg, Denmark, Holland and Italy. The continuing constituent businesses in CEE are expected to make a positive contribution to the Group's results and to be cash positive in FY 2010.
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