Wolseley Reports 10 Years Of Growth
Its 10th consecutive year of record results was fueled by strong U.S. growth. U.S. operations accounted for 59.1% of the revenue and 60.8% of the trading profit. Revenue of Wolseley's North American division was up 36.1% to $16.1 billion, reflecting organic growth of 16.4%. Trading profit was up 41.5% to $1.08 billion.
Ferguson, Newport News, VA, had sales of $9.65 billion, up 35.1% in dollars from the previous year. Trading profit, including acquisitions, was up 40.4% in dollar terms, to $676 million. Ferguson achieved strong organic revenue growth of 24.3%.
Volumes through the distribution center network grew by 34% compared to the prior year, with more than 50% of branch sales now going through the network.
Expansion of four existing facilities added 700,000 sq. ft. of capacity to the distribution centers. New distribution centers are planned for Florida and northern California and should be operational within 12 months.
Of the markets in which Ferguson operates, the commercial and industrial sectors continued to improve. Although new housing slowed towards the end of the financial year, other housing-related activity remained strong, with the positive economic environment benefiting the repairs, maintenance and improvement sector.
Ferguson opened 64 XpressNet branches and 30 showrooms during the year. More than 60 specialist branches for HVAC or waterworks were also opened.
For Wolseley Canada, local currency revenue increased by 13%, of which 10.7% was organic. Gross margin improved and local currency trading profit rose by 12.4%. The company continues to consolidate back offices, recruit additional managers and trainees and improve logistics. It now operates 246 locations.
Stock Building Supply, Raleigh, NC, Wolseley's U.S. building materials business, achieved revenue growth of 27.4% in dollars to $5.3 billion, with trading profit up 40.6% in dollars to $343 million. Stock's trading margin increased from 5.9% to 6.5%.
Wolseley said that the new residential housing marketing in the United States is expected to account for 30% of group revenue, but is likely to continue to soften with significant regional variations. It foresees growth in the repairs, maintenance and improvement sector and the industrial and commercial markets.
“Although the slowing U.S. housing market may bring us challenges next year, we will continue to pursue our double-digit growth targets through a combination of organic and acquisitive growth, utilizing our competitive advantages of our scale, people [and] supply chain, and reaping the rewards of our commitment to delivering customer solutions,” Wolseley Group CEO Chip Hornsby said in a statement.
For more information, visit www.ferguson.com or www.wolseley.com.