Wolseley's profits fell by 23% and the group blames the US housing market for 'increasingly difficult trading conditions.
With its US stock having plummeted to a loss of £44 million,
the knock on effect led to the profit fall announced by the group in its interim results for the half year ended January 31, 2008.

The world's largest distributer of plumbing and heating products reported trading profit of £300million for the six months to end-January 31, 2008. It suffered the 23% loss in trading profit when compared to the interim half year results up to January 31, 2007.

The board said it expects business conditions in a number of the Group's markets to become more challenging

It also said the 'results reflect increasingly difficult trading conditions across many businesses and the continuing action to significantly reduce the group's cost base and maximise cash flow'.

'Operational improvements from recent UK initiatives starting to deliver benefits, with underlying improvement in the UK (excluding Ireland) in trading profit, despite a slowing market'.

It also said growth rates in European markets are likely to slow, but the RMI and commercial and industrial segments, that drive the majority of the group's business, are expected to remain marginally positive.

Chip Hornsby, Wolseley plc Group chief executive said: 'The first half results reflect creditable performances in most of our major markets against the background of increasingly challenging conditions. In the short-term, we remain very focused on maximising cash flow, reducing costs and growing market share. We are confident in the long term fundamentals of our markets and will emerge from this current downturn as a stronger organisation with an excellent platform for future growth.'

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