Shares in Wolseley fell by almost 3% yesterday after the plumbing giant's half-year results revealed it took a £245m financial hit and faced 'challenging' trading conditions in Europe.
The company, which acquired a majority stake in bathroom retailer BathEmpire.com for an undisclosed sum earlier this month, reported revenues were up 7.8% to £6.4bn – but pre-tax profits fell by almost two-thirds to £103m.
It said the £245m writedown related to its Nordic business DT Group, which it bought in 2006, was the result of 'continued challenging market conditions in the region and reduced expectations of future profitability'.
Like-for-like sales in the Nordic region were up 3.3% compared to last year, while the UK saw its sales grow by nearly 2%. The USA had the strongest results, with an 11.7% rise in like-for-like sales. Central Europe's sales fell by 1.5%.
Chief executive Ian Meakins said the group expects like-for-like revenue growth rate in the second half of the year to be around 6%. He added: “We are taking action to improve profitability in Europe in the second half.”
Shares in the FTSE 100 group climbed to 4096p today – up from 4069p yesterday.