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Wolseley to shed 2,300 more jobs Wolseley to shed 2,300 more jobs
(10 minutes later)
Building materials firm Wolseley says it is to cut 2,300 more jobs, the majority in the UK, as the housing downturn continues to bite.Building materials firm Wolseley says it is to cut 2,300 more jobs, the majority in the UK, as the housing downturn continues to bite.
The company, which operates in Europe and North America, said it had already cut 5,000 posts in the August to October period.The company, which operates in Europe and North America, said it had already cut 5,000 posts in the August to October period.
Wolseley said it expected trading to continue to worsen in the short-run. Wolseley said it trading conditions to continue to worsen in the short-run.
"We continue to react swiftly to market conditions with aggressive but measured cost reduction," the company said."We continue to react swiftly to market conditions with aggressive but measured cost reduction," the company said.
Building materials giant Wolseley has seen profits drop 77% after being hit by the US and UK housing slowdown.
Pre-tax profits for the year to 31 July fell to £145m ($266m) from £634m a year ago, and Wolseley said conditions in many of its markets may get worse.
As well as a slowdown in the UK, the US housing slump, where it makes about half its sales, has also hit profits.
The world's biggest distributor of plumbing materials said it had cut 7,700 jobs since since last August.
Profits before one-off costs, which included restructuring costs and branch closures, fell 30% to £527m.
The firm made 7,100 of the job cuts in the financial year, with a further 600 since then.
Investors cheered
Wolseley - which runs Plumb Center and Build Center in the UK - said it had no plans to raise extra funds or to renegotiate covenants held with banks.
But it said these remained options should market conditions deteriorate dramatically.
Chief executive Chip Hornsby said that controlling costs and cash flow was the priority to ensure the firm was "well positioned for any market recovery".
About £176m a year is expected to be saved through restructuring and other initiatives, the firm said.
Wolseley shares rose 7% in early trading - with investors cheered on guidance that it was likely to remain within its banking covenants.
The company employs 14,000 people in the UK and 1,300 staff in Ireland.