Wolseley Forum

AlphaValue also published one: "Wolseley reported H1 FY16 results below our estimates. In Q2, the lfl revenue growth declined sequentially for the fourth straight quarter, clocking +2.3% (vs our estimate: +4.2% and management guidance: +4%), pinned down once again by weak industrial demand in North America (the adverse impact of low oil prices, a stronger USD and destocking by manufacturers; accounts for c.15% of US sales and c.10% of Canada) and ongoing sluggishness in the UK’s RMI activity (lfl growth: -2.9% vs Q1: -1.1% and Q4 15: +3.1%; c.15% of group..."

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Beaufort's note from this morning: "Wolseley delivered a resilient Q3 performance, against the backdrop of tempering demand in number of its international market and commodity price deflation. Price deflation in the US continued to affect the Group's revenues, with a 2.3% reduction in LFL revenue growth. While +5.0% growth in LFL revenue in the US were stronger than Q1 and Q2 (+4.5% and +4.0%), boosted by strong growth in Blended Branches, Waterworks, Heating, Ventilation and Air Conditioning, Fire and Fabrication and B2C businesses. In the UK, repairs, maintenance and improvement markets remained weak, but the Group made good progress reviewing its UK operating model which expects to be completed by August. In the Nordic areas, adverse weather conditions and the reduction of tax incentives impacted spring sales. In Canada, weakness in the oil prices in the West was offset by relative strength in the East. In Central Europe costs remain tightly controlled, which resulted in a slight improvement in gross margins. Overall, the Group's trading profit was encouraging, positively impacted by the extra day of trading, representing an additional £6m together with favourable exchange rates which added £11m. Post the period, the Group said LFL revenue growth so far in Q4 is about 1.0%. To summarise, although the outlook provided by the management remained somewhat unexciting, we believe Wolseley's ongoing restructuring in the UK and Europe, together with management's ability to adequately acquire and dispose assets will continue to deliver growth over the longer-term. With its full year outlook for trading profit (before restructuring costs of £20m) remaining in line with current consensus analysts' estimate at £925m, Beaufort..." From Research Tree