Shares in Wolseley rose today as investors were bullish over the building and plumbing giant’s prospects despite profits taking a hit from exchange rate movements.
Trading profit edged up 0.6% to £155 million after a strong performance in the United States and the Nordics, where it posted its best performance for two years, but the company took a £12 million hit from unfavourable exchange rates.
The plumbing merchant, which operates Plumb Center, reported third-quarter revenue rose 5.1% to £3 billion across the group. The shares increased 2.8% to 3402.5p.
Killik & Co partner Paul Kavanagh said: “These results were better than expected. In the US the macro picture seems to be disappointing in housing and construction but Wolseley have obviously found room to power through that and there are signs Europe is stabilising too.
“The market tends to be comfortable with fluctuations in currency.”
RBC analyst Olivia Peters said: “Overall growth trends are improving. Growth patterns in the US exceeded expectations, outperforming both Lowe’s and Home Depot.”
However, sales in the UK were sluggish as it opted to protect gross margins and shun low-margin business amid a weak industrial market and flat house repair environment.