Wolseley Plc, which held onto its North American lending group when it sold 51% of Stock Building Supply last year, reported today that the lending arm recorded an operating loss of $4 million in the six-month period ended Jan. 31.
That's an improvement from the $18 million in losses it recorded in the first half of the previous fiscal year. The amount of loans on the books dropped nearly in half, to $199 million as of Jan. 31.
Last spring, Wolseley sold a majority stake in Stock, America's No. 2 LBM operation, to The Gores Group of Los Angeles. Stock filed for Chapter 11 bankruptcy protection, reorganized, and emerged in July as a much smaller, more focused organization. Wolseley held onto its lending group during that process. It now focuses on five states--the Carolinas, Virginia, Texas, and Utah--and aims to sell Stock Loan Services in two to three years' time.
Wolseley also said today that Ferguson, its U.S. plumbing and heating business, saw a 44% drop in underlying trading profits before property profits to $159 million on a 21.4% decline in first-half sales to $3.88 billion. The operating margin shrank to 4.1% from 5.8%.
Ferguson has reduced its headcount by 30% over the past 2-1/2 years, to just under 7,000 workers, Wolseley said. It also closed a loss-making HVAC operation in Alabama.
