Wolseley won't take risks on acquisitions

By DAILY MAIL REPORTER
Updated: 03:15 EST, 29 May 2009

Wolseley chief Chip Hornsby admitted the impact of the economic meltdown on the group would make him and his management tread more carefully when considering future acquisitions. 

Before the slump, Wolseley was known for its aggressive deal-making, hoovering up smaller rivals on an almost weekly basis.

Tough time: Wolseley has cut 20,000 jobs over the past two years

But Hornsby indicated the group would be more restrained in future, saying: 'There will be a higher degree of scrutiny involved, especially when it comes to acquisitions.'

He was speaking as the plumbing and building supplies group said underlying pretax profits for the first nine months fell 80 per cent to £72million, and warned it sees no signs of recovery.

The group has cut 20,000 jobs over the last two years, including 3,238 in the third quarter, with 270 of these in the UK. It now has 63,000 workers. 

Hornsby warned this wouldn't be the end of the bloodletting: 'We'll continue to make adjustments.'

Wolseley (down 223p, or over 18 per cent, at 1,005p) recently tapped shareholders for £1billion in order to help prop up its debt-laden balance sheet.

It said net debt stood at £1.53billion, down from £2.88billion last year. 

Despite the gloomy update, Hornsby said the U.S. housing market was showing signs of being 'pretty close to the bottom'. But, he said there is still no sign of an upturn.