22nd Nov 2005 07:01
Wolseley PLC22 November 2005 NEWS RELEASE 22 November 2005 Wolseley plc Acquisitions Update and Impact of IFRS on Results for Year Ended 31 July 2005 Wolseley plc, the world's largest specialist trade distributor of plumbing andheating products to professional contractors and a leading supplier of buildingmaterials, announces details of a further two acquisitions and restates itsresults for the twelve months to 31 July 2005 in accordance with InternationalFinancial Reporting Standards ("IFRS"). Acquisitions Update Since Wolseley's last acquisitions update announcement on 8 November 2005, anadditional two distribution businesses in Europe and North America have beenacquired for an aggregate consideration of approximately £4 million in cash. Since the beginning of the financial year on 1 August 2005, a total of 17distribution businesses in Europe and North America have been acquired for anaggregate consideration of approximately £422 million in cash. These 17acquisitions are expected to add approximately £680 million to group turnover ina full year. Goodwill related to these acquisitions is estimated to be around£269 million. North American Plumbing and Heating Distribution On 14 November 2005, Ferguson acquired Mobile Supply Company, Inc. ("Mobile")from Mr. and Mrs. Raymond Stallings. Mobile is a heating, ventilation andair-conditioning (HVAC) distributor operating from a branch in Mobile, Alabamaand a branch in Pensacola, Florida. In the year ended 31 October 2004, Mobilehad sales of $12.3 million (£6.8 million) and had gross assets of $5.0 million(£2.8 million) at that date. European Distribution On 18 November 2005, PBM signed an agreement to acquire MSCO from Mr Jean-MarieLe Sellin, Mrs Annie Le Sellin, Mr Michel Nadaud and Mrs Annie Nadaud. Completion is expected on 1 December 2005. MSCO is a generalist builders' merchant based in the South West of France operating from two branches. In theyear ended 30 November 2004, MSCO had sales of €3.7 million (£2.5 million) andhad gross assets of €1.7 million (£1.2 million) at that date. The divisional split of the total acquisition spend since 1 August 2005 is: Division No. of Spend Acquisitions £ million European Distribution 5 243North American Plumbing & Heating 10 105DistributionUS Building Materials Distribution 2 74TOTAL 17 422 Exchange Rates The following exchange rates have been used for the acquisitions noted above:£1 = $1.80, £1 = €1.46. Adoption of International Financial Reporting Standards ("IFRS") Wolseley plc has today published a statement setting out the restatement inaccordance with International Financial Reporting Standards ("IFRS") of itsresults for the year ended 31 July 2005. Copies of the statement are availableon the company's website www.wolseley.com in the "Investor Centre" section. Adoption of IFRS would have increased the Group's operating profit for the yearto 31 July 2005 by £24.6 million (3.6%) to £702.0 million and its profit beforetax by £17.4 million (2.7%) to £665.2 million. The net assets of the Group at31 July 2005 would have increased by £6.8 million (0.3%) to £2,313.7 million andnet debt would have increased by £27.0 million (2.4%) to £1,170.5 million. Thiswould have resulted in an increase in gearing from 49.6% to 50.6%. As noted in previous announcements relating to the adoption of IFRS, theprincipal areas of impact are in respect of leases, taxation, pensions,goodwill, other intangible assets and stock compensation. The Group's first fullset of audited IFRS financial statements will be those for the year ending 31July 2006. The summary below shows how the Group's financial highlights prepared under UKGAAP would have been reported if they had been prepared in accordance with IFRS. Reported under Adjustments Restated under UK GAAP IFRS £m £m £m ---------- --------- ----------Year ended 31 July 2005 Group revenue 11,257.7 (1.4) 11,256.3---------------------- ---------- --------- ---------- Group trading profit(1) 720.8 (13.0) 707.8Group operating profit 677.4 24.6 702.0---------------------- ---------- --------- ---------- Group profit before tax 647.8 17.4 665.2Group profit before tax and amortisation of acquired intangibles 691.2 (20.2) 671.0---------------------- ---------- --------- ---------- Basic earnings per share 78.53p 3.08p 81.61pEarnings per share, before amortisation of acquired intangibles 85.93p (3.33)p 82.60p---------------------- ---------- --------- ----------As at 31 July 2005 Total net assets 2,306.9 6.8 2,313.7Gearing(2) 49.6% 1.0% 50.6%---------------------- ---------- --------- ---------- (1) Trading profit is defined as operating profit before the amortisation ofacquired intangible assets. (2) Gearing is the ratio of net borrowings, excluding construction loanborrowings, to shareholders' funds. The European Commission may not endorse all the pronouncements issued to date bythe International Accounting Standards Board, new interpretations may be issuedon existing accounting and financial reporting standards and best practicecontinues to evolve. It is therefore possible that the IFRS financialinformation provided in this news release and the statement on thewww.wolseley.com website might have been revised by the time it forms thecomparative to the Group's first annual results announcement under IFRS (for theyear ended 31 July 2006). There will be a conference call today at 10.00 a.m. should analysts/investorswish to ask questions regarding the IFRS announcement. UK dial-in 020 7162 0125 International dial-in +44 20 7162 0125 A replay facility will be available until 6 December 2005 by dialling: UK & International +44 (0)20 7031 4064 Pass code 682185 ENQUIRIES: Investors/Analysts:Guy Stainer 0118 929 8744Head of Investor Relations 07739 778 187 Press:Penny Studholme 0118 929 8886Director of Corporate Communications Brunswick 020 7404 5959Andrew FenwickDeborah Fairbrass Certain statements included in this announcement may be forward-looking and mayinvolve risks, assumptions and uncertainties that could cause actual results todiffer materially from those expressed or implied by the forward lookingstatements. Forward-looking statements include, without limitation, projectionsrelating to results of operations and financial conditions and the Company'splans and objectives for future operations including, without limitation,discussions of the Company's business and financial plans, expected futurerevenues and expenditures, investments and disposals, risks associated withchanges in economic conditions, the strength of the plumbing and heating andbuilding materials market in North America and Europe, fluctuations in productprices and changes in exchange and interest rates. All forward-lookingstatements in this respect are based upon information known to the Company onthe date of this announcement. The Company undertakes no obligation to publiclyupdate or revise any forward-looking statement, whether as a result of newinformation, future events or otherwise. It is not reasonably possible toitemise all of the many factors and events that could cause the Company'sforward-looking statements to be incorrect or that could otherwise have amaterial adverse effect on the future operations or results of the Company. Notes to Editors Wolseley plc is the world's largest specialist trade distributor of plumbing andheating products and a leading supplier of building materials to professionalcontractors in North America, the UK and Continental Europe. Group sales for theyear ended 31 July 2005 were approximately £11.3 billion and operating profit,before goodwill, was £721 million. Wolseley has around 60,000 employeesoperating in 14 countries namely: UK, USA, France, Canada, Ireland, Italy, TheNetherlands, Switzerland, Austria, Czech Republic, Hungary, Belgium, Luxembourgand Denmark. Wolseley is listed on the London and New York Stock Exchanges (LSE:WOS.L, NYSE: WOS) and is in the FTSE 100 index of listed companies. -- ENDS -- This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
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