Trading Statement

Wolseley PLC
18 July 2005

NEWS RELEASE

                                  Wolseley plc
  Pre-Close Period Trading Statement for 11 months to 30 June 2005, Update on
       Eight Recent Acquisitions and Impact of IFRS on First Half Results


Wolseley plc, the world's largest specialist trade distributor of plumbing and
heating products to professional contractors and a leading supplier of building
materials, issues its regular trading statement for the 11 months to 30 June
2005, prior to entering its close period. It also announces details of a further
eight acquisitions for an estimated combined consideration of approximately £171
million and restates its first half results for the six months to 31 January
2005 in accordance with International Financial Reporting Standards ('IFRS').
The preliminary results for the 12 months ending 31 July 2005 are due to be
announced on 26 September 2005.

Trading Update

Overview

Business conditions in the Group's principal markets have been broadly in line
with comments made in the Interim Results statement on 21 March 2005. As
expected, the rate of growth in the second half of 2005 has been slower than in
the first half due to the strong comparators in the second half of 2004, the
absence of commodity price gains in products such as copper, steel, plastics and
lumber and a slowing in the UK market. During the second half, investments in
human resources, logistics and new branches have been accelerated to position
the Group for continued growth.

The Group's results for the first 11 months to 30 June 2005 show a strong
increase in sales and profits driven by high rates of organic growth in North
America and good growth in the UK, albeit at a slower rate in recent months. The
markets in Continental Europe continue to be broadly flat, although all of the
Group's businesses showed sales growth. The Group's trading margin for the
period is also ahead of the equivalent period in the prior year.

After currency translation and including the effect of acquisitions, Group sales
for the 11 months to 30 June 2005 were up by more than 10% and trading profit up
by more than 15% on the same period in 2004. The adverse currency translation
effect was approximately £292 million on sales and £18 million on trading
profit, broadly representing an additional 3% on the reported sterling figures.

Further details of market conditions in each of the Group's business segments
are set out below.



North American Plumbing and Heating Distribution

In the US, housing related activity has been strong, with the repairs and
remodelling market benefiting from the more positive economic environment. The
commercial and industrial sectors continue to improve.

The US plumbing operations performed strongly with sales in local currency for
the 11 months to 30 June 2005 up by 20%, and trading profit up by 25% on the
equivalent period in the prior year. More than half of the sales growth was
organic, including the beneficial effects of commodity price inflation in
products such as copper, steel and plastics in the first half. This follows
approximately $30 million of additional trading profit attributed to commodity
price increases in the second half of 2004 which has not been repeated in the
second half of 2005. For the 11 month period, the net margin remains up on the
comparable period in the prior year. This is despite the lower benefit from
commodity price inflation and reflects the decision to increase the investment
in people, logistics and new branch openings in the second half of the year.

Ferguson's market outperformance continues to be driven by the commercial
advantage gained from its distribution centre network and from management's
focus on achieving organic growth in selective markets. The latest distribution
centre in Iowa opened in May 2005 and the rollout of the XpressNet stores
continues with the 60th store expected to open before the end of July 2005. To
support this continued growth, Ferguson has added an additional 3,300 employees
since 1 August 2004, including approximately 850 new college graduates.

As previously announced, as a result of a review of revised contractual
arrangements and following the guidance contained in Application Note G to FRS5,
with effect from 1 August 2004 the recorded sales value in Ferguson's Integrated
Supply Division represents the gross profit rather than the gross sales value
which was recorded in the year to 31 July 2004. The effect of this change in the
11 months to 30 June 2005, which has no effect on profit, is to reduce sales by
$187 million. There is, consequently, a positive impact on the trading margin of
Ferguson for the 11 month period of 0.2%.

In Canada, the construction and housing markets remained strong. In local
currency, Wolseley Canada achieved a double-digit increase in both sales and
trading profit over the equivalent 11 month period in the prior year, although
there is recent evidence of some increased pressure on gross margins.


US Building Materials Distribution

US Building Materials sales in US$ were up more than 15% for the first 11 months
and trading profits up by more than 25% compared to the equivalent period in the
prior year. Organic sales growth was more than 10%.

The continued strength of the US housing market is illustrated by the level of
housing starts which remain robust at between 1.8 million to 2.1 million per
annum and the inventory of unsold houses at around 4.2 months, which compares
favourably to the long-term average of around 6 months.

Commodity lumber prices, which directly affect approximately 35% of Stock
Building Supply's product range, held up well in the period. For the 11 months
to 30 June 2005, average lumber prices of $402 per thousand board feet were 7%
up on the prior comparable period average of $374 per thousand board feet. The
increased sales benefit from higher lumber prices was almost entirely offset by
the 20% price decline to $406 per thousand square feet in structural panels,
which directly affect a further 13% of Stock Building Supply's product range.
Lumber and structural panel prices are currently slightly lower than a year ago.

Both the trading margin and the return on capital of Stock Building Supply are
showing substantial increases on the prior year.


European Distribution

In European Distribution, sales and trading profit in the 11 months to 30 June
2005 in sterling were both up by around 10% compared to the same period in the
prior year, with the trading margin improving slightly.

Wolseley UK has continued to outperform a slowing UK market with sales and
trading profit both showing double-digit increases for the 11 months to 30 June
2005. More than 5% of the sales growth was organic. The commercial sector,
including government spending, continues to show a positive trend. The trading
margin was negatively impacted by the higher pension, rebranding and
restructuring costs that were announced previously. Property gains of around £10
million have been realised in the 11 months to 30 June 2005.

In France, government tax incentives underpin growth in the new residential
market, but repairs, maintenance and improvement ('RMI'), the principal driver
of both Brossette and PBM, continues to show only marginal growth. Brossette's
results continue to reflect the disruption caused by its reorganisation of the
branch and management structure and distribution network. For the 11 months to
30 June 2005 sales were up only slightly compared to the similar period in the
prior year, whilst profits were down. PBM performed in line with expectations
with local currency sales up more than 3% and the trading margin improving.

In the rest of Continental Europe there was a mixed picture with all of the
Group's businesses showing sales growth, despite most markets remaining broadly
flat.

During the period the decision was taken to invest €20 million in a new central
distribution centre in northern Italy to support the growing business there,
following the acquisition of Iser Zauli in January 2005. Work is also
progressing on Wolseley UK's new national distribution centre in Leamington Spa.
These facilities are expected to be completed around autumn 2006.


Financial

The Group's financial position remains strong with Group gearing, as at 30 June
2005, of around 52% at current exchange rates (compared to 55.1% at 31 January
2005). The gearing reflects acquisition spend offset by strong operating cash
flow. The interest charge is higher than the corresponding period in the prior
year due to interest rate rises and the higher level of average borrowings.


Outlook

Market conditions in North America are expected to remain strong for the
foreseeable future. Although the market in the UK has slowed in recent months,
the Group expects its UK business to continue to show modest growth. In
Continental Europe the Group's principal markets are likely to remain flat.



Exchange Rates

The average profit & loss account translation rate for the first 11 months was
$1.8593 to the £1 compared to $1.7466 for the comparable period last year, a
fall of 6.1%, and €1.4596 to the £1 compared to €1.4593.

Trading profit, a term used throughout this announcement, is defined as
operating profit before goodwill amortisation. Trading margin is the ratio of
trading profit to sales stated as a percentage.



Acquisitions Update

Since Wolseley's last acquisitions update announcement on 7 April 2005, an
additional eight distribution businesses in Europe and North America have been
acquired for an aggregate consideration of approximately £171 million in cash,
including an estimated amount for consideration relating to earn-out
arrangements based on future profits.

These acquisitions bring Wolseley's total spend on acquisitions, including debt
acquired, since the beginning of the financial year, to approximately £430
million. In total, the 26 acquisitions completed to date are expected to add
approximately £771 million to Group turnover in a full year. Goodwill related to
these 26 acquisitions is estimated to be around £213 million.

These additional eight acquisitions have been made from a variety of
individuals, trusts, companies and other business entities. Further details are
set out below.


European Distribution

In May 2005, Brossette in France acquired two companies, namely, Serge Barral
SARL ('Barral') and Dispotherm.

Barral is a distributor of plumbing, heating and sanitary products operating
from a single branch close to Lyon. It achieved sales of €3.2 million (£2.2
million) in the year to 31 December 2004 and had gross assets of €1.4 million
(£1.0 million) at that date.

Dispotherm is a distributor of spare parts and accessories to heating and air
conditioning installers. Operating from a single branch in Poitiers, central
France, Dispotherm achieved sales of €0.1 million (£0.1 million) in the year to
30 September 2004 and had gross assets of €0.1 million (£0.1 million) at that
date.

North American Plumbing and Heating Distribution

In May 2005, Ferguson acquired the trade and assets of United Supply &
Distributing ('US&D'). US&D is a distributor of HVAC products operating from
three branches in Maryland and Virginia. In the year ended 31 December 2004, US&
D had sales of $13.6 million (£7.6 million) and gross assets of $5.1 million
(£2.9 million) at that date.

In June 2005, Ferguson acquired Webb Distributors Inc. ('Webb'). Webb
distributes HVAC equipment through seven branches, principally in the greater
Phoenix, Arizona area. In the year ended 28 February 2005, Webb had sales of
$50.0 million (£28.1 million) and gross assets of $23.4 million (£13.1 million)
at that date.


US Building Materials Distribution

In April 2005, Stock Building Supply ('Stock') acquired J.C. Baldridge Lumber
('Baldridge') based in Albuquerque, New Mexico. Baldridge was founded in 1881
and is Stock's first operation in the state of New Mexico. Operating from a
single branch, Baldridge supplies building materials, lumber and architectural
products to professional home builders and light commercial contractors. It had
sales of US$33.1 million (£18.6 million) for the year ended 31 December 2004 and
gross assets of $4.4 million (£2.5 million) at that date.

In May 2005, Stock acquired Adams Building Materials ('Adams'), a distributor of
building materials to the professional contractor in central Florida. Operating
from seven locations, Adams had sales of US$90.7 million (£50.9 million) for the
year ended 30 September 2004 and gross assets of $20.9 million (£11.7 million)
at that date.

In July 2005, Stock acquired two further businesses, namely, Vegas General
Construction and its affiliates ('Vegas') and East Haven Builders Supply ('East
Haven').

Vegas is a turnkey supplier of construction materials and services to the
residential builder in the Las Vegas and Denver markets. The acquisition of
Vegas represents Stock's first operation in Las Vegas, one of the largest
housing markets in the USA. Vegas had sales of US$231.0 million (£130.0 million)
for the year ended 31 December 2004 and gross assets of $50.1 million (£28.1
million) at that date.

East Haven is a distributor of building materials, timber and kitchen cabinets
to the professional contractor in the state of Connecticut and represents
Stock's initial entrance into the state of Connecticut. East Haven, operating
from four facilities, had sales of US$72.1 million (£40.5 million) for the year
ended 31 December 2004 and gross assets of $17.9 million (£10.1 million) at that
date.

Following these acquisitions, Stock now operates in 30 states in the USA.

The segmental split of the total acquisition spend since 1 August 2004 has been:

Division                                       No. of Acquisitions     Spend
                                                                     £ million

European Distribution                                           10         161
North American Plumbing & Heating Distribution                  10         103
US Building Materials Distribution                               6         166
                                       TOTAL                    26         430

Exchange Rates

The following exchange rates have been used for the acquisitions noted above:
£1 = $1.78, £1 = €1.46.

Adoption of International Financial Reporting Standards ('IFRS')
Wolseley plc has today published a statement setting out the restatement in
accordance with International Financial Reporting Standards ('IFRS') of its
unaudited interim results for the half year ended 31 January 2005. Copies of the
statement are available on 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 six
months to 31 January by £13.4 million (4.4%) to £314.9 million and its profit
before tax by £9.6 million (3.3%) to £296.8 million. The net assets of the Group
at 31 January 2005 would have reduced by £65.2 million (3.2%) to
£1,961.1 million and net debt would have increased by £26.3 million (2.3%) to
£1,141.9 million. This would have resulted in an increase in gearing from 55.1%
to 58.2%.

As noted in previous announcements relating to the adoption of IFRS, the
principal areas of impact are in respect of leases, taxation, pensions,
goodwill, other intangible assets and stock compensation. The Group's first full
set of audited IFRS financial statements will be those for the year ending 31
July 2006.

Further information on the restatement of the Group's financial statements for
the year to 31 July 2005 will be provided in November 2005, after the
publication of the Group's full year results to 31 July 2005 prepared under UK
GAAP.

The summary below shows how the Group's financial highlights prepared under UK
GAAP would have been reported if they had been prepared in accordance with IFRS.

                                   Reported under  Adjustments   Restated under
                                         UK GAAP                          IFRS
                                              £m            £m              £m
-------------------------------         ----------     ---------      ----------
Half year ended 31 January 2005

Group revenue                            5,331.9             -         5,331.9
----------------------                  ----------     ---------      ----------

Group trading profit(1)                    322.3          (5.9)          316.4
Group operating profit                     301.5          13.4           314.9
----------------------                  ----------     ---------      ----------

Group profit before tax                    287.2           9.6           296.8
Group profit before tax and
amortisation of intangible
assets                                     308.0          (9.7)          298.3
----------------------                  ----------     ---------      ----------

Basic earnings per share                   34.86p         1.46p          36.32p
Earnings per share, before
amortisation of intangible
assets                                     38.40p        (1.83)p         36.57p
----------------------                  ----------     ---------      ----------
As at 31 January 2005

Total net assets                         2,026.3         (65.2)        1,961.1
Gearing(2)                                  55.1%          3.1%           58.2%
----------------------                  ----------     ---------      ----------

(1) Trading profit is defined as operating profit before the amortisation of
intangible assets.
(2) Gearing is the ratio of net borrowings, excluding construction loan
borrowings, to shareholders' funds.

The European Commission may not endorse all the pronouncements issued to date by
the International Accounting Standards Board, new interpretations may be issued
on existing accounting and financial reporting standards and best practice
continues to evolve. It is therefore possible that the IFRS financial
information provided in this news release and the statement on the
www.wolseley.com website might have been revised by the time it forms the
comparative to the Group's first interim results announcement under IFRS (for
the six months ended 31 January 2006).



Charlie Banks, Group Chief Executive of Wolseley, said:

'We are on track to achieve another good performance across our businesses this
year. Our principal operating companies continue to successfully increase their
local market shares and improve their financial performance. Although Europe
remains slow, the three North American businesses all enjoyed record monthly
sales in June and this encourages us for the months ahead. Furthermore, the
acquisitions and other investments we have announced today provide a further
platform for future growth.'





Certain statements included in this announcement may be forward-looking and may
involve risks, assumptions and uncertainties that could cause actual results to
differ materially from those expressed or implied by the forward looking
statements. Forward-looking statements include, without limitation, projections
relating to results of operations and financial conditions and the Company's
plans and objectives for future operations including, without limitation,
discussions of the Company's business and financial plans, expected future
revenues and expenditures, investments and disposals, risks associated with
changes in economic conditions, the strength of the plumbing and heating and
building materials market in North America and Europe, fluctuations in product
prices and changes in exchange and interest rates. All forward-looking
statements in this respect are based upon information known to the Company on
the date of this announcement. The Company undertakes no obligation to publicly
update or revise any forward-looking statement, whether as a result of new
information, future events or otherwise. It is not reasonably possible to
itemise all of the many factors and events that could cause the Company's
forward-looking statements to be incorrect or that could otherwise have a
material adverse effect on the future operations or results of the Company.



There will be analyst/investor meeting today at 9.30 a.m. taking place at UBS, 1
Finsbury Avenue, London, EC2.

A dial-in facility will be available for this meeting:
UK dial-in 020 7162 0089
International dial-in [phone]
US toll free dial-in [phone]

A replay facility will be available until 1 August 2005 by dialling:
UK freephone 0800 358 1860 (UK only)
UK & International [phone]

Pass code 665761

US dial-in [phone]
Free phone [phone]

Passcode 665761




Press/Investor Enquiries:


Wolseley plc 0118 929 8700

Guy Stainer
Head of Investor Relations


Brunswick 020 7404 5959

Andrew Fenwick
Deborah Done



Notes to Editors

Wolseley plc is the world's largest specialist trade distributor of plumbing and
heating products and a leading supplier of building materials to professional
contractors in North America, the UK and Continental Europe. Group sales for the
year ended 31 July 2004 were approximately £10.1 billion and operating profit,
before goodwill, was £619 million. Wolseley has more than 55,000 employees
operating in 13 countries namely: UK, USA, France, Canada, Ireland, Italy, The
Netherlands, Switzerland, Austria, Czech Republic, Hungary, Luxembourg and
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.



                      This information is provided by RNS
            The company news service from the London Stock Exchange