Wolseley, the supplier of building materials, heating and plumbing products, announced yesterday the head of its North American business, Chip Hornsby, will become group chief executive.
The current chief executive, Charlie Banks, who will hand over next year, said post-hurricane reconstruction work in the southern US would lead to greater demand for the kind of building materials provided by Wolseley. But he said the company, which has five branches in and around the regions worst hit by the hurricanes Katrina and Rita, did not expect a "gigantic impact" on its business.
Announcing full-year results, Mr Banks said: "I think there will be no major construction work for a year and then the work will be spread over several years." He pointed out that about 30,000 houses have to be rebuilt, a small proportion of the 2 million new homes built every year in the US. The worst-affected areas form only a tiny part of the US economy, he said. "Had Houston taken a major hit [from Rita], that would have had a greater impact," he said.
Mr Banks, who has been chief executive since 2001, will retire at the end of July, when he will be 65, and will be succeeded by Mr Hornsby, 49, who joined Wolseley's Ferguson business in the US 27 years ago as a graduate trainee. Mr Banks said: "I stayed until we had a good successor in place, someone who could keep the business moving along. We have now found that person."
A new executive to replace Mr Hornsby at the head of the North American business will be put in place later. Mr Banks joined Ferguson, which Wolseley acquired in 1982, in 1967. He has worked with Mr Hornsby for almost 25 years.
During Mr Banks's tenure, group sales have grown from £7.2bn to £11.2bn, trading profits from £414.2m to £720.8m, and the share price has increased 250 per cent from 468p to yesterday's close of 1,156p.
Mr Hornsby, who has been on the main company board since 2001, said: "I am delighted to be given the responsibility of leading the Wolseley Group and to build on the legacy that Charlie Banks will leave behind. Wolseley has shown an impressive record of growth over many years, through organic expansion and acquisitions. I am confident we will continue to build on that strong base to sustain and expand the group's development in existing and new international markets."
For the year ended 31 July, turnover grew 11 per cent to £11.3bn, while group pre-tax profits were up 16 per cent at £647.8m. The company said the US market remained strong, while conditions in the UK were more challenging.Reuse content