HEATING and plumbing giant Wolseley plunged to annual losses of £766m as the group felt the “harsh impact” of the construction slump.

Wolseley’s huge pre-tax loss for the year to July 31 came after more than £1bn in write-downs and restructuring costs as the group desperately stripped out costs to weather the storm.

The company, which reported profits of £399m a year earlier, has cut more than 10,000 jobs over the year – including almost 3,100 in the UK and Ireland – and signalled more redundancies to come.

The company trades as Build Center and Plumb Center in the UK. It has Build Center outlets in Huddersfield at Willow Lane, Birkby, and Trident Business Park, Deighton, as well as a Plumb Center at Armytage Industrial Estate, Brighouse.

Chief executive Ian Meakins said further actions to lower costs would be taken “according to anticipated local market conditions”.

Short-term trading will remain challenging, although profits should begin to recover in the second half of this financial year thanks to the cost-cutting drive.

“Our final results reflect the harsh impact of the economic downturn on the construction industry,” he added.

Stripping out the one-off costs, Wolseley’s pre-tax profits of £293m were ahead of expectations despite being 54% below the £631m seen previously – sending the firm’s shares higher.

In the UK, where the firm closed four depots, trading profits fell by 69% to £55m despite a stronger performance from its Plumb and Parts Center arms.

Wolseley, which now has about 50,000 staff, hopes its cost-cutting drive will save an annual £160m in the UK. In Ireland, jobs have been cut by almost half since the market peak in early 2007.

Underlying sales in the UK and Ireland, which account for almost a fifth of group revenues, were down by 17% to £2.7bn amid fierce competition. US revenues also slumped by more than 17%.

The firm reported “signs of stabilisation” in the new housing market, but Mr Meakins added: “We think the road to recovery will be long and slow.”