Heating and plumbing giant Wolseley warned of “challenging” trading until the end of 2009 as pre-tax profits tumbled in the first 11 months of its financial year.

The building supplies firm, which has regional distribution centres in Worcester and Milton Keynes and a giant logistics hub in Leamington Spa, saw profits slump 72 per cent to £233 million on a constant currency basis and reported a 15 per cent fall in United Kingdom and Irish revenues.

Wolseley said new housing markets showed signs of stabilisation, but were “unlikely to recover quickly”.

The firm has cut almost 9,400 jobs in the current year – including more than 3,200 in the UK and Ireland – to cut £200 m in costs, but Wolseley said management would focus on further savings.

The Plumb Center and Build Center firm has been hit by housing slumps on both sides of the Atlantic. Directors are considering making further closures to cut costs after deciding to sell units in Belgium, Slovakia and the Czech Republic.

“We can still achieve further cost reductions without damaging the infrastructure of the business,” chief financial officer Steve Webster said. “One just has to keep adjusting the cost base as these markets decline.”

It expects a slower rate of decline in repair and maintenance markets – but added that commercial and industrial business is deteriorating more quickly.

This contributed to a 17 per cent fall in US revenues and a 16 per cent slide across the group as a whole to £13.3 bn after allowing for currency impacts. Trading profits in the UK and Ireland are down 75 per cent on last year as the impact of recession follows hard on the sharp fall in house prices seen last year.

Ireland’s construction market remains “severely depressed”, the group added, with new housing activity about 70 per cent below the previous year.

The Irish business made a trading loss of £20 m and Wolseley warned: “It is now widely expected that the market is unlikely to return to the levels of activity experienced in the past decade.”

The company raised £1?bn from investors earlier this year and spun off a majority stake in its US building materials business.

Wolseley – which has slashed debt from £2.7 bn to £1.4 bn in the past year – is to sell further operations in Belgium, Slovakia and the Czech Republic to focus the business on more attractive European markets.

Panmure Gordon’s James Cooke said: “The key sentiment driver from here will be recovery in the US housing market, which does not appear imminent.”