Plumbing and builders’ merchant Wolseley will shut 80 of its UK branches over the next three years, in a move that could cost up to 800 jobs.
The decision follows an 18 per cent drop in trading profit for the 12 months to 31 July 2016 to £74m, down from £90m in its previous year.
This is the second batch of UK branches to close after the company shut down 21 in 2015.
The move is expected to take two to three years and could generate between £25m and £30m in savings annually.
Some of these savings will go towards a planned three-year £40m investment into the refurbishment of existing branches as well as investing in new technology.
The restructuring is expected cost the firm around £100m, of which £70m is cash and will be fully funded by working capital efficiencies and disposal proceeds.
The firm attributed part of the profit drop to a decline in the repair, maintenance and improvement markets, where the company generates most of its profit.
Profit from its UK business represented 8 per cent of its global trading profit in its latest results.
Despite this, the firm said it had experienced some growth in the new residential construction market.
The company will now go out to consultation over the branch closures, which could take 90 days.
Wolseley chief executive John Martin said: “Our review of UK operational strategy has identified opportunities to transform our customer propositions while simplifying our branch network and supporting logistics facilities to greatly improve service levels.
“Regrettably this will result in job losses which we will handle sensitively and minimise through redeployment and attrition as far as possible.”
Wolseley is the third major company to announce staff cuts in the last week.
Kier revealed last week that it had reduced its headcount by 4 per cent following the integration of Mouchel into the business.
Yesterday engineering consultant Arup revealed it would be cutting 4 per cent of its London workforce as a result of “Brexit uncertainty”.