Wolseley, the £10 billion plumbing and building materials supply giant that is being stalked by Cinven, the buyout firm, has said that there may be worse times ahead in the troubled American housing market.

Chip Hornsby, the chief executive, announcing that the company is laying off another 1,150 workers from its US division, said that the American housing market could be hit by a wave of forced sellers.

Mr Hornsby said that the spate of corporate collapses in the US sub-prime lending market had undermined earlier hopes of a summer recovery in the housing sector.

Delivering an 8.3 per cent fall in underlying pretax profits for its first half trading to £330 million — better than analysts had feared — Mr Hornsby said: “We are not so sure when the upturn will come. We are less confident that it will be spring or summer than we were two months ago.

“Attention is on the sub-prime. This has affected the overall [housing] market. The sub-prime affects the levels of [loan] foreclosures — this can increase the number of homes on the market.”

Mr Hornsby’s comments will send shivers through the US housing market, which had juddered to a halt even before last week’s suspension of shares of New Century Financial, North America’s second-largest sub-prime lender.

Wolseley, which reaps 55 per cent of its group revenue from North America, said that it had cut another 500 jobs from its Stock building materials supply business. In addition, Wolseley is cutting 650 jobs from its Ferguson US plumbing division, taking the total lay-offs there to 1,150.

The additional job cuts come barely a month after Cinven called off plans to mount a formal bid approach for Wolseley after months of preparation.

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