Building materials company Wolseley PLC (WOS.LN) Monday became the latest U.K. company to move its residence abroad to cut its tax burden, after reporting narrowing full-year losses and announcing its intention to resume dividend payments.

But the company, which said that Gareth Davis, a non-executive director since 2003, will succeed John Whybrow as Chairman after the Annual General Meeting on Jan. 20., also said its markets remain mixed and it can't be certain about the future, sending its shares lower.

At 0916 GMT, Wolseley's stock was down 32 pence, or 2.1%, at 1498 pence, one of the biggest declines in the FTSE100 index in London.

The company is the latest to propose a change to its corporate structure, which will be U.K.-listed, incorporated in Jersey but will have its tax residence in Switzerland. While its U.K. operations will continue to fall under U.K. tax jurisdiction, and the new holding company will continue to report results in sterling and it will pay its taxes abroad.

Several British companies have moved abroad in recent years as U.K. taxes on businesses have risen. Wolseley joins the likes of Shire PLC (SHP.LN), Henderson PLC (HGI.LN), and WPP PLC (WPP.LN), all of which moved to Ireland, as well as Informa PLC (INF.LN), which moved to Switzerland.

Global giants McDonalds Corp. (MCD), Yahoo Inc. (YHOO) and Kraft Foods Inc. (KFT) have also moved their headquarters to Switzerland and are being joined by some hedge funds and investment banks that are seeking to avoid rising personal and corporation taxes.

"The board has concluded that the interests of its business and its shareholders are best served by establishing an international holding company corporate structure that will help provide more certainty in its taxation position," Wolseley said.

Wolseley said its loss before tax more than halved to GBP328 million in the 12 months to July 31, from a loss of GBP766 million a year earlier, helped by cost cutting and restructuring initiatives. Revenue fell 9% to GBP13.2 billion but Wolseley booked revenue growth of 4% in the fourth-quarter and maintained gross margins at 27.7% despite tough trading conditions. The figures beat analysts' hopes.

"We will continue to take actions that will strengthen the business and, whilst overall we remain cautious about the outlook for our markets, we are confident that Wolseley will make good progress in the year ahead," said Chief Executive Ian Meakins.

Signaling confidence, Wolseley said it intends to resume paying dividends half way through fiscal 2011, having not paid a dividend since 2008.

The company has been hit hard by the credit crisis and resulting economic downturn, laying off staff and closing some sites as it reacted to falling profits and lower demand.

By Anita Likus, Dow Jones Newswires; +44 20 7842 9407; anita.likus@dowjones.com

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