TIDMFERG
Kevin Murphy, Ferguson CEO, commented "Our teams continued to
execute, delivering strong full year results with continued market
outperformance, as our balanced business mix served us well in
challenging markets. I would like to thank our associates for their
unwavering commitment to help make our customers' complex projects
simple, successful and sustainable. As expected, disciplined
working capital management drove excellent cash flow in the year.
Our cash generative model and strong balance sheet allow us to
invest for organic growth, sustainably grow our dividend,
consolidate our fragmented markets through acquisitions and return
capital to shareholders.
"FY2024 financial guidance reflects a continued challenging
market backdrop, particularly in the first half of our fiscal year
against strong prior year comparables. Our balanced end market
exposure positions us well to leverage emerging multi-year
structural tailwinds such as non-residential megaprojects. We
remain confident in the strength of our markets over the medium and
longer term and expect to capitalize on attractive growth
opportunities."
FY2024 Guidance
Total Company 2024 Guidance
Net sales* Broadly flat
Adjusted operating margin** 9.2% - 9.8%
Interest expense $190 - $210 million
Adjusted effective tax rate** Approximately 25%
Capital expenditures $400 - $450 million
* Net sales guidance assumes mid-single digit market decline with continued
Company market outperformance, contribution from already completed
acquisitions and one additional sales day. Overall impact of price inflation
estimated to be broadly neutral for the year.
** The Company does not reconcile forward-looking non-GAAP measures. See
"Non-GAAP Reconciliations and Supplementary information".
Three months ended July 31,
US$ (In millions,
except per share
amounts) 2023 2022 Change
Reported(1) Adjusted(2) Reported(1) Adjusted(2) Reported Adjusted
Net sales 7,838 7,838 7,971 7,971 (1.7) % (1.7) %
Gross margin 30.6 % 30.6 % 30.5 % 30.5 % +10 bps +10 bps
Operating profit 782 814 814 849 (3.9) % (4.1) %
Operating margin 10.0 % 10.4 % 10.2 % 10.7 % (20) bps (30) bps
Earnings per share
- diluted 2.85 2.77 2.73 2.85 +4.4 % (2.8) %
Adjusted EBITDA 858 896 (4.2) %
Twelve months ended July 31,
US$ (In millions,
except per share
amounts) 2023 2022 Change
Reported(1) Adjusted(2) Reported(1) Adjusted(2) Reported Adjusted
Net sales 29,734 29,734 28,566 28,566 +4.1 % +4.1 %
Gross margin 30.4 % 30.4 % 30.7 % 30.7 % (30) bps (30) bps
Operating profit 2,659 2,917 2,820 2,951 (5.7) % (1.2) %
(100)
Operating margin 8.9 % 9.8 % 9.9 % 10.3 % bps (50) bps
Earnings per share
- diluted 9.12 9.84 9.59 9.76 (4.9) % +0.8 %
Adjusted EBITDA 3,105 3,153 (1.5) %
Net debt(2) : 1.0x 1.0x
Adjusted EBITDA
(1) The results are presented in accordance with U.S. GAAP on a continuing
operations basis.
(2) The Company uses certain non-GAAP measures, which are not defined or
specified under U.S. GAAP. See the section titled "Non-GAAP
Reconciliations and Supplementary Information."
Summary of financial results
Fourth quarter
Net sales of $7.8 billion were 1.7% below last year. Organic
revenue declined 5.3%, partially offset by acquisition growth of
2.2% and 1.4% positive net impact from one additional sales day and
the impact of foreign exchange rates. The Company's decrease in net
sales was mainly driven by declines in residential, partially
offset by growth in non-residential sales compared to the prior
year period. As expected, price inflation stepped down from
approximately 5% in the third quarter to approximately 1% in the
fourth quarter.
Gross margin of 30.6% was 10 basis points ahead of last year.
Operating expenses continued to be diligently managed and we remain
focused on productivity and efficiencies while investing in core
capabilities for future growth.
Reported operating profit was $782 million (10.0% operating
margin), 3.9% lower than last year. Adjusted operating profit of
$814 million (10.4% adjusted operating margin) was 4.1% lower than
last year.
Reported diluted earnings per share was $2.85 (Q4 2022: $2.73),
an increase of 4.4%, while adjusted diluted earnings per share of
$2.77 decreased 2.8% with the reduction due to lower adjusted
operating profit and higher interest expense, partially offset by
the impact of share repurchases.
Full year
Net sales of $29.7 billion were 4.1% ahead of last year, 1.5%
higher on an organic basis with an additional 2.5% from
acquisitions. An additional selling day contributed 0.4% to growth
while the adverse impact of foreign exchange rates was 0.3%.
Average inflation during the year was approximately 8%.
Gross margin of 30.4% was 30 basis points lower than last year
and operating expenses continued to be well controlled. Reported
operating profit was $2.7 billion (8.9% operating margin), 5.7%
lower than last year. Adjusted operating profit of $2.9 billion
(9.8% adjusted operating margin) was 1.2% lower than last year.
Reported diluted earnings per share was $9.12 (FY2022: $9.59), a
decrease of 4.9%, while adjusted diluted earnings per share of
$9.84 increased 0.8% due to the slightly lower adjusted operating
profit and higher interest expense, offset by the impact of share
repurchases.
USA - fourth quarter
Net sales in the US business declined 1.5%, with an organic
revenue decline of 5.5% partially offset by 2.4% from acquisitions
and a 1.6% positive impact from one additional sales day.
Residential end markets, which comprise just over half of US
revenue, slowed further during the quarter as expected. New
residential housing start and permit activity has remained
relatively stable on a sequential basis but remains below prior
year levels, while repair, maintenance and improvement ("RMI") work
remained more resilient. Overall, residential revenue declined by
approximately 4% in the fourth quarter.
Non-residential end markets, representing just under half of US
revenue, continued to moderate with non-residential revenue growing
by approximately 2% in the fourth quarter. Industrial and
non-residential waterworks projects saw continued strength in the
quarter on top of difficult prior year comparables and, as
expected, we are seeing increased levels of megaproject related bid
activity.
Adjusted operating profit of $804 million was 3.0% or $25
million behind last year.
We completed three acquisitions during the quarter that included
Bruce Supply Corp., a plumbing distributor in the New York City
Metro operating from 6 locations and The Kennedy Companies, a
waterworks distribution business in the mid-Atlantic region with 9
locations. Additionally, we completed the acquisition of S. G.
Torrice, an HVAC distributor in the New England region with 15
locations. In aggregate these businesses generate annualized
revenue of approximately $450 million.
Canada - fourth quarter
Net sales compressed by 5.1%, with an organic revenue decline of
2.7%, a 1.6% positive impact from one additional sales day, and a
further 4.0% due to the adverse impact of foreign exchange rates.
Similar to the US segment, non-residential end markets have been
more resilient than residential end markets. Adjusted operating
profit of $22 million declined by $13 million compared to last
year.
Segmental overview
Three months Twelve months ended
ended July 31, July 31,
US$ (In millions) 2023 2022 Change 2023 2022 Change
Net sales:
USA 7,428 7,539 (1.5 )% 28,291 27,067 4.5 %
Canada 410 432 (5.1 )% 1,443 1,499 (3.7 )%
Total net sales 7,838 7,971 (1.7 )% 29,734 28,566 4.1 %
Adjusted operating
profit:
USA 804 829 (3.0 )% 2,892 2,893 -- %
Canada 22 35 (37.1)% 76 112 (32.1)%
Central and other
costs (12 ) (15 ) (51 ) (54 )
Total adjusted
operating profit 814 849 (4.1 )% 2,917 2,951 (1.2 )%
Financial position
Net debt to adjusted EBITDA at July 31, 2023 was 1.0x and during
the year we invested $0.4 billion in capital expenditures, paid
$0.7 billion of dividends, invested $0.6 billion in eight
acquisitions, and repurchased 7.0 million of our outstanding shares
equating to $0.9 billion. We have a remaining outstanding balance
of $0.5 billion under the current share repurchase program at July
31, 2023.
We have declared a quarterly dividend of $0.75, having
transitioned from a semi-annual distribution schedule earlier in
the fiscal year. This implies a 9% increase, as compared to a
quarter of the prior year's total dividend, and will be paid on
November 15, 2023 to shareholders on the register as of October 6,
2023. This brings the full year dividend to $3.00, a growth of 9%
for the year.
There have been no other significant changes to the financial
position of the Company.
Investor conference call and webcast
A call with Kevin Murphy, CEO and Bill Brundage, CFO will
commence at 8:30 a.m. ET (1:30 p.m. BST) today. The call will be
recorded and available on our website after the event at
corporate.ferguson.com.
Dial in number US: +1 646 787 9445
UK: +44 (0) 20 4587 0498
Ask for the Ferguson call quoting 710245. To access the call via
your laptop, tablet or mobile device please go to
corporate.ferguson.com. If you have technical difficulties, please
click the "Listen by Phone" button on the webcast player and dial
the number provided.
About us
Ferguson plc (NYSE: FERG; LSE: FERG) is a leading value-added
distributor in North America providing expertise, solutions and
products from infrastructure, plumbing and appliances to HVAC,
fire, fabrication and more. We exist to make our customers' complex
projects simple, successful and sustainable. Ferguson is
headquartered in the U.K., with its operations and associates
solely focused on North America and managed from Newport News,
Virginia. For more information, please visit corporate.ferguson.com
or follow us on LinkedIn
linkedin.com/company/ferguson-enterprises.
Analyst resources
For further information on quarterly financial breakdowns, visit
corporate.ferguson.com on the Investors menu under Analyst
Consensus and Resources.
Financial calendar
Annual General Meeting record date* October 4, 2023
Annual General Meeting November 28, 2023
Q1 Results for period ending October December 5, 2023 with call from 8:30
31, 2023 a.m. ET
*Shareholders entered on the register of members of the Company on October 4,
2023 will be entitled to attend or vote at the Annual General Meeting
Timetable for the quarterly dividend
The timetable for payment of the quarterly dividend of $0.75 per
share is as follows:
Ex-dividend date: October 5, 2023
Record date: October 6, 2023
Payment date: November 15, 2023
The quarterly dividend is declared in U.S. dollars and since
March 2021, the default currency for dividends is also U.S.
dollars. Those shareholders who have not elected to receive the
dividend in pounds sterling and who would like to make such an
election may do so online by going to Computershare's Investor
Center and returning the completed form to the address located in
the upper--right corner of the form. The deadline to elect to
receive the quarterly dividend in pounds sterling, or to amend an
existing election, is 5:00 p.m. ET on October 20, 2023 and any
requests should be made in good time ahead of that date.
The form is available at www-us.computershare.com/investor/#home
and navigating to Company Info > FERG > GBP Dividend Election
and Mandate Form.
The completion of cross-border movements of shares between the
U.K. and the U.S. is contingent upon the receiving broker
identifying and acknowledging any such movements. Where a
cross-border movement of shares has been initiated but not
completed by the relevant dividend record date (being October 6,
2023 for this quarterly dividend), there is a risk that the
dividend in respect of such shares will not be received on the
dividend payment date. Accordingly, shareholders are advised not to
initiate any cross-border movements of shares during the period
from October 4, 2023 through October 6, 2023 inclusive.
Cautionary note on forward-looking statements
Certain information included in this announcement is
forward-looking, including within the meaning of the Private
Securities Litigation Reform Act of 1995, and involves risks,
assumptions and uncertainties that could cause actual results to
differ materially from those expressed or implied by
forward-looking statements. Forward-looking statements cover all
matters which are not historical facts and include, without
limitation, statements or guidance regarding or relating to our
future financial position, results of operations and growth,
projected interest in and ownership of our ordinary shares by
investors including as a result of inclusion in North American
market indices, plans and objectives for the future including our
capabilities and priorities, risks associated with changes in
global and regional economic, market and political conditions,
ability to manage supply chain challenges, ability to manage the
impact of product price fluctuations, our financial condition and
liquidity, legal or regulatory changes, statements regarding our
expectations for U.S. residential and non-residential growth
drivers and other statements concerning the success of our business
and strategies. Forward-looking statements can be identified by the
use of forward-looking terminology, including terms such as
"believes," "estimates," "anticipates," "expects," "forecasts,"
"guidance," "intends," "continues," "plans," "projects," "goal,"
"target, " "aim," "may," "will," "would," "could" or "should" or,
in each case, their negative or other variations or comparable
terminology and other similar references to future periods.
Forward-looking statements speak only as of the date on which they
are made. They are not assurances of future performance and are
based only on our current beliefs, expectations and assumptions
regarding the future of our business, future plans and strategies,
projections, anticipated events and trends, the economy and other
future conditions. Therefore, you should not place undue reliance
on any of these forward-looking statements. Although we believe
that the forward-looking statements contained in this announcement
are based on reasonable assumptions, you should be aware that many
factors could cause actual results to differ materially from those
in such forward-looking statements, including but not limited to:
weakness in the economy, market trends, uncertainty and other
conditions in the markets in which we operate, and other factors
beyond our control, including disruption in the financial markets
and any macroeconomic or other consequences of the current conflict
in Ukraine or potential conflict between China and Taiwan; failure
to rapidly identify or effectively respond to direct and/or end
customers' wants, expectations or trends, including costs and
potential problems associated with new or upgraded information
technology systems or our ability to timely deploy new omni-channel
capabilities; decreased demand for our products as a result of
operating in highly competitive industries and the impact of
declines in the residential and non--residential markets, as well
as the RMI and new construction markets; changes in competition,
including as a result of market consolidation or competitors
responding more quickly to emerging technologies (such as
generative artificial intelligence ("AI")); failure of a key
information technology system or process as well as exposure to
fraud or theft resulting from payment--related risks; privacy and
protection of sensitive data failures, including failures due to
data corruption, cybersecurity incidents or network security
breaches; ineffectiveness of or disruption in our domestic or
international supply chain or our fulfillment network, including
delays in inventory, availability at our distribution facilities
and branches, increased delivery costs or lack of availability;
failure to effectively manage and protect our facilities and
inventory or to prevent personal injury to customers, suppliers or
associates, including as a result of workplace violence;
unsuccessful execution of our operational strategies; failure to
attract, retain and motivate key associates; exposure of
associates, contractors, customers, suppliers and other individuals
to health and safety risks; inherent risks associated with
acquisitions, partnerships, joint ventures and other business
combinations, dispositions or strategic transactions; regulatory,
product liability and reputational risks and the failure to achieve
and maintain a high level of product and service quality; inability
to renew leases on favorable terms or at all, as well as any
remaining obligations under a lease when we close a facility;
changes in, interpretations of, or compliance with tax laws in the
United States, the United Kingdom, Switzerland or Canada; our
indebtedness and changes in our credit ratings and outlook;
fluctuations in product prices (e.g., commodity-priced materials,
inflation/deflation) and foreign currency; funding risks related to
our defined benefit pension plans; legal proceedings as well as
failure to comply with domestic and foreign laws, regulations and
standards, as those laws, regulations and standards or
interpretations and enforcement thereof may change, or the
occurrence of unforeseen developments such as litigation; our
failure to comply with the obligations associated with being a U.S.
domestic issuer and the costs associated therewith; the costs and
risk exposure relating to environmental, social and governance
("ESG") matters, including sustainability issues, regulatory or
legal requirements, and disparate stakeholder expectations; adverse
impacts caused by a public health crisis; and other risks and
uncertainties set forth under the heading "Risk Factors" in our
Quarterly Report on Form 10-Q for the fiscal quarter ended April
30, 2023 as filed with the Securities and Exchange Commission
("SEC") on June 7, 2023, our Annual Report on Form 10-K for the
fiscal year ended July 31, 2022 as filed with the SEC on September
27, 2022, and in other filings we make with the SEC in the
future.
Additionally, forward-looking statements regarding past trends
or activities should not be taken as a representation that such
trends or activities will continue in the future. Other than in
accordance with our legal or regulatory obligations, we undertake
no obligation to publicly update or revise any forward-looking
statement, whether as a result of new information, future events or
otherwise.
Ferguson plc
Non-GAAP Reconciliations and Supplementary Information
(unaudited)
Non-GAAP items
This announcement contains certain financial information that is
not presented in conformity with U.S. GAAP. These non-GAAP
financial measures include adjusted operating profit, adjusted
operating margin, adjusted net income, adjusted earnings per share
- diluted, adjusted EBITDA, adjusted effective tax rate, net debt
and net debt to adjusted EBITDA ratio. The Company believes that
these non-GAAP financial measures provide users of the Company's
financial information with additional meaningful information to
assist in understanding financial results and assessing the
Company's performance from period to period. Management believes
these measures are important indicators of operations because they
exclude items that may not be indicative of our core operating
results and provide a better baseline for analyzing trends in our
underlying businesses, and they are consistent with how business
performance is planned, reported and assessed internally by
management and the Company's Board of Directors. Such non-GAAP
adjustments include amortization of acquired intangible assets,
discrete tax items, and any other items that are non-recurring.
Non-recurring items may include business restructuring charges,
corporate restructuring charges, which includes costs associated
with the Company's listing in the United States, gains or losses on
the disposals of businesses which by their nature do not reflect
primary operations, as well as certain other items deemed
non-recurring in nature and/or that are not a result of the
Company's primary operations. Because non-GAAP financial measures
are not standardized, it may not be possible to compare these
financial measures with other companies' non-GAAP financial
measures having the same or similar names. These non-GAAP financial
measures should not be considered in isolation or as a substitute
for results reported under U.S. GAAP. These non-GAAP financial
measures reflect an additional way of viewing aspects of operations
that, when viewed with U.S. GAAP results, provide a more complete
understanding of the business. The Company strongly encourages
investors and shareholders to review the Company's financial
statements and publicly filed reports in their entirety and not to
rely on any single financial measure.
The Company does not provide a reconciliation of forward-looking
non-GAAP financial measures to the most directly comparable U.S.
GAAP financial measures on a forward-looking basis because it is
unable to predict with reasonable certainty or without unreasonable
effort non-recurring items, such as those described above, that may
arise in the future. The variability of these items is
unpredictable and may have a significant impact.
Summary of Organic Revenue
Management evaluates organic revenue as it provides a consistent
measure of the change in revenue year-on-year. Organic revenue
growth (or decline) is determined as the growth (or decline) in
total reported revenue excluding the growth (or decline)
attributable to currency exchange rate fluctuations, sales days,
acquisitions and disposals, divided by the preceding financial
year's revenue at the current year's exchange rates.
A summary of the Company's historical revenue and organic
revenue growth is below:
Q4 2023 Q3 2023 Q2 2023 Q1 2023 Q4 2022
Organic Organic Organic Organic Organic
Revenue Revenue Revenue Revenue Revenue Revenue Revenue Revenue Revenue Revenue
USA (1.5 )% (5.5 )% (1.6 )% (2.5 )% 5.4 % 2.6 % 17.4 % 13.0 % 22.1 % 19.8 %
Canada (5.1 )% (2.7 )% (9.5 )% (1.5 )% (4.5 )% 3.0 % 3.6 % 8.2 % 10.5 % 14.2 %
Continuing
operations (1.7 )% (5.3 )% (2.0 )% (2.5 )% 4.9 % 2.7 % 16.6 % 12.7 % 21.4 % 19.5 %
For further details regarding organic revenue growth, visit
corporate.ferguson.com on the Investors menu under Analyst
Consensus and Resources.
Reconciliation of Net Income to Adjusted Operating Profit and
Adjusted EBITDA
Three months ended Twelve months ended
July 31, July 31,
(In millions) 2023 2022 2023 2022
Net income $ 584 $580 $ 1,889 $2,122
Loss (Income) from
discontinued
operations (net
of tax) -- 2 -- (23 )
Income from
continuing
operations 584 582 1,889 2,099
Provision for
income taxes 146 193 575 609
Interest expense,
net 48 40 184 111
Other expense
(income), net 4 (1 ) 11 1
Operating profit 782 814 2,659 2,820
Corporate
restructurings(1) -- 5 -- 17
Impairments and
other charges(2) (2 ) -- 125 --
Amortization of
acquired
intangibles 34 30 133 114
Adjusted Operating
Profit 814 849 2,917 2,951
Depreciation and
impairment of
PP&E 37 35 148 140
Amortization and
impairment of
non-acquired
intangibles 7 12 40 62
Adjusted EBITDA $ 858 $896 $ 3,105 $3,153
(1) For the three and twelve months ended July 31, 2022, corporate
restructuring costs primarily related to the incremental costs of the
Company's listing in the United States.
(2) For the three months ended July 31, 2023, the benefit recorded in
impairments and other charges related to a change in estimated
impairment charges in connection with the closure of certain, smaller
underperforming branches in the United States recorded in the third
quarter of fiscal 2023. For the twelve months ended July 31, 2023,
impairments and other charges related to the $107 million in software
impairment charges and $18 million in charges associated with the
closure of certain smaller, underperforming branches in the United
States.
Net Debt : Adjusted EBITDA Reconciliation
To assess the appropriateness of its capital structure, the
Company's principal measure of financial leverage is net debt to
adjusted EBITDA. The Company aims to operate with investment grade
credit metrics and keep this ratio within one to two times.
Net debt
Net debt comprises bank overdrafts, bank and other loans and
derivative financial instruments, excluding lease liabilities, less
cash and cash equivalents. Long-term debt is presented net of debt
issuance costs.
As of July 31,
(In millions) 2023 2022
Long-term debt $3,711 $3,679
Short-term debt 55 250
Bank overdrafts(1) 17 32
Derivative liabilities 18 4
Cash and cash equivalents (601 ) (771 )
Net debt $3,200 $3,194
Adjusted EBITDA $3,105 $3,153
Net Debt: Adjusted EBITDA 1.0x 1.0x
(1) Bank overdrafts are included in other current liabilities in the
Company's Consolidated Balance Sheet.
Reconciliation of Net Income to Adjusted Net Income and Adjusted
EPS - Diluted
Three months ended
July 31,
(In millions,
except per share
amounts) 2023 2022
per
share(1) per share(1)
Net income $ 584 $ 2.85 $580 $ 2.72
Loss from
discontinued
operations (net
of tax) -- -- 2 0.01
Income from
continuing
operations 584 2.85 582 2.73
Corporate
restructurings(2) -- -- 5 0.02
Impairments and
other charges(3) (2 ) (0.01 ) -- --
Amortization of
acquired
intangibles 34 0.17 30 0.14
Discrete tax
adjustments(4) (32 ) (0.16 ) -- --
Tax impact on
non-GAAP
adjustments(5) (16 ) (0.08 ) (9 ) (0.04 )
Adjusted net
income $ 568 $ 2.77 $608 $ 2.85
Diluted weighted
average shares
outstanding 205.1 213.4
Twelve months ended
July 31,
(In millions,
except per share
amounts) 2023 2022
per
share(1) per share(1)
Net income $1,889 $ 9.12 $2,122 $ 9.69
(Income) from
discontinued
operations (net
of tax) -- -- (23 ) (0.10)
Income from
continuing
operations 1,889 9.12 2,099 9.59
Corporate
restructurings(2) -- -- 17 0.08
Impairments and
other charges(3) 125 0.60 -- --
Amortization of
acquired
intangibles 133 0.64 114 0.52
Discrete tax
adjustments(4) (36 ) (0.17) (72 ) (0.33)
Tax impact on
non-GAAP
adjustments(5) (73 ) (0.35) (21 ) (0.10)
Adjusted net
income $2,038 $ 9.84 $2,137 $ 9.76
Diluted weighted
average shares
outstanding 207.2 218.9
(1) Per share on a dilutive basis.
(2) For the three and twelve months ended July 31, 2022, corporate
restructuring costs primarily related to the incremental costs of the
Company's listing in the United States.
(3) For the three months ended July 31, 2023, the benefit recorded in
impairments and other charges related to a change in estimated
impairment charges in connection with the closure of certain, smaller
underperforming branches in the United States recorded in the third
quarter of fiscal 2023. For the twelve months ended July 31, 2023,
impairments and other charges related to the $107 million in software
impairment charges and $18 million in charges associated with the
closure of certain smaller, underperforming branches in the United
States.
(4) For the three and twelve months ended July 31, 2023, discrete tax
adjustments primarily related to the release of uncertain positions
following the lapse of statute of limitations, as well as adjustments
in connection with amended returns. For the three and twelve months
ended July 31, 2022, the discrete tax adjustments primarily related to
the release of uncertain tax positions following the closure of tax
audits and prior year adjustments, including amended tax return items.
(5) For the three and twelve months ended July 31, 2023, the tax impact on
non-GAAP adjustments primarily related to the impairments and other
charges and amortization of acquired intangibles. For the three and
twelve months ended July 31, 2022, the tax impact on non-GAAP
adjustments primarily related to the amortization of acquired
intangibles.
Ferguson plc
Condensed Consolidated Statements of Earnings
(unaudited)
Three months ended Twelve months ended
July 31, July 31,
(In millions,
except per
share amounts) 2023 2022 2023 2022
Net sales $7,838 $7,971 $29,734 $28,566
Cost of sales (5,436) (5,536) (20,709) (19,810)
Gross profit 2,402 2,435 9,025 8,756
Selling,
general and
administrative
expenses (1,544) (1,544) (5,920 ) (5,635 )
Impairments and
other charges 2 -- (125 ) --
Depreciation
and
amortization (78 ) (77 ) (321 ) (301 )
Operating
profit 782 814 2,659 2,820
Interest
expense, net (48 ) (40 ) (184 ) (111 )
Other (expense)
income, net (4 ) 1 (11 ) (1 )
Income before
income taxes 730 775 2,464 2,708
Provision for
income taxes (146 ) (193 ) (575 ) (609 )
Income from
continuing
operations 584 582 1,889 2,099
(Loss) income
from
discontinued
operations
(net of tax) -- (2 ) -- 23
Net income $584 $580 $1,889 $2,122
Earnings per
share - Basic:
Continuing
operations $2.86 $2.74 $9.15 $9.64
Discontinued
operations -- (0.01 ) -- 0.11
Total $2.86 $2.73 $9.15 $9.75
Earnings per
share -
Diluted:
Continuing
operations $2.85 $2.73 $9.12 $9.59
Discontinued
operations -- (0.01 ) -- 0.10
Total $2.85 $2.72 $9.12 $9.69
Weighted
average number
of shares
outstanding:
Basic 204.3 212.3 206.4 217.7
Diluted 205.1 213.4 207.2 218.9
Ferguson plc
Condensed Consolidated Balance Sheets
(unaudited)
As of July 31,
(In millions) 2023 2022
Assets
Cash and cash equivalents $601 $771
Accounts receivable, net 3,597 3,610
Inventories 3,898 4,333
Prepaid and other current assets 953 834
Assets held for sale 28 3
Total current assets 9,077 9,551
Property, plant and equipment, net 1,595 1,376
Operating lease right-of-use assets 1,474 1,200
Deferred income taxes, net 300 177
Goodwill 2,241 2,048
Other non-current assets 1,307 1,309
Total assets $15,994 $15,661
Liabilities and shareholders' equity
Accounts payable $3,408 $3,607
Other current liabilities 2,021 2,192
Total current liabilities 5,429 5,799
Long-term debt 3,711 3,679
Long-term portion of operating lease liabilities 1,126 878
Other long-term liabilities 691 640
Total liabilities 10,957 10,996
Total shareholders' equity 5,037 4,665
Total liabilities and shareholders' equity $15,994 $15,661
Ferguson plc
Condensed Consolidated Statements of Cash Flows
(unaudited)
(In millions) Twelve months ended
July 31,
2023 2022
Cash flows from operating activities:
Net income $ 1,889 $2,122
Income from discontinued operations -- (23 )
Income from continuing operations 1,889 2,099
Depreciation and amortization 321 301
Share-based compensation 51 57
Non-cash impact of impairments 125 15
Changes in deferred income taxes (104 ) 41
Decrease (increase) in inventories 607 (927 )
Increase in receivables and other assets (1 ) (780 )
(Decrease) increase in accounts payable and
other liabilities (196 ) 436
Increase (decrease) in income taxes payable 24 (103 )
Other operating activities 11 10
Net cash provided by operating activities of
continuing operations 2,727 1,149
Net cash used in operating activities of
discontinued operations (4 ) --
Net cash provided by operating activities 2,723 1,149
Cash flows from investing activities:
Purchase of businesses acquired, net of cash
acquired (616 ) (650 )
Capital expenditures (441 ) (290 )
Other investing activities 3 (6 )
Net cash used in investing activities of
continuing operations (1,054 ) (946 )
Net cash provided by investing activities of
discontinued operations -- 24
Net cash used in investing activities (1,054 ) (922 )
Cash flows from financing activities:
Purchase of own shares by Employee Benefit
Trust -- (92 )
Purchase of treasury shares (908 ) (1,545 )
Proceeds from sale of treasury shares 17 13
Net change in debt and bank overdrafts (170 ) 1,440
Cash dividends (711 ) (538 )
Other financing activities (35 ) (22 )
Net cash used in financing activities (1,807 ) (744 )
Change in cash, cash equivalents and
restricted cash (138 ) (517 )
Effects of exchange rate changes 22 (40 )
Cash, cash equivalents and restricted cash,
beginning of period 785 1,342
Cash, cash equivalents and restricted cash,
end of period $ 669 $785
For further information please contact
Investor relations
Brian Lantz, Vice President IR and Communications
Mobile: +1 224 285 2410
Pete Kennedy, Director of Investor Relations
Mobile: +1 757 603 0111
Media inquiries
John Pappas, Director of Financial Communications
Mobile: +1 484 790 2727
View source version on businesswire.com:
https://www.businesswire.com/news/home/20230926027022/en/
CONTACT:
Ferguson plc
SOURCE: Ferguson plc
Copyright Business Wire 2023
(END) Dow Jones Newswires
September 26, 2023 06:45 ET (10:45 GMT)
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