Ferguson Sales Climb 4% in Latest Fiscal Year Despite Q4 Decline

The company, however, expects sales to remain “broadly flat” in the new fiscal year.

Ferguson office, Secaucus, N.J., Aug. 2022.
Ferguson office, Secaucus, N.J., Aug. 2022.

British plumbing and heating products giant Ferguson said its sales rose by just more than 4% in its recently completed fiscal year.

The company, however, saw other financial metrics slide, and it wrapped up the year with a drop in sales during the final quarter.

For the most recent 12-month window, Ferguson reported $29.7 billion in net sales, up 4.1% from the $28.6 billion posted in the previous fiscal year. But the company’s operating profit dropped 1.2% over that span — from $2.8 billion to shy of $2.7 billion — and its gross margin, operating margin, adjusted EBITDA and diluted earnings per share saw declines, as well.

Ferguson — whose North American industrial business came in at no. 16 on ID’s newly released Big 50 rankings — characterized its full-year results as “strong,” and said that a balanced mix of business helped the company navigate tumultuous economic conditions. Citing a continued “challenging market backdrop,” however, the company’s initial forecast anticipates that sales will be “broadly flat” over the new fiscal year.

Ferguson also expects a full-year adjusted operating margin of between 9.2% and 9.8% — even with or slightly below the adjusted margin last year.

“Our balanced end market exposure positions us well to leverage emerging multi-year structural tailwinds, such as non-residential megaprojects,” Ferguson CEO Kevin Murphy said in a statement. “We remain confident in the strength of our markets over the medium and longer term and expect to capitalize on attractive growth opportunities.”

In the most recent quarter, sales declined 1.7% to $7.8 billion, while operating profit fell 4.1% to $782 million. Company officials said acquisitions and an additional sales day helped offset a drop of more than 5% in organic growth year-over-year. Earnings and operating margin also fell during the latest quarter, but gross margin rose by 10 basis points to 30.6%.

The company’s net sales in North America declined by 1.7% in the fourth quarter, while adjusted operating profit in the region slipped 4.1%.

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