Ferguson Enterprises Inc DE

Ferguson at a Glance

Ferguson is the largest value-added distributor serving the specialized professional in our $340B residential andnon-residential North American construction market. We help make our customers’ complex projects simple, successful and sustainable by providing expertise and a wide range of products and services from plumbing, HVAC, appliances, and lighting to PVF, water and wastewater solutions, and more.

Our North American customer groups have leading positions in large, growing and fragmented markets with over 75% of revenue estimated to come from #1 or #2 market positions. These markets have historically grown above GDP and their long-term structural characteristics remain supportive. We have an intentional balance between attractive end markets and serve customers principally in North America. Residential andnon-residential markets each account for approximately half of our net sales, with net sales within these combined markets balanced between repair, maintenance and improvement (“RMI”) (approximatelytwo-thirds of our net sales) and new construction (approximatelyone-third of our net sales), based on management’s estimates. This balance continues to serve us well and creates resilience with a less cyclical and more robust business model.

Balanced market exposure

Our business model enables us to connect approximately 36,000 suppliers with more than one million customers, and our scale has continued to help us consistently outperform the market. Through scale deployed locally utilizing our world-class supply chain, value-added solutions and digital tools, along with our expert associates, we help meet our customers’ unique needs.

We look to generate long-term shareholder value by investing for organic growth, consolidating our fragmented markets through acquisitions and returning surplus capital to shareholders. We have a demonstrated long-term track record of returning capital to our shareholders, with over $11 billion returned via dividends and share repurchases over the past ten years.

Fiscal 2024 Performance

We delivered a strong performance in fiscal year 2024 despite challenging end markets during the year. Net sales of $29.6 billion were broadly flat as we continued to consolidate our markets with above market share gains and high quality acquisitions.

Operating profit of $2,652 million was $7 million lower than last year with diluted earnings per share of $8.53, a decrease of 6.5%. Adjusted operating profit* of $2,824 million was $93 million lower than last year with adjusted diluted earnings per share* of $9.69, a decrease of 1.5% principally arising due to the lower adjusted operating profit, partially offset by the impact of share repurchases.

Cash generation remains an important strength of our business, with operating cash flow of approximately $1.9 billion during the year. Our cash generative model and strong balance sheet allowed us to invest for organic growth, sustainably grow our dividend, consolidate our fragmented markets through acquisitions and return capital to shareholders. During the year we invested $0.4 billion in capital expenditures, paid $0.8 billion of dividends, invested $0.3 billion in ten acquisitions, and repurchased 3.3 million of our outstanding shares equating to $0.6 billion.

The Board declared total annual dividends for the fiscal year of $3.16 per share which reflects 5% growth over the prior year.

• Adjusted operating profit, Adjusted EPS – diluted and Return on capital employed (ROCE) arenon-GAAP measures. See the section of this Proxy Statement titled“Non-GAAP Reconciliations and Supplementary Information” for more information and a reconciliation of thenon-GAAP measure to the most comparable measure under accounting principles generally accepted in the United States (“U.S. GAAP”).

Governance Transition & Timeline and Related Board of Director Matters

Governance Transition & Timeline

Since 2019, Ferguson plc’s Board of Directors (the “Ferguson plc Board”) considered North America to be the best long-term location for the Company and worked methodically and transparently with shareholders on a journey to align the Company’s headquarters and governance with its operations and leadership. As part of this effort, the Company obtained an additional listing of its ordinary shares on the New York Stock Exchange (“NYSE”) effective March 8, 2021, and, on May 12, 2022, the Company relocated its primary listing to the NYSE following the transfer of its listing category on the London Stock Exchange (“LSE”) from a Premium listing to a Standard listing. Following this transfer, the Company was no longer required to comply (or explainnon-compliance) with the U.K. Corporate

Governance Code and adjusted its corporate governance arrangements to align with those typically adopted by a U.S. domestic issuer of similar size and nature that maintains a listing on the NYSE. During fiscal 2023, the Company determined that it no longer qualified as a foreign private issuer under the Securities Exchange Act of 1934, as amended (the “Exchange Act”). As a result, effective August 1, 2023, the Company was no longer eligible to use the rules designed for foreign private issuers and was considered a U.S. domestic issuer under the rules of the SEC and NYSE listing standards. However, the Company remained a foreign company incorporated in Jersey under the Companies (Jersey) Law 1991 (as amended) (the “Companies Law”) that was required to comply with Jersey law and its memorandum and articles of association under such law.

In the next step of our journey, on January 18, 2024, the Company announced that the Ferguson plc Board had concluded that it would be in the best interests of the Company and its shareholders as a whole to proceed with establishing a new corporate structure to domicile the Ferguson group of companies’ ultimate parent company in the United States. On May 30, 2024, Ferguson plc held an extraordinary general meeting at which shareholders approved the proposed merger transaction. The Merger was effective on August 1, 2024 and resulted in (i) Ferguson plc becoming a direct wholly owned subsidiary of Ferguson Enterprises Inc., a Delaware corporation, and (ii) shareholders of Ferguson plc at the designated record time for the Merger no longer holding ordinary shares of Ferguson plc but instead holding shares of common stock of Ferguson Enterprises Inc.

Pursuant to the reforms to the U.K. Listing Rules which took effect on July 29, 2024, the Company’s Standard listing on the LSE was discontinued and Ferguson was admitted to the new equity shares (international commercial companies secondary listing) category on the LSE in its place. The Company’s shares of common stock are listed on both the NYSE (primary) and LSE (secondary) under the symbol “FERG,” the same symbol that previously attached to Ferguson plc’s ordinary shares.

The following timeline depicts the Company’s journey described above.

Related Board of Director Matters

As part of establishing the new corporate structure, each of Ferguson plc’s Executive Directors, Kevin Murphy and Bill Brundage, was appointed to the Board of Directors of Ferguson Enterprises Inc. (the “Board” or the “Ferguson Enterprises Inc. Board”) on February 5, 2024, and each Non-Employee Director serving on the Ferguson plc Board at the time was appointed to the Ferguson Enterprises Inc. Board on February 14, 2024 (each a “Legacy NED” and, together with the Executive Directors, the “Legacy Directors”). On June 3, 2024, Rekha Agrawal and Rick Beckwitt were appointed to the Ferguson Enterprises Inc. Board.

Unless otherwise specified, references in this Proxy Statement to a Director nominee’s appointment to or tenure on the Board include service on the Ferguson plc Board for the Legacy Directors, and references to term of employment for the Company’s Named Executive Officers include employment with Ferguson plc or its subsidiaries prior to the Merger. References in this Proxy Statement to meetings of Committees of the Board of Directors held in fiscal 2024 refer to meetings of Committees of the Ferguson plc Board. The Ferguson Enterprises Inc. Board had no Committees during fiscal 2024 and established the following three standing Committees effective August 1, 2024: Audit Committee, Compensation Committee, and Nominations & Governance Committee.

Governance and Compensation Highlights

Sound and Effective Board Practices • Active board oversight of the Company’s strategy, enterprise risk management and environmental, social and governance (“ESG”) framework and related public disclosures • Active board engagement in succession planning for CEO, CFO and other Executive Officers • Annual Board and Committee performance evaluations • Annual review of board leadership structure • Formal policy limiting service on other public company boards of directors

Diverse, Engaged Board with Demonstrated Commitment to Refreshment and Independence • Nine out of 11 Director nominees (82%) are independent • Four out of 11 Director nominees (36%) are female, with two (18%) identifying as a person of color and one (9%) identifying as LGBTQ+ • Seven new Non-Employee Directors elected in the last five years • Female Directors chair both the Audit Committee and Compensation Committee • Proactive Board and Committee refreshment with focus on optimal mix of skills and experience • Eight out of 11 Director nominees (73%) are a current or former CEO or CFO of a public company • Audit, Compensation and Nominations & Governance Committees are composed solely of independent Directors

Commitment to Shareholder Rights • Shareholders that own at least 10% of the total voting power of the outstanding shares of common stock of the Company have the right to request a special meeting • Single class of outstanding voting stock • Directors elected annually to serve one-year terms • Majority voting for Directors with Director resignation policy in an uncontested election and plurality voting for Directors in a contested election • No supermajority voting provisions

Strong Corporate Governance and Compensation Practices • Robust annual risk assessment of executive compensation programs, policies and practices • Recommended annual Say-on-Pay Vote • Comprehensive clawback policy • Stock Ownership Guidelines for Non-Employee Directors and Executive Officers • Prohibition on hedging and pledging of Company shares • Prohibition on political donations by the Company

For more information about our compensation governance practices, see the section below titled “Compensation Discussion and

Analysis—Pay Decisions and Compensation Governance Policies and Practices” on page 42.

Our Director Nominees

Our Director nominees possess a range of diverse backgrounds, skills, knowledge and experience that we believe are integral to an effective and well-functioning board. For more information about our Director nominees, please see our Director skills and experience matrix on page 17. Detailed information about each Director nominee’s qualifications, experience and expertise can be found in their biographies starting on page 11. As further discussed in the section titled “Proposal 1: Election of Directors,” Thomas Schmitt and Nadia Shouraboura are not standing forre-election at the 2024 Annual Meeting.

Director Tenure, Diversity, Independence and Qualifications

Our slate of Director nominees reflects our aim to establish a Board with an appropriate balance of skills, knowledge, experience, and diversity of background, including gender and racial/ethnic diversity, sexual orientation, tenure, and independence.

ESG Framework and Reporting

The Board-approved ESG framework reflects Ferguson’s priority ESG issues identified through our risk management analyses, stakeholder priority assessments and the guidance and methods provided by the Sustainability Accounting Standards Board (“SASB”), considering issues relevant to Multiline and Specialty Retailers & Distributors industry standards (sasb.org). It comprises the key sustainability topics informing and influencing our business strategy and structures our overall vision for sustainability across three key pillars: Environmental, Social and Governance.

Our ESG Report is available on our website. Our SASB disclosure and our disclosure under the Task Force on Climate-Related Financial Disclosures (TCFD) framework are included within our ESG Report and are also available on our website. The ESG Report and other information regarding our ESG practices on our website are not incorporated by reference into this Proxy Statement.