Ferguson Enterprises Inc DE
For the period ended Jan 31, 2025. Filed Mar 11, 2025.
View on SEC.govAbout this filing
A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Jan 31, 2025 · Filed Mar 11, 2025
FERG$233.70-0.8%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2024-10-31; filed 2024-12-10.
0002011641-24-000011
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsNon-GAAP Reconciliations and Supplementary InformationCurrent report: 10-Q
Period ended 2025-01-31; filed 2025-03-11.
0002011641-25-000006
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsNon-GAAP Reconciliations and Supplementary InformationThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 85 previous paragraphs and 94 current paragraphs.
53 unchanged; 30 reworded; 11 added; 2 removed; 0 previous and 0 current paragraphs rearranged.
Tables are not compared: 12 previous and 13 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (11)
Current report
Net sales were $14.6 billion in the year-to-date period of fiscal 2025, an increase of $0.3 billion, or 1.8%, compared with the same period in fiscal 2024. The factors impacting the year-to-date comparison were largely the same as those noted above for the quarter.
Current report
Gross profit in the year-to-date period of fiscal 2025 increased $22 million, or 0.5%, compared with the same period in fiscal 2024. Gross profit as a percentage of sales was 29.9% and 30.3% in the year-to-date periods of fiscal 2025 and fiscal 2024, respectively. The factors impacting the year-to-date comparisons were largely the same as those noted above for the quarter.
Current report
SG&A expenses in the year-to-date period of fiscal 2025 increased $144 million, or 4.8%, compared with the same period in fiscal 2024. SG&A as a percentage of sales was 21.3% and 20.7% in the year-to-date period of fiscal 2025 and fiscal 2024, respectively. The factors impacting the year-to-date comparisons were largely the same as those noted above for the quarter, as well as the impact of increased labor costs, primarily related to wage inflation, on the year-to-date comparison.
Current report
Income tax expense was $94 million for the second quarter of fiscal 2025, a decrease of $17 million, or 15.3%, compared to the same period in fiscal 2024. In the year-to-date period of fiscal 2025, income tax expense was $248 million, a decrease of $35 million, or 12.4%, compared to the same period in fiscal 2024. In each case the decrease was due to lower income before income taxes.
Current report
Net interest expense
Current report
Net interest expense was $48 million in the second quarter of fiscal 2025 compared with $44 million in the same period in fiscal 2024. In the year-to-date periods, net interest expense was $94 million in fiscal 2025 compared with $89 million in fiscal 2024. The increase in interest expense was due to higher average borrowings over the respective periods compared with the prior year.
Current report
Net sales were $13.9 billion in the year-to-date period of fiscal 2025, an increase of $0.2 billion, or 1.7%, compared with the same period in fiscal 2024. The factors impacting the year-to-date comparison were largely the same as those noted above for the quarter.
Current report
Adjusted operating profit for the United States segment was $455 million in the second quarter of fiscal 2025, a decrease of $70 million, or 13.3%, compared to the same period in fiscal 2024, primarily reflecting the impact of higher operating costs driven by sales volume growth and cost inflation.
Current report
Adjusted operating profit for the United States segment was $1.2 billion in the year-to-date period of fiscal 2025, a decrease of $0.1 billion, or 10.8%, compared to the same period in fiscal 2024. The factors impacting the year-to-date comparison were largely the same as those noted above for the quarter.
Current report
Net sales were $722 million in the year-to-date period of fiscal 2025, an increase of $34 million, or 4.9%, compared with the same period in fiscal 2024. The factors impacting the year-to-date comparison were largely the same as those noted above for the quarter.
Current report
Net cash used in financing activities was $289 million and $597 million for the year-to-date periods of fiscal 2025 and 2024, respectively.
Removed paragraphs (2)
Previous report
Adjusted operating profit for the United States segment was $697 million in the first quarter of fiscal 2025, a decrease of $69 million, or 9.0%, compared to the same period in fiscal 2024, primarily reflecting the impact of labor and infrastructure cost inflation, as well as an increase in associates in connection with sales volume growth.
Previous report
Net cash used in financing activities was $214 million for the first quarter of fiscal 2025 compared with $313 million in the same period in fiscal 2024.
Reworded paragraphs (30)
Previous wording
Management’s discussion and analysis of financial condition and results of operations (“MD&A”)is intended to convey management’s perspective regarding the Company’s operational and financial performance for the three months ended October 31, 2024 and 2023, respectively. This MD&A should be read in conjunction with the unaudited condensed consolidated financial statements and related notes appearing in “Item 1. Financial Statements” of this Quarterly Report (the “Condensed Consolidated Financial Statements”) and the consolidated financial statements and related notes in “Item 8. Financial Statements and Supplementary Data” of the Annual Report.
Current wording
Management’s discussion and analysis of financial condition and results of operations (“MD&A”)is intended to convey management’s perspective regarding the Company’s operational and financial performance for the three and six months ended January 31, 2025 and 2024, respectively. This MD&A should be read in conjunction with the unaudited condensed consolidated financial statements and related notes appearing in “Item 1. Financial Statements” of this Quarterly Report (the “Condensed Consolidated Financial Statements”) and the consolidated financial statements and related notes in “Item 8. Financial Statements and Supplementary Data” of the Annual Report.
Previous wording
For the first quarter of fiscal 2025, net sales increased by 0.8% compared to the first quarter of fiscal 2024, primarily due to higher sales volume and incremental revenue from acquisitions, partially offset by price deflation (approximately 2%), mainly within certain commodity categories.
Current wording
For the second quarter of fiscal 2025, net sales increased by 3.0% compared to the second quarter of fiscal 2024, primarily due to higher sales volume and incremental revenue from acquisitions, partially offset by price deflation (approximately 2%), mainly within certain commodity categories in the United States.
Previous wording
For the first quarter of fiscal 2025, operating profit decreased by 10.0% (adjusted operating profit decreased 8.7%), compared with the first quarter of fiscal 2024. This decrease was primarily due to higher operating costs driven by sales volume growth, as well as inflation.
Current wording
For the second quarter of fiscal 2025, operating profit decreased by 14.0% (adjusted operating profit decreased 13.7%), compared with the second quarter of fiscal 2024. This decrease was primarily due to higher operating costs driven by sales volume growth and cost inflation.
Previous wording
For the first quarter of fiscal 2025, diluted earnings per share was $2.34 (adjusted diluted earnings per share: $2.45), decreasing 7.9% compared with the first quarter of fiscal 2024 (7.5% on an adjusted basis) due to lower net income, partially offset by the impact of share repurchases.
Current wording
For the second quarter of fiscal 2025, diluted earnings per share was $1.38 (adjusted diluted earnings per share: $1.52), decreasing 12.7% compared with the second quarter of fiscal 2024 (12.6% on an adjusted basis) due to lower net income, partially offset by the impact of share repurchases.
Previous wording
Net cash provided by operating activities decreased to $0.3 billion in the first quarter of fiscal 2025 compared with $0.6 billion in the same period in fiscal 2024, primarily reflecting an increase in working capital period-over-period, along with lower net income after adjusting for non-cash items.
Current wording
Net cash provided by operating activities decreased to $0.7 billion in the year-to-date period of fiscal 2025 compared with $0.9 billion in the same period of fiscal 2024, reflecting an increase in working capital to support volume growth period-over-period, along with lower net income after adjusting for non-cash items.
Previous wording
Net sales were $7.8 billion in the first quarter of fiscal 2025, an increase of $0.1 billion, or 0.8%, compared with the same period in fiscal 2024. The increase in net sales was driven by higher sales volume and incremental sales from acquisitions of 1.1%, partially offset by price deflation of approximately 2%, mainly within certain commodity categories. The Company’s increase in net sales was primarily driven by its United States segment, mainly due to growth in non-residential sales.
Current wording
Net sales were $6.9 billion in the second quarter of fiscal 2025, an increase of $0.2 billion, or 3.0%, compared with the same period in fiscal 2024. The increase in net sales was driven by higher sales volume and incremental sales from acquisitions of 1.2%. These increases were partially offset by price deflation of approximately 2%, mainly within certain commodity categories in the United States. The Company’s increase in net sales was driven by growth in both of the residential and non-residential markets in its United States segment.
Previous wording
Gross profit in the first quarter of fiscal 2025 increased $9 million, or 0.4%, compared with the same period in fiscal 2024, primarily reflecting increased net sales. Gross profit as a percentage of sales was 30.1% and 30.2% in the first quarters of fiscal 2025 and fiscal 2024, respectively. The decrease of 0.1% primarily reflected the impact of deflation in certain commodity categories.
Current wording
Gross profit in the second quarter of fiscal 2025 increased $13 million, or 0.6%, compared with the same period in fiscal 2024, primarily reflecting increased net sales. Gross profit as a percentage of sales was 29.7% and 30.4% in the second quarters of fiscal 2025 and fiscal 2024, respectively. The decrease of 0.7% reflected the impact on margins from subdued end market demand, as well as the impact of price deflation and sales mix.
Previous wording
SG&A expenses in the first quarter of fiscal 2025 increased $73 million, or 4.8%, compared with the same period in fiscal 2024. SG&A as a percentage of sales was 20.4% and 19.6% in the first quarters of fiscal 2025 and fiscal 2024, respectively. The increase in SG&A as a percent of sales primarily reflects the impact of labor and infrastructure cost inflation, as well as an increase in associates in connection with sales volume growth.
Current wording
SG&A expenses in the second quarter of fiscal 2025 increased $71 million, or 4.8%, compared with the same period in fiscal 2024. SG&A as a percentage of sales was 22.4% and 22.0% in the second quarters of fiscal 2025 and fiscal 2024, respectively. The increase in SG&A as a percent of sales primarily reflects the impact of cost inflation, mainly on infrastructure and fleet.
Previous wording
Income tax expense was $154 million for the first quarter of fiscal 2025, a decrease of $18 million, or 10.5%, compared to the same period in fiscal 2024 in connection with lower income before income taxes. The Company’s effective tax rates were 24.7% and 24.9% for the first quarters of fiscal 2025 and 2024, respectively. The decrease in the effective tax rate was primarily due to a discrete tax benefit recorded in the first quarter of fiscal 2025.
Current wording
The Company’s effective tax rates were 25.4% and 25.6% for the second quarters of fiscal 2025 and 2024, respectively. The Company’s effective tax rates were 24.9% and 25.2% for the year-to-date periods of fiscal 2025 and 2024, respectively. For each of the year-over-year comparisons, the decrease in the effective tax rate was primarily due to discrete tax benefits recorded in fiscal 2025.
Previous wording
Net income for the first quarter of fiscal 2025 was $470 million, a decrease of $49 million, or 9.4%, compared with the same period in fiscal 2024 due to the various elements described in the sections above.
Current wording
Net income for the second quarter and year-to-date periods of fiscal 2025 was $276 million and $746 million, respectively. These represented decreases in net income of $46 million, or 14.3%, and $95 million, or 11.3%, compared with the respective periods in fiscal 2024 due to the various elements described in the sections above.
Previous wording
Net sales for the United States segment were $7.4 billion in the first quarter of fiscal 2025, an increase of $40 million, or 0.5%, compared to the same period in fiscal 2024. The increase in net sales was primarily driven by higher sales volume and incremental sales from acquisitions of 0.9%, partially offset by price deflation of approximately 2%, mainly within certain commodity categories. Net sales in non-residential markets increased 0.9% in connection with growth in Industrial and Civil/Infrastructure sales compared with the same period in fiscal 2024. Net sales in residential markets were even with the same period in fiscal 2024.
Current wording
Net sales for the United States segment were $6.6 billion in the second quarter of fiscal 2025, an increase of $189 million, or 3.0%, compared to the same period in fiscal 2024. The increase in net sales was primarily driven by higher sales volume and incremental sales from acquisitions of 1.0%, partially offset by price deflation of approximately 2%, mainly within certain commodity categories. Net sales in non-residential markets increased 3.8%, mainly in connection with growth in Commercial and Civil/Infrastructure sales compared with the same period in fiscal 2024. Net sales in residential markets increased 2.2% compared with the same period in fiscal 2024 with growth across both new construction and repairs, maintenance and improvement.
Previous wording
Net sales for the Canada segment were $403 million in the first quarter of fiscal 2025, an increase of $24 million, or 6.3%, compared to the same period in fiscal 2024. This increase in net sales was primarily driven by incremental sales from an acquisition of 5.6%, price inflation of approximately 1% and higher sales volume, partially offset by the impact of foreign currency exchange rates of 0.6%.
Current wording
Net sales for the Canada segment were $319 million in the second quarter of fiscal 2025, an increase of $10 million, or 3.2%, compared to the same period in fiscal 2024. This increase in net sales was primarily driven by incremental sales from an acquisition of 5.4%, price inflation of approximately 2% and higher sales volume, partially offset by the impact of foreign currency exchange rates of 5.3%.
Previous wording
Adjusted operating profit for the Canada segment in the first quarter of fiscal 2025 was even with the first quarter of fiscal 2024.
Current wording
Adjusted operating profit for the Canada segment in the second quarter and year-to-date periods of fiscal 2025 increased by $2 million compared with the respective periods in fiscal 2024 in connection with higher sales.
Previous wording
(1)For the three months ended October 31, 2024, corporate restructurings primarily related to incremental costs in connection with transition activities following the establishment of our parent company’s domicile in the United States.
Current wording
(1)For the six months ended January 31, 2025, corporate restructurings primarily related to incremental costs in connection with transition activities following the establishment of our parent company’s domicile in the United States. For the three and six months ended January 31, 2024, corporate restructuring costs related to incremental costs in connection with establishing a new corporate structure to domicile our ultimate parent company in the United States.
Previous wording
(2)For the three months ended October 31, 2024, corporate restructurings primarily related to incremental costs in connection with transition activities following the establishment of our parent company’s domicile in the United States.
Current wording
(2)For the six months ended January 31, 2025, corporate restructurings primarily related to incremental costs in connection with transition activities following the establishment of our parent company’s domicile in the United States. For the three and six months ended January 31, 2024, corporate restructuring costs related to incremental costs in connection with establishing a new corporate structure to domicile our ultimate parent company in the United States.
Previous wording
(3)For the three months ended October 31, 2024, discrete tax adjustments mainly related to the tax treatment of certain compensation items that is not material.
Current wording
(3)For the three and six months ended January 31, 2025 and 2024, discrete tax adjustments mainly related to the tax treatment of certain compensation items that are not material.
Previous wording
(4)For the three months ended October 31, 2024 and 2023, the tax impact on non-GAAP adjustments primarily related to the amortization of acquired intangibles.
Current wording
(4)For the three and six months ended January 31, 2025 and 2024, the tax impact on non-GAAP adjustments primarily related to the amortization of acquired intangibles.
Previous wording
The Company’s material cash requirements include contractual and other obligations arising in the normal course of business. These obligations primarily include debt service and related interest payments, operating lease obligations and other purchase obligations. The nature and composition of such existing cash requirements have not materially changed from those disclosed in the Annual Report other than items updated in this Quarterly Report.
Current wording
The Company’s material cash requirements include contractual and other obligations arising in the normal course of business. These obligations primarily include debt service and related interest payments, operating lease obligations, required pension obligations and other purchase obligations. The nature and composition of such existing cash requirements have not materially changed from those disclosed in the Annual Report other than items updated in this Quarterly Report.
Previous wording
As of October 31, 2024 and July 31, 2024, the Company had cash and cash equivalents of $601 million and $571 million, respectively. In addition to cash, the Company had $2.4 billion of available liquidity from undrawn debt facilities as of October 31, 2024.
Current wording
As of January 31, 2025 and July 31, 2024, the Company had cash and cash equivalents of $764 million and $571 million, respectively. In addition to cash, the Company had $1.9 billion of available liquidity from undrawn debt facilities as of January 31, 2025.
Previous wording
As of October 31, 2024, the Company’s total debt was $4.0 billion. The Company anticipates that it will be able to meet its debt obligations as they become due.
Current wording
As of January 31, 2025, the Company’s total debt was $4.3 billion. The Company anticipates that it will be able to meet its debt obligations as they become due.
Previous wording
Net cash provided by operating activities was $345 million for the first quarter of fiscal 2025 compared to $557 million in the same period in fiscal 2024. The $212 million decrease was primarily driven by a decrease in payables due to the timing of vendor payments and lower earnings in fiscal 2024 after adjusting for non-cash charges. These decreases in cash flow were partially offset by the timing of receivables collections year-over-year.
Current wording
Net cash provided by operating activities was $685 million and $863 million for the year-to-date periods of fiscal 2025 and 2024, respectively. The $178 million decrease was mainly due to lower net income (adjusted for non-cash items), as well as changes in working capital compared with the prior year. The increase in working capital was primarily driven by the timing of receivables collections year-over-year and an increase in inventory in connection with sales volume growth and consideration of customer demand, partially offset by the timing of vendor payments compared with the prior year.
Previous wording
Net cash used in investing activities was $99 million for the first quarter of fiscal 2025 compared to $96 million in the same period in fiscal 2024.
Current wording
Net cash used in investing activities was $192 million and $231 million for the year-to-date periods of fiscal 2025 and 2024, respectively.
Previous wording
Capital expenditures totaled $77 million and $91 million for the first quarter of fiscal 2025 and fiscal 2024, respectively. These investments were primarily for strategic projects to support future growth, such as new market distribution centers, our branch network and new technology. In addition, the Company invested $22 million and $12 million in new acquisitions in the first quarter of fiscal 2025 and fiscal 2024, respectively.
Current wording
Capital expenditures totaled $158 million and $192 million for the year-to-date periods of fiscal 2025 and 2024, respectively. These investments were primarily for strategic projects to support future growth, such as new market distribution centers, our branch network and new technology. In addition, the Company invested $46 million and $67 million in new acquisitions in the year-to-date period of fiscal 2025 and fiscal 2024, respectively.
Previous wording
The Company generally pays dividends in the fiscal quarter following the fiscal quarter in which the dividend was declared. However, the dividends declared in the fourth quarter of fiscal 2024 were also paid in the fourth quarter of fiscal 2024 due to the Merger. As such, no dividends were paid in the first quarter of fiscal 2025. Dividends paid to shareholders were $152 million for the first quarter of fiscal 2024.
Current wording
Dividends paid to shareholders were $158 million and $305 million for the year-to-date periods of fiscal 2025 and 2024, respectively. The Company generally pays dividends in the fiscal quarter following the fiscal quarter in which the dividend was declared. However, the dividends declared in the fourth quarter of fiscal 2024 were also paid in the fourth quarter of fiscal 2024 due to the Merger. As such, no dividends were paid in the first quarter of fiscal 2025.
Previous wording
Share repurchases under the Company’s announced share repurchase program were $256 million and $108 million for the first quarter of fiscal 2025 and fiscal 2024, respectively.
Current wording
Share repurchases under the Company’s announced share repurchase program were $508 million and $250 million for the year-to-date periods of fiscal 2025 and fiscal 2024, respectively.
Previous wording
Net proceeds from debt transactions were $71 million compared with net payments of $50 million for the first quarter of fiscal 2025 and fiscal 2024, respectively. In the first quarter of fiscal 2025, the Company received $746 million in net proceeds from the issuance of 2034 Senior Notes, partially offset by the repayment of the Company’s $500 million Term Loans and $175 million in net repayments under the Receivables Facility. In the first quarter of fiscal 2024, the Company made net repayments of $50 million under the Receivables Facility.
Current wording
Net proceeds from debt transactions were $421 million compared with net payments of $30 million for the year-to-date periods of fiscal 2025 and 2024, respectively. In the year-to-date period of fiscal 2025, the Company received net proceeds of $746 million and $325 million from the issuance of the 2034 Senior Notes and net borrowings under the Receivables Facility, respectively. These proceeds were partially offset by debt repayments of $500 million and $150 million in connection with the Company’s Term Loans and the maturity of certain Private Placement Notes, respectively. In the year-to-date period of fiscal 2024, the Company repaid $55 million in connection with the maturity of certain Private Placement Notes, which was partially offset by net proceeds of $25 million borrowed under the Receivables Facility.
Previous wording
In June 2015 and November 2017, Wolseley Capital, Inc., a wholly-owned subsidiary of the Company, privately placed fixed rate notes (the “Private Placement Notes”). As of October 31, 2024, $850 million in Private Placement Notes remain outstanding.
Current wording
In June 2015 and November 2017, Wolseley Capital, Inc., a wholly-owned subsidiary of the Company, privately placed fixed rate notes (the “Private Placement Notes”). As of January 31, 2025, $700 million in Private Placement Notes remain outstanding.
Previous wording
Subsequent to October 31, 2024, the Company repaid $150 million of Private Placement Notes that matured. In September 2025, an additional $400 million of such notes will mature.
Current wording
In the second quarter of fiscal year 2025, the Company repaid $150 million of Private Placement Notes that matured. In September 2025, an additional $400 million of such notes will mature.
Previous wording
As of October 31, 2024, $75 million in borrowings were outstanding under the Receivables Facility.
Current wording
As of January 31, 2025, $575 million in borrowings were outstanding under the Receivables Facility.
Previous wording
There have been no significant changes to the Company’s policies on accounting for, valuing or managing the risk of financial instruments during the first quarter of fiscal 2025.
Current wording
There have been no significant changes to the Company’s policies on accounting for, valuing or managing the risk of financial instruments during the second quarter of fiscal 2025.