Slide 1: Second Quarter Results Presentation
FY2023 Second Quarter Results Presentation Results to January 31, 2024
Slide 2: Legal Disclaimer
Legal Disclaimer Cautionary note on forward-looking statements Certain information included in this presentation and discussed on the conference call that this presentation accompanies is forward-looking, including w ithin the meaning of the Private Securities Litigation Reform Act of 1995, and invo
Slide 3: Highlights and introduction
01 Highlights and introduction Kevin Murphy, CEO •Kevin Murphy, CEO
Slide 4: Second quarter financial highlights
Second quarter financial highlights Net sales ($m) Adjusted operating profit* ($m) Adjusted EPS – diluted* 6,825 6,673 6,508 $1.93 $1.91 588 582 $1.74 520 4,937 350 $1.10 2021 2022 2023 2024 2021 2022 2023 2024 2021 2022 2023 2024 +31.8% +4.9% (2.2%) +68.0% (1.0%) (10.7%) +75.5% (1.0%) (8.9%) Solid
Slide 5: Balanced approach to US end markets
Balanced approach to US end markets Q2 2024 Q2 2023 % of US net US net sales US net sales sales* (decline)/growth growth Residential 52% (4%) +1% Non-residential 48% (1%) +11% Commercial 33% Flat +9% Civil/Infrastructure 8% Flat +7% Industrial 7% (6%) +24% 100% (2.2%) +5.4% Solid performance against
Slide 6: USA second quarter net sales
USA second quarter net sales Q2 2024 Q2 2023 % of US net Customer group net sales net sales sales* (decline)/growth (decline)/growth Residential Trade Plumbing 18% (2%) (5%) HVAC 11% +1% +10% Residential Building and Remodel 14% (4%) +12% Residential Digital Commerce 8% (13%) (10%) Waterworks 21% Fl
Slide 7: Financial review
02 Financial review Bill Brundage, CFO •Kevin Murphy, CEO
Slide 8: Second quarter financial highlights
Second quarter financial highlights $m (except per share amounts) Q2 2024 Q2 2023 Change Net sales 6,673 6,825 (2.2%) Gross margin 30.4% 30.2% +20 bps Adjusted operating profit* 520 582 (10.7%) Adjusted operating margin* 7.8% 8.5% (70) bps Adjusted earnings per share – diluted* $1.74 $1.91 (8.9%) Ad
Slide 9: Segmental financial highlights
Segmental financial highlights $m Q2 2024 Q2 2023 Change Net sales US 6,364 6,504 (2.2%) Canada 309 321 (3.7%) Total net sales 6,673 6,825 (2.2%) Adjusted operating profit* US 525 579 (9.3%) Canada 9 14 (35.7%) Central and other costs (14) (11) Total adjusted operating profit 520 582 (10.7%) * The C
Slide 10: Half Year financial highlights
Half Year financial highlights $m (except per share amounts) H1 2024 H1 2023 Change Net sales 14,381 14,756 (2.5%) Gross margin 30.3% 30.4% (10) bps Adjusted operating profit* 1,293 1,446 (10.6%) Adjusted operating margin* 9.0% 9.8% (80) bps Adjusted earnings per share – diluted* $4.40 $4.87 (9.7%)
Slide 11: Cash flow – Half Year
Cash flow – Half Year $m H1 2024 H1 2023 Adjusted EBITDA* 1,387 1,542 Working capital (113) 115 Interest and tax (427) (502) Other items 16 20 Operating cash flow 863 1,175 Capex (192) (242) Proceeds from the sale of assets 28 3 Free cash flow* 699 936 Strong cash generation continues * This is a no
Slide 12: Capital allocation
Capital allocation 1. Organic growth 2. Dividends 3. Acquisitions 4. Surplus capital returns Working capital • Quarterly dividend of $0.79 • Completed 3 acquisitions • $250m share repurchases per share, an increase of 5% during the first half and 1 completed during first half • Inventory position no
Slide 13: Sequential performance
Sequential performance FY23 FY24 Q1 Q2 Q3 Q4 Q1 Q2 Organic revenue growth / (decline)* +12.7% +2.7% (2.5%) (5.3%) (4.9%) (3.7%) We expect overall improvement against easing comparables * Management evaluates organic revenue as it provides a consistent measure of the change in revenue year-on-year. O
Slide 14: FY2024 Guidance (unchanged)
FY2024 Guidance (unchanged) • Net sales to be broadly flat • Assumes mid-single digit market decline with continued Company market outperformance, contribution from completed acquisitions and one additional sales day. • Overall impact of price inflation estimated to be broadly neutral for the year.
Slide 15: Closing remarks
03 Closing remarks Kevin Murphy, CEO •Kevin Murphy, CEO
Slide 16: Closing remarks
Closing remarks Thank you to our associates. 1. Solid execution in first half. 2. Well positioned for improvement in the second half with FY2024 guidance unchanged. 3. Balanced market exposure and agile business positions us well for continued outperformance. 4. Underpinned by a cash generative mode
Slide 17: Join us for Q&A
Join us for Q&A |e
Slide 18: Appendix
04 Appendix •Kevin Murphy, CEO
Slide 19: Leading positions in highly fragmented North American markets
Leading positions in highly fragmented North American markets ~75% of revenue generated from #1 or #2 market positions Residential Trade Plumbing HVAC $31b market 17% Share #2 Market Position ~$70b 5% Share $30b revenue with a market #3 Market Position Residential Building and Remodel $25b $30b mark
Slide 20: Reconciliation of Net Income to Adjusted Operating Profit and Adjusted EBITDA
Reconciliation of Net Income to Adjusted Operating Profit and Adjusted EBITDA Three months ended Six months ended January 31, January 31, (In millions) 2024 2023 2022 2021 2024 2023 Net income $322 $374 $436 $94 $841 $969 Income from discontinued operations (net of tax) — — — 183 — — Income from con
Slide 21: Net Debt:Adjusted EBITDA reconciliation
Net Debt:Adjusted EBITDA reconciliation Net debt comprises bank overdrafts, bank and other loans and derivative financial instruments, excluding lease liabilities, l ess cash and cash equivalents. Long-term debt is presented net of debt issuance costs. A rolling 12-month adjusted EBITDA is used in t
Slide 22: Adjusted EBITDA (rolling 12-month) reconciliation
Adjusted EBITDA (rolling 12-month) reconciliation Adjusted EBITDA is net income before charges/credits relating to depreciation, amortization, impairment and certain non-GAAP adjustments. Twelve months ended (In millions) January 31, 2024 2023 Net income $1,761 $2,095 Loss from discontinued operatio
Slide 23: Reconciliation of Net Income to Adjusted Net Income and Adjusted EPS - Diluted
Reconciliation of Net Income to Adjusted Net Income and Adjusted EPS - Diluted Three months ended Six months ended January 31, January 31, 2024 2023 2022 2021 2024 2023 (In millions, except per share amounts) per share(1) per share(1) per share(1) per share(1) per share(1) per share(1) Net income $3
Slide 24: Thank you
Thank you # FERGUSON