Ferguson delivers strong trading profit in challenging period

Ferguson, the distributor of plumbing and heating products, today said its resilient business model had helped it deliver strong trading profit growth during a time of uncertainty.
Ferguson has provided an update for the stock exchange.Ferguson has provided an update for the stock exchange.
Ferguson has provided an update for the stock exchange.

Ferguson has published a trading update for the three months to October 31, 2020. Over the first quarter, ongoing revenue was 3.1% ahead of last year, despite one fewer trading day. Revenue grew by 5.2% in the UK from non-ongoing operations with organic growth of 1.2%

In September 2019, the board announced its intention to separate its Wolseley UK operations by way of a demerger into an independent UK listed company, subject to shareholder approval.

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In a statement, Ferguson said: "As announced in September 2020, this remains uncertain in the current economic environment and consequently the board is assessing other separation options in parallel with progress towards the demerger to facilitate the exit of the Wolseley UK business."

Kevin Murphy, the group chief executive at Ferguson, commented: "We are pleased with the revenue growth in the first quarter and today's results further demonstrate the resilience of our business model.

"We are firmly focused on revenue growth and continued market share gains at the same time as carefully controlling gross margins and costs.

"This approach has enabled us to deliver robust trading profit growth in the first quarter. Cash generation was good and our balance sheet remains strong. This has enabled us to continue to invest in the business including our technology platforms to drive the best digitally enabled customer relationships and a seamless omni-channel experience.

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"Our continued focus is on protecting our associates and supporting our customers and we would like to express our sincere thanks to all of our 33,000 associates for their dedication and commitment during these challenging times. Our associates are the main contributors to our success as they continue to deliver outstanding service to our customers.

"Since the start of the second quarter Ferguson has continued to generate low single digit revenue growth in broadly flat markets although we remain cautious on the outlook for the year as a whole, considering current pandemic trends.

"Despite these potential headwinds the business is in very good shape and we are well prepared should there be any further market related disruption and overall management's expectations for FY 2021 are unchanged."

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