Ferguson plc reported solid QQ3 2024 results with revenue of approximately $7.309 billion, marking a 2.35% year-over-year growth and a 9.52% sequential (quarter-on-quarter) increase. The quarter delivered an operating margin of about 8.72% and a net margin near 6.06%, supported by a resilient gross margin of 29.38% and meaningful operating leverage as volume recovered. Net income rose to $443 million, up about 31.9% year over year, with earnings per share (reported/diluted) of $2.19/$2.18, reflecting a favorable mix and disciplined cost management.
Cash generation remains a key strength: operating cash flow reached roughly $643 million in the quarter, and free cash flow was about $572 million. Ferguson used this cash flow to fund acquisitions (~$118 million), a modest capital expenditure program (~$70.5 million), share repurchases (~$171 million), and dividends (~$159 million), resulting in net debt of approximately $4.45 billion and total liquidity supported by $755 million in cash at period end. Management commentary during the quarter emphasized continued pricing discipline, channel strength in the US, and ongoing investment in service capabilities and online tools to sustain growth in a competitive environment. The business appears well positioned to navigate macro volatility given its diversified exposure to residential, commercial, and industrial end-markets in the United States and Canada.
Valuation remains modestly stretched by traditional growth multiples but supported by robust cash generation and a strong balance sheet. With a net debt/EBITDA cushion and a dividend policy consistent with multi-year shareholder returns, Ferguson offers an attractive risk-adjusted profile for exposure to the North American plumbing & HVAC distribution space, albeit with sensitivity to housing/civil infrastructure cycles and input-cost pressures.