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Ferguson profit dips; UK demerger on track
17th Mar 2020 07:33
(Sharecast News) - Plumbing and heating company Ferguson posted a dip in first-half pre-tax profit on Tuesday due to exceptional charges and said its UK demerger was on track for completion this year.
In the half to the end of January 2020, pre-tax profit fell to $640m from $679m in the same period a year ago due to exceptional charges of $19m and the $22m impairment of an associate. Revenue edged up 1.1% to $10.9bn and the dividend per share was lifted 7% to 67.5 cents.
Chief executive Kevin Murphy said: "Given the markets we serve remained flat we were pleased with our progress in the first half and we continued to generate above market revenue growth in the major US business units. This, alongside continued operational delivery including tight cost control, ensured we delivered robust trading profit growth and good cash generation."
The company said it was taking steps to mitigate the potential impact of Covid-19 and following the guidance of governmental health agencies including the World Health Organization and the Center for Disease Control.
Murphy said Ferguson had planned to confirm its full-year trading profit outlook for 2020. "However, due to the dynamic situation unfolding with Covid-19 it is too early to understand its impact on current trading," he said.
"Recent government actions to contain the spread of Covid-19 and societal reactions, alongside any potential actions we will take to mitigate them are not reflected in existing market forecasts and it is too early to quantify them."
Ferguson said the demerger process for Wolseley UK is on track and should complete within the current calendar year.
In the half to the end of January 2020, pre-tax profit fell to $640m from $679m in the same period a year ago due to exceptional charges of $19m and the $22m impairment of an associate. Revenue edged up 1.1% to $10.9bn and the dividend per share was lifted 7% to 67.5 cents.
Chief executive Kevin Murphy said: "Given the markets we serve remained flat we were pleased with our progress in the first half and we continued to generate above market revenue growth in the major US business units. This, alongside continued operational delivery including tight cost control, ensured we delivered robust trading profit growth and good cash generation."
The company said it was taking steps to mitigate the potential impact of Covid-19 and following the guidance of governmental health agencies including the World Health Organization and the Center for Disease Control.
Murphy said Ferguson had planned to confirm its full-year trading profit outlook for 2020. "However, due to the dynamic situation unfolding with Covid-19 it is too early to understand its impact on current trading," he said.
"Recent government actions to contain the spread of Covid-19 and societal reactions, alongside any potential actions we will take to mitigate them are not reflected in existing market forecasts and it is too early to quantify them."
Ferguson said the demerger process for Wolseley UK is on track and should complete within the current calendar year.