PVF, plumbing, HVAC, infrastructure and industrial supplies distributor Ferguson reported its fiscal 2Q25 (November-January) financial results on March 11, which showed a solid acceleration in sequential sales growth.

The company posted 2Q sales of $6.9 billion, up 3.0% year-over-year driven by a 2.1% gain in organic revenue and acquisition growth of 2.1%, offset by 0.3% adverse impact of foreign exchange rates.

The 2Q sales growth was a notable improvement from 1Q25’s 0.8% growth.

On a volumetric basis, total volume increased by approximately 5% with organic with organic volume up approximately 4%. While continued weakness in certain commodity related categories drove modest overall price deflation of around 2%.

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Gross margin of 29.7% was 70 basis-points lower than last year.

Reported operating profit was $410 million (6.0% operating margin), 12.7% lower than last year. Adjusted operating profit of $449 million (6.5% adjusted operating margin) was 13.7% below a year earlier.

“Our associates continued to execute well for our customers in the second quarter, generating continued market outperformance with a sequential step up in volume growth rates,” Ferguson CEO Kevin Murphy said in the financial release. “We are navigating a unique time with continued subdued markets and persistent commodity price deflation that drove lower than expected adjusted operating margin in our seasonally lightest quarter.”

U.S./Canada

In the U.S. — where Ferguson did 95.4% of business — 2Q sales were up 3.0%. Organic revenue was up 2.0% alongside a 1% contribution from acquisitions.

Residential end markets, which account for just over half of U.S. revenue, proved to be slightly more resilient than non-residential end markets, with ongoing activity in large capital projects. The company also gained market share, with non-residential revenue growing by approximately 4% in the second quarter. Sales saw modest growth in both commercial and industrial sectors, driven by strength in the civil/infrastructure markets.

Meanwhile, 2Q25 Canada sales of $319 million were up 3.2% year-over-year.

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Ferguson completed one acquisition during the quarter, Templeton and its affiliate, TEMSCO, which serves the water and wastewater industries in the southeast. Additionally, subsequent to the quarter end, the company agreed to acquire Independent Pipe & Supply Corporation, a distributor of commercial/mechanical supplies in the northeast.

Additionally, the company announced during 2Q that it broke ground on a new facility near Bozeman, MT which will house Ferguson’s newest 88,000-square-foot distribution facility.

Full-Year Guidance

Ferguson’s fiscal 2025 guidance remained predominantly unchanged besides one update. The company still expects low single digit growth in net sales but updated the full-year adjusted operating margin range down from 9.0%-9.5% to 8.3%-8.8%.

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Murphy added: “While we have been disciplined in managing costs in relation to volume growth, we are taking additional steps to streamline the business to increase speed and efficiency to better serve our customers, positioning the organization for future profitable growth.”

On March 4, the company announced that Ferguson Bath, Kitchen & Lighting Gallery and Build.cm will unify under the Ferguson Home brand, a single source for kitchen, bath, lighting and home improvement products.

Ferguson was No. 1 on MDM’s Top Distributor’s List for Plumbing, No. 2 for HVACR, No 2. For Industrial PVF, No. 3 for Industrial Supplies, No. 3 for Building Materials/Construction.