Ferguson plc (NYSE:FERG) Q1 2024 Earnings Conference Call December 5, 2023 8:30 AM ET

Company Participants

Brian Lantz - Vice President of Investor Relations and Communications

Kevin Murphy - Chief Executive Officer

Bill Brundage - Chief Financial Officer

Conference Call Participants

Phil Ng - Jefferies

Ryan Merkel - William Blair

Will Jones - Redburn Partners

Patrick Baumann - JPMorgan

Brian Biros - Thompson Research

Sam Darkatsh - Raymond James

Operator

Hello, everyone, and welcome to Ferguson's First Quarter Results Conference Call. My name is Bruno, and I'll be coordinating your call today. [Operator Instructions]

I would now like to turn the call over to Brian Lantz, Vice President of Investor Relations and Communications. The floor is yours. Please go ahead.

Brian Lantz

Good morning, everyone, and welcome to Ferguson's first quarter earnings conference call and webcast. Hopefully, you've had a chance to review the earnings announcement we issued this morning. The announcement is available in the Investors section of our corporate website and on our SEC filings webpage. A recording of this call will be made available later today. I want to remind everyone that some of our statements today may be forward-looking and are subject to certain risks and uncertainties that could cause actual results to differ materially from those projected, including the various risks and uncertainties discussed in the section entitled Risk Factors in our Form 10-K.

Also, any forward-looking statements represent the company's expectations only as of today and we specifically disclaim any obligation to update these statements. In addition, on today's call, we will also discuss certain non-GAAP financial measures. Please refer to our earnings presentation and announcement on our website for additional information regarding those non-GAAP measures, including reconciliations to the most directly comparable GAAP financial measures.

With me on the call today are Kevin Murphy, our CEO; and Bill Brundage, our CFO. I will now turn the call over to Kevin.

Kevin Murphy

Thank you, Brian, and welcome, everyone, to Ferguson's first quarter results conference call. On the call today, I'll cover highlights from our first quarter performance and I'll also provide a more detailed view of our performance by end market and by customer group before turning the call over to Bill for the financials. I'll then come back at the end to give some closing comments before Bill and I take your questions.

Focusing on the first quarter. Our associates delivered solid results that were in line with our expectations as we lap strong comparables. Our dedicated associates have remained focused on execution continuing to go above and beyond to serve our customers, helping to make their projects more simple, successful and sustainable. As expected, we saw a modest revenue decline of 2.8% in the quarter in a challenging market. We delivered solid gross margins and we're diligent in managing costs, delivering adjusted operating profit of $773 million, down 10.5% but delivering an adjusted operating margin of 10% and adjusted diluted earnings per share of $2.65. Over the 3 years since fiscal 2021, this represents sales growth of 43%, adjusted operating profit growth of 60% and adjusted diluted earnings per share growth of 74% for the first quarter.