Ferguson residential plumbing sales stay flat as broader business grows

Ferguson on Monday released its second-quarter earnings report, showing that its residential plumbing sales were flat year-over-year, while its HVAC sales grew 11 percent.

What’s happening: That marks a recovery from the first quarter, when the distribution giant’s residential plumbing revenue slid by two percent year-over-year, and its HVAC business — which includes residential and commercial — grew by just one percent. 

• The company’s total U.S. residential revenue in the second quarter inched up two percent year-over-year, following a one percent decline in the first quarter, and the distributor upped its full-year sales guidance to mid-single-digit growth. 
• Full earnings presentation

The big picture: “Residential end markets, representing approximately half of revenue, remained subdued,” Ferguson noted in a news release. “New residential construction activity has been weak, and repair, maintenance and improvement (‘RMI’) work remains soft.”

Zoom in: Ferguson completed five acquisitions in the second quarter, including two HVAC distributors — Michigan-based Carrier Great Lakes and Georgia-based Dealers Supply Company — adding 24 locations across the Midwest and Southeast.

• CEO Kevin Murphy said on the company’s earnings call that approximately one-third of its customers are dual-trade HVAC and plumbing contractors, adding that he expects that figure to grow over time.

What they’re saying: “We delivered another strong quarter of non-residential growth and we returned to growth in residential despite the challenging market backdrop,” Murphy said in a statement.