ISA has launched registration for its next virtual event for 2020, the inaugural Women in Industry Virtual Summit, October 21-22, from 1 p.m. to 4:30 p.m. EST.

Powered by the ISA network W.I.S.E. (Women Industrial Supply Executives), this two-day virtual event is open to women at all levels within the Industrial Supply Channel, allowing attendees to engage, learn and lead with a larger group of women than ever before.

“The virtual summit is full of incredible educational content that women at any level can benefit from,” said Donna Benner, vice president of operations, ISA. “Open to non-members as well, we’re looking forward to a successful event with more women in attendance than ever before.”

The event features an opening keynote from TEDx speaker Julie Kratz, who will share her research on why women need men as allies for gender equality. The event will also include virtual networking with other women in the industrial supplu channel. Click here for the Click here for the full agenda. And click here to register.

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Ferguson, one of the more acquisitive companies in distribution, paused M&A activity back in March. The COVID-19 crisis brought too much uncertainty not only to the deal environment but also the economic landscape as a whole.

But with business settling into a new normal and fiscal 2020 now complete, the UK-based distributor — which has a huge presence in the U.S. through its Ferguson Enterprises brand — is raring to resume acquisition mode.

“Going forward, we have a number of attractive traditional bolt-on acquisitions in the pipeline, several of which we expect to conclude later this year,” Ferguson’s group CEO, Kevin Murphy, told analysts on Tuesday morning’s earnings call. “But in addition to bolt-ons, we’ll also use acquisitions to grow capabilities that will make our branches and our digital channels more relevant. Many of these opportunities allow us to get closer to the consumer and owner while adding to our own brand product offering.”

Murphy’s acquisition proclamation came after the company reported fiscal 2020 sales of $21.8 billion. That was down 0.9% compared to fiscal year 2019, while profit of $1.3 billion marked a 4.8% decrease from the year-ago period.

But the company said its U.S. division saw revenue growth of 2.7% to $18.9 billion and underlying trading profit growth of 5.2% to $1.6 billion.

As the company looks to fiscal 2021, it is wary of continued softness due to the coronavirus but eager for growth opportunities — especially on this side of the pond.

“It is impossible to predict the future progress of the virus or its economic impact and we expect the current levels of uncertainty to continue for the foreseeable future,” Murphy said in the company’s earnings press release. “However, the fundamental aspects of our business model remain attractive and since the start of the new financial year, Ferguson has generated low single-digit revenue growth in the U.S. in flat markets overall. While we remain cautious on the outlook for the year as a whole, the business is in good shape and well prepared to address any further market-related disruption.”

Behind Ferguson’s M&A Approach

A big part of growth plan revolves around M&A. Before Ferguson paused deal activity in March due to the COVID-19 crisis, it had already invested $351 million in six acquisitions during the fiscal year.

Ferguson Enterprises ranks No. 1 on MDM’s Market Leaders list for the Top 40 Industrial & Construction distributors. Not only is it the largest U.S. distributor of plumbing supplies, PVF, waterworks and fire and fabrication products, but it’s also the third-largest distributor of industrial and HVACR products.

The U.S. division posted $18.9 billion in sales in the fiscal year, up from $18.4 billion, counts 27,000 associates, 1,400 locations, 10 distribution centers and customers in all 50 states, the Caribbean, Puerto Rico and Mexico.

Right before the company’s M&A pause, it pulled off the largest of its fiscal 2020 deals with the acquisition of Columbia Pipe & Supply Co., a distributor in Chicago. The business profile of Columbia Pipe — Murphy described the company as one with a “strong reputation and well-established vendor and customer relationships in this important region” — provides some clues as to the type of target Ferguson might pursue once it begins moving forward with acquisitions.

“As we go through COVID and beyond the investments necessary for foundational technology for what an omnichannel experience looks like, for the tools that are necessary to drive this business, I do think it will create opportunities for us to acquire businesses that have great local relationships, that we can plug together with that technology, with that supply chain, with that breadth and depth of product offering to make them more successful,” Murphy said. “So that’s what I’m most bullish about in terms of bolt-on M&A as we look forward.”

Even Bill Brundage, whose appointment to Ferguson’s group CFO was just announced Tuesday, chimed in on the company’s M&A strategy and the types of assets it was interested in going after.

“From a margin standpoint, the vast majority of those acquisitions that we do have a lower margin, lower trading margin than what we have, and we look to bring those synergies in quickly and get them up to our trading multiple over a couple of years,” he said on the earnings call. “If you think about the traditional bolt-on M&A deals that we do, we go in quickly, we put them on our system, we hook them up to our supply chain, we get to distribution and the fleet synergy, we get sourcing synergies, and then we can take a little bit of back-office costs out as well in those acquisitions. That’s typically how we approach the M&A front.”

Photo courtesy Ferguson

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Ferguson PLC, Wokingham, United Kingdom, reported sales of $21.8 billion for fiscal year 2020 ended July 31, down 0.9% compared to fiscal year 2019. Profit of $1.3 billion marked a 4.8% decrease from the year-ago period.

The company said ongoing revenue was 2% ahead of last year with continued market share gains in the U.S. The U.S. saw revenue growth of 2.7% and underlying trading profit growth of 5.2%.

Ferguson had invested $351 million in six acquisitions during the fiscal year before pausing activity in March due to the COVID-19 crisis.

“We have delivered a strong performance in 2020, which given the global pandemic has highlighted the resilience of our business model,” said Kevin Murphy, group CEO. “Early in the crisis we moved decisively to protect the health and wellbeing of our associates while continuing to serve our customers supporting critical infrastructure. We have rapidly adjusted our ways of working to adapt to this new operating reality while taking action to lower the cost base. We have also managed working capital and capital expenditure which alongside the strong profit delivery has led to an excellent cash performance.”

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Ferguson PLC on Tuesday announced the appointment of Bill Brundage as CFO and an executive director, effective November 1. Brundage is currently CFO of Ferguson Enterprises, a position he has held since March 2017.

Brundage has more than 17 years of experience in a variety of senior finance roles at Ferguson Enterprises. In 2008, he was appointed as vice president of finance, a position he held until his promotion to senior vice president of Finance in 2016. He succeeds Mike Powell, who will step down as Group CFO and an executive director on October 31.

Geoff Drabble, chairman of Ferguson, said: “In searching for Mike’s successor we conducted a rigorous review of potential candidates both internally and externally. I am delighted that Bill will step up to the CFO role. He’s a talented executive with a great track record and has been one of the key architects of Ferguson’s transformation into one of the largest value-added distribution businesses in the US. Bill’s broad experience and strong leadership capabilities will ensure that Ferguson continues to drive improved operational performance and capitalizes on the significant opportunities to generate profitable growth.”

Kevin Murphy, CEO of Ferguson, said: “I am delighted that Bill has been appointed as Ferguson’s CFO. We have worked together for many years and we were fortunate to have an internal candidate of such high caliber and expertise as a successor to Mike. I am confident Bill’s operational skills and experience will continue make a significant contribution to the future development of Ferguson.”

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