Ferguson Enterprises Inc. /de,
Fiscal Year 2025 Q2.

Income tax Income tax expense was $147 million for the third quarter of fiscal 2025, an increase of $9 million, or 6.5%, compared to the same period in fiscal 2024. This increase was mainly related to the impact of the discrete tax benefit recorded in fiscal 2024. In the year-to-date period of fiscal 2025, income tax expense was $395 million, a decrease of $26 million, or 6.2%, compared to the same period in fiscal 2024. This decrease was due to lower income before income taxes in fiscal 2025, partially offset by the impact of the discrete tax benefit recorded in fiscal 2024. The Company's effective tax rates were 26.4% and 23.8% for the third quarters of fiscal 2025 and 2024, respectively. The Company's effective tax rates were 25.5% and 24.7% for the year-to-date periods of fiscal 2025 and 2024, respectively. For each of the year-over-year comparisons, the increases were primarily driven by the release of uncertain tax positions in fiscal 2024 due to the lapsing of statute limitations, as well as the impact of other discrete tax items.

The following table presents highlights of the Company's performance for the periods below: Three months endedNine months ended April 30,April 30, (In millions, except per share amounts)2025202420252024

Supplemental non-GAAP financial measures:(1) Adjusted operating profit7156741,8701,967 Adjusted earnings per share - diluted2.502.326.486.72 (1) The Company uses certain non-GAAP measures, which are not defined or specified under U.S. GAAP. See the section titled "Non-GAAP Reconciliations and Supplementary Information." For the third quarter of fiscal 2025, net sales increased by 4.3% compared to the third quarter of fiscal 2024, primarily due to higher sales volume and incremental revenue from acquisitions, partially offset by the impact of one less sales day. Pricing was broadly flat in the quarter. While we have seen instances of pull-forward buying activity from customers, such behavior is difficult to quantify and we do not believe it had a material impact on our performance in the third quarter. For the third quarter of fiscal 2025, operating profit decreased by 3.0% (adjusted operating profit increased 6.1%), compared with the third quarter of fiscal 2024. This decrease was primarily due to the $70 million in non-recurring restructuring expenses, which was partially offset by higher gross profit compared with the third quarter of fiscal 2024. Adjusted operating profit increased due to higher gross profit compared with the third quarter of 2024. For the third quarter of fiscal 2025, diluted earnings per share was $2.07 (adjusted diluted earnings per share: $2.50), decreasing 5.0% compared with the third quarter of fiscal 2024 due to lower net income, partially offset by the impact of share repurchases. Adjusted diluted earnings per share increased 7.8%, driven by higher adjusted operating profit and the impact of share repurchases. 20 Net cash provided by operating activities decreased to $1.4 billion in the year-to-date period of fiscal 2025 compared with $1.5 billion in the same period of fiscal 2024, reflecting an increase in working capital to support volume growth period-over-period, along with lower net income after adjusting for non-cash items.

For further discussion on the Company's net sales, see the "Segment results" section below. Gross profit Gross profit in the third quarter of fiscal 2025 increased $127 million, or 5.7%, compared with the same period in fiscal 2024, primarily reflecting increased net sales. Gross profit as a percentage of sales was 31.0% and 30.5% in the third quarters of fiscal 2025 and fiscal 2024, respectively. The increase of 0.5% reflected improved pricing driven by specific management actions to better capture the value provided to customers, as well as moderating deflation in the year-over-year comparison. Gross profit in the year-to-date period of fiscal 2025 increased $149 million, or 2.3%, compared with the same period in fiscal 2024. Gross profit as a percentage of sales was 30.3% and 30.4% in the year-to-date periods of fiscal 2025 and fiscal 2024, respectively. The decrease of 0.1% reflected the impact of price deflation, primarily during the first half of the year, and sales mix, partially offset by management actions to improve pricing during the third quarter of fiscal 2025. 21

Receivables Securitization Facility The Company maintains a Receivables Facility with an aggregate total available amount of $1.1 billion. The Company has the ability to increase the aggregate total available amount under the Receivables Facility up to a total of $1.5 billion from time to time, subject to lender participation. In October 2024, the Company extended the termination date of the Receivables Facility and made other changes to the terms and conditions of the Receivables Facility. See Note 5, Debt to the Condensed Consolidated Financial Statements for further details of such changes.

Selling, general and administrative ("SG&A") expenses SG&A expenses in the third quarter of fiscal 2025 increased $79 million, or 5.2%, compared with the same period in fiscal 2024. SG&A as a percentage of sales was 20.9% and 20.7% in the third quarters of fiscal 2025 and fiscal 2024, respectively. The increase in SG&A as a percent of sales primarily reflects the impact of cost inflation, mainly on labor, infrastructure and fleet. SG&A expenses in the year-to-date period of fiscal 2025 increased $228 million, or 5.1%, compared with the same period in fiscal 2024. SG&A as a percentage of sales was 21.2% and 20.7% in the year-to-date period of fiscal 2025 and fiscal 2024, respectively. The factors impacting the year-to-date comparisons were largely the same as those noted above for the quarter.

Net interest expense Net interest expense was $46 million in the third quarter of fiscal 2025 compared with $43 million in the same period in fiscal 2024. In the year-to-date periods, net interest expense was $140 million in fiscal 2025 compared with $132 million in fiscal 2024. The increase in interest expense was due to higher average borrowings over the respective periods compared with the prior year.

Net income Net income for the third quarter and year-to-date periods of fiscal 2025 was $410 million and $1,156 million, respectively. These represented decreases in net income of $33 million, or 7.4%, and $128 million, or 10.0%, compared with the respective periods in fiscal 2024 due to the various elements described in the sections above. 22

Segment results United States Three months endedNine months ended April 30,April 30, (In millions)2025202420252024 Net sales$7,288 $6,974 $21,210 $20,667

Adjusted operating profit 726 685 1,878 1,976 Net sales for the United States segment were $7.3 billion in the third quarter of fiscal 2025, an increase of $314 million, or 4.5%, compared to the same period in fiscal 2024. The increase in net sales was primarily driven by higher sales volume and incremental sales from acquisitions of 1.0%, partially offset by the 1.5% impact of one less sales day. Pricing was broadly flat in the quarter due to improvements in finished goods pricing offset by deflation in certain commodity categories. Net sales in non-residential markets increased approximately 7% due to growth in each of Commercial, Civil/Infrastructure and Industrial sales compared with the same period in fiscal 2024. Net sales in residential markets increased approximately 2% compared with the same period in fiscal 2024 with growth across both new construction and repairs, maintenance and improvement. Net sales were $21.2 billion in the year-to-date period of fiscal 2025, an increase of $0.5 billion, or 2.6%, compared with the same period in fiscal 2024. The factors impacting the year-to-date comparison were largely the same as those noted above for the quarter, except price deflation was approximately 2%. Adjusted operating profit for the United States segment was $726 million in the third quarter of fiscal 2025, an increase of $41 million, or 6.0%, compared to the same period in fiscal 2024, primarily reflecting higher gross profit. Adjusted operating profit for the United States segment was $1.9 billion in the year-to-date period of fiscal 2025, a decrease of $0.1 billion, or 5.0%, compared to the same period in fiscal 2024, primarily reflecting the impact of higher operating costs driven by sales volume growth and cost inflation.

Canada Three months endedNine months ended April 30,April 30, (In millions)2025202420252024 Net sales$333 $334 $1,055 $1,022 Adjusted operating profit

Nine months ended April 30, (In millions, except per share amounts)20252024 per share(1) per share(1) Net income$1,156 $5.78 $1,284 $6.30 Corporate restructuring expenses(2)

Cash flows As of April 30, 2025 and July 31, 2024, the Company had cash and cash equivalents of $519 million and $571 million, respectively. In addition to cash, the Company had $2.1 billion of available liquidity from undrawn debt facilities as of April 30, 2025. As of April 30, 2025, the Company's total debt was $4.1 billion. The Company anticipates that it will be able to meet its debt obligations as they become due.

Cash flows from operating activities Nine months ended April 30, (In millions)20252024 Net cash provided by operating activities$1,367 $1,507 Net cash provided by operating activities was $1,367 million and $1,507 million for the year-to-date periods of fiscal 2025 and 2024, respectively. The $140 million decrease was mainly due to lower net income (adjusted for non-cash items), as well as changes in working capital compared with the prior year. The increase in working capital was primarily driven by receivables in light of sales growth and an increase in inventory in connection with sales volume growth and consideration of customer demand, partially offset by the timing of vendor payments compared with the prior year.

Cash flows from investing activities Nine months ended April 30, (In millions)20252024 Net cash used in investing activities($464)($418) Net cash used in investing activities was $464 million and $418 million for the year-to-date periods of fiscal 2025 and 2024, respectively. Capital expenditures totaled $235 million and $263 million for the year-to-date periods of fiscal 2025 and 2024, respectively. These investments were primarily for strategic projects to support future growth, such as new market distribution centers, our branch network and new technology. In addition, the Company invested $242 million and $185 million in new acquisitions in the year-to-date period of fiscal 2025 and fiscal 2024, respectively. 26

Cash flows from financing activities Nine months ended April 30, (In millions)20252024 Net cash used in financing activities($975)($995) Net cash used in financing activities was $975 million and $995 million for the year-to-date periods of fiscal 2025 and 2024, respectively. Dividends paid to shareholders were $324 million and $465 million for the year-to-date periods of fiscal 2025 and 2024, respectively. The Company generally pays dividends in the fiscal quarter following the fiscal quarter in which the dividend was declared. However, the dividends declared in the fourth quarter of fiscal 2024 were also paid in the fourth quarter of fiscal 2024 due to the Merger. As such, no dividends were paid in the first quarter of fiscal 2025. Share repurchases under the Company's announced share repurchase program were $759 million and $421 million for the year-to-date periods of fiscal 2025 and fiscal 2024, respectively. Net proceeds from debt transactions were $171 million compared with net payments of $105 million for the year-to-date periods of fiscal 2025 and 2024, respectively. In the year-to-date period of fiscal 2025, the Company received net proceeds of $746 million and $75 million from the issuance of the 2034 Senior Notes and net borrowings under the Receivables Facility (each, as defined below), respectively. These proceeds were partially offset by debt repayments of $500 million and $150 million in connection with the Company's Term Loans and the maturity of certain Private Placement Notes (each, as defined below), respectively. In the year-to-date period of fiscal 2024, the Company repaid $55 million in connection with the maturity of certain Private Placement Notes and $50 million under the Receivables Facility.

As of (In millions)April 30, 2025July 31, 2024 Short-term debt$400 $150 Long-term debt3,701 3,774 Total debt$4,101 $3,924 Private Placement Notes In June 2015 and November 2017, Wolseley Capital, Inc., a wholly-owned subsidiary of the Company, privately placed fixed rate notes (the "Private Placement Notes"). As of April 30, 2025, $700 million in Private Placement Notes remain outstanding. In the second quarter of fiscal year 2025, the Company repaid $150 million of Private Placement Notes that matured. In September 2025, an additional $400 million of such notes will mature.

As of April 30, 2025, $325 million in borrowings were outstanding under the Receivables Facility. Other The Company was in compliance with all debt covenants that were in effect as of April 30, 2025. See Note 5, Debt to the Condensed Consolidated Financial Statements and the notes to the consolidated financial statements in "Item 8. Financial Statements and Supplementary Data" of the Annual Report for further details regarding the Company's debt. There have been no significant changes to the Company's policies on accounting for, valuing or managing the risk of financial instruments during the third quarter of fiscal 2025.

Due from non-guarantor subsidiaries9,741 5,474 Nine months ended April 30, (In millions)2025 Net sales$- Gross profit- Operating loss(10) Net loss(97)

Other interest income, net from non-guarantor subsidiaries484 Other income, net from non-guarantor subsidiaries(1) $4,383 (1)Includes income from intercompany transactions with non-guarantor subsidiaries, primarily from non-cash dividend transactions.

Provision for income taxes(147)(138)(395)(421) Net income$410 $443 $1,156 $1,284 Net sales Net sales were $7.6 billion in the third quarter of fiscal 2025, an increase of $0.3 billion, or 4.3%, compared with the same period in fiscal 2024. The increase in net sales was primarily driven by higher sales volume and incremental sales from acquisitions of 1.0%, partially offset by the 1.5% impact of one less sales day. Pricing was broadly flat in the quarter due to improvements in finished goods pricing offset by deflation in certain commodity categories in the United States. The Company's increase in net sales was driven by growth in non-residential markets, as well as residential markets, in its United States segment. Net sales were $22.3 billion in the year-to-date period of fiscal 2025, an increase of $0.6 billion, or 2.7%, compared with the same period in fiscal 2024. The factors impacting the year-to-date comparison were largely the same as those noted above for the quarter, except price deflation was approximately 1%.