Ferguson Enterprises Inc. /de,
Fiscal Year 2026 Q2.

(4)For the three months ended March 31, 2026 and 2025, discrete tax adjustments were mainly related to interest on uncertain tax positions. (5)For the three months ended March 31, 2026, the tax impact on non-GAAP adjustments primarily related to the amortization of acquired intangibles. For the three months ended March 31, 2025, the tax impact on non-GAAP adjustments related to the restructuring expenses and the amortization of acquired intangibles.

In September 2025, the Company repaid $400 million related to the 3.73% private placement notes that matured. Unsecured Senior Notes The Company has issued $3.9 billion in various issuances of unsecured senior notes (collectively, the "Unsecured Senior Notes"), including the September 2025 issuance of $750 million aggregate principal amount of unsecured senior notes due March 2031 (the "2031 Senior Notes").

Overview Ferguson is a value-added distributor of essential water and air solutions, serving the specialized professional in the residential and non-residential North American construction markets. We help make our customers' complex projects simple, successful and sustainable by providing expertise and a wide range of products and services from plumbing, HVAC, appliances, and lighting to PVF, water and wastewater solutions, and more. Ferguson is headquartered in Newport News, Virginia.

Selling, general and administrative ("SG&A") expenses SG&A expenses in the first quarter of 2026 increased $42 million, or 2.7%, compared with the first quarter of 2025. SG&A as a percentage of sales was 21.5% in the first quarter of 2026 compared with 21.7% in the first quarter of 2025. The decrease in SG&A as a percentage of sales primarily reflects improved productivity and operating leverage of the Company's cost base.

Net income Net income was $414 million in the first quarter of 2026, an increase of $69 million, or 20.0%, compared with the first quarter of 2025, primarily due to the various elements described in the sections above. 20

Segment results United States Three months ended March 31, (In millions)20262025 Net sales$7,146 $6,904 Adjusted operating profit 656 611 Net sales for the United States segment were $7.1 billion in the first quarter of 2026, an increase of $242 million, or 3.5%, compared with the first quarter of 2025. The increase in net sales was primarily driven by mid-single digit price inflation and incremental sales from acquisitions of 0.6%, partially offset by lower sales volume. Net sales in non-residential markets, representing approximately half of revenue in the United States, increased approximately 8% compared with the first quarter of 2025. This increase was driven by commercial/mechanical, industrial and waterworks, including large capital project activity. Net sales in residential markets decreased approximately 1% compared with the first quarter of 2025 in light of weak new construction activity, along with soft repair, maintenance and improvement ("RMI") work. Adjusted operating profit for the United States segment was $656 million in the first quarter of 2026, an increase of $45 million, or 7.4%, compared with the first quarter of 2025, primarily reflecting higher sales and the associated gross profit, partially offset by higher variable operating costs.

Canada Three months ended March 31, (In millions)20262025 Net sales$326 $309 Adjusted operating profit 5 6 Net sales for the Canada segment were $326 million in the first quarter of 2026, an increase of $17 million, or 5.5%, compared with the first quarter of 2025. This increase in net sales was primarily driven by incremental sales from acquisitions of 5.8%, the impact of foreign currency exchange rates of 4.6% and low to mid-single digit price inflation. These increases were partially offset by lower volume and the impact of a non-core business divestments of 4.6%. Adjusted operating profit for the Canada segment decreased by $1 million in the first quarter of 2026, compared with the first quarter of 2025 due to higher operating costs, partially offset by higher gross profit. 21

The following table presents highlights of the Company's performance for the periods below: Three months ended March 31, (In millions, except per share amounts)20262025

Three months ended March 31, (In millions, except per share amounts)20262025 per share(1) per share(1) Net income$414 $2.13 $345 $1.73 Corporate restructuring expenses(2)

Liquidity and Capital Resources The Company believes its current cash position coupled with cash flow anticipated to be generated from operations and access to capital should be sufficient to meet its operating cash requirements for the next 12 months and will also enable the Company to invest and fund capital expenditures, acquisitions, dividend payments, share repurchases, required debt payments and other contractual obligations through the next several years. The Company also anticipates that it has the ability to obtain alternative sources of financing, if necessary. The Company's material cash requirements include contractual and other obligations arising in the normal course of business. These obligations primarily include debt service and related interest payments, operating lease obligations and other purchase obligations. The nature and composition of such existing cash requirements have not materially changed from those disclosed in the Transition Report other than items updated in this Quarterly Report.

Cash flows As of March 31, 2026 and December 31, 2025, the Company had cash and cash equivalents of $820 million and $557 million, respectively. In addition to cash, the Company had $2.4 billion of available liquidity from undrawn debt facilities as of March 31, 2026. As of March 31, 2026, 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. 23

Cash flows from investing activities Three months ended March 31, (In millions)20262025 Net cash used in investing activities($94)($211) Capital expenditures totaled $92 million and $73 million for the three months ended March 31, 2026 and 2025, 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 $10 million and $150 million in new acquisitions for the three months ended March 31, 2026 and 2025, respectively.

As of (In millions)March 31, 2026December 31, 2025 Short-term debt$148 $148 Long-term debt3,979 3,978 Total debt$4,127 $4,126 24 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 March 31, 2026, $300 million in Private Placement Notes remain outstanding.

Receivables Securitization Facility The Company maintains a Receivables Securitization Facility with an aggregate total available amount of $900 million (the "Receivables Facility"). 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. As of March 31, 2026, no borrowings were outstanding under the Receivables Facility.

Other The Company was in compliance with all debt covenants that were in effect as of March 31, 2026. 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 Transition 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 three months ended March 31, 2026. 25

Supplemental non-GAAP financial measures:(1) Adjusted operating profit647597 Adjusted earnings per share - diluted2.282.09 (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 first quarter of 2026, net sales increased by 3.6% compared with the first quarter of 2025, primarily due to price inflation and incremental sales from acquisitions, partially offset by lower volume. For the first quarter of 2026, operating profit increased by 20.7% (adjusted operating profit increased 8.4%), compared with the first quarter of 2025. The year-over-year change was driven by higher sales and the associated gross profit, partially offset by higher variable operating costs. For the first quarter of 2026, diluted earnings per share was $2.13 (adjusted diluted earnings per share: $2.28), increasing 23.1% (9.1% on an adjusted basis) compared with the first quarter of 2025 due to higher net income and the impact of share repurchases. Net cash provided by operating activities decreased to $772 million in the first quarter of 2026 compared with $874 million in the first quarter of 2025, primarily reflecting an increased investment in working capital, partially offset by higher net income after adjusting for non-cash items. 19

Gross profit Gross profit in the first quarter of 2026 increased $102 million, or 4.6%, compared with the first quarter of 2025, primarily reflecting increased net sales. Gross profit as a percentage of sales was 31.0% in the first quarter of 2026 compared with 30.7% in the first quarter of 2025. The increase of 0.3% primarily reflected solid execution across the business.

Item 1A.Risk Factors As of the date of this Quarterly Report, there have been no material changes to the risk factors disclosed in our Transition Report. We may disclose changes to such factors or disclose additional factors from time to time in our future filings with the SEC.