27th Mar 2018 08:49
LONDON (Alliance News) - Plumbing and heating supplier Ferguson PLC announced on Tuesday its plans to return USD1.00 billion to shareholders via a special dividend, representing the expected proceeds from the disposal of Stark Group at the end of March.
The company also said revenue in first half of 2018 grew to USD10.03 billion from USD9.38 billion in the previous year, with a strong performance in the US, which accounts 79% of the revenue.
Pretax profit increased during six months to January to USD598 million from USD556 million year over year. Before exceptional items, pretax profit climbed to USD644 million from USD557 million.
Ferguson declared an interim dividend of 57.4 cents per share, up 10% from last year's 52.1 cents per share.
In addition, the company proposed a special dividend of USD4 per share, equivalent to approximately USD1 billion, with an accompanying share consolidation.
The special payout represents expected proceeds from the sale of Nordic building-materials distributor Stark, due to be completed at the end of March. Ferguson had announced the sale to an affiliate of Lone Star Funds in November.
The ongoing share buyback programme of approximately USD650 million announced in October will continue as well. To date Ferguson has purchased 4.8 million shares for USD335 million.
Looking ahead, Ferguson said that US residential markets are growing well, commercial market growth is good, and industrial markets have recovered. Canadian markets are healthy, though UK markets are challenging. Group organic revenue growth since the end of January has continued in line with growth in the second quarter, though comparators get progressively tougher through the second half, the company said. It said it is confident of achieving trading profit in line with analyst expectations for the full year.
"Group organic revenue growth since the end of January has continued in line with growth in the second quarter, though comparators get progressively tougher through the second half. The group is confident of achieving trading profit in line with analyst expectations for the full year," Ferguson said.
Ferguson shares are up 4.8% at 5,380.00 pence per share on Tuesday.
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