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Shares in FTSE 100 building materials firm Ferguson (LON:FERG) fell by 6% to 6,137p (as of 13:30 BST) despite revenues climbing by 7.6% to $20.7 billion. Gross margins for the group were 30 basis points higher than last year but management said that UK markets remained challenging with lower profits and ongoing restructuring plans.
Chief executive John Martin said: “The Group delivered a good result in the year, revenue increased to $20.8 billion and ongoing trading profit increased by $200 million to $1.5 billion. In the USA, which generated 90 per cent of Group trading profit, all businesses grew well and continued to gain market share, with the Industrial business having a particularly strong year. Markets in the USA and Canada have remained good throughout the year despite recent inflationary pressures, though the UK remains tough.
“We continue to execute our strategy to allocate resources to markets and businesses where we are best equipped to win. Our focus remains on investing in organic growth, supplemented by selective bolt-on acquisitions where we can expand our leadership positions or invest in capabilities to extend the value of our brand.
“Given the Group’s track record of excellent cash generation and the ongoing strength of the balance sheet, a proposed final dividend of 131.9 cents has been recommended. This brings the total dividend to 189.3 cents, 21 percent ahead of last year and includes an upwards rebasing of 10 percent.
“In the first eight weeks of our new financial year organic revenue growth has been broadly in line with the overall growth rate last year, though growth in September was slightly lower than August. The growth in our order books suggests continued growth in the months ahead.”