Ferguson’s acquisition strategy has added approximately $1.4 billion of aggregate annualized revenue through eight transactions announced year-to-date as the distributor continues consolidating specialized plumbing, HVAC, waterworks and industrial markets.
The company completed five acquisitions during the second quarter and subsequently entered into a definitive agreement to acquire FloWorks, a distributor and service provider focused on highly technical valves and flow-control solutions. Including FloWorks, the eight acquisitions announced during 2026 represent approximately $1.4 billion of annualized revenue.
Ferguson’s Q2 acquisitions broadened the company across several markets. Carrier Great Lakes added seven HVAC locations across Michigan and Ohio, while Dealers Supply Company added 17 locations in the Southeast. New England Applied Products expanded commercial HVAC capabilities, Hamlett Environmental Technologies added water and wastewater treatment solutions in Michigan, and PRD Technologies Group strengthened Ferguson’s industrial valve, flow-control and process equipment offerings through 10 U.S. locations.
The acquisition activity coincided with strong growth in Ferguson’s non-residential operations. U.S. non-residential revenue increased 8% during Q2, with the company citing market-share gains from its scale, expertise, multi-customer-group approach and value-added solutions. Large capital project activity remained healthy, including growth in open orders and strong bidding activity.
Residential revenue also returned to growth despite continued weakness in new residential construction and repair, maintenance and improvement activity. Residential revenue increased 2% during the quarter, while total U.S. sales increased 5%, including 4% organic growth and a 1% contribution from acquisitions.
Overall Q2 sales increased 4.6% to $8.75 billion, while adjusted operating profit increased 2.9% to $932 million. Adjusted EBITDA reached $994 million, and adjusted diluted EPS increased 5.3% to $3.39.
Ferguson invested $573 million in acquisitions during the quarter while also returning $202 million of surplus capital through share repurchases. Net debt to adjusted EBITDA remained at 1.3x.
The company raised its calendar 2026 outlook following the quarter, now expecting mid-single-digit net sales growth and an adjusted operating margin between 9.5% and 9.8%. The updated guidance does not include the expected impact of the pending FloWorks acquisition.
KEY QUOTES:
“We delivered another strong quarter of non-residential growth and we returned to growth in residential despite the challenging market backdrop.”
“Our scale-advantaged business model and consistent cash generation enable us to invest in organic growth, consolidate our markets through acquisitions and return capital to shareholders, all while maintaining a strong balance sheet.”
Kevin Murphy, Chief Executive Officer Of Ferguson
