Plumbing parts distributor Ferguson enjoyed rising profit after residential housing activity in the US improved.
The London-listed firm said it was still on track to split off its UK business, as it pivots to focus on the US market.
Shares fell 1.8 per cent this morning.
Underlying profit was £433m for the quarter ending 31 October, a 4.8 per cent rise on the same period last year.
Revenue rose 5.3 per cent, while the firm’s core US business enjoyed revenue growth of 6.2 per cent.
Why it’s interesting
In September, Ferguson named a new chief executive and said it would separate its UK operations to concentrate on the US market.
Nelson Peltz’s Trian Fund Management disclosed a six per cent stake in the company in June. It is among the best known US activist hedge funds that take stakes in companies they view as undervalued, with a view to forcing major changes to generate returns for shareholders.
“Ferguson continued to take market share against a backdrop of flat US markets and we remain firmly focused on maximizing organic revenue growth, while tightly managing gross margins and costs,” chief executive Kevin Murphy said.
Read more: Ferguson to split UK and US operations
What Ferguson said
“We expect to make further good progress in the year ahead. While US market growth is currently broadly flat we remain confident of outperforming our end markets and our order books support continued modest revenue growth in the months ahead,” Murphy added.
“This strong focus on growth with continued cost and margin discipline gives us confidence in our expectations for the full year which remain unchanged.”