Ferguson plc (NYSE:FERG) Q2 2024 Earnings Call Transcript

Patrick Baumann: Helpful. And then if I could fit one more in here. I know I’m the last question, so I’m just going to fit one more in — on the — your MDC rollout, any update kind of on how that’s going relative to your expectations? Like what are kind of the plans for this year from an MDC perspective? And any kind of financial metrics you could share with us on how it’s impacting the business.

Bill Brundage: Yes, Pat, we’re pretty pleased with our rollout to date. To date, we have 3 MDCs that are open, Denver, Phoenix and Houston, Houston being our most recent MDC that we’ve opened. And as we look at this year from a calendar year perspective, we’ll open our first MDC in Canada in Toronto. We’ll have Nashville come online later this calendar year. And then as we roll into next calendar year, Dallas and Washington, D.C. So the rollout strategy of, call it, two to three per year over the next several years is very much on track. Early reads on productivity levels are quite good and positive. As you know, we’ve got a lot of investment in automation within those warehouses. And just from a pure labor standpoint, we’re getting 20% to 30% productivity out of those components of the warehouses.

So good productivity, but maybe more importantly, from a strategic standpoint, what we’re bringing is best same-day availability of inventory into these major metropolitan markets. And that’s really improving customer service scores and product availability, fill rates and in-stocks in those markets. We think this is a real core component of our continued organic growth strategy over the next several years. So very pleased with the rollout to date, and we’ll continue to march down that path.

Patrick Baumann: Great. Thanks a lot for the update. Best luck.

Bill Brundage: Thanks, Pat.

Operator: This concludes today’s Q&A session. I’ll now hand over to Kevin Murphy for closing remarks.

Kevin Murphy: Thank you, operator, and thank you all for your time with us today. We appreciate it more than you know. And again, I’ll end where we started and to thank you to our associates there. Tyler’s efforts to really make our customers’ projects better because we were on the job with them. As I take a step back, we are pleased with how the year is progressing. It’s generally progressing as we expected. And as we look forward to the second half, our seasonally stronger second half, we look forward to continued improvement as we lap some easing comparables. So again, thank you very much for your time, and we look forward to seeing and talking with you soon.

Operator: That concludes the Ferguson second quarter results conference call. I’d like to thank you for your participation. You may now disconnect your lines.