09:02 AM EST, 12/10/2024 (MT Newswires) -- Ferguson's (FERG) fiscal first-quarter earnings declined on an annual basis and sales fell short of Wall Street estimates amid continued weakness in certain commodity categories while the company reiterated its full-year revenue growth outlook.

The UK-based plumbing and heating products company on Tuesday posted adjusted earnings of $2.45 per share, down from $2.65 the year before. Sales for the quarter ended Oct. 31 inched 0.8% higher year over year to $7.77 billion, but fell short of the FactSet-polled consensus of $7.81 billion. The stock fell 7.4% in premarket activity.

Persistent weakness in certain commodity categories resulted in overall price deflation of about 2%, according to the company. On an organic basis, revenue slipped 0.3% while volume rose about 2%.

"Our associates remained focused on execution, delivering revenue growth in the quarter, despite continued market headwinds and commodity price deflation," Chief Executive Kevin Murphy said in a statement. "The year has started largely as expected and our balanced business mix and ability to deploy scale locally give us confidence in our continued market outperformance."

Sales in the US ticked up to $7.37 billion from $7.33 billion in the 2023 quarter, as residential revenue remained unchanged. Non-residential revenue was "slightly more resilient" but declined on a yearly basis. Sales in Canada improved 6.3% year over year to $403 million, partially offset by a 0.6% foreign-exchange headwind.

Ferguson continues to anticipate sales to rise by low single digits for fiscal 2025. The Street is looking for sales of $30.41 billion for the year. It also reiterated its adjusted operating margin guidance of 9% to 9.5% and capital expenditures of $400 million to $450 million.

"Our fiscal 2025 financial guidance remains unchanged, reflecting modest full year revenue growth with continued outperformance," according to Murphy. "While we anticipate an ongoing challenging near-term market environment, we will continue to invest in scale and capabilities to take advantage of multi-year structural tailwinds such as underbuilt and aging US housing, non-residential large capital projects and our opportunity with the plumbing and (heating, ventilation, and air conditioning) specialized professional."