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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
 
 
FORM 8-K
 
 
CURRENT REPORT
Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934
Date of Report (Date of Earliest Event Reported): January 12, 2024
 
 
FERGUSON PLC
(Exact Name of Registrant as Specified in its Charter)
 
 
 
         
Jersey, Channel Islands
  
001-40066
  
98-1499339
(State or Other Jurisdiction
of Incorporation)
  
(Commission
File Number)
  
(IRS Employer
Identification Number)
     
1020 Eskdale Road,
Winnersh Triangle, Wokingham,
        
     
Berkshire, United Kingdom
      
RG41 5TS
(Address of Principal Executive Offices)
      
(Zip Code)
Registrant’s Telephone Number, Including Area Code: +44 (0) 118 927 3800
Not Applicable
(Former Name or Former Address, if Changed Since Last Report.)
 
 
Check the appropriate box below if the Form
8-K
filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2.):
 
☐
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
 
☐
Soliciting material pursuant to Rule
14a-12
under the Exchange Act (17 CFR 240.14a-12)
 
☐
Pre-commencement
communications pursuant to Rule
14d-2(b)
under the Exchange Act (17 CFR 240.14d-2(b))
 
☐
Pre-commencement
communications pursuant to Rule
13e-4(c)
under the Exchange Act (17 CFR
240.13e-4(c))
Securities registered pursuant to Section 12(b) of the Act:
 
         
Title of each class
  
Trading
Symbol(s)
  
Name of each exchange
on which registered
Ordinary Shares of 10 pence   FERG   New York Stock Exchange London Stock Exchange
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (17 CFR §230.405) or Rule
12b-2
of the Securities Exchange Act of 1934 (17 CFR
§240.12b-2).
Emerging growth company  ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.  ☐
 
 
 
Item 7.01
Regulation FD Disclosure.
On October 17, 2023, Ferguson plc (the “
Company
”) filed its Definitive Proxy Statement (the “
Proxy Statement
”) for its 2023 Annual General Meeting, which was held on November 28, 2023. After such meeting had occurred, the Company became aware of immaterial errors within certain components of the “Pay Versus Performance” disclosures on pages
 
68-71
 
of the Proxy Statement (the “
Pay Versus Performance Disclosure
”).
The sole purpose of the filing of this Current Report on Form
 
8-K
 
is to correct the Pay Versus Performance Disclosure as provided in Exhibit 99.1 hereto. Except as described in Exhibit 99.1, this filing does not change any other information in the Proxy Statement.
The information disclosed pursuant to this Item 7.01 (including Exhibit 99.1) shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “
Exchange Act
”), or otherwise subject to the liability of that section and shall not be incorporated by reference into any registration statement or other document filed under the Securities Act of 1933, as amended, or the Exchange Act, except as shall be expressly set forth by specific reference in any such filing.
 
Item 9.01
Financial Statements and Exhibits.
 
(d)
Exhibits
 
Exhibit
No.
  
Description
99.1
  
104
  
Cover Page Interactive Data File (embedded within the Inline XBRL document)
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
 
 
 
Ferguson plc
Date: January 12, 2024
 
 
By:
 
/s/ Katherine McCormick
 
 
Name:
 
Katherine McCormick
 
 
Title:
 
Company Secretary
Exhibit 99.1
Executive Compensation
Pay Versus Performance
The following table sets forth certain information with respect to the Company’s financial performance and the compensation paid to our NEOs for the fiscal years ended on July 31, 2021, July 31, 2022 and July 31, 2023.
 
                       
Value of Initial Fixed $100    
Investment
(7)
Based On:    
          
Fiscal Year
   
Summary
Compensation
Table Total for
PEO ($)
(1)
   
Compensation
Actually Paid
to PEO ($)
(2)(3)
   
Average
Summary
Compensation
Table Total for
Non-PEO

NEOs ($)
(4)
   
Average
Compensation
Actually Paid
to
Non-PEO

NEOs ($)
(2)(4)(5)
  
Ferguson  
Total  
Shareholder  
Return ($)  
   
Peer Group  
Total  
Shareholder  
Return ($)
(6)
  
   
Net
Income
($ in millions)
   
Adjusted
Operating
Profit ($ in
millions)
(7)
 
(a)
   
(b)
   
(c)
   
(d)
   
(e)
  
(f)
   
(g)
   
(h)
   
(i)
 
2023    5,440,771    9,060,208    2,265,568    2,916,515   194.42    161.85    1,889    2,917
 
2022
 
    4,865,698    5,460,206    2,212,036    2,532,866   146.64    137.61    2,122    2,951
2021    5,048,917    12,573,301    1,171,378    345,655   160.17    146.43    1,472    2,092
 
Notes:
(1)
The principal executive officer (“PEO”) is Kevin Murphy, who has remained the Chief Executive Officer for the duration of the disclosure period.
(2)
In calculating the ‘compensation actually paid’ amounts reflected in these columns, the fair value or change in fair value, as applicable, of the equity award adjustments included in such calculations was computed in accordance with FASB ASC Topic 718. The valuation assumptions used to calculate such fair values did not materially differ from those disclosed at the time of grant. We do not have pensions in the US; therefore, an adjustment to the 2023 Summary Compensation Table (“SCT”) totals related to pension value for any of the years reflected in this table is not needed.
(3)
To calculate the Compensation Actually Paid (“CAP”) for the PEO, the following adjustments were made to SCT total compensation, calculated in accordance with the SEC methodology for determining CAP for each year shown:
 
         
Adjustments to SCT
     
Fiscal
Year
   
SCT Total for PEO
($)
   
Less, Grant
Date Fair Value
of Awards
Reported in FY
SCT ($)
   
Plus, Year-End

Fair Value of
Awards granted in
FY that are
outstanding and
unvested
as of end of FY ($)
   
Plus, Vesting
Date Fair Value
of Awards that
are granted and
vested
in the same FY ($)
   
Plus, Change in Fair
Value of Prior Year
Awards outstanding
and unvested as of
end of FY ($)
   
Plus, Change in
Fair Value of
Prior Year
Awards that
vested in FY ($)
   
Less, Prior Year
Awards that fail to
meet vesting
conditions during
FY ($)
   
Plus, Dividends or
other earnings
paid on all awards
in CFY prior to
vesting date ($)
   
CAP for
PEO ($)
 
2023
    5,440,771    2,520,730    3,947,882    —    2,331,881    (454,998)    —    315,402    9,060,208
 
2022
 
    4,865,698    2,047,019    3,494,039    —    (1,138,890)    203,786    —    82,592    5,460,206
2021
    5,048,917    1,986,339    5,307,895    —    3,867,497    335,331    —    —    12,573,301
 
 
(4)
The
non-PEO
NEOs represent the following individuals for each of the years shown.
 
 
•
  
2023: Bill Brundage, Chief Financial Officer; Ian Graham, Chief Legal Officer; Sammie Long, Chief Human Resources Officer; Bill Thees, Senior Vice President of Business and Sales.
 
 
•
  
2022: Bill Brundage, Chief Financial Officer.
 
 
•
  
2021: Bill Brundage, Chief Financial Officer; Mike Powell, former Group Chief Financial Officer.
Executive Compensation
 
(5)
To calculate the CAP for the
non-PEO
NEOs, the following adjustments were made to SCT total compensation, calculated in accordance with the SEC methodology for determining CAP for each year shown:
 
         
Adjustments to SCT
     
Fiscal
Year
   
SCT Total for Non-
PEO NEOs ($)
   
Less, Grant
Date Fair Value
of Awards
Reported in FY
SCT ($)
   
Plus, Year-End

Fair Value of
Awards granted in
FY that are
outstanding and
unvested
as of end of FY ($)
   
Plus, Vesting
Date Fair Value of
Awards that
are granted and
vested
in the same FY ($)
   
Plus, Change in Fair
Value of Prior Year
Awards outstanding
and unvested as of
end of FY ($)
   
Plus, Change in
Fair Value of
Prior Year
Awards that
vested in FY ($)
   
Less, Prior Year
Awards that fail
to meet vesting
conditions during
FY ($)
   
Plus, Dividends or
other earnings
paid on all awards
in CFY prior to
vesting date ($)
   
CAP for Non-PEO

NEOs ($)
 
2023
    2,265,568    908,195    998,610    —    778,288    (239,457)    —    21,701    2,916,515
 
2022
 
    2,212,036    816,013    1,392,846    —    (356,654)    71,623    —    29,028    2,532,866
2021
    1,171,378    363,394    1,003,318    —    574,938    180,745    2,221,330    —    345,655
 
 
(6)
The selected peer group is the S&P 500 Industrials Index. The comparison of total shareholder returns assumes that $100 was invested on July 31, 2020 in Company ordinary shares and the S&P 500 Index and that dividends were reinvested when and as paid.
(7)
Our company-selected measure, which is the measure we believe represents the most important financial performance not otherwise presented in the table above that we use to link CAP to our NEOs for fiscal 2023 to our Company’s performance, is adjusted operating profit, a
non-GAAP
measure. Adjusted operating profit is defined as operating profit before acquisition related intangible amortization and certain other
non-GAAP
adjustments, as further described in the section titled
“Non-GAAP
Reconciliations and Supplementary Information.”
The items listed below represent the most important financial performance measures used by us to link compensation actually paid to our NEOs to Company performance for the fiscal year ended July 31, 2023:
 
   
Most Important Performance Measures
for PEO and
Non-PEO
NEOs
(1)
    
 
  
                    
  
Adjusted Operating Profit
(2)
  
                    
  
 
 
  
 
  
Adjusted Earnings per Share (“EPS”) - Diluted
(3)
  
 
  
 
 
  
 
 
  
Return on Capital Employed (ROCE)
(4)
  
 
 
  
 
Notes:
 
(1)
The most important performance measures include our company selected measure and the two financial metrics used for long-term incentive awards with performance-based vesting, as described in our Compensation Discussion and
Analysis
(CD&A) within the section titled Long-Term Equity-Based Incentive Program. Each of these measures is a critical operational metric reported to shareholders.
(2)
See footnote (7) above for the definition of adjusted operating profit.
(3)
Adjusted EPS - diluted is defined as adjusted net income divided by
the
weighted average diluted shares outstanding. Adjusted net income is defined as income from continuing operations before amortization of acquired intangible assets (net of tax), discrete tax items and other items that are
non-recurring
(net of tax). See the section titled
“Non-GAAP
Reconciliations and Supplementary Information” for more information.
(4)
ROCE is defined as adjusted earnings before interest and taxes (Adjusted EBIT) divided by average capital employed. Adjusted EBIT is defined as operating profit from continuing operations excluding certain
non-GAAP
adjustments, as further described in the section titled
“Non-GAAP
Reconciliations and Supplementary Information,” and including the impact of acquisition related intangible amortization. Average capital employed is defined as the sum of average net debt and average shareholders’ equity and excludes average assets held for sale. See the section titled
“Non-GAAP
Reconciliations and Supplementary Information” for more information.
Comparative Disclosure
The following graphs set forth the relationship between each of the financial performance measures included in the table above and the amount of compensation actually paid to our NEOs for the years ended on July 31, 2021, July 31, 2022 and July 31, 2023.
 
 

v3.23.4
Cover
Jan. 12, 2024
Cover [Abstract]  
Document Type 8-K
Document Period End Date Jan. 12, 2024
Entity Registrant Name FERGUSON PLC
Entity File Number 001-40066
Entity Tax Identification Number 98-1499339
Entity Address, Address Line One 1020 Eskdale Road
Entity Address, Address Line Two Winnersh Triangle
Entity Address, City or Town Wokingham
Entity Address, Country GB
Entity Address, Postal Zip Code RG41 5TS
City Area Code 118
Local Phone Number 927 3800
Written Communications false
Soliciting Material false
Pre-commencement Tender Offer false
Pre-commencement Issuer Tender Offer false
Title of 12(b) Security Ordinary Shares of 10 pence
Trading Symbol FERG
Security Exchange Name NYSE
Entity Emerging Growth Company false
Entity Central Index Key 0001832433
Amendment Flag false
Entity Incorporation, State or Country Code Y9
v3.23.4
Pay vs Performance Disclosure - USD ($)
 12 Months Ended
Jul. 31, 2023
Jul. 31, 2022
Jul. 31, 2021
Pay vs Performance Disclosure      
Pay vs Performance Disclosure, Table
Pay Versus Performance
The following table sets forth certain information with respect to the Company’s financial performance and the compensation paid to our NEOs for the fiscal years ended on July 31, 2021, July 31, 2022 and July 31, 2023.
 
                       
Value of Initial Fixed $100    
Investment
(7)
Based On:    
          
Fiscal Year
   
Summary
Compensation
Table Total for
PEO ($)
(1)
   
Compensation
Actually Paid
to PEO ($)
(2)(3)
   
Average
Summary
Compensation
Table Total for
Non-PEO

NEOs ($)
(4)
   
Average
Compensation
Actually Paid
to
Non-PEO

NEOs ($)
(2)(4)(5)
  
Ferguson  
Total  
Shareholder  
Return ($)  
   
Peer Group  
Total  
Shareholder  
Return ($)
(6)
  
   
Net
Income
($ in millions)
   
Adjusted
Operating
Profit ($ in
millions)
(7)
 
(a)
   
(b)
   
(c)
   
(d)
   
(e)
  
(f)
   
(g)
   
(h)
   
(i)
 
2023    5,440,771    9,060,208    2,265,568    2,916,515   194.42    161.85    1,889    2,917
 
2022
 
    4,865,698    5,460,206    2,212,036    2,532,866   146.64    137.61    2,122    2,951
2021    5,048,917    12,573,301    1,171,378    345,655   160.17    146.43    1,472    2,092
 
Notes:
(1)
The principal executive officer (“PEO”) is Kevin Murphy, who has remained the Chief Executive Officer for the duration of the disclosure period.
(2)
In calculating the ‘compensation actually paid’ amounts reflected in these columns, the fair value or change in fair value, as applicable, of the equity award adjustments included in such calculations was computed in accordance with FASB ASC Topic 718. The valuation assumptions used to calculate such fair values did not materially differ from those disclosed at the time of grant. We do not have pensions in the US; therefore, an adjustment to the 2023 Summary Compensation Table (“SCT”) totals related to pension value for any of the years reflected in this table is not needed.
(3)
To calculate the Compensation Actually Paid (“CAP”) for the PEO, the following adjustments were made to SCT total compensation, calculated in accordance with the SEC methodology for determining CAP for each year shown:
 
         
Adjustments to SCT
     
Fiscal
Year
   
SCT Total for PEO
($)
   
Less, Grant
Date Fair Value
of Awards
Reported in FY
SCT ($)
   
Plus, Year-End

Fair Value of
Awards granted in
FY that are
outstanding and
unvested
as of end of FY ($)
   
Plus, Vesting
Date Fair Value
of Awards that
are granted and
vested
in the same FY ($)
   
Plus, Change in Fair
Value of Prior Year
Awards outstanding
and unvested as of
end of FY ($)
   
Plus, Change in
Fair Value of
Prior Year
Awards that
vested in FY ($)
   
Less, Prior Year
Awards that fail to
meet vesting
conditions during
FY ($)
   
Plus, Dividends or
other earnings
paid on all awards
in CFY prior to
vesting date ($)
   
CAP for
PEO ($)
 
2023
    5,440,771    2,520,730    3,947,882    —    2,331,881    (454,998)    —    315,402    9,060,208
 
2022
 
    4,865,698    2,047,019    3,494,039    —    (1,138,890)    203,786    —    82,592    5,460,206
2021
    5,048,917    1,986,339    5,307,895    —    3,867,497    335,331    —    —    12,573,301
 
 
(4)
The
non-PEO
NEOs represent the following individuals for each of the years shown.
 
 
•
  
2023: Bill Brundage, Chief Financial Officer; Ian Graham, Chief Legal Officer; Sammie Long, Chief Human Resources Officer; Bill Thees, Senior Vice President of Business and Sales.
 
 
•
  
2022: Bill Brundage, Chief Financial Officer.
 
 
•
  
2021: Bill Brundage, Chief Financial Officer; Mike Powell, former Group Chief Financial Officer.
 
(5)
To calculate the CAP for the
non-PEO
NEOs, the following adjustments were made to SCT total compensation, calculated in accordance with the SEC methodology for determining CAP for each year shown:
 
         
Adjustments to SCT
     
Fiscal
Year
   
SCT Total for Non-
PEO NEOs ($)
   
Less, Grant
Date Fair Value
of Awards
Reported in FY
SCT ($)
   
Plus, Year-End

Fair Value of
Awards granted in
FY that are
outstanding and
unvested
as of end of FY ($)
   
Plus, Vesting
Date Fair Value of
Awards that
are granted and
vested
in the same FY ($)
   
Plus, Change in Fair
Value of Prior Year
Awards outstanding
and unvested as of
end of FY ($)
   
Plus, Change in
Fair Value of
Prior Year
Awards that
vested in FY ($)
   
Less, Prior Year
Awards that fail
to meet vesting
conditions during
FY ($)
   
Plus, Dividends or
other earnings
paid on all awards
in CFY prior to
vesting date ($)
   
CAP for Non-PEO

NEOs ($)
 
2023
    2,265,568    908,195    998,610    —    778,288    (239,457)    —    21,701    2,916,515
 
2022
 
    2,212,036    816,013    1,392,846    —    (356,654)    71,623    —    29,028    2,532,866
2021
    1,171,378    363,394    1,003,318    —    574,938    180,745    2,221,330    —    345,655
 
 
(6)
The selected peer group is the S&P 500 Industrials Index. The comparison of total shareholder returns assumes that $100 was invested on July 31, 2020 in Company ordinary shares and the S&P 500 Index and that dividends were reinvested when and as paid.
(7)
Our company-selected measure, which is the measure we believe represents the most important financial performance not otherwise presented in the table above that we use to link CAP to our NEOs for fiscal 2023 to our Company’s performance, is adjusted operating profit, a
non-GAAP
measure. Adjusted operating profit is defined as operating profit before acquisition related intangible amortization and certain other
non-GAAP
adjustments, as further described in the section titled
“Non-GAAP
Reconciliations and Supplementary Information.”
The items listed below represent the most important financial performance measures used by us to link compensation actually paid to our NEOs to Company performance for the fiscal year ended July 31, 2023:
 
   
Most Important Performance Measures
for PEO and
Non-PEO
NEOs
(1)
    
 
  
                    
  
Adjusted Operating Profit
(2)
  
                    
  
 
 
  
 
  
Adjusted Earnings per Share (“EPS”) - Diluted
(3)
  
 
  
 
 
  
 
 
  
Return on Capital Employed (ROCE)
(4)
  
 
 
  
 
Notes:
 
(1)
The most important performance measures include our company selected measure and the two financial metrics used for long-term incentive awards with performance-based vesting, as described in our Compensation Discussion and
Analysis
(CD&A) within the section titled Long-Term Equity-Based Incentive Program. Each of these measures is a critical operational metric reported to shareholders.
(2)
See footnote (7) above for the definition of adjusted operating profit.
(3)
Adjusted EPS - diluted is defined as adjusted net income divided by
the
weighted average diluted shares outstanding. Adjusted net income is defined as income from continuing operations before amortization of acquired intangible assets (net of tax), discrete tax items and other items that are
non-recurring
(net of tax). See the section titled
“Non-GAAP
Reconciliations and Supplementary Information” for more information.
(4)
ROCE is defined as adjusted earnings before interest and taxes (Adjusted EBIT) divided by average capital employed. Adjusted EBIT is defined as operating profit from continuing operations excluding certain
non-GAAP
adjustments, as further described in the section titled
“Non-GAAP
Reconciliations and Supplementary Information,” and including the impact of acquisition related intangible amortization. Average capital employed is defined as the sum of average net debt and average shareholders’ equity and excludes average assets held for sale. See the section titled
“Non-GAAP
Reconciliations and Supplementary Information” for more information.
   
Company Selected Measure Name Adjusted operating profit    
Named Executive Officers, Footnote
(4)
The
non-PEO
NEOs represent the following individuals for each of the years shown.
 
 
•
  
2023: Bill Brundage, Chief Financial Officer; Ian Graham, Chief Legal Officer; Sammie Long, Chief Human Resources Officer; Bill Thees, Senior Vice President of Business and Sales.
 
 
•
  
2022: Bill Brundage, Chief Financial Officer.
 
 
•
  
2021: Bill Brundage, Chief Financial Officer; Mike Powell, former Group Chief Financial Officer.
   
Peer Group Issuers, Footnote The selected peer group is the S&P 500 Industrials Index. The comparison of total shareholder returns assumes that $100 was invested on July 31, 2020 in Company ordinary shares and the S&P 500 Index and that dividends were reinvested when and as paid.    
PEO Total Compensation Amount $ 5,440,771 $ 4,865,698 $ 5,048,917
PEO Actually Paid Compensation Amount $ 9,060,208 5,460,206 12,573,301
Adjustment To PEO Compensation, Footnote
         
Adjustments to SCT
     
Fiscal
Year
   
SCT Total for PEO
($)
   
Less, Grant
Date Fair Value
of Awards
Reported in FY
SCT ($)
   
Plus, Year-End

Fair Value of
Awards granted in
FY that are
outstanding and
unvested
as of end of FY ($)
   
Plus, Vesting
Date Fair Value
of Awards that
are granted and
vested
in the same FY ($)
   
Plus, Change in Fair
Value of Prior Year
Awards outstanding
and unvested as of
end of FY ($)
   
Plus, Change in
Fair Value of
Prior Year
Awards that
vested in FY ($)
   
Less, Prior Year
Awards that fail to
meet vesting
conditions during
FY ($)
   
Plus, Dividends or
other earnings
paid on all awards
in CFY prior to
vesting date ($)
   
CAP for
PEO ($)
 
2023
    5,440,771    2,520,730    3,947,882    —    2,331,881    (454,998)    —    315,402    9,060,208
 
2022
 
    4,865,698    2,047,019    3,494,039    —    (1,138,890)    203,786    —    82,592    5,460,206
2021
    5,048,917    1,986,339    5,307,895    —    3,867,497    335,331    —    —    12,573,301
 
    
Non-PEO NEO Average Total Compensation Amount $ 2,265,568 2,212,036 1,171,378
Non-PEO NEO Average Compensation Actually Paid Amount $ 2,916,515 2,532,866 345,655
Adjustment to Non-PEO NEO Compensation Footnote
         
Adjustments to SCT
     
Fiscal
Year
   
SCT Total for Non-
PEO NEOs ($)
   
Less, Grant
Date Fair Value
of Awards
Reported in FY
SCT ($)
   
Plus, Year-End

Fair Value of
Awards granted in
FY that are
outstanding and
unvested
as of end of FY ($)
   
Plus, Vesting
Date Fair Value of
Awards that
are granted and
vested
in the same FY ($)
   
Plus, Change in Fair
Value of Prior Year
Awards outstanding
and unvested as of
end of FY ($)
   
Plus, Change in
Fair Value of
Prior Year
Awards that
vested in FY ($)
   
Less, Prior Year
Awards that fail
to meet vesting
conditions during
FY ($)
   
Plus, Dividends or
other earnings
paid on all awards
in CFY prior to
vesting date ($)
   
CAP for Non-PEO

NEOs ($)
 
2023
    2,265,568    908,195    998,610    —    778,288    (239,457)    —    21,701    2,916,515
 
2022
 
    2,212,036    816,013    1,392,846    —    (356,654)    71,623    —    29,028    2,532,866
2021
    1,171,378    363,394    1,003,318    —    574,938    180,745    2,221,330    —    345,655
 
    
Compensation Actually Paid vs. Total Shareholder Return

   
Compensation Actually Paid vs. Net Income

   
Compensation Actually Paid vs. Company Selected Measure

   
Total Shareholder Return Vs Peer Group

   
Tabular List, Table
The items listed below represent the most important financial performance measures used by us to link compensation actually paid to our NEOs to Company performance for the fiscal year ended July 31, 2023:
 
   
Most Important Performance Measures
for PEO and
Non-PEO
NEOs
(1)
    
 
  
                    
  
Adjusted Operating Profit
(2)
  
                    
  
 
 
  
 
  
Adjusted Earnings per Share (“EPS”) - Diluted
(3)
  
 
  
 
 
  
 
 
  
Return on Capital Employed (ROCE)
(4)
  
 
 
  
 
Notes:
 
(1)
The most important performance measures include our company selected measure and the two financial metrics used for long-term incentive awards with performance-based vesting, as described in our Compensation Discussion and
Analysis
(CD&A) within the section titled Long-Term Equity-Based Incentive Program. Each of these measures is a critical operational metric reported to shareholders.
(2)
See footnote (7) above for the definition of adjusted operating profit.
(3)
Adjusted EPS - diluted is defined as adjusted net income divided by
the
weighted average diluted shares outstanding. Adjusted net income is defined as income from continuing operations before amortization of acquired intangible assets (net of tax), discrete tax items and other items that are
non-recurring
(net of tax). See the section titled
“Non-GAAP
Reconciliations and Supplementary Information” for more information.
(4)
ROCE is defined as adjusted earnings before interest and taxes (Adjusted EBIT) divided by average capital employed. Adjusted EBIT is defined as operating profit from continuing operations excluding certain
non-GAAP
adjustments, as further described in the section titled
“Non-GAAP
Reconciliations and Supplementary Information,” and including the impact of acquisition related intangible amortization. Average capital employed is defined as the sum of average net debt and average shareholders’ equity and excludes average assets held for sale. See the section titled
“Non-GAAP
Reconciliations and Supplementary Information” for more information.
   
Total Shareholder Return Amount $ 194.42 146.64 160.17
Peer Group Total Shareholder Return Amount 161.85 137.61 146.43
Net Income (Loss) $ 1,889,000,000 $ 2,122,000,000 $ 1,472,000,000
Company Selected Measure Amount 2,917,000,000 2,951,000,000 2,092,000,000
PEO Name Kevin Murphy    
Measure:: 1      
Pay vs Performance Disclosure      
Name Adjusted Operating Profit    
Non-GAAP Measure Description Our company-selected measure, which is the measure we believe represents the most important financial performance not otherwise presented in the table above that we use to link CAP to our NEOs for fiscal 2023 to our Company’s performance, is adjusted operating profit, a
non-GAAP
measure. Adjusted operating profit is defined as operating profit before acquisition related intangible amortization and certain other
non-GAAP
adjustments, as further described in the section titled
“Non-GAAP
Reconciliations and Supplementary Information.” 		   
Measure:: 2      
Pay vs Performance Disclosure      
Name Adjusted Earnings per Share (“EPS”) - Diluted    
Measure:: 3      
Pay vs Performance Disclosure      
Name Return on Capital Employed (ROCE)    
PEO | Grant Date Fair Value Of Awards Reported In FY SCT [Member]      
Pay vs Performance Disclosure      
Adjustment to Compensation, Amount $ 2,520,730 $ 2,047,019 $ 1,986,339
PEO | Awards Granted In FY That Are Outstanding And Unvested As Of End Of FY [Member]      
Pay vs Performance Disclosure      
Adjustment to Compensation, Amount 3,947,882 3,494,039 5,307,895
PEO | Prior Year Awards Outstanding And Unvested As Of End Of FY [Member]      
Pay vs Performance Disclosure      
Adjustment to Compensation, Amount 2,331,881 (1,138,890) 3,867,497
PEO | Prior Year Awards That Vested In FY [Member]      
Pay vs Performance Disclosure      
Adjustment to Compensation, Amount (454,998) 203,786 335,331
PEO | Dividends Or Other Earnings Paid On All Awards In CFY Prior To Vesting Date [Member]      
Pay vs Performance Disclosure      
Adjustment to Compensation, Amount 315,402 82,592  
Non-PEO NEO | Grant Date Fair Value Of Awards Reported In FY SCT [Member]      
Pay vs Performance Disclosure      
Adjustment to Compensation, Amount 908,195 816,013 363,394
Non-PEO NEO | Awards Granted In FY That Are Outstanding And Unvested As Of End Of FY [Member]      
Pay vs Performance Disclosure      
Adjustment to Compensation, Amount 998,610 1,392,846 1,003,318
Non-PEO NEO | Prior Year Awards Outstanding And Unvested As Of End Of FY [Member]      
Pay vs Performance Disclosure      
Adjustment to Compensation, Amount 778,288 (356,654) 574,938
Non-PEO NEO | Prior Year Awards That Vested In FY [Member]      
Pay vs Performance Disclosure      
Adjustment to Compensation, Amount (239,457) 71,623 180,745
Non-PEO NEO | Prior Year Awards That Fail To Meet Vesting Conditions During FY [Member]      
Pay vs Performance Disclosure      
Adjustment to Compensation, Amount     $ 2,221,330
Non-PEO NEO | Dividends Or Other Earnings Paid On All Awards In CFY Prior To Vesting Date [Member]      
Pay vs Performance Disclosure      
Adjustment to Compensation, Amount $ 21,701 $ 29,028  
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