10/16/2014
NEWS BRIEFS
Grainger Reports Steady U.S. Sales

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Grainger reported sales in the third quarter of 2014 increased 7% to $2.6 billion, with net earnings up 9% to $230 million and EPS rising 12% to $3.30.

“We were pleased with the overall performance of the business in the quarter,” said CEO Jim Ryan.  “Strong volume growth and positive operating leverage in the U.S. business were the primary drivers of our results. 

“Outside of North America, we were disappointed with the performance of several multichannel businesses and are committed to improving or exiting those operations.” 

“We are very excited about the continued success of our single channel businesses in Japan and the United States, and we are evaluating and testing additional markets for expansion of this model.”  

Ryan concluded, “Despite headwinds from historically low inflation and a sluggish global economy, we will continue to invest in infrastructure and growth to capitalize on the attractive share gain opportunity in the large and fragmented MRO market.”  

Q3 sales for the U.S. segment increased 7% to $2.04 billion, which included organic sales growth of 5% driven by 6 percentage points from volume.  Sales growth to customers in the Heavy and Light Manufacturing, Commercial, Retail and Natural Resources customer end markets contributed to the sales increase. U.S. operating earnings rose 13% to $386.5 million.

Sales in Canada increased 3% to $278.3 million, while operating earnings declined 14% to $27.5 million.

Sales in the company’s Other Businesses segment gained 16% to $300.8 million, while operating earnings slipped 16.7% to $5.1 million, driven by incremental expenses associated with the start-up of the single channel business in Europe and continued soft performance from the multichannel business in Europe (Fabory).

In the first nine months of 2014 Grainger sales climbed 6% to $7.5 billion, with net earnings up 2% to $653 million.

Grainger lowered the top end of its guidance for 2014.  The company now expects 5% to 5.5% sales growth and earnings per share of $12.20 to $12.30.

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Related Links:

• Grainger