11/2/2015 1:58:00 PM
HEADLINES
Fastener results at Fastenal
For the third time in 11 months, Fastenal has a new CEO.
The company’s board elected CFO Daniel Florness as president and CEO, effective January 1, 2016. Florness, 51, will replace Will Oberton.
No explanation was given for the change.
Oberton, 57, first became CEO in December 2002, when he succeeded company founder Bob Kierlin, until December 2014, when Leland Hein took over.
But seven months after becoming CEO, Hein abruptly relinquished the top job to his predecessor Oberton, who resumed his duties as president and CEO on July 20.
Florness will be paid a base salary of $550,000 plus a quarterly performance bonus and stock options. He has served as CFO since June 1996 and as an executive VP since December 2002.
Oberton becomes board chairman in 2016 with an annual retainer of $360,000.
The latest CEO shakeup at Fastenal comes amid declining fastener sales at the Winona, MN-based distribution giant.
Fastenal said fastener sales fell 4.4% in the third quarter of 2015 after flatlining in the second quarter and growing 5.5% in the opening quarter.
For 2014, fastener sales at Fastenal grew 6.9%.
Overall Q3 sales gained 1.5% to $995.2 million, primarily from higher unit sales. Net sales were impacted by minimal price changes in non-fastener products and some price deflation in fastener products.
Q3 operating earnings increased 2.9% to $219.2 million, while net earnings improved 2.4% to $136.5 million and gross profit declined to 50.5%.
Nine-month sales improved 5% to $2.95 billion, with net earnings up 7.6% to $404.4 million.
In early October Fastenal agreed to acquire Fasteners Inc., a regional industrial and construction supply distributor with store locations in the states of Washington, Idaho, Oregon, and Montana.
A week earlier, Fastenal agreed to pay $1.25 million to settle allegations the company discriminated against 171 job applicants who sought general warehouse positions at two of its distribution facilities in Indianapolis and Atlanta, the U.S. Department of Labor’s Office of Federal Contract Compliance Programs determined.
OFCCP investigators found that Fastenal engaged in screening and testing practices that discriminated against African Americans and women.
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