4/25/2012 10:53:00 AM
HEADLINES
Grainger Posts Record Results In All Segments

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Grainger reported record results for the opening quarter of 2012, with sales climbing 16% to $2.2 billion. Q1 net earnings grew 19% to $188 million, while earnings per share increased 18% to $2.57.

“We continued to aggressively invest in growing the business through product line expansion, sales force expansion, eCommerce, inventory management services and international expansion,” stated CEO Jim Ryan.

Sales in the U.S. rose 11% to $1.7 billion, including 9% volume growth and three percentage points from price, offset by a one percentage point drag from lower sales of seasonal products due to the unusually warm weather. Quarterly operating earnings jumped 17% to $298.9 million, driven by strong sales and “positive expense leverage.” Gross profit margins increased 10 basis points.

“All customer end markets in the United States posted sales growth versus the 2011 first quarter, led by a strong increase in heavy manufacturing and natural resources,” Grainger stated.

Sales for Acklands-Grainger — the company’s Canadian division — increased 13% to $272.9 million, led by strong growth to customers in the construction, agriculture and mining, and transportation sectors of the economy, partially offset by lower sales to the government. Strong volume growth contributed 13 percentage points to the sales increase, while price contributed 1 percentage point.

Operating earnings in Canada increased 24 percent to $29.7 million in Q1, boosted by a 60 basis point improvement in gross profit margins.

Sales for the Other Businesses segment, which includes operations in Asia, Europe and Latin America, more than doubled to $238.9 million.

“This increase was primarily due to the incremental sales from the business in Europe (Fabory) acquired on August 31, 2011, combined with strong revenue growth in Japan and Mexico,” Grainger stated.

Excluding Fabory, sales for the Other Businesses increased 33%.

Operating earnings for the Other Businesses nearly doubled to $11 million, driven by strong earnings growth in Japan and Mexico combined with $1 million dollars in operating earnings from the Fabory business in Europe. ©2012 GlobalFastenerNews.com

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