7/20/2015 1:48:00 AM
NEWS BRIEFS
Grainger Profit Outpaces Sales Growth
Grainger reported sales, including fasteners, increased 1% to $2.5 billion in the second quarter of 2015, with operating earnings growing 5% to $357 million and net earnings gaining 7% to $221 million.
“While this continues to be a difficult economic environment, we are focusing on the things we can control,” said CEO Jim Ryan. “Despite continued softness in sales and gross profit margins from a tough industrial economy, we continue to invest for the long term while driving significant productivity to fund growth and infrastructure investments and reduce overall margin pressure.”
Q2 included charges of $2 million related to the restructuring at Fabory in Europe and the shutdown of the business in Brazil.
Second-quarter sales for the U.S. segment increased 2% to $2.03 billion, driven by 2 percentage points from volume and 1 percentage point from increased sales to online business Zoro, partially offset by a 1 percentage point decline in price. Sales growth to customers in the Commercial, Government, Light Manufacturing and Retail customer end markets contributed to the sales increase in the quarter. U.S. operating earnings increased 1% to $369.5 million.
Q2 sales for Acklands-Grainger in Canada declined 9% in U.S. dollars to $239.5 million but were up 2% in local currency. Acklands-Grainger had lower sales to the Oil and Gas, Construction, Commercial, Retail, Heavy Manufacturing, Forestry and Transportation customer end markets, which were partially offset by growth to customers in the Light Manufacturing, Mining, Government and Utilities customer end markets.
“The business in Canada continues to be affected by weak oil and gas prices and lower commodity prices,” the company stated.
In U.S. dollars, operating earnings in Canada dropped 51% to $9.5 million. In local currency, operating earnings in Canada were down 44%. primarily driven by lower gross profit margins and negative expense leverage. The gross profit margin in Canada declined 1.1 percentage points versus the prior year.
Sales for the Other Businesses segment increased 7% to $318.9 million, consisting of 21 percentage points of growth from volume and price, partially offset by a 14 percentage points decline from foreign exchange. Operating earnings were $15 million.
Grainger sales during the first six months of 2015 gained 1.4% to $4.96 billion, with operating earnings up 1.85% to $707.9 million.
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Related Links:
• Grainger
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