10/17/2013 1:33:00 AM
NEWS BRIEFS
Grainger Reports Volume and Price Gains
Quarterly Highlights
— Sales of $2.4 billion, up 5%
— Sales for the U.S. segment up 7%
— EPS of $2.95, up 37%
— Operating cash flow of $354 million, up 5%
Grainger reported sales, including fasteners, rose 5% to $2.4 billion in the third quarter of 2013. Sales on a daily basis increased 4%, including 4 percentage points from volume and 1 percentage point from acquisitions, partially offset by a 1 percentage point decline attributable to unfavorable foreign exchange. Q3 net earnings increased 36% to $211 million, and EPS grew 37% to $2.95.
United States
Q3 sales for the United States segment increased 7%, driven by 5 percentage points from volume and 1 percentage point from acquisitions. “The sales increase for the quarter was led by solid growth primarily to large customers in the light and heavy manufacturing, natural resources and commercial customer end markets.” Quarterly operating earnings in the U.S. increased 39%.
Canada
Sales in Canada decreased 1%. In local currency, sales increased 4%, led by solid growth to customers in the oil and gas, forestry, light manufacturing and utilities end markets. Operating earnings in Canada decreased 7%.
Other Businesses
Daily sales for the Other Businesses, which includes operations primarily in Asia, Europe and Latin America, were flat in Q3, as volume and price gains were offset by an unfavorable foreign exchange. Operating earnings for the Other Businesses slipped 33% to $6 million, driven by weaker performance in Mexico, Colombia and Brazil. Strong earnings growth in Japan was essentially offset by the weakness in the Japanese yen versus the U.S. dollar.
“Despite a challenging environment, our U.S. business delivered solid volume growth and earnings that were in line with our expectations,” said CEO Jim Ryan. “Our businesses outside of the United States remain affected by weaker macroeconomic conditions and unfavorable foreign exchange rates.”
While noting Grainger continues to “aggressively invest” with $135 million in incremental growth spending planned for 2013 designed to build additional scale and accelerate our market share gains, Ryan said the company is narrowing its 2013 guidance, citing “continuing headwinds of a softer global economy and stronger U.S. dollar.”
Grainger now expects 2013 sales growth of 5% to 6% and EPS $11.45 to $11.65.
Year-to-Date
For the nine months ended September 30, 2013, sales grew 5% to $7.1 billion, with net earnings up 20% to $640 million. ©2013 GlobalFastenerNews.com
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Related Links:
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