Fastenal Company (NASDAQ: FAST)
Shares of Fastenal took a slide of more than 6% during midday trading on Wednesday after the distributer of construction and industrial supplies reported its Q1 earnings for fiscal 2018.
The profit failed to surpass the figure that analysts had anticipated. Investors were expecting the company to report a bigger profit only for them to be disappointed. As a result, the company ended up as one of the biggest losers among the components of the S&P 500 on Wednesday morning.
FAST Earnings & Outlook
Fastenal reported net income of $174.3 million, or an EPS of $0.61, representing a rise of 33% for the first quarter of fiscal 2018. That compares with a net income of $134.2 million, or $0.46 in the same period last year.
The company posted revenues amounting to $1.186 billion, representing a rise of 13%. The EPS and revenues figures both matched the consensus estimate of FactSet and Zach Investment Research analysts. However, the company’s profit margins dropped to 48.7% during the quarter from 49.4% in the same period a year ago.
Fastenal CEO Comments
The President and Chief Executive Officer of Fastenal Dan Florness blamed the profit margins on inflationary pressures on fasteners’ sales at the local level, but said it was habitual problem that is going to fix going forward. Florness said on the firm’s earnings call that it was hit hard by weather fluctuations during the quarter.
Fastenal canceled a total of 332 delivery routes because of bad weather in the period. The number is a rise of 65% from the number of delivery route that were canceled out by the company in the first quarter of the previous fiscal year.
Fastenal Company Profile
Fastenal is headquartered in Winona, Minnesota. The company was founded in 1967 and provides construction supplies, tools, and fasteners. The products distributed by the company include metalworking and cutting tools; fasteners; packaging and storage; material handling; motors and power transmission; equipment and tools; plumbing, electrical; pneumatics, abrasives; rigging and lifting; automotive and fleet; welding; raw materials; furniture; office products; lighting; and janitorial. Its products are used to protect personnel, build structures, and maintain equipment and facilities.
The company has a total of eleven regional distribution centers across the US. The states where the Fastenal has distribution centers include Utah, Minnesota, Kansas, Indiana, Texas, Ohio, Pennsylvania, Georgia, California, Washington, and North Carolina. The company also has other distribution centers outside the country and they include Ontario, Alberta, Nuevo Leon, Ontario; Mexico. –Reuters