Fastenal Company reported adjusted earnings of 48 cents per share in the second quarter of 2015. Net sales of $997.8 million increased 5% year over year.
Article continues below
Fastenal’s total average daily sales growth rate was 5% in the second quarter, much less than 12.1% in the prior-year quarter. Foreign exchange dragged second-quarter daily sales growth rate by 1%. A strong dollar significantly hurt the company’s export related activity.
Daily sales growth was 3.7% in June, 5.3% in May and 6.1% in April lower than 12.7%, 13.5% and 10% improvement, respectively, in the corresponding year-ago months.
The industrial and construction supplies wholesale distributor serves customers in the manufacturing and non-residential construction markets. Both of these end markets witnessed moderating growth due to weak industrial environment.
Daily sales to manufacturing customers (representing almost 50% of revenues) grew 3.8%, down from 11.2% growth in the prior-year quarter and 6.9% in the previous quarter. Daily sales growth rates to manufacturing customers softened due to subdued sales of both fasteners and non-fasteners.
Daily sales growth rate of fastener products (used mainly for industrial production and accounting for nearly 40% of the company’s business) remained flat in the quarter, much weaker than 5.5% improvement each in the previous and the year-ago quarter.
Non-fastener product sales (used mainly for maintenance) increased 9%, down from 17.1% growth in the prior-year quarter and 11.7% in the last quarter. The non-fastener business also weakened over the last six months as improved vending trends were offset by overall weakness in the industrial environment.
In the non-residential construction market, daily sales to non-residential construction customers (representing 20% to 25% of revenues) grew 1.6%, down from 7.5% in the prior-year quarter as well as 6.2% in the previous quarter. Slowdown in the energy sector also hurt sales in this market. ■