Fastenal Company Reports First Quarter Earnings

Apr 11, 2001, 01:00 ET from Fastenal Company

    WINONA, Minn., April 11 /PRNewswire/ --
 The Fastenal Company of Winona, MN (Nasdaq:   FAST) reported the results of the
 First Quarter ended March 31, 2001.
     Net sales for the three-month period ended March 31, 2001 totaled
 $201,016,000, an increase of 14.0% over the $176,268,000 in the first quarter
 of 2000.  Net earnings grew from $20,046,000 in the first quarter of 2000 to
 $20,739,000 in the first quarter of 2001, an increase of 3.5%.  Earnings per
 share increased from $.53 to $.55 for the comparable periods.
     During the quarter, Fastenal opened 50 new sites, bringing the total
 number of sites to 947.  There were 4,444 site employees as of March 31, 2001,
 an increase of 2.0% over December 31, 2000.
 
     Management's comments on the first quarter, 2001, results:
     The quarter began with a 20.3% growth in daily sales in January.  A
 noticeable recovery from the 17.8% growth in daily sales experienced in
 December 2000.  The growth in daily sales dropped to 16.4% in February and to
 11.7% in March.  This decline in the daily sales growth rates continues a
 trend, which began in November 2000.  This trend mirrors the overall weakening
 of the industrial economy we service in North America.
     The increased pressures of the competitive marketplace impacted our gross
 margin during the quarter.  The gross margin was 52.0% in the first quarter of
 2001 and 52.3% in the comparable period in 2000.  The Company experienced
 negative leverage during the quarter.  This was due to (1) the aforementioned
 decrease in gross margin, (2) the additional expenses of planned store
 openings, and (3) the added impact of increases in utility costs when compared
 to the same quarter in 2000.
     The Company opened 22, 20, 36, and 50 new stores during the last
 four quarters respectively, for a total of 128 (or 15.6%).  While the new
 stores continue to build the infrastructure for future growth, the added
 expenses related to payroll, occupancy, and transportation costs impact the
 Company's ability to leverage earnings in a slowing industrial economy.
     As we move into the second quarter of 2001 we will continue to open
 stores.  The time line for slowing down the planned openings is such that
 openings can be altered in a short time span, usually less than 60 to 90 days.
 The Company is committed to continued earnings growth; as the second quarter
 unfolds the Company will continue to reevaluate the level of planned openings.
     Additional information regarding Fastenal Company's first quarter
 statistics is available on the Fastenal Company World Wide Web site at
 www.fastenal.com .  Beginning in November 2000, the Company began to disclose
 sales information on a monthly basis.  This information is posted on the
 Fastenal Company World Wide Web site at www.fastenal.com on the third business
 day following the end of each month.
 
     This press release contains statements that are not historical in nature
 and that are intended to be, and are hereby identified as, "forward-looking
 statements" as defined in the Private Securities Litigation Reform Act of
 1995, including statements regarding increases in selling locations.  A change
 in the economy, from that currently being experienced, could cause the store
 openings to change from that expected.  A discussion of other risks and
 uncertainties is included in the Company's 2000 Annual Report to Shareholders
 under the section captioned "Management's Discussion and Analysis of Financial
 Condition and Results of Operations."
 
 
                       FASTENAL COMPANY AND SUBSIDIARIES
                          Consolidated Balance Sheets
                (Amounts in thousands except share information)
 
                                    (Unaudited)
 
                                                   March 31,     December 31,
     Assets                                            2001             2000
 
     Current assets:
       Cash and cash equivalents               $     35,746           19,710
       Marketable securities                          3,027            4,028
       Trade accounts receivable, net of
        allowance for doubtful accounts of
        $2,238 and $2,238, respectively             113,501          106,120
       Inventories                                  145,669          143,068
       Deferred income tax asset                      4,060            4,060
       Other current assets                           9,385            7,469
          Total current assets                      311,388          284,455
 
     Marketable securities                            8,032            8,969
     Property and equipment, less
      accumulated depreciation                      110,304          105,807
     Other assets, less accumulated amortization      3,211            3,233
 
          Total assets                          $   432,935          402,464
 
     Liabilities and Stockholders' Equity
 
     Current liabilities:
       Accounts payable                             $21,181           19,898
       Accrued expenses                              14,391           13,502
       Income taxes payable                          14,806            3,179
          Total current liabilities                  50,378           36,579
 
     Deferred income tax liability                    6,627            6,627
 
     Stockholders' equity:
       Preferred stock                                    0                0
       Common stock, 50,000,000 shares authorized
        37,938,688 shares issued and outstanding        379              379
       Additional paid-in capital                     4,424            4,424
       Retained earnings                            372,572          355,248
       Accumulated other comprehensive loss          (1,445)            (793)
          Total stockholders' equity                375,930          359,258
 
          Total liabilities and
           stockholders' equity                 $   432,935          402,464
 
 
                       FASTENAL COMPANY AND SUBSIDIARIES
                      Consolidated Statements of Earnings
               (Amounts in thousands except earnings per share.)
 
                                    (Unaudited)
 
                                                       Three months ended
                                                            March 31,
                                                      2001             2000
 
     Net sales                                  $   201,016          176,268
 
     Cost of sales                                   96,411           84,081
              Gross profit                          104,605           92,187
 
     Operating and administrative expenses           71,559           60,152
              Operating income                       33,046           32,035
 
     Other income (expense):
        Interest income                                 651              639
        Loss on disposal of property and equipment      (85)             (78)
              Total other income (expense)              566              561
 
              Earnings before income taxes           33,612           32,596
 
     Income tax expense                              12,873           12,550
 
              Net earnings                      $    20,739           20,046
 
     Basic and diluted earnings per share       $       .55              .53
 
     Weighted average shares outstanding             37,939           37,939
 
 

SOURCE Fastenal Company
    WINONA, Minn., April 11 /PRNewswire/ --
 The Fastenal Company of Winona, MN (Nasdaq:   FAST) reported the results of the
 First Quarter ended March 31, 2001.
     Net sales for the three-month period ended March 31, 2001 totaled
 $201,016,000, an increase of 14.0% over the $176,268,000 in the first quarter
 of 2000.  Net earnings grew from $20,046,000 in the first quarter of 2000 to
 $20,739,000 in the first quarter of 2001, an increase of 3.5%.  Earnings per
 share increased from $.53 to $.55 for the comparable periods.
     During the quarter, Fastenal opened 50 new sites, bringing the total
 number of sites to 947.  There were 4,444 site employees as of March 31, 2001,
 an increase of 2.0% over December 31, 2000.
 
     Management's comments on the first quarter, 2001, results:
     The quarter began with a 20.3% growth in daily sales in January.  A
 noticeable recovery from the 17.8% growth in daily sales experienced in
 December 2000.  The growth in daily sales dropped to 16.4% in February and to
 11.7% in March.  This decline in the daily sales growth rates continues a
 trend, which began in November 2000.  This trend mirrors the overall weakening
 of the industrial economy we service in North America.
     The increased pressures of the competitive marketplace impacted our gross
 margin during the quarter.  The gross margin was 52.0% in the first quarter of
 2001 and 52.3% in the comparable period in 2000.  The Company experienced
 negative leverage during the quarter.  This was due to (1) the aforementioned
 decrease in gross margin, (2) the additional expenses of planned store
 openings, and (3) the added impact of increases in utility costs when compared
 to the same quarter in 2000.
     The Company opened 22, 20, 36, and 50 new stores during the last
 four quarters respectively, for a total of 128 (or 15.6%).  While the new
 stores continue to build the infrastructure for future growth, the added
 expenses related to payroll, occupancy, and transportation costs impact the
 Company's ability to leverage earnings in a slowing industrial economy.
     As we move into the second quarter of 2001 we will continue to open
 stores.  The time line for slowing down the planned openings is such that
 openings can be altered in a short time span, usually less than 60 to 90 days.
 The Company is committed to continued earnings growth; as the second quarter
 unfolds the Company will continue to reevaluate the level of planned openings.
     Additional information regarding Fastenal Company's first quarter
 statistics is available on the Fastenal Company World Wide Web site at
 www.fastenal.com .  Beginning in November 2000, the Company began to disclose
 sales information on a monthly basis.  This information is posted on the
 Fastenal Company World Wide Web site at www.fastenal.com on the third business
 day following the end of each month.
 
     This press release contains statements that are not historical in nature
 and that are intended to be, and are hereby identified as, "forward-looking
 statements" as defined in the Private Securities Litigation Reform Act of
 1995, including statements regarding increases in selling locations.  A change
 in the economy, from that currently being experienced, could cause the store
 openings to change from that expected.  A discussion of other risks and
 uncertainties is included in the Company's 2000 Annual Report to Shareholders
 under the section captioned "Management's Discussion and Analysis of Financial
 Condition and Results of Operations."
 
 
                       FASTENAL COMPANY AND SUBSIDIARIES
                          Consolidated Balance Sheets
                (Amounts in thousands except share information)
 
                                    (Unaudited)
 
                                                   March 31,     December 31,
     Assets                                            2001             2000
 
     Current assets:
       Cash and cash equivalents               $     35,746           19,710
       Marketable securities                          3,027            4,028
       Trade accounts receivable, net of
        allowance for doubtful accounts of
        $2,238 and $2,238, respectively             113,501          106,120
       Inventories                                  145,669          143,068
       Deferred income tax asset                      4,060            4,060
       Other current assets                           9,385            7,469
          Total current assets                      311,388          284,455
 
     Marketable securities                            8,032            8,969
     Property and equipment, less
      accumulated depreciation                      110,304          105,807
     Other assets, less accumulated amortization      3,211            3,233
 
          Total assets                          $   432,935          402,464
 
     Liabilities and Stockholders' Equity
 
     Current liabilities:
       Accounts payable                             $21,181           19,898
       Accrued expenses                              14,391           13,502
       Income taxes payable                          14,806            3,179
          Total current liabilities                  50,378           36,579
 
     Deferred income tax liability                    6,627            6,627
 
     Stockholders' equity:
       Preferred stock                                    0                0
       Common stock, 50,000,000 shares authorized
        37,938,688 shares issued and outstanding        379              379
       Additional paid-in capital                     4,424            4,424
       Retained earnings                            372,572          355,248
       Accumulated other comprehensive loss          (1,445)            (793)
          Total stockholders' equity                375,930          359,258
 
          Total liabilities and
           stockholders' equity                 $   432,935          402,464
 
 
                       FASTENAL COMPANY AND SUBSIDIARIES
                      Consolidated Statements of Earnings
               (Amounts in thousands except earnings per share.)
 
                                    (Unaudited)
 
                                                       Three months ended
                                                            March 31,
                                                      2001             2000
 
     Net sales                                  $   201,016          176,268
 
     Cost of sales                                   96,411           84,081
              Gross profit                          104,605           92,187
 
     Operating and administrative expenses           71,559           60,152
              Operating income                       33,046           32,035
 
     Other income (expense):
        Interest income                                 651              639
        Loss on disposal of property and equipment      (85)             (78)
              Total other income (expense)              566              561
 
              Earnings before income taxes           33,612           32,596
 
     Income tax expense                              12,873           12,550
 
              Net earnings                      $    20,739           20,046
 
     Basic and diluted earnings per share       $       .55              .53
 
     Weighted average shares outstanding             37,939           37,939
 
 SOURCE  Fastenal Company