Fastenal Co.'s (FAST) fourth-quarter profit rose 46% as sales in
the hardware supplier's industrial segment surged following a
slowdown during the recession.
Shares slid 4% to $57.52 in premarket trading as earnings
slightly missed estimates. The stock is up 31% in the past
year.
Fastenal, which sells fasteners, office products and other
industrial and construction supplies, has seen results improve the
past several quarters as sales to manufacturing customers have
increased.
Sales rose 10% in the company's non-residential construction
segment, which has historically represented 20% to 25% of
Fastenal's business. The segment that sells parts to industrial
customers reported an 18% sales spike over the prior year, when
manufacturers were still severely cutting back production.
The company reported a profit of $65.2 million, or 44 cents a
share, up from $44.5 million, or 30 cents a share, a year earlier.
Revenue rose 20% to $573.8 million.
Analysts polled by Thomson Reuters projected earnings of 45
cents a share on $563 million in revenue.
Gross margin rose to 52% from 49.9% as vendor incentives
improved over 2009.
Investors briefly punished Fastenal shares in October after
third-quarter results beat expectations but margins declined from
the second quarter.
Fastenal opened 37 stores during the fourth quarter. The company
operated 2,490 stores as of the end of December, up from 2,453 the
prior year.
The company announced Monday it will pay a cash dividend of 50
cents a share on top of a special dividend of 42 cents a share
announced in November.
-By Drew FitzGerald, Dow Jones Newswires; 212-416-2909;
Andrew.FitzGerald@dowjones.com