CHICAGO—Grainger (NYSE: GWW) today reported results for the 2016 first quarter ended March 31, 2016. Sales of $2.5 billion increased 3 percent versus $2.4 billion in the first quarter of 2015. On a daily basis, sales in the quarter increased 1 percent versus the prior year. Net earnings for the quarter of $187 million were down 12 percent versus $211 million in 2015. Earnings per share of $2.98 declined 3 percent versus $3.07 in 2015.
The first quarter contained the following restructuring items:
|
Three Months Ended |
|||
|
2016 |
2015 |
% Change |
|
|
Diluted Earnings Per Share as reported: |
$2.98 |
$3.07 |
(3)% |
|
Restructuring (United States) |
0.16 |
||
|
Restructuring (Canada) |
0.04 |
||
|
Restructuring (Other Businesses) |
0.03 |
||
|
Subtotal |
0.20 |
0.03 |
|
|
Diluted Earnings Per Share as adjusted: |
$3.18 |
$3.10 |
3% |
“Revenue and share gains are tracking as we expected given the tough economic environment,” said Chairman, President and Chief Executive Officer Jim Ryan. “In our U.S. business, share gains with large and small businesses continue to outpace our performance with medium-sized customers. We continue to see price and gross margin pressure driven primarily by the low inflation economic environment and faster growth from lower gross margin customers. At the same time, we have reduced our operating expenses to offset some of the gross margin decline. In early February, we reached a significant milestone, successfully implementing SAP in Canada. We now have our North American business running on one platform, which will drive better service and increased productivity over time. In addition, I continue to be very pleased with the strong growth of our single channel businesses.” Ryan concluded, “Despite the current short-term uncertainty, we will continue to invest in the business to drive long term results.”
The company also narrowed its 2016 sales and earnings per share guidance for the year and now expects sales growth of 0 to 6 percent and earnings per share of $11.00 to $12.80. The company’s previous 2016 guidance, communicated on January 26, 2016, was sales growth of -1 to 7 percent and earnings per share of $10.80 to $13.00.
Company
Sales increased 3 percent and 1 percent daily in the 2016 first quarter versus the prior year.
Company operating earnings of $317 million for the 2016 first quarter declined 10 percent versus $351 million in the 2015 quarter. The decline was driven primarily by lower gross profit margins and $19 million in restructuring charges recorded in the quarter.
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