Melville, NY - MSC Industrial Direct Co., Inc. reported financial results for its fiscal third quarter ended May 31, 2014.
Net sales for the fiscal third quarter 2014 were $720.5 million, an increase of 13.1% over net sales of $636.9 million in the same quarter a year ago.
Adjusted operating income for the fiscal third quarter 2014 was $107.3 million, or 14.9% of net sales, compared to $106.6 million, or 16.7% of net sales in the same quarter a year ago. GAAP operating income for the fiscal third quarter 2014 was $104.9 million, or 14.6% of net sales, compared to $100.2 million, or 15.7% of net sales in the same quarter a year ago.
Excluding the after tax effects of non-recurring costs, adjusted net income for the fiscal third quarter 2014 was $66.2 million, or $1.06 per diluted share (based on 62.2 million diluted shares outstanding), compared to $66.7 million, or $1.05 per diluted share, in the same quarter a year ago (based on 63.1 million diluted shares outstanding). GAAP net income for the fiscal third quarter 2014 was $64.7 million, or $1.03 per diluted share, compared to $62.4 million, or $0.98 per diluted share, in the same quarter a year ago.
Erik Gershwind, President and Chief Executive Officer, stated, "Our strategic growth programs continued to drive share gains during our March through May third fiscal quarter against the backdrop of continued improvement in overall market conditions. We would characterize the current demand environment as one of moderate growth, despite the soft pricing environment."
Jeff Kaczka, Executive Vice President and Chief Financial Officer, commented, "We delivered adjusted EPS towards the higher end of our guidance, reflecting our ability to leverage our sales growth. With one quarter remaining in our fiscal 2014, we remain on-track to achieve an annual adjusted operating margin consistent with our fiscal 2014 operating framework, and our infrastructure and growth initiatives are progressing well and on schedule."
Mr. Gershwind concluded, "We are performing well against our strategic plan, executing on our critical growth and infrastructure initiatives and capitalizing on our share gain initiatives to improve revenue growth as the demand environment continues to firm. We are building an exciting story within the Class C Solutions Group and delivering against the financial commitments we set for the business. Additionally, we are moving our overall portfolio of business towards high retention channels including VMI, vending, Class C and mscdirect.com. All of this builds towards an exciting story for the coming years."
Outlook
MSC expects net sales for fiscal fourth quarter 2014 to be between $718 million and $730 million. At the midpoint, average daily sales growth is expected to be 7.5 percent, which includes CCSG sales that are expected to be growing at a lower rate than the MSC base business. The Company expects adjusted diluted earnings per share for the fiscal fourth quarter 2014 to be between $0.98 and $1.02.
The Company expects non-recurring integration costs related to the Class C Solutions Group ("CCSG") acquisition to impact GAAP diluted earnings per share by approximately 2 cents in the fiscal fourth quarter.
An explanation and reconciliation of the non-GAAP financial measures contained in this press release to the most directly comparable GAAP financial measures are included in the attached tables.
