Fastenal Co. is feeling a little more like its old self after reporting its best sales and earnings growth since the fourth quarter of 2014.
“The second quarter of 2017 felt more like Fastenal,” said Dan Florness, president and chief executive. “We have grown well over the last year, but market headwinds have masked this growth.”
The Winona-based distributor of construction and industrial supplies reported revenue of $1.1 billion, up 10.6 percent over the second quarter last year. Earnings were $148.9 million, or 52 cents per share, up 13.2 percent over last year.
The strong growth was better than analysts had expected. The consensus among 17 analysts tracked by Thomson Reuters was that the company would earn 50 cents per share. Fastenal also beat the consensus sales estimate.
Underlying market conditions also improved, leading to higher unit sales, the company said. Sales were particularly strong from the company’s installed base of industrial vending machines. The company also said it signed 68 new Onsite locations — where there is dedicated sales and service within a customer’s facility — in the second quarter compared to 44 signings in the second quarter of 2016.
Fastenal has a goal of signing 275 to 300 new Onsite locations this year, up from its current installed base of 486 locations.
The growth in the company’s Onsite locations is changing the company’s internal lingo. Instead of using the term “stores,” Fastenal now uses “in-market locations.” Florness told analysts on the company’s earnings call that the new terminology reflects the position that Fastenal is a service organization that is part of their customers’ supply chain.
Shares of Fastenal closed Wednesday at $44.72 per share, down 87 cents.
Year-to-date the company shares are down 5.6 percent.