Fastenal Co. saw continued growth in its first quarter, driven by an increase in on-site industrial vending machines and stores.
Fastenal CEO Dan Florness told analysts on the company’s earnings call: “2019 has started where 2018 left off.”
The Winona-based wholesale distributor of industrial and construction supplies saw earnings grow faster than revenue in the quarter that ended March 31. Earnings were $194.1 million, or 68 cents per share, up about 11.5% from last year’s first quarter.
Revenue, meanwhile, increased 10.4% to $1.3 billion.
Fastenal’s revenue largely met analyst expectations, and earnings per share were a penny better than predictions among 17 analysts polled by Thomson Reuters.
The company’s stock increased 5% Thursday to close at $68.48 a share. For the past 52 weeks, Fastenal shares have traded between $47.37 and $69.20 per share.
One of the drivers of Fastenal’s growth since 2015 has been the performance of its Onsite locations, which are dedicated sales and service locations that are generally within a customer’s plans.
During the quarter, Fastenal signed 105 new Onsite locations, bringing the total active sites to 945 by the end of the quarter. Florness told the analysts on the call that he had confidence the sites would exceed 1,000 during the second quarter.
For the year, he expects 375 to 400 new Onsite locations, making them “truly part of Fastenal now.”
Customers understand the benefit of the Onsite locations. “It’s not something that we’re experimenting with or pushing people to change or even pushing customers to consider changing,” Florness added.
Sales through the Onsite locations grew more than 20% in the first quarter, compared with the same quarter last year. Sales through the industrial vending machines grew almost as quickly, the company said.
Fastenal also signed 5,603 industrial vending devices in the quarter, bringing the total to 83,410 machines at the end of the quarter — 13.4% more than at the end of the first quarter last year.