Fastenal Company · NASDAQ:FAST
Fastenal — Q3 2022 Earnings Presentation
14 slides from Fastenal's earnings presentation, Oct 13, 2022
Slide 1: Third Quarter 2022 Investor Teleconference
THIRD QUARTER 2022 INVESTOR TELECONFERENCE OCTOBER 13, 2022 1
Slide 2: Safe Harbor Statement
SAFE HARBOR STATEMENT All statements made herein that are not historical facts (e.g., future operating results and business activity, as well as expectations regarding operations, including gross margin, future inventory levels, pricing, Onsite and weighted FMI device signings, the size of our U.S./
Slide 3: CEO Messages on 3Q22
CEO MESSAGES ON 3Q22 • We had a solid performance in 3Q22. Our 16.0% daily sales Daily Sales Rate (DSR) Growth growth was leveraged to 19.1% operating profit growth and, 20% ultimately, strong operating cash flow (54.1% growth). The 18.4% 18.0% 18% 16.0% Blue Team continues to execute well. 16% 14.6
Slide 4: 3Q22 Growth Driver Update
3Q22 GROWTH DRIVER UPDATE Onsite Signings and Active Locations • Onsites: We had 86 signings in 3Q22 and finished with 160 1,800 1,567 active sites, +14.6% from 3Q21. Daily sales, 1,567 140 1,600 excluding transferred branch sales, grew more than 20% 1,367 120 1,236 1,400 from 3Q21. Our 2022 goal re
Slide 5: 3Q22 Business Cadence
3Q22 BUSINESS CADENCE • U.S. Industrial Production rose 4.1% in July/August 2022 End Market Daily Sales Rate (DSR) Growth over 3Q21, and has been steady for the last five quarters. 40% U.S. PMI averaged 52.2 in 3Q22, consistent with further 28.9% 30% near term growth, albeit at moderating rates as t
Slide 6: 3Q22 Margin Summary
3Q22 MARGIN SUMMARY • Our 3Q22 operating margin was 21.0%, up 50 bps from Gross Profit Margin 50% 20.5% in 3Q21. Our incremental operating margin was 24.5%. Results reverted back to the pre-pandemic form of 46.3% strong growth from larger accounts driving both lower gross 45.9% 45.3% margin and high
Slide 7: 3Q22 Cash Flow Profile
3Q22 CASH FLOW PROFILE Operating Cash Flow • 3Q22 operating cash flow was $257.9, or 90.6% of net (in millions) earnings. The conversion rate is still below historical norms, 400 but it was the first year-to-year increase since 1Q21. This 350 130.5% was due to a moderation in our working capital inv
Slide 8: Appendix: Non-GAAP Financial Measures
APPENDIX Non-GAAP Financial Measures The appendix includes information on our Return on Invested Capital ('ROIC'), which is a non- GAAP financial measure. We define ROIC as net operating profit less income tax expense divided by average invested capital over the trailing 12 months. We believe ROIC i
Slide 9: Return on Invested Capital
RETURN ON INVESTED CAPITAL* Calculation of Return on Invested Capital Reconciliation of ROIC to Return on Assets (ROA) TTM TTM TTM TTM (Amounts in millions) 3Q22 3Q21 (Amounts in millions) 3Q22 3Q21 Operating Income $ 1,421.5 1,180.9 Net Earnings $ 1,072.5 889.9 Income Tax Expense (337.8) (281.5) To
Slide 10: Sequential Trends
SEQUENTIAL TRENDS* Cum. Cum. Cum. Cum. Daily Sales Rate Chg., Chg., Chg., Chg., (DSR) Jan. to Jan. to Jan. to Jan. to BENCHMARKS Jan.* Feb. Mar. Mar. Apr. May June Jun. July Aug. Sep. Sep. Oct. Oct. Nov. Dec. BENCHMARK** (0.1%) 0.8% 3.4% 4.1% 0.1% 2.2% 1.9% 8.5% (3.3%) 3.1% 3.4% 11.9% (2.1%) 9.5% (3
Slide 11: Employee Statistics
EMPLOYEE STATISTICS Absolute Count FTE Count (1) HEADCOUNT Change Change Change Change Change Change STATISTICS Since Since Since Since Since Since 3Q22 2Q22 2Q22 4Q21 4Q21 3Q21 3Q21 3Q22 2Q22 2Q22 4Q21 4Q21 3Q21 3Q21 In-market locations (branches & Onsites) 13,243 13,134 0.8% 12,464 6.3% 12,347 7.3
Slide 12: In-Market Location Statistics
IN-MARKET LOCATION STATISTICS Annual Quarterly 2016 2017 2018 2019 2020 2021 1Q22 2Q22 3Q22 4Q22 Starting Branches 2,622 2,503 2,383 2,227 2,114 2,003 1,793 1,760 1,737 Opened Branches 40 18 11 12 12 10 6 2 3 Closed/ Converted Branches (1) (159) (138) (167) (125) (123) (220) (39) (25) (24) Ending Br
Slide 13: End Market Profile
END MARKET PROFILE End Market Mix — Full Year 2021 Transportation/ Other, 3.0% Warehousing, 4.9% Gov't/Education, 4.6% Reseller, 7.5% Manufacturing, 41.9% Construction, 11.1% Mfg - Heavy Equip., 27.0% MAJOR SEGMENT GROWTH Year- to- Full (Daily Sales rates) Jan. Feb. Mar. Apr. May June July Aug. Sep.
Slide 14: Thank You
THANK YOU 14