News

Fastenal reports net sales increase for first quarter despite pandemic

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April 16, 2020

Fastenal, a provider of automated industrial supply distribution, reported net sales increased $57.7, or 4.4%, in the first quarter of 2020 compared to the first quarter of 2019 for the quarter ended March 31, 2020, according to a press release.

Compared to the first quarter of 2019, this increase was driven by higher unit sales related to the growth drivers, most notably contribution from industrial vending and onsite locations, and from increases in certain products later in the quarter related to the coronavirus pandemic.

A lesser contributor to sales growth in the first quarter of 2020 was higher product pricing as a result of increases implemented throughout 2019 and in the first quarter of 2020 to mitigate the impacts of general and tariff related inflation in the marketplace. Approximately 50% of the business relates to fastener and safety products. Together, these two product lines grew 4.3% on a daily basis.

First quarter business activity in January, February and the first half of March remained sluggish, as it had been through much of the latter half of 2019. The second half of March saw activity levels weaken significantly in response to societal actions meant to address the coronavirus pandemic.

While the company's facilities and in-market locations continued to operate, branches did restrict public access and many of onsite locations were closed or operated at a diminished capacity.

The company signed 4,798 industrial vending devices during the first quarter of 2020. The installed device count on March 31, 2020 was 92,124, an increase of 10.4% over March 31, 2019. Daily sales through vending devices grew at a low double-digit pace in the first quarter of 2020 over the first quarter of 2019 due to the increase in the installed base. These device counts do not include slightly more than 15,000 vending devices deployed as part of the lease locker program.

The company signed 85 new onsite locations (defined as dedicated sales and service provided from within, or in close proximity to, the customer's facility) during the first quarter of 2020. There were 1,179 active sites on March 31, 2020, which represented an increase of 24.8% from March 31, 2019. Daily sales through onsite locations, excluding sales transferred from branches to new onsites, grew at a mid-single-digit rate in the first quarter of 2020 over the first quarter of 2019.

New revenue from relatively new active locations continues to offset the impact of weak demand on more mature sites as well as the temporary closing of certain sites where customers suspended operations.