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FAST · FASTENAL CO

30 filings

10-K

FAST 10-K Annual Reports

FASTENAL CO - 30 annual reports

Filing record · 2016–202610-K1210-Q348-K100

2025
FASTENAL CO Annual Report, Year Ended Dec 31, 2025
Fastenal Company (FAST) reported strong performance in its 2025 10-K filing, demonstrating robust revenue growth of 8.7% to $8.2 billion, with daily sales increasing by 9.1%. This growth was primarily driven by market share gains, particularly with large key account customers and in fastener products, amidst a sluggish manufacturing environment and uncertain tariff landscape. The company effectively managed gross profit, which remained stable at 45.0% despite a shift towards lower-margin large accounts, while improving operating margins by 20 basis points through leveraged SG&A expenses. Strategic investments in technology and growth initiatives, including FMI (FASTVend, FASTStock, FASTBin) solutions and digital footprint expansion, continue to be a focus. The installed base of FMI devices grew by 7.6%, and the Digital Footprint accounted for 62.4% of sales in December 2025. Fastenal also saw meaningful growth in average spend per customer site, particularly for those exceeding $5k monthly. The company generated strong operating cash flow and maintained a healthy financial position, reflecting its resilience and strategic execution in a dynamic economic climate.
Feb 5, 2026
2024
FASTENAL CO Annual Report, Year Ended Dec 31, 2024
Fastenal Company (FAST) reported fiscal year 2024 results indicating modest sales growth of 2.7% year-over-year, reaching $7.55 billion. This growth occurred in a challenging economic environment, with industrial production declining and the ISM PMI consistently below 50. The company's strategy of focusing on key accounts and Onsite customer locations, alongside expansion in non-fastener products, particularly safety supplies, drove performance. However, this favorable mix, combined with product margin pressure, led to a slight contraction in operating margin. Investments in growth initiatives like Onsite locations and FMI technology continue, with a 11.5% increase in Onsite locations and a 12.2% rise in installed FMI devices (MEUs). The company maintained a strong balance sheet with solid cash flow from operations, though it was lower than the prior year due to increased inventory investment. Looking ahead, Fastenal anticipates continued growth in its in-market locations, driven by a stable branch network and further expansion of Onsite locations and global reach. The company is also investing in its digital capabilities to enhance customer value and supply chain visibility. Despite a softening manufacturing sector and a shift towards lower-margin non-fastener products, Fastenal's diversified customer base and focus on service and technology provide a resilient business model. Investors should monitor the company's ability to leverage its investments for improved profitability in the coming periods.
Feb 6, 2025
2023
FASTENAL CO Annual Report, Year Ended Dec 31, 2023
Fastenal Company reported net sales of $7.35 billion for the fiscal year ended December 30, 2023, representing a 5.2% increase over the previous year, driven by higher unit sales and pricing. Despite a challenging economic environment characterized by moderating industrial activity and some product deflation, particularly in fasteners, the company achieved stable operating profit margins. This was attributed to strategic investments in growth drivers like their key account model, Onsite locations, Fastenal Managed Inventory (FMI) devices, and digital footprint expansion, alongside disciplined control of discretionary expenses. Financially, Fastenal demonstrated strong operational cash flow, enabling a supplemental dividend payment in Q4 2023. The company continued to expand its network, with a 3.4% increase in total in-market locations due to growth in Onsite locations and international branches, which more than offset a decline in traditional branches. Management anticipates a reduction in traditional branch closures going forward as strategic rationalization efforts are largely complete. The company also highlighted its ongoing commitment to customer service and innovation as core to its strategy for sustained growth.
Feb 6, 2024
2022
FASTENAL CO Annual Report, Year Ended Dec 31, 2022
Fastenal Company (FAST) reported strong performance for the fiscal year ending December 31, 2022, with net sales increasing by 16.1% to $6.98 billion. This growth was driven by a combination of higher unit sales and incremental pricing actions taken earlier in the year, reflecting a normalization of business activity post-pandemic. The company saw healthy customer demand, particularly from manufacturing clients, though a moderation in demand was observed as the year progressed. Key growth drivers, such as Onsite and Fastenal Managed Inventory (FMI) solutions, showed improved "signings" (new agreements) compared to prior pandemic-affected years, approaching pre-pandemic levels. The company's strategic focus on "high-tech, high-touch" solutions continues to strengthen customer relationships and drive market share. While facing some headwinds in smaller non-North American markets due to geopolitical events and currency fluctuations, Fastenal's overall operational efficiency and digital footprint expansion contributed to margin improvement. The company remains committed to expanding its network and technological capabilities to further enhance customer value and drive long-term growth.
Feb 7, 2023
2021-A
FASTENAL CO Annual Report (Amendment), Year Ended Dec 31, 2021
Fastenal Company (FAST) filed Amendment No. 1 on Form 10-K/A on February 10, 2022, for fiscal year 2021. The amendment's stated purpose was to add the 2021 Annual Report to Shareholders as Exhibit 99.1, which was omitted from the original 10-K filed February 7, 2022, and to update Exhibit 10.4 (Non-Employee Director Stock Option Plan). The amendment itself contains no financial statements, so the financial results below come from the Annual Report exhibit. Fiscal 2021 was a solid year: net sales rose 6.4% to $6.01 billion, gross margin expanded to 46.2% from 45.5%, operating income grew 6.6% to $1.22 billion (20.3% margin), and net earnings increased 7.7% to $925.0 million, or $1.60 per diluted share. Cash generation weakened. Operating cash flow fell 30.1% to $770.1 million, and free cash flow declined 24.2% to $621.6 million, as working capital rose. Operational working capital assets (receivables and inventory) grew 15% to $2.42 billion, and the company did not repurchase any shares in 2021. Cash dividends totaled $643.7 million ($1.12 per share), about 70% of net earnings. Balance sheet strength remains high: total debt was $390 million against $3.04 billion of stockholders' equity and $4.30 billion of total assets. Management reported that the company's market capitalization exceeded $30 billion during the year. Strategically, management's focus is on its "Digital Footprint" (FMI Technology plus eCommerce), which reached 46.4% of sales in Q4 2021, up from 37.2% a year earlier. The company targets roughly 85% of sales from the Digital Footprint at $10 billion in annual revenue, and it is migrating U.S. branches to Customer Fulfillment Center (CFC) and Customer Service Branch (CSB) formats, with CFCs representing 66.8% of U.S. branches at year-end. Investors should weigh these productivity initiatives against the cash flow decline and the reduced buybacks.
Feb 10, 2022
2021
FASTENAL CO Annual Report, Year Ended Dec 31, 2021
Fastenal Company reported a 6.4% increase in net sales for 2021, reaching $6.01 billion. This growth was driven by strong demand from traditional manufacturing and construction customers, coupled with higher pricing. Despite supply chain disruptions, labor shortages, and inflation impacting business operations, the company's gross profit margin improved to 46.2% from 45.5% in the prior year, indicating effective cost management and pricing strategies. Net earnings saw a 7.7% increase to $925.0 million, translating to diluted EPS of $1.60. While growth drivers like Onsite locations and Fastenal Managed Inventory (FMI) device signings showed improvement, they remained below pre-pandemic targets due to customers prioritizing short-term crisis management. The company continues to focus on its 'high-tech, high-touch' strategy, leveraging its extensive in-market location network and digital solutions to enhance customer service and drive future growth.
Feb 7, 2022
2020
FASTENAL CO Annual Report, Year Ended Dec 31, 2020
Fastenal (FAST) closed 2020 with sales of $5.65 billion, up 5.9%, and net earnings of $859.1 million, up 8.6%, with diluted EPS of $1.49. The year was split sharply. Traditional manufacturing and construction demand fell, with fastener sales down 7.2%, while pandemic-driven demand for personal protective equipment (PPE) lifted safety supplies to 25.5% of sales from 17.9% in 2019. Gross margin compressed 170 basis points to 45.5%, reflecting lower-margin PPE mix and pandemic-era sourcing costs. Operating and administrative expense discipline (down 7.2% for the 'all other' bucket and roughly 2% in employee costs) kept operating margin roughly flat to up at 20.2%, versus 19.8% in 2019. The company's growth drivers did not contribute meaningfully. Onsite signings fell to 223 from 362, industrial vending signings fell 24.9% to 16,417, and sales through both channels declined at a low-single-digit rate. Branch count dropped again, by 111 net, to 2,003 public branches, while Onsite locations rose 13.6% to 1,265. Headcount fell 7.2% to 20,365 as management reduced costs. Cash generation was strong, with operating cash flow up 30.7% to $1.10 billion and free cash flow up 36.0% to $820.1 million. Management returned $855.4 million to shareholders, including a $0.40 special dividend, and funded the $125 million Apex vending-technology acquisition. For investors, the central question is durability. The 2020 earnings lift came from temporary PPE demand, while the company's structural growth engines (Onsite, vending, FMI) stalled under pandemic access restrictions. The 2021 outlook calls for net capex of $170-200 million, a 2021 Onsite signing goal of 375-400, and a new weighted FMI unit metric (23,000-25,000 MEUs). The balance sheet remains conservative, with $405 million of debt against a $700 million revolver and $245.7 million of cash, leaving ample flexibility.
Feb 8, 2021
2019
FASTENAL CO Annual Report, Year Ended Dec 31, 2019
Fastenal (FAST) closed 2019 with net sales of $5.33 billion, up 7.4% from $4.97 billion in 2018, and diluted EPS of $1.38, up 5.2%. Growth slowed sharply through the year: management describes daily sales growth moving from double digits in early 2019 to the mid-single digits by mid-year and about 1% in December. Gross margin fell 110 basis points to 47.2%, driven by mix shift toward lower-margin non-fastener products and national accounts, weaker freight absorption, and tariff-related cost inflation. Operating margin slipped to 19.8% from 20.1%, though operating and administrative expenses leveraged to 27.4% of sales from 28.2%, helped by slower headcount growth in branches. The company is deliberately reshaping its footprint toward its growth drivers. Onsite locations rose to 1,114 (up 24.6%) and industrial vending devices to about 90,000 product-revenue units (up 10.8%), while the traditional public branch count fell by 113 net to 2,114. Management says Onsite economics carry lower gross margins and a short-term drag on branch profitability, but a lower cost to serve and higher revenue per customer. Capital spending rose to $240 million net (4.5% of sales) to build out distribution and vending, exceeding the company's own target range. Balance-sheet and cash-flow metrics are solid. Operating cash flow was $843 million (106% of net earnings), and total debt fell to $345 million from $500 million. Dividends of $0.87 per share were paid, and no shares were repurchased in 2019 (4.8 million shares remain under authorization). The company declared a $0.25 quarterly dividend for 2020 and guided 2020 net capital expenditures to $180-205 million. Key risks flagged include tariffs on Chinese-sourced product, the cyclical industrial and manufacturing end markets, competition from e-commerce, and the margin pressure from Onsite growth.
Feb 6, 2020
2018
FASTENAL CO Annual Report, Year Ended Dec 31, 2018
Fastenal Company (FAST) reported a strong 2018, with net sales rising 13.1% to $4,965.1 million and diluted EPS up 30.5% to $2.62. Operating income was roughly flat as a share of sales at 20.1%, but the operating income dollar figure grew 13.3% to $999.2 million. Net earnings grew 29.9% to $751.9 million, though this was amplified by the lower tax rate under the Tax Act; management excludes the Tax Act effect, under which 2018 net earnings would have been $625.2 million (up 12.8%). Growth was driven by volume rather than price, with fastener sales growing 11.2% and non-fastener sales 14.7%, and by growth drivers such as Onsite locations (up 47.8% to 894), industrial vending devices (up 13.6% to about 81,000 installed), and national accounts (51.2% of sales). The key concern for investors is margin pressure. Gross margin fell 100 basis points to 48.3%, driven by product and customer mix shifts toward lower-margin national accounts and non-fastener products, rising freight costs, and steel and product inflation that price increases did not fully offset. Operating and administrative expenses improved to 28.2% of sales from 29.2%, which kept operating margin stable. Working capital absorbed cash: operational working capital grew 17.2%, inventory rose 17.0%, and receivables grew amid customers stretching payment terms. Operating cash flow fell to 89.7% of net earnings from 101.1%. Total debt rose to $500 million, and management expects 2019 net capital expenditures of $195 to $225 million. Fastenal also reported a net decline of 156 traditional branches in 2018, continuing a trend since 2013, as the company shifts resources toward Onsite, vending, and national accounts. The adoption of ASC 842 in 2019 is expected to add roughly $250 million to both assets and liabilities. Investors should weigh the strength of the growth drivers and volume momentum against the gross margin erosion and the rising working capital needs.
Feb 6, 2019
2017
FASTENAL CO Annual Report, Year Ended Dec 31, 2017
Fastenal (FAST) closed 2017 with net sales of $4,390.5 million, up 10.8% from $3,962.0 million in 2016, and diluted EPS of $2.01 versus $1.73. Net earnings rose 15.8% to $578.6 million. Pre-tax earnings grew 10.6% to $873.1 million, and operating margin held flat at 20.1%. Gross margin slipped 30 basis points to 49.3%, which management attributes mainly to mix: slower growth in higher-margin fasteners, faster growth in lower-margin national accounts and Onsite business, and the Mansco acquisition. Results include a net $24.4 million discrete tax benefit from the Tax Act, so the effective tax rate fell to 33.7% from 36.8%. Excluding the Tax Act, net earnings would have been about $554.2 million (up 11.0%) and diluted EPS $1.92. Management guided its 2018 tax rate to 24%–26%. The growth engine has shifted away from traditional branches. The company opened 18 public branches and closed 130 in 2017, leaving 2,383, and has had net branch declines every year since 2013. Growth is coming from alternative channels: Onsite locations rose 51% to 605, industrial vending reached about 71,000 product-revenue devices, and national accounts reached 48.7% of sales. Management says it expects 1,000 Onsite locations and 100,000 vending devices within 12 to 18 months. These channels carry lower gross margins but lower cost to serve, so the margin trade-off is central to the investment case. The balance sheet remains conservative, with $415.0 million of debt against $2.1 billion of equity. Operating cash flow was $585.2 million and free cash flow $405.9 million. Capital spending was $112.5 million net, and shareholder returns totaled $451.7 million, including a $0.37 quarterly dividend declared for 2018. Key risks include gross margin pressure from mix, cyclicality tied to manufacturing and non-residential construction, rising operating costs from Onsite expansion, and exposure to trade policy changes and foreign-sourced products.
Feb 5, 2018
2016
FASTENAL CO Annual Report, Year Ended Dec 31, 2016
Fastenal (FAST) reported 2016 net sales of $3.96 billion, up 2.4% from $3.87 billion in 2015, but net earnings fell 3.3% to $499.5 million and diluted EPS fell 2.3% to $1.73. The decline was driven mainly by gross margin compression: gross margin dropped to 49.6% from 50.4%, its first annual reading below 50% in ten years, as sales mix shifted away from higher-margin fasteners toward non-fastener products and larger national accounts. Operating and administrative expenses rose to 29.5% of sales from 29.0%, largely from industrial vending equipment, headcount, health care, and IT costs. Operating margin fell to 20.1% from 21.4%. Management acknowledged it did not manage store occupancy expense well and plans to address it in 2017 and 2018. The balance sheet and cash generation remain solid but more leveraged. Total debt rose to $390 million from $365 million, and the company returned $406 million to shareholders through dividends and buybacks, down from $620 million in 2015 when it repurchased 7.1 million shares. Operating cash flow was $514 million. Inventories grew 8.7% and receivables 6.7%, outpacing sales, and capital expenditures were $183 million, mainly for industrial vending machines and distribution automation. Demand indicators were mixed: fastener sales declined 2.3% for the year, non-fastener sales grew 5.0%, and daily sales to vending customers grew in each quarter. The company also reduced its store count to 2,503 from 2,622 and cut headcount by about 1,100. For investors, the key questions for 2017 are whether gross margin stabilizes, whether management can control occupancy and operating expenses, and whether industrial vending (62,800 installed units, up 13%) and Onsite locations (401, up 52%) can drive growth as the traditional store network matures. The company raised its quarterly dividend to $0.32, and management guided to growing sales and earnings in 2017.
Feb 6, 2017
2015
FASTENAL CO Annual Report, Year Ended Dec 31, 2015
Fastenal's FY2015 10-K shows a year of slowing growth and margin pressure, even as the company kept investing in its store-based model. Net sales rose 3.6% to $3.87 billion, but daily sales growth decelerated sharply through the year, turning negative by late 2015 as oil and gas customers pulled back and the weakness spread to manufacturing and non-residential construction. Net earnings grew 4.5% to $516 million and diluted EPS rose 6.6% to $1.77, helped by operating expense discipline and a 7.1 million-share buyback that reduced the share count. Gross margin fell to 50.4% from 50.8% on customer and product mix shifts and a weak fourth quarter, while operating and administrative expenses improved to 29.0% of sales from 29.8%, leaving operating margin roughly flat at 21.4%. Management invested through the downturn, adding 2,329 employees (up 12.6%), signing 82 Onsite locations, growing industrial vending to 55,510 devices (up 18.5%), and converting about 800 stores to the CSP 16 same-day inventory format. Store openings were modest, with 41 opened and 50 closed, leaving 2,622 stores at year end. Capital allocation shifted toward shareholder returns: total dividends and buybacks reached $620 million, or 120% of net earnings, funded partly by $260 million of net borrowings. The year-end balance sheet still looks sound, with total debt of $365 million against $1.8 billion of equity and operating cash flow of $547 million. For investors, the key questions are whether the sales slowdown reflects a cyclical trough or a structural shift in demand, and whether the rising headcount and inventory investment (CSP 16) will drive returns once industrial activity recovers. The company is also carrying higher leverage to fund buybacks at a time when its gross margin is under pressure, so near-term earnings sensitivity to volume is elevated.
Feb 5, 2016
2014
FASTENAL CO Annual Report, Year Ended Dec 31, 2014
Fastenal (FAST) closed 2014 with record results: net sales rose 12.2% to $3.73 billion, net earnings grew 10.1% to $494 million, and diluted EPS reached $1.66. Growth re-accelerated through the back half of the year, with daily sales growth in the double digits from March onward, driven by store-level selling energy, the expansion of store labor hours and district/regional leadership, and FAST Solutions industrial vending. Vending is becoming a meaningful growth engine: 46,855 devices were installed at year end, up from 40,775, and sales to vending customers grew about 20%. Margins were the soft spot. Gross profit as a percentage of sales fell to 50.8% from 51.7%, driven by customer and product mix, a deliberate push toward larger stores (the 'Pathway to Profit' strategy), and seasonal Q4 pressure. Operating and administrative expenses improved only slightly as a share of sales (29.8% vs. 30.3%), so pre-tax margin slipped to 21.1% from 21.5%. Management acknowledged that miscellaneous expenses rose and that the cost discipline it expects going forward was lacking for much of the year. Capital spending was heavy but declining from its 2013 peak, and free cash flow rose 44.6% to $310 million. Operating cash flow was 101% of net earnings. The company remains conservatively financed but is taking on more leverage: it drew $90 million on its credit facility, which it expects to repay within twelve months, and it has expanded the facility to $230 million. Management also closed 73 stores in 2014 (per the store table; the text also describes roughly 52 closures in the second half) to consolidate locations, and it increased its buyback authorization to 2 million shares in January 2015. Investors should weigh the strong cash generation and growth runway against the margin pressure from store-size and mix shifts, rising operating costs, and the rising capital intensity of vending and automation.
Feb 5, 2015
2013
FASTENAL CO Annual Report, Year Ended Dec 31, 2013
Fastenal (FAST) closed 2013 with net sales of $3.33 billion, up 6.1% from $3.13 billion in 2012, and net earnings of $448.6 million, up 6.7%. Diluted EPS rose to $1.51 from $1.42. Growth came mainly from higher unit volume at older stores, with store openings slowing to about 2% of the base (53 net new stores in 2013). Management is shifting spending toward store headcount, distribution automation and FAST Solutions industrial vending, which pushed operating and administrative expenses up 7.0% against sales growth of 6.1%. Pre-tax margin held at 21.5%, flat year over year, as gross margin edged up to 51.7% from 51.5%. The filing shows a company in a deliberate investment phase. Average daily sales growth slowed through 2013, from roughly 6.5% in Q1 to a weak spring and a sharp July/December pause, while heavy machinery manufacturers (about one-fifth of the business) remained weak. Management says daily sales trends improved after September 2013, and it added 1,407 store personnel from May to December. Industrial vending installations reached 33,920 equivalent machines, and vending customers now account for more than a third of total sales. Vending also weighs on occupancy costs, which rose 11.2%, and capital spending nearly doubled to $201.6 million. Balance sheet and cash flow remain strong. Operating cash flow was $416 million, and the company paid $237 million in dividends ($0.80 per share for 2013, after the $1.24 total in 2012 that included a $0.50 supplemental payment). It holds $58.5 million in cash and no outstanding borrowings under its $125 million credit facility. Inventory of $784 million and receivables of $414 million grew faster than sales, and the sales-to-AR-and-inventory ratio slipped to 2.8:1 from 2.9:1. Investors will be watching whether the 2013 store-hiring and vending investments turn into faster same-store growth and margin recovery in 2014.
Feb 6, 2014
2012
FASTENAL CO Annual Report, Year Ended Dec 31, 2012
Fastenal's 2012 10-K shows a company that grew sales 13.3% to $3.13 billion and net earnings 17.5% to $420.5 million, with pre-tax margin reaching 21.5%, the highest in company history. Growth was driven mainly by higher unit sales at older stores and by the rapid expansion of FAST Solutions industrial vending, which reached 20,162 machines signed in 2012, up from 7,842 in 2011. Gross margin slipped slightly to 51.5% from 51.8%, so the profit gain came from expense control: operating and administrative expenses rose only 9.5% against 13.3% sales growth. Management said the 2012 margin gain was made possible entirely by that expense discipline. The company is pursuing its 'pathway to profit' strategy, which slows new store openings (about 3% growth in 2012, with 65 to 80 planned for 2013) while adding sales specialists. Management now believes its 23% pre-tax margin goal can be reached at average store sales of $100,000 to $110,000 per month, down from the original $125,000 target, with the timeline shortened to 2013. The company's 2012 average monthly store sales were $83,098 in Q4, so this remains a meaningful execution hurdle. Sales growth slowed sharply from about 20% in early 2012 to single digits by late 2012, and the filing attributes part of the weakness to political uncertainty and Hurricane Sandy. Capital intensity and cash returns rose in 2012. Net capex was $133.9 million, with 2013 guidance of about $186.5 million, mainly for vending equipment and distribution automation. Dividends totaled $367.3 million, or $1.24 per share, including a $0.50 special dividend paid in December. Management signaled a smaller quarterly dividend in early 2013 ($0.10 declared), and it opened a $125 million credit facility to fund the cash needs of expansion and the large year-end payout. Operating cash flow was $396.3 million, and the balance sheet remained strong with $1.56 billion of equity.
Feb 7, 2013
2011
FASTENAL CO Annual Report, Year Ended Dec 31, 2011
Fastenal (FAST) closed 2011 with a strong year: net sales rose 21.9% to $2.77 billion, up from $2.27 billion in 2010, and net earnings grew 34.9% to $357.9 million, or $1.21 per diluted share. Pre-tax margin expanded 180 basis points to 20.8%, driven by good sales growth and tight expense control, while gross margin was essentially flat at 51.8%. Growth came mainly from higher unit sales at older stores, with same-store daily sales growth of roughly 15-18% across store age cohorts, and from non-store initiatives such as national accounts, government sales, and FAST Solutions industrial vending. Management continued its "pathway to profit" strategy, slowing new store openings (122 opened in 2011, about 5% growth, with 100-150 planned for 2012) while adding sales specialists. The company now believes it can reach its 23% pre-tax earnings target with average monthly store sales of $100,000-$110,000, rather than the original $125,000, and is targeting 2013 for that goal. Vending installations ramped sharply, with about 7,453 machines installed by year-end, and the company reports that 88% of sales now flow through stores. Investors should weigh the strong earnings momentum against a meaningful rise in working capital, with receivables up 25% and inventory up 16%, and capital expenditures nearly doubling to $116 million, mostly for vending equipment and distribution expansion. The balance sheet remains conservative, with no debt drawn on a small $8 million credit line, $117.7 million in cash, and $1.46 billion in equity. Shareholder returns came through dividends of $0.65 per share (about $192 million), with no buybacks in 2011 and 1.8 million shares still authorized. The 2010 supplier lawsuit, which sought $180 million, is considered remote by management following favorable rulings, with appeals pending.
Feb 9, 2012
2010-A
FASTENAL CO Annual Report (Amendment), Year Ended Dec 31, 2010
Fastenal's 2010 results show a strong rebound from the 2009 downturn. Net sales rose 17.6% to $2,269.5 million, and net earnings rose 43.9% to $265.4 million, or $1.80 per share, versus $1.24 in 2009. Gross margin improved to 51.8% from 50.9%, and pre-tax earnings reached $430.6 million, or 19.0% of sales, up from 15.4%. Management attributes the gains to sales growth, expense control, and margin improvement. Non-payroll expenses fell 1.8%, while total expenses grew 8.5%, well below sales growth. Growth drivers included the Fastenal Automated Supply Technology (FAST) vending program, national accounts, government sales, and international operations. International revenue grew 35% to more than $200 million, and the company entered Panama and the United Kingdom. Manufacturing revenue grew 29% to $91 million. The company opened 127 stores in 2010 (45 in the first half and 82 in the second half), bringing the total to 2,490, and added more than 150 sales specialists. Inventory rose 9.6% to $557.4 million, slower than sales growth. Management reaffirmed its 'pathway to profit' target of a 23% pre-tax margin, now expected by about 2013 at average monthly store sales of $100,000 to $110,000. Capital returns were generous. Total 2010 dividends were $1.24 per share, including a $0.42 special dividend, and the company declared a $0.50 quarterly dividend in January 2011. No shares were repurchased in 2010, leaving authority for 900,000 shares. This filing is Amendment No. 1 to the Form 10-K and was filed solely to add Exhibit 13 (the 2010 Annual Report to Shareholders), which was omitted from the original filing. It does not change the financial statements or other disclosures.
Feb 10, 2011
2010
FASTENAL CO Annual Report, Year Ended Dec 31, 2010
Fastenal Company's 2010 10-K filing reveals a company in recovery mode following the 2009 economic downturn. Net sales rebounded significantly, growing by 17.6% to $2.27 billion, driven by increased unit sales at older store locations and partially offset by a continued decrease in construction market sales. The company's 'Pathway to Profit' strategy, focusing on leveraging cost structures and optimizing store operations, appears to be gaining traction as profitability improved from the previous year. Despite the recovery in sales, the company faced challenges including a decrease in gross profit margins compared to 2008, attributed to deflationary price changes in 2009 that impacted inventory valuation. However, margins began to recover in 2010. Fastenal also continued its expansion efforts, planning to open 150-200 new stores in 2011, indicating a strategic push for future growth. The company also settled a significant legal matter with the DOJ for $6.25 million, mitigating a potential protracted dispute.
Feb 9, 2011
2009
FASTENAL CO Annual Report, Year Ended Dec 31, 2009
Fastenal's 2009 10-K shows a sharply weaker year driven by the North American industrial and construction downturn. Net sales fell 17.5% to $1.93 billion from $2.34 billion, and net earnings dropped 34.1% to $184.4 million, or $1.24 per diluted share, from $279.7 million ($1.88). Gross margin compressed to 50.9% from 52.8%, reflecting steel-driven deflation, aggressive competitive pricing in the first half, and reduced supplier volume rebates. Management cut operating and administrative expenses 12.6% through lower headcount, reduced incentive pay, and a slowdown in new store openings to 2%-5% from the historical 7%-10%, which helped protect profitability in a sharp downturn. The balance sheet and cash generation remained strong. Operating cash flow was $306.1 million, or 166% of net earnings, driven by a $55.8 million (9.9%) reduction in inventory and a lower receivables balance. Capital expenditures fell to $52.5 million from $95.3 million, and Fastenal ended the year with no debt, $164.9 million in cash, and $30.6 million in marketable securities. Dividends were maintained and raised, with a $0.40 semi-annual dividend declared for early 2010 (up from $0.35 in 2009's first payment), and 1.1 million shares were repurchased in the fourth quarter. Management says the 'Pathway to Profit' strategy is delayed by 24 to 30 months, but it remains intact. Management expects a return to the 7%-10% store-opening rate in the second half of 2010 and sees daily sales trends improving since the July 2009 trough, with December 2009 daily sales down 8.6% year over year. The company also completed the small Holo-Krome acquisition in December 2009 and disclosed a late-filed, low-materiality supplier exclusivity claim (under $1 million in purchases).
Feb 9, 2010
2008
FASTENAL CO Annual Report, Year Ended Dec 31, 2008
Fastenal (FAST) closed 2008 with record results despite a sharp late-year slowdown. Net sales rose 13.5% to $2.34 billion, and net earnings grew 20.2% to $279.7 million, or $1.88 per diluted share. Gross margin expanded to 52.8% from 50.8% in 2007, driven by pricing discipline, direct sourcing, and the freight initiative. Operating and administrative expenses grew 17.0%, faster than sales, reflecting payroll incentives, fuel-driven transportation costs, and a $10 million legal settlement. Management hit its 2008 pathway-to-profit target of a one-point pretax margin improvement, but sales growth decelerated sharply from October, with December daily sales essentially flat year over year. The company is shifting its growth engine from store openings toward adding outside sales staff to existing stores. New store openings slowed to 161 in 2008 (about 7.5% store count growth) versus a historical 13-18% pace, and the company is funding outside sales hiring with the savings. Balance sheet strength is solid: cash and equivalents rose to $85.9 million, there is no debt drawn on the $40 million credit line, and operating cash flow was $259.9 million. Inventory grew 11.8% against 13.5% sales growth, and the company acknowledged it was higher than expected. Dividends were raised substantially, with total 2008 payouts of $0.79 per share including a special dividend, and the board declared a $0.35 semi-annual dividend in January 2009. Investors should weigh the strong structural execution against the cyclical risk now visible in the fourth-quarter trend, which the filing itself flags as the weakest period in the company's history.
Feb 20, 2009
2007
FASTENAL CO Annual Report, Year Ended Dec 31, 2007
Fastenal Company (FAST), a North American wholesale distributor of industrial and construction supplies, closed fiscal 2007 with net sales of $2.06 billion, up 14.0% from $1.81 billion in 2006. Net earnings rose 16.9% to $232.6 million, or $1.55 per diluted share, and pretax margin expanded to 18.3% from 17.7%. Growth was driven by a combination of new store openings (161 in 2007, versus 245 in 2006) and same-store sales gains, with the company's store count reaching 2,160 across North America and select international markets. Daily sales growth decelerated through the year, from 12.6% in January to a low of 13.7% in Q3 before recovering to 16.8% in December, reflecting a softening industrial economy in 2007. The most significant strategic development is the 'Pathway to Profit' initiative introduced in April 2007. Management is shifting its growth engine from store openings (historically 13% to 18% annually) to a 7% to 10% rate of new stores, redirecting the cost savings toward adding outside sales personnel to existing stores. The stated goal is to raise average monthly store sales from roughly $80,000 to $125,000 over five years and expand the pretax margin from about 18% to 23%. Management also noted that the strategy has not yet been proven over the long term, and that the a la carte store expansion and the master stocking hub both carry execution risk. Financially, operating cash flow improved sharply to $227.9 million from $97.9 million, aided by slower inventory growth (up 10.7%, below sales growth of 14.0%). The company repurchased 2.086 million shares for $87.3 million and paid $66.2 million in dividends, with a semi-annual dividend of $0.25 declared for early 2008. Key risks include sensitivity to economic downturns, rising steel and diesel fuel costs, and a pending putative class action alleging misclassification of Assistant General Managers under FLSA and California law, which management says it cannot yet estimate. The annual sales-to-accounts-receivable-and-inventory ratio was 2.8:1, below management's 3.0:1 target.
Feb 21, 2008
2006
FASTENAL CO Annual Report, Year Ended Dec 31, 2006
Fastenal Company (FAST) closed 2006 with net sales of $1.809 billion, up 18.8% from $1.523 billion in 2005, and net earnings of $199.0 million, up 19.3%, or $1.32 per diluted share. Growth was driven by continued expansion to 2,000 store sites (245 opened in 2006, 14% more locations) and solid unit growth in stores older than two years, though management described 2006 as a softer year, with sales slowing in the second half as the North American economy weakened. Gross margin improved to 50.2% from 49.8%, helped by the freight initiative and direct sourcing, while operating and administrative expenses rose to 32.5% of sales from 32.2%, partly due to the CSP2 store conversions and rising fuel and occupancy costs. The key concern for investors is working capital. Inventory rose 26.1% (about $94 million) versus 18.8% sales growth, and operating cash flow fell to $97.9 million from $121.9 million. Management acknowledged the inventory build was poorly executed, particularly in Q4, and cited an Indianapolis stocking expansion and the CSP2 conversions as drivers. The ratio of annual sales to accounts receivable plus inventory slipped to 2.7:1 from 2.8:1, below the 3.0:1 target management associates with a roughly 20% after-tax return on assets. Management expects to slow inventory growth in 2007, and the company remains financially strong, with no debt outstanding, $1.0 billion in stockholders' equity, and a semi-annual dividend increased to $0.21 per share. Overall, the filing shows a high-quality, highly profitable distributor still growing rapidly, but with near-term execution risk around inventory and a slowing economic backdrop. Investors should watch 2007 inventory turns, the performance of the new CSP2 and CSP3 formats, and whether sales growth holds up as the economy softens.
Feb 23, 2007
2005
FASTENAL CO Annual Report, Year Ended Dec 31, 2005
Fastenal Company (FAST) closed 2005 with a strong year: net sales rose 23.0% to $1.523 billion and net earnings grew 27.4% to $166.8 million, or $1.10 per share. Gross margin edged up to 49.8% from 49.7%, and operating and administrative expenses fell to 32.2% of sales from 32.9%, showing operating leverage as the company added stores. Operating cash flow more than doubled to $121.9 million from $57.4 million, helped by working capital discipline. Accounts receivable grew only 13% against 23% sales growth, and inventory grew 17.6%, though above the company's 15% internal goal. The growth engine remains store expansion. Fastenal opened 222 stores in 2005, bringing the total to 1,755 across North America, and management targets 13% to 18% annual store growth toward an estimated potential of 3,500 North American stores. New stores take nine to 12 months to reach their first profitable month, so near-term margins are pressured by store openings. Same-store sales growth for stores older than two years was 15.6%, though growth in mature stores slowed to 12.0% from 15.3%, reflecting the sensitivity of established locations to the economic cycle. Management also launched CSP2, an expanded store format, converting 30 stores by year-end, and centralized accounts receivable collections and freight operations. Risks to note include the unproven long-term economics of the CSP and CSP2 formats, rising steel and fuel costs, dependence on the pace of new store openings, and competition in a consolidating industry. Hurricanes Katrina and Rita disrupted operations in the third quarter, though they also temporarily boosted sales. The board raised the semi-annual dividend to $0.20 per share from $0.155 previously, and the company repurchased 700,000 shares in April 2005. Overall, the filing points to a company executing consistently on its store-based growth model with improving efficiency, while the main investor questions center on the durability of growth in mature stores and the returns from new formats.
Feb 23, 2006
2004
FASTENAL CO Annual Report, Year Ended Dec 31, 2004
Fastenal Company (FAST), a North American wholesale distributor of industrial and construction supplies, delivered a strong 2004. Net sales rose 24.5% to $1.238 billion, and net earnings climbed 55.7% to $131.0 million, lifting diluted EPS to $1.72 from $1.11. Management attributes the earnings leap mainly to efficiency gains from its Customer Service Project (CSP) store-format upgrade, which lifted sales per store employee by more than 30% since May 2002, along with a 200-basis-point-plus expansion in gross margin to 50.4%, driven by steel-driven price increases and vendor incentives. Operating leverage was also visible, with operating and administrative expenses falling to 33.6% of sales from 35.5%. The key watch items for investors are working capital and cash generation. Inventory grew 32% to $307 million, operating cash flow fell to $57.4 million from $90.6 million, and cash and marketable securities declined, even as the company raised its dividend to $0.40 per share from $0.21. Management expects inventory to keep growing in 2005 as CSP shifts the stocking mix toward stores, and it has guided to roughly $52 million in 2005 capital expenditures. Network expansion continued, with 219 new stores opened in 2004 (1,533 total) and a stated plan to open 13 to 18% more per year. The filing also flags inflation-driven import cost pressures (about 40% of fasteners are imported) and steel-price exposure as risks to margins. Overall, the filing describes a company executing well on store productivity and profitability, with a balance sheet that is strong but increasingly consumed by inventory investment. Investors will want to monitor whether inventory turns stabilize as CSP matures and whether gross margin gains from 2004's steel-price environment can be sustained.
Mar 1, 2005
2003
FASTENAL CO Annual Report, Year Ended Dec 31, 2003
Fastenal Company (FAST) closed 2003 with net sales of $994.9 million, up 9.9% from $905.4 million in 2002 (12.0% growth excluding the divested Do-It-Yourself business). Net earnings rose 11.4% to $84.1 million, and diluted EPS was $1.11 versus $1.00 in 2002. Gross margin slipped to 49.2% from 49.5%, but operating and administrative expenses fell to 35.5% of sales from 37.0%, which drove the faster earnings growth. Management attributed the margin pressure to lower vendor incentive savings tied to slower inventory growth, large low-margin accounts, and product mix. The company's growth engine remains its store network, which reached 1,314 locations after 151 openings in 2003, with guidance for 12% to 16% annual store growth (160 to 210 new stores in 2004). Stores more than five years old grew only 3.3% in 2003, while younger stores grew faster, and management noted that new stores typically take nine to 12 months to reach their first profitable month. The main capital-intensive initiative is the Customer Service Project (CSP), which shifts inventory toward stores and raised store inventory by $28 million in 2003. Inventory growth was held to $16 million net, and operating cash flow recovered to $90.6 million from $17.6 million in 2002. The balance sheet remains very strong, with $71 million in cash and marketable securities, no bank debt outstanding on the $15 million credit line, and total stockholders' equity of $576.7 million. The company declared a semi-annual dividend of $0.15 per share and paid $0.21 in 2003, up sharply from $0.05 in 2002. Key risks noted in the filing include economic cyclicality (especially for mature stores), execution risk from the CSP rollout, gross margin pressure from vendor incentive trends, and foreign expansion, which remains small at under 5% of sales.
Feb 25, 2004
2002
FASTENAL CO Annual Report, Year Ended Dec 31, 2002
Fastenal Company (FAST) reported fiscal 2002 results that showed modest top-line and bottom-line growth in a difficult industrial economy. Net sales rose 10.7% to $905.4 million from $818.3 million, and net earnings increased 7.7% to $75.5 million, or $1.00 per share. Results were helped by a $5.9 million pre-tax gain on the sale of the Do-It-Yourself (DIY) business to The Hillman Group, and were partly offset by roughly $4 million of unexpected general self-insured claim reserve adjustments recorded in the fourth quarter. Gross margin compressed to 49.5% from 50.4% in 2001, and operating and administrative expenses rose to 37.0% of sales from 36.7%, so earnings grew more slowly than sales. Sales growth decelerated through the second half of the year, with daily sales growth slowing in July and rebounding into November before slipping in December. The key strategic development is the Customer Service Project (CSP), a re-merchandising initiative that stocks a broader inventory in stores in an open-floor, self-service format. By year-end 155 stores operated under CSP, and management plans to convert about 80 stores per month and open all new stores in CSP format in 2003. CSP drove a 42.3% increase in inventory to $217.3 million, which reduced operating cash flow to just $17.8 million from $91.7 million in 2001. The company continues to expand, opening 144 stores in 2002 to reach 1,169 locations across the U.S., Canada, Puerto Rico, Mexico and Singapore, and it targets 14% to 16% annual store growth. The balance sheet remains conservative, with no outstanding bank debt, a $15 million line of credit unused, and stockholders' equity of $499.9 million. The company also raised its annual dividend to $0.06 per share. For investors, the central questions are whether CSP will lift same-store sales and returns enough to justify its inventory and capital investment, and whether margins can stabilize as the new format matures. The 2002 filing shows a company with strong growth momentum and a healthy balance sheet, but with near-term cash flow pressure and margin headwinds from the CSP rollout, which management characterizes as an investment in future growth.
Feb 26, 2003
2001
FASTENAL CO Annual Report, Year Ended Dec 31, 2001
Fastenal Company (FAST), a Nasdaq-listed industrial and construction supplies distributor, reported a challenging 2001 in its 10-K filed March 4, 2002. Net sales rose 8.3% to $818.3 million (including an August 2001 acquisition of Textron's DIY fastener business, which contributed $8.5 million), but net earnings fell 13.2% to $70.1 million and diluted EPS dropped to $1.85 from $2.13. Growth slowed sharply through the year: daily sales growth on the existing base bottomed at negative 0.3% in November, and sales to some large manufacturing customers fell more than 30%. Management attributed the earnings decline to slower sales, gross margin compression from product mix (gross margin fell to 50.4% from 51.4%), higher operating and administrative expenses (36.7% of sales vs. 34.2%), and the costs of opening 128 new stores, which lifted the store count to 1,025. The balance sheet remained strong. Stockholders' equity grew 18.3% to $424.9 million, the company carried no funded debt apart from a $6.5 million industrial revenue bond, and operating cash flow improved sharply to $91.7 million as working capital needs eased. Management expects roughly $30 million in 2002 capital expenditures and plans to keep expanding in the U.S., Canada, Puerto Rico, Mexico and Singapore, targeting 2,000 to 2,200 total stores over time. The dividend was raised to $0.10 per share for 2002 (from $0.09), and the company says it expects to continue paying comparable cash dividends. For investors, the key takeaways are a company still growing its store network at 10 to 15% per year, with strong returns on capital and a clean balance sheet, but facing a cyclical slowdown in industrial demand that compressed margins and earnings in 2001. The filing's near-term outlook hinges on whether store-level sales recover, since management says new stores take nine to 12 months to reach their first profitable month and that near-term profitability is pressured by openings. The Company also noted it had no legal proceedings and no changes in accountants.
Mar 4, 2002
2000
FASTENAL CO Annual Report, Year Ended Dec 31, 2000
Fastenal Company (FAST) reported a strong fiscal 2000, with net sales rising 22.4% to $745.7 million from $609.2 million in 1999, and net earnings growing 23.3% to $80.7 million, or $2.13 per diluted share. Gross margin was 52.1% (versus 52.4% in 1999), and operating and administrative expenses fell to 34.7% of sales from 35.1%, which lifted operating income to $129.6 million. Growth came mainly from new store openings, same-store unit growth, and newer product lines, which now make up 35.5% of sales. Management tempered the picture by noting price deflation in the first half of 2000 and a slowdown in manufacturing activity among its U.S. and Canadian customers. The balance sheet remains very conservative. The company ended 2000 with no long-term debt, $32.7 million in cash, and stockholders' equity of $359.3 million. Inventory rose 34.2% to $143.1 million, which drove operating cash flow down to $38.3 million from $56.0 million in 1999. Capital expenditures are planned at roughly $40 million for 2001. The company operated 897 store sites at year-end, including 90 opened in 2000, and expects new store openings of about 10% to 15% per year. Its 10-K also flags several forward-looking risks, including economic cycles, the ability to attract personnel, supply chain exposure to Far East sourcing, and the rollout of new management information systems. For investors, the key points are consistent top-line growth, steady profitability, a debt-free balance sheet, and a dividend that was raised to $0.09 per share for 2001. The main watch items are the rising inventory build, the decelerating new-store growth rate, and the company's exposure to industrial and construction cycles.
Mar 5, 2001
1998
FASTENAL CO Annual Report, Year Ended Dec 31, 1998
Fastenal Company (FAST) closed 1998 with record results despite a deteriorating industrial economy. Net sales rose 26.4% to $503.1 million from $398.0 million, and net earnings rose 29.7% to $52.95 million, or $1.40 per share. Growth was driven by new store openings (766 stores at year-end, up from 644), growth in existing stores, and the seven newer product lines, which made up 30.1% of sales in the fourth quarter. Operating leverage was the main driver of earnings growth: operating and administrative expenses fell to 35.2% of sales from 35.6%, and gross margin held at 52.5%. The outlook is more cautious. Management said the 1998 slowdown in manufacturing, the Asian crisis, deflation in standard fasteners, and weak farm equipment demand would likely persist into 1999. As a result, the company has slowed new store openings and plans to grow by selling more products to existing customers. Capital expenditures are planned at about $22.7 million, mostly for computer equipment, and the company will move to operating leases for vehicles. The balance sheet is strong, with no long-term debt, $142.5 million of working capital, and $217.6 million of equity. The dividend was raised to $0.04 per share for 1999 from $0.02. Investors should weigh the strong profitability and balance sheet against slowing growth and risks from the Year 2000 transition and the new POS and enterprise systems. Those systems carry about $16 million of expected cost, and the company identifies execution risk in both. Stock prices fell sharply during 1998, from a high of $56-7/8 to a low of $20-1/2 in the fourth quarter.
Mar 15, 1999
1997
FASTENAL CO Annual Report, Year Ended Dec 31, 1997
Fastenal Company (FAST) reported a strong 1997, with net sales rising 38.3% to $397.99 million from $287.69 million in 1996, and net earnings up 25.5% to $40.83 million, or $1.08 per share. Growth was driven mainly by new store openings (160 added in 1997, bringing the total to 644 sites across 48 states and Canada), unit growth in existing stores, and newer product lines rather than price increases. Store sites opened in 1997 contributed about $18.2 million (4.6%) of 1997 sales, and the company's 10-year average compound annual net sales growth rate exceeded 30%. Profitability moderated relative to sales. Gross margin slipped to 52.5% from 53.1%, mainly due to product mix, and operating and administrative expenses rose to 35.6% of net sales from 34.6%, reflecting payroll, occupancy and training costs tied to expansion. Management says these costs are part of planned expansion and should pay off later. The balance sheet remains conservative: the company carries no long-term debt, though notes payable rose to $16.3 million, inventories increased to $79.4 million, and working capital reached $106.6 million. Management plans roughly $36 million in 1998 capital expenditures and about 200 new store openings, and it is rolling out a new 824-page catalog and NT-based point-of-sale system. Key risks flagged in the filing include an economic downturn affecting existing stores, the ability to staff smaller-community stores, Year 2000 computer issues, foreign currency and trade exposure, and the pace of new store openings. The company reports no legal proceedings and pays a modest $0.02 annual dividend. Investors should weigh the strong top-line growth and expansion runway against margin pressure from rising operating costs and the execution risk of rapid store and product-line growth.
Mar 16, 1998