Summary
W.W. Grainger, Inc. reported a strong second quarter and first half of 2018, demonstrating significant year-over-year growth in net sales and net earnings attributable to W.W. Grainger, Inc. Net sales increased by 9% for the quarter and 9% for the first six months, driven by volume increases and market share gains, particularly in the U.S. The company also saw continued double-digit growth in its single-channel businesses and improved international sales. Operating earnings showed a substantial increase of 50% for the quarter and 30% for the half-year, reflecting higher sales and improved SG&A expense leverage. Profitability significantly improved, with net earnings attributable to W.W. Grainger, Inc. up 142% for the quarter and 72% for the half-year. This improvement was supported by stronger gross profit, lower selling, general, and administrative expenses (when adjusted for restructuring costs), and a lower effective tax rate, partly due to the Tax Cuts and Jobs Act. The company also raised its full-year 2018 sales and earnings per share guidance, indicating confidence in its ongoing strategies and business outlook.
Financial Highlights
52 data points| Revenue | $2.86B |
| Cost of Revenue | $1.75B |
| Gross Profit | $1.11B |
| SG&A Expenses | $767.00M |
| Operating Income | $344.00M |
| Interest Expense | $23.00M |
| Net Income | $237.00M |
| EPS (Basic) | $4.19 |
| EPS (Diluted) | $4.16 |
| Shares Outstanding (Basic) | 56.11M |
| Shares Outstanding (Diluted) | 56.55M |
Key Highlights
- 1Net sales increased by 9% to $2.86 billion for the three months ended June 30, 2018, and by 9% to $5.63 billion for the six months ended June 30, 2018, compared to the prior year periods.
- 2Net earnings attributable to W.W. Grainger, Inc. saw substantial growth, increasing by 142% to $237 million for the quarter and by 72% to $469 million for the first six months.
- 3Operating earnings increased by 50% to $344 million for the quarter and by 30% to $679 million for the first six months, demonstrating improved operational efficiency.
- 4The U.S. segment remains the primary driver of growth, with net sales up 9% for the quarter and 8% for the first six months, supported by market share gains and improved demand.
- 5eCommerce sales continued to be a strong performer, growing 18% year-over-year for both the quarter and the first six months, representing 54% and 53% of total sales, respectively.
- 6The company raised its full-year 2018 guidance for sales growth (5.5% to 8.5%) and earnings per share ($15.05 to $16.05).
- 7The effective tax rate decreased significantly to 23.4% for the quarter and 22.5% for the first six months due to the Tax Cuts and Jobs Act and excess tax benefits from stock-based awards.