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Fastenal Company

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Fastenal reported a stellar second quarter with earnings and revenues beating the consensus mark. Earnings grew 13.4% and sales rose 10.6% year over year driven by higher units sales on improvement in underlying market demand and growth in industrial vending business and existing Onsite locations. After a soft 2013, vending trends improved through 2014, 2015 and 2016 as management’s efforts to enhance the quality of signings/installs paid off. As of Jun 30, 2017, Fastenal operated 66,577 vending machines, up 14.1% year over year. Gross margin rose 30 bps in the quarter due to improvement in supply chain initiatives, increased discipline in purchasing and efficient utilization of fleet. Meanwhile, in spite of the improvement in gross margin in the quarter, changes in product and customer mix continued to affect gross profit, as did the addition of Mansco.


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