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In The News:

Grainger Second-Quarter Sales Up 12%

July 18, 2012
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Grainger (NYSE: GWW), Chicago, IL, reported second quarter sales of $2.2 billion, a year-over-year increase of 12 percent. Profit increased 12 percent to $191 million.

Organic sales in the second quarter increased 9 percent, including 6 percentage points from volume and 3 percentage points from price. Acquisitions contributed 5 percentage points and foreign exchange subtracted 2 percentage points from the sales growth. On a daily basis, sales increased 12 percent in April, 13 percent in May and 12 percent in June.

For the first six months of 2012, sales were $4.4 billion, up 14 percent over the same period a year ago. Profit increased 15 percent to $378 million.

Sales for the United States segment increased 7 percent in the 2012 second quarter versus the prior year. The 7 percent sales growth for the quarter was driven by 4 percent volume growth and 3 percentage points from price. Daily sales were up 7 percent in April, 8 percent in May and 7 percent in June. For the quarter, the heavy manufacturing, light manufacturing, retail, commercial, government, natural resources and reseller end markets all posted sales growth versus the 2011 second quarter, while the contractor end market posted a small decline.

Quarterly operating earnings in the United States increased 15 percent versus the prior year. Expense leverage in the United States was positive despite an incremental $24 million in growth-related spending on new sales representatives, eCommerce and advertising.

Second-quarter sales for Acklands-Grainger, Grainger's Canadian segment, increased 9 percent, 14 percent in local currency. The 14 percent sales growth consisted of 12 percent volume growth and 2 percent from price. Daily sales in local currency increased 13 percent in April, 14 percent in May and 14 percent in June. The sales increase for the quarter in Canada was led by strong growth to customers in the commercial services, oil and gas, contractor and utilities end markets.

Operating earnings in Canada increased 15 percent in the 2012 second quarter, up 20 percent in local currency.

Sales for the Other Businesses, which includes operations in Asia, Europe and Latin America, increased 84 percent for the second quarter versus the prior year. This increase was primarily due to the incremental sales from the business in Europe (Fabory) acquired in August 2011, and the business in Brazil (AnFreixo) acquired in April 2012. Excluding acquisitions, sales for the Other Businesses increased 21 percent, primarily the result of strong revenue growth in Japan.

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