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In his speech Clark revised sales guidance for 2003: ''The economy isn't helping and we don't know just when the economy is going to turn. That's why we're lowering our sales growth estimates. We now expect sales to be up 1 to 3 percent versus last year.''
The prior projected sales growth range had been 4 to 6 percent, but Clark noted that sales in the second quarter have weakened. He also stated that given the lackluster economy, the company needs to reexamine its costs and therefore is more comfortable with the low end of the range for 2003 earnings per share: ''Given what we see right now, we should come in toward the lower end of our forecasted range of $2.50 to $2.65.''
In his presentation to the William Blair & Co. 23rd Annual Growth Stock Conference Clark discussed Grainger's plan to grow share in the $100 billion facilities maintenance market through ongoing investments in people, technology and product availability to improve customer service. He said, ''Not only do we have the products businesses and institutions need when and where they need them, we save them time and effort, which in turn saves them money.'' He described how Grainger has developed strong relationships with customers seeking to reduce the costs of the multi-step process of purchasing -- finding, buying, receiving and paying for facilities maintenance products.
Clark added, ''Grainger is in the home stretch of completing a new, redesigned distribution network.''
Grainger remains on schedule to complete its new logistics network in early 2004, recently opening its Memphis facility, the sixth of nine new or redesigned distribution centers. The enhanced network is expected to improve product availability for customers while substantially increasing the company's capacity and productivity. The $200 to $210 million capital project is projected to be cash flow positive on a cumulative basis by 2005.