Grainger Reports Results For Year Ended December 31, 2017

Grainger (NYSE: GWW) today reported results for the year ended Dec. 31, 2017.  Sales of $10.4 billion were up 3 percent versus $10.1 billion in 2016.  Reported net earnings of $586 million declined 3 percent versus $606 million in 2016.  Reported earnings per share of $10.02 were up 2 percent versus $9.87 in 2016.

“Overall we were pleased with the year.  We made progress by removing the pricing barrier and improving service for customers while improving our cost structure.  This continued in the fourth quarter with strong performance, as customers responded positively to our actions.  We’re encouraged that we remain on track with our volume growth and expense management goals in an improving demand environment,” said DG Macpherson, Chairman and Chief Executive Officer.  “In Canada, we are in the early stages of a business model reset and like the progress we are seeing.  We remain focused in 2018 on providing the best experience and value for our customers,” he concluded.

For the full year, the company generated $1.1 billion in operating cash flow versus $1.0 billion in 2016.  Gross capital expenditures for the year were $237 million versus $284 million in 2016.  Grainger repurchased approximately 3.0 million shares of stock for $605 million in 2017, and dividends paid in 2017 totaled $304 million.  For the year, Grainger returned $910 million to shareholders in the form of share repurchases and dividends.

2017 Fourth Quarter
Sales for the 2017 fourth quarter of $2.6 billion were up 7 percent versus the 2016 fourth quarter.  Reported net earnings of $151 million increased 149 percent versus $61 million in 2016.  Reported fourth quarter earnings per share of $2.63 increased 160 percent versus $1.01 in 2016.

Company sales in the 2017 fourth quarter were up 7 percent versus the prior year.  There were 63 selling days in both the 2017 fourth quarter and the 2016 fourth quarter.  The sales increase consisted of an 11 percentage point increase from volume, partially offset by a 3 percentage point decline from price and a 1 percentage point decline from the divestiture of a specialty business.

Company operating earnings of $240 million for the 2017 fourth quarter increased 38 percent versus the 2016 quarter.  The increase was driven by higher sales and gross profit dollars along with lower restructuring costs and other charges versus the prior year.  The company’s gross profit margin for the quarter decreased 1.3 percentage points, primarily driven by price deflation in the United States, partially offset by higher gross profit margin in Canada.  Operating expenses decreased 4 percent.  Excluding restructuring items noted in the fourth quarter table, adjusted operating expenses were up 4 percent and adjusted operating earnings in the quarter were up 4 percent.
more detail at:  http://invest.grainger.com/phoenix.zhtml?c=76754&p=irol-newsArticle&ID=2328136

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