Fastenal Q4: Earnings Miss, 3.7% Sales Growth, Manufacturing Woes And More

Fastenal Company FAST shares are trading lower after the company reported fourth-quarter results.

Fastenal reported sales growth of 3.7% year-over-year to $1.825 billion, missing the consensus of $1.844 billion.

There was one more selling day in the fourth quarter of 2024 relative to the prior year period, and considering this, the company’s net daily sales increased by 2.1%. Growth remained slow due to a persistently weak manufacturing environment, further impacted by sharp year-end production cuts from major customers.

Foreign exchange fluctuations reduced sales by 20 bps in the quarter. Unit sales increased in the quarter due to growth at Onsite locations opened in the last two years along with larger customers not serviced through an Onsite. 

Weighted FASTBin/FASTVend signings (MEUs) rose 24.3% Y/Y to 6,790; Weighted FASTBin/FASTVend installations rose 12.2% Y/Y.

In the fourth quarter, FAST’s Digital Footprint represented 62.2% of sales, an increase from 58.1% a year ago.

The gross margin contracted to 44.8% from 45.5% a year ago quarter, primarily due to unfavorable customer and product mix, pressured fastener and safety product margins and higher import duty fees.

Operating income was $344.8 million (-2.6% Y/Y), and the margin was 18.9%, a decline from 20.1% in the same quarter of 2023.

The company’s fourth-quarter EPS was 46 cents, missing the estimate of 48 cents.

Fastenal’s operating cash flow for the year was $1.173 billion, a decrease of 18.1% year over year. The company held cash and equivalents of $255.8 million as of December end. The company did not repurchase any common stock in 2024 or 2023.

Total debt decreased to $200 million (5.2% of total capital) at the end of the quarter. This compares to 7.2% of total capital at the end of 2023.

The company signed 56 new Onsite locations in the fourth quarter, resulting in 358 signings in 2024. Active Onsite locations rose 11.5% to 2,031.

Outlook: For 2025, the company targets weighted FASTBin and FASTVend device signings between 28,000 and 30,000 MEUs.

The company expects 66% – 68% of the sales volume to account for the Digital Footprint during 2025.

In 2025, net investment in property and equipment is expected to be within the $265.0 million – $285.0 million range, up from $214.1 million in 2024.

Price Action: FAST shares are down 1.7% at $73.50 at the last check Friday.

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