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MSC Industrial Sees Q3 Results Above Estimates After Higher Q2 Profit

Wholesale equipment marketer MSC Industrial Direct Co., Inc. (MSM) on Wednesday projected third-quarter earnings and sales above Wall Street estimates after reporting a 21 percent climb in second-quarter profit. Quarterly earnings per share matched the view, while top line beat estimates.

Erik Gershwind, President and Chief Operating Officer, stated, "Our strong top and bottom-line performance in the second quarter was driven by the success of our growth initiatives, including the growth of our highly customized vending program and recent acquisitions."

For its second quarter, the distributor of Metalworking and Maintenance, Repair and Operations or MRO supplies said its net income climbed to $60.07 million from last year's $49.69 million. Earnings per share grew 21.8 percent to $0.95 from $0.78 a year ago, reflecting slightly lower share count.

On average, 12 analysts polled by Thomson Reuters expected the company to report earnings of $0.95 per share. Analysts' estimates typically exclude special items.

Net sales rose 16.5 percent to $562.97 million from $483.36 million last year, while analysts were looking for revenues of $554.69 million.

Operating income increased 19.8 percent and operating margin was up to 17.1 percent from 16.7 percent a year earlier.

David Sandler, Chief Executive Officer, said, "I am extremely pleased with the progress of our growth initiatives and our performance in the quarter. With each passing quarter, it becomes increasingly clear that the industry consolidation we foresaw almost four years ago is entering the next phase."

Based on current market conditions, MSC expects third-quarter earnings per share between $1.08 and $1.12 and net sales between $610 million and $622 million. Analysts expect the company to earn $1.08 per share, on revenues of $594.43 million.

According to the company, the positive forecast primarily reflects continued growth in its core business, expected cyclical increases in product costs, dilution from recent acquisition and planned increases in investment spending.

MSC shares are currently trading at $84.30 in pre-market activity, up $0.03 or 0.04 percent.

by RTT Staff Writer

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