Industrial products distributor MSC Industrial Direct Co., Inc. (MSM) reported Wednesday a sharp decline in fourth-quarter profit, reflecting a fall in sales as the company experienced extended shut downs by customers during the period. On a per share basis, earnings came in above analysts' estimate by 5 cents. The company also provided an outlook for the fourth quarter, which is better than current Street view.
For the fourth quarter, net income almost halved to $25.99 million or $0.41 per share from $50.53 million or $0.80 per share in the previous year. On average, 11 analysts polled by Thomson Reuters expected the company to report earnings of $0.36 per share in the fourth quarter. Analysts' estimates typically exclude special items.
Net sales for the quarter decreased to $354.09 million from $448.56 million in the fourth quarter of the prior fiscal year. Six analysts were expecting revenue of $343.42 million in the fourth quarter.
David Sandler, MSC Industrial's Chief Executive, said that the results were hurt by the extended shut downs by the company's customers, which however were not as severe as originally expected.
For the full year, net income dropped to $125.12 million or $2.00 per share from $196.24 million or $3.04 per share in fiscal 2008. Sales slid to $1.49 billion from $1.78 billion last year. Analysts were looking for earnings of $1.95 a share on revenue of $1.48 billion for fiscal 2009.
Sandler adumbrated, "While our visibility remains limited, we are seeing some encouraging signs in the marketplace. We look at the eventual economic recovery as a significant opportunity for MSC, and will continue to focus our investment program on the opportunities that we believe will produce the greatest returns."
Looking ahead, for the first quarter of fiscal 2010, the company currently forecasts earnings to range between $0.46 and $0.50 a share on net sales of $378 million to $390 million. Analysts are expecting earnings of $0.42 per share on revenue of $355.59 million for the first quarter.
MSM closed Tuesday's regular trading hours at $45.32 on the NYSE.
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