MSC Industrial Direct Co Inc (NYSE: MSM) stock enhanced over 1.9% on April 10th, 2018 (as of 10:23 AM GMT-4; Source: Google finance).
They delivered a fiscal second quarter average daily sales rise of 9.3%, while gross margin continued to be flat reaching 43.9%. The group derived over 430 basis points of acquisitive growth. The group’s operating expenses to sales improved to 31.1%, and operating income rose 13.2%. Their organic average daily sales growth was 5.0% excluding the impact of the DECO acquisition.
MSC Industrial Direct operating expenses to sales ratio improved by 90 basis points, and operating income rose 12.8%, demonstrating strong leverage. This quarter also delivered a solid cash generation, with year to date net cash from operations rising 22% against the prior year. During the quarter, they bought back shares and paid out a dividend of 58 cents per share, which is a rise of 29% as compared to the last year.
They reported a diluted EPS of $2.06, which includes one-time tax adjustments, versus $0.93 in the prior-year quarter. This includes a provisional benefit of $41.2 million, or $0.72 per diluted share, from the revaluation of the company’s tax-related balance sheet items; and derived $16.9 million, or $0.30 per diluted share, attributable to the lower effective tax rate. The diluted earnings per share excluding the positive impacts of the Tax Cuts and Jobs Act rose 11.8% yoy to $1.04 per share.
For the third quarter of fiscal 2018, MSC Industrial Direct forecasts net sales to be in the range of $820 million and $835 million. At the midpoint, the average daily sales are forecasted to rise over 11% against the last year’s third quarter. They forecast a net sales for the third quarter of fiscal 2018 Excluding DECO, in the range of $789 million and $803 million, with average daily sales at the midpoint expected to increase roughly 7% as compared to last year’s third quarter. MSC Industrial Direct forecasts a diluted earnings per share for the third quarter of fiscal 2018, including and excluding DECO, to be in the range of $1.37 and $1.43.