Tariffs and inflation sting Fastenal earnings
Fastenal raises prices, but it's not enough.
Fastenal, the Winona, Minn.-based construction supplies and fastener distributor, reported second quarter 2019 sales increased 7.9% to $1.37 billion from second quarter 2018 net sales of $1.27 billion.
Sales for the first six months of 2019 rose 9.1% to $2.67 billion from sales of $2.45 billion for the same period a year ago.
Net earnings for the second quarter fell 3.1% to $204.6 million from net earnings of $211.2 million for the second quarter last year, however.
For the first six months, net earnings grew 3.4% to $398.7 million from earnings of $385.5 million for the first half of 2018.
The bottom line: Sales rise nearly 8% to $1.37 billion but profits slip 3.1% to $204.6 million.
What the company said: Despite raising prices to offset tariffs placed to date on products sourced from China, the increases were not sufficient to also counter general inflation in the marketplace. Fastenal said it has taken additional actions in the third quarter of 2019 to counter the broader pressures it is experiencing on costs as well as the additional tariffs that were levied on China-sourced products in May 2019.
More company info: The full second quarter 2019 earnings report from Fastenal can be read here.
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