MSC INDUSTRIAL SUPPLY CO. REPORTS FISCAL 2024 FOURTH QUARTER AND FULL YEAR RESULTS
MSC Industrial Supply reported fiscal 2024 Q4 results with net sales of $952.3 million, down 8.0% YoY, and full-year sales of $3,821.0 million, down 4.7% YoY. Q4 operating income was $90.9 million with a 9.5% margin, while adjusted operating income was $94.2 million with a 9.9% margin. Q4 diluted EPS decreased to $0.99 from $1.56 in the prior year. The company generated strong operating cash flows of $410.7 million, representing 160% of net income. For Q1 FY2025, MSC projects year-over-year ADS growth between -5.5% and -4.5% with adjusted operating margin of 7.0-7.5%.
MSC Industrial Supply ha riportato i risultati del Q4 dell'anno fiscale 2024 con vendite nette di 952,3 milioni di dollari, in calo dell'8,0% rispetto all'anno precedente, e vendite annuali di 3.821,0 milioni di dollari, in calo del 4,7% rispetto all'anno precedente. L'utile operativo del Q4 è stato di 90,9 milioni di dollari con un margine del 9,5%, mentre l'utile operativo rettificato è stato di 94,2 milioni di dollari con un margine del 9,9%. L'EPS diluito del Q4 è diminuito a 0,99 dollari da 1,56 dollari dell'anno precedente. L'azienda ha generato forti flussi di cassa operativi di 410,7 milioni di dollari, pari al 160% dell'utile netto. Per il Q1 dell'FY2025, MSC prevede una crescita annuale dell'ADS compresa tra -5,5% e -4,5%, con un margine operativo rettificato del 7,0-7,5%.
MSC Industrial Supply reportó los resultados del Q4 del año fiscal 2024 con ventas netas de 952,3 millones de dólares, lo que representa una disminución del 8,0% en comparación con el año anterior, y ventas anuales de 3.821,0 millones de dólares, en baja del 4,7% en comparación con el año anterior. El ingreso operativo del Q4 fue de 90,9 millones de dólares con un margen del 9,5%, mientras que el ingreso operativo ajustado fue de 94,2 millones de dólares con un margen del 9,9%. El EPS diluido del Q4 disminuyó a 0,99 dólares desde 1,56 dólares del año anterior. La compañía generó fuertes flujos de efectivo operativos de 410,7 millones de dólares, representando el 160% del ingreso neto. Para el Q1 del FY2025, MSC proyecta un crecimiento interanual del ADS entre -5,5% y -4,5% con un margen operativo ajustado del 7,0-7,5%.
MSC 산업 공급은 2024 회계연도 4분기 결과를 보고했으며, 순매출은 9억5230만 달러로 전년 대비 8.0% 감소했으며, 연간 매출은 38억2100만 달러로 전년 대비 4.7% 감소했습니다. 4분기 운영 소득은 9090만 달러로 9.5%의 마진을 기록하였고, 조정된 운영 소득은 9420만 달러로 9.9%의 마진을 보였습니다. 4분기 희석 주당순이익(EPS)은 전년도 1.56 달러에서 0.99 달러로 감소했습니다. 회사는 운영 현금 흐름으로 4억1070만 달러를 생성하였으며, 이는 순이익의 160%에 해당합니다. 2025 회계년도 1분기 동안, MSC는 연간 ADS 성장이 -5.5%에서 -4.5% 사이일 것으로 예상하며, 조정된 운영 마진은 7.0-7.5%입니다.
MSC Industrial Supply a rapporté les résultats du 4e trimestre de l'exercice fiscal 2024 avec des ventes nettes de 952,3 millions de dollars, en baisse de 8,0 % par rapport à l'année précédente, et des ventes annuelles de 3 821,0 millions de dollars, en baisse de 4,7 % par rapport à l'année précédente. Le bénéfice opérationnel du 4e trimestre était de 90,9 millions de dollars avec une marge de 9,5 %, tandis que le bénéfice opérationnel ajusté était de 94,2 millions de dollars avec une marge de 9,9 %. Le BPA dilué du 4e trimestre a diminué à 0,99 $ contre 1,56 $ l'année précédente. L'entreprise a généré des flux de trésorerie opérationnels solides de 410,7 millions de dollars, représentant 160 % du bénéfice net. Pour le 1er trimestre de l'exercice 2025, MSC prévoit une croissance annuelle de l'ADS comprise entre -5,5 % et -4,5 % avec une marge opérationnelle ajustée de 7,0 à 7,5 %.
MSC Industrial Supply berichtete über die Ergebnisse des 4. Quartals des Geschäftsjahres 2024 mit Nettoumsätzen von 952,3 Millionen Dollar, was einem Rückgang von 8,0% im Jahresvergleich entspricht, und einem Gesamtumsatz von 3.821,0 Millionen Dollar, was einem Rückgang von 4,7% im Jahresvergleich entspricht. Der operative Gewinn des 4. Quartals betrug 90,9 Millionen Dollar mit einer Marge von 9,5%, während der bereinigte operative Gewinn 94,2 Millionen Dollar mit einer Marge von 9,9% betrug. Der verwässerte EPS des 4. Quartals fiel von 1,56 Dollar im Vorjahr auf 0,99 Dollar. Das Unternehmen generierte starke operative Cashflows von 410,7 Millionen Dollar, was 160% des Nettoergebnisses entspricht. Für das 1. Quartal des Geschäftsjahres 2025 prognostiziert MSC ein jährliches Wachstum des ADS zwischen -5,5% und -4,5% mit einer bereinigten operativen Marge von 7,0-7,5%.
- Strong operating cash flows of $410.7 million (160% of net income)
- National Account customer growth outperformed Industrial Production index
- Gross margins achieved higher end of expectations
- Q4 net sales declined 8.0% YoY to $952.3 million
- Q4 operating income decreased 23.0% YoY to $90.9 million
- Q4 diluted EPS fell 36.5% to $0.99 from $1.56
- Negative Q1 FY2025 guidance with projected sales decline of -5.5% to -4.5%
- Operating margin guidance shows decline to 7.0-7.5% for Q1 FY2025
Insights
The Q4 and full-year fiscal 2024 results reveal significant challenges for MSC Industrial. Net sales declined -8.0% YoY to
Key concerns include weakness in heavy manufacturing markets and reduced public sector orders. However, there are some positive indicators: strong cash flow generation at
The Q1 FY2025 outlook projects continued pressure with expected ADS decline of
The market positioning and strategic initiatives present a mixed picture. While MSC's high-touch solutions maintain momentum and web enhancements show progress, the company faces significant headwinds in its core markets. The focus on three pillars - maintaining Mission Critical momentum, reenergizing core customers and optimizing cost structure - suggests a comprehensive approach to recovery.
The long-term target of achieving mid-teens adjusted operating margins and
FISCAL 2024 Q4 HIGHLIGHTS
- Net sales of
decreased$952.3 million 8.0% YoY and includes a roughly 300 basis point headwind from non-repeating Public Sector orders in the prior year - Operating income of
, or$90.9 million adjusted to exclude acquisition-related and restructuring and other costs1$94.2 million - Operating margin of
9.5% , or9.9% excluding the adjustments described above1 - Diluted EPS of
vs.$0.99 in the prior fiscal year quarter$1.56 - Adjusted diluted EPS of
vs.$1.03 in the prior fiscal year quarter1$1.64
FISCAL 2024 HIGHLIGHTS
- Net sales of
decreased$3,821.0 million 4.7% YoY and includes a roughly 160 basis point headwind from non-repeating Public Sector orders in the prior year - Operating income of
, or$390.4 million adjusted to exclude share reclassification, acquisition-related and restructuring and other costs1$407.2 million - Operating margin of
10.2% , or10.7% excluding the adjustments described above1 - Diluted EPS of
and adjusted diluted EPS of$4.58 1$4.81 - Generated strong operating cash flows of
or$410.7 million 160% of net income
Financial Highlights2 | FY24 Q4 | FY23 Q4 | Change | FY24 | FY23 | Change | ||||||
Net Sales | $ 952.3 | $ 1,035.4 | (8.0) % | $ 3,821.0 | $ 4,009.3 | (4.7) % | ||||||
Income from Operations | $ 90.9 | $ 118.1 | (23.0) % | $ 390.4 | $ 483.7 | (19.3) % | ||||||
Operating Margin | 9.5 % | 11.4 % | 10.2 % | 12.1 % | ||||||||
Net Income Attributable to MSC | $ 55.7 | $ 87.6 | (36.4) % | $ 258.6 | $ 343.2 | (24.7) % | ||||||
Diluted EPS | $ 0.99 | 3 | $ 1.56 | 4 | (36.5) % | $ 4.58 | 3 | $ 6.11 | 4 | (25.0) % | ||
Adjusted Financial Highlights2 | FY24 Q4 | FY23 Q4 | Change | FY24 | FY23 | Change | ||||||
Net Sales | $ 952.3 | $ 1,035.4 | (8.0) % | $ 3,821.0 | $ 4,009.3 | (4.7) % | ||||||
Adjusted Income from Operations 1 | $ 94.2 | $ 130.4 | (27.8) % | $ 407.2 | $ 504.5 | (19.3) % | ||||||
Adjusted Operating Margin 1 | 9.9 % | 12.6 % | 10.7 % | 12.6 % | ||||||||
Adjusted Net Income Attributable to MSC 1 | $ 58.1 | $ 92.0 | (36.8) % | $ 271.3 | $ 353.8 | (23.3) % | ||||||
Adjusted Diluted EPS 1 | $ 1.03 | 3 | $ 1.64 | 4 | (37.2) % | $ 4.81 | 3 | $ 6.29 | 4 | (23.5) % |
1 Represents a non-GAAP financial measure. An explanation and a reconciliation of each non-GAAP financial measure to the most directly comparable GAAP financial measure are presented in the schedules accompanying this press release. |
2 In millions except percentages and per share data or as otherwise noted. |
3 Based on 56.2 million and 56.4 million weighted-average diluted shares outstanding for FY24 Q4 and FY24, respectively. |
4 Based on 56.3 million and 56.2 million weighted-average diluted shares outstanding for FY23 Q4 and FY23, respectively. |
Erik Gershwind, Chief Executive Officer, said, "During our fiscal fourth quarter, we made important progress in our Mission Critical strategy despite a challenging macro environment, particularly in heavy manufacturing. We sustained momentum in our high touch solutions, made solid progress on our web enhancements, restored gross margin stability, added to our productivity pipeline and generated strong free cash flow."
Kristen Actis-Grande, Executive Vice President and Chief Financial Officer, added, "Ongoing softness in the heavy manufacturing markets where we have significant exposure and headwinds from non-repeating orders in the prior year resulted in an average daily sales decline of
Gershwind concluded, "As we begin fiscal year 2025, we are focused on driving efficiencies across the organization and executing the three pillars that define our new chapter of Mission Critical — maintaining momentum in the first chapter of Mission Critical, reenergizing the core customer base, and optimizing our cost to serve through productivity improvements. While headwinds in our end markets continue for now, we are laser focused on realizing our long-term goals of achieving adjusted operating margin in the mid-teens and driving 400 basis points of growth above the Industrial Production index over the cycle. We are setting a clear path to get MSC back to our historically strong performance."
First Quarter Fiscal 2025 Financial Outlook | |
ADS Growth (YoY) | (5.5)% - (4.5)% |
Adjusted Operating Margin1 |
Full-Year Fiscal 2025 Outlook for Certain Financial Metrics
- Depreciation and amortization expense of
~ $90M -$95M - Interest and other expense of
~ $45M - Capital expenditures of
~ $100M -$110M - Free cash flow conversion1 of ~
100% - Tax rate of ~
24.5% -25.0%
(1) Guidance provided is a non-GAAP figure presented on an adjusted basis. For further details see the Non-GAAP financial measures information presented in the schedules accompanying this press release. |
Conference Call Information
MSC will host a conference call today at 8:30 a.m. EDT to review the Company's fiscal 2024 fourth quarter and full year results. The call, accompanying slides, and other operational statistics may be accessed at: https://investor.mscdirect.com. The conference call may also be accessed at 1-877-443-5575 (
An online archive of the broadcast will be available until November 7, 2024. The Company's reporting date for the fiscal 2025 first quarter is scheduled for January 8, 2025.
About MSC Industrial Supply Co.
MSC Industrial Supply Co. (NYSE:MSM) is a leading North American distributor of a broad range of metalworking and maintenance, repair and operations (MRO) products and services. We help our customers drive greater productivity, profitability and growth with approximately 2.4 million products, inventory management and other supply chain solutions, and deep expertise from more than 80 years of working with customers across industries. Our experienced team of more than 7,000 associates works with our customers to help drive results for their businesses - from keeping operations running efficiently today to continuously rethinking, retooling and optimizing for a more productive tomorrow. For more information on MSC Industrial, please visit mscdirect.com.
Cautionary Note Regarding Forward-Looking Statements:
Statements in this press release may constitute "forward-looking statements" under the Private Securities Litigation Reform Act of 1995. All statements, other than statements of present or historical fact, that address activities, events or developments that MSC expects, believes or anticipates will or may occur in the future, including statements about results of operations and financial condition, expected future results, expected benefits from our investment and strategic plans and other initiatives, and expected future growth, profitability and return on invested capital, are forward-looking statements. The words "will," "may," "believes," "anticipates," "thinks," "expects," "estimates," "plans," "intends" and similar expressions are intended to identify forward-looking statements. Forward-looking statements involve risks and uncertainties that could cause actual results to differ materially from those anticipated by these forward-looking statements. In addition, statements which refer to expectations, projections or other characterizations of future events or circumstances, statements involving a discussion of strategy, plans or intentions, statements about management's assumptions, projections or predictions of future events or market outlook and any other statement other than a statement of present or historical fact are forward-looking statements. The inclusion of any statement in this press release does not constitute an admission by MSC or any other person that the events or circumstances described in such statement are material. In addition, new risks may emerge from time to time and it is not possible for management to predict such risks or to assess the impact of such risks on our business or financial results. Accordingly, future results may differ materially from historical results or from those discussed or implied by these forward-looking statements. Given these risks and uncertainties, the reader should not place undue reliance on these forward-looking statements. These risks and uncertainties include, but are not limited to, the following: general economic conditions in the markets in which we operate; changing customer and product mixes; volatility in commodity, energy and labor prices, and the impact of prolonged periods of low, high or rapid inflation; competition, including the adoption by competitors of aggressive pricing strategies or sales methods; industry consolidation and other changes in the industrial distribution sector; the applicability of laws and regulations relating to our status as a supplier to the
MSC INDUSTRIAL DIRECT CO., INC. | |||
Consolidated Balance Sheets | |||
(In thousands) | |||
August 31, | September 2, | ||
ASSETS | |||
Current Assets: | |||
Cash and cash equivalents | $ 29,588 | $ 50,052 | |
Accounts receivable, net of allowance for credit losses | 412,122 | 435,421 | |
Inventories | 643,904 | 726,521 | |
Prepaid expenses and other current assets | 102,475 | 105,519 | |
Total current assets | 1,188,089 | 1,317,513 | |
Property, plant and equipment, net | 360,255 | 319,660 | |
Goodwill | 723,894 | 718,174 | |
Identifiable intangibles, net | 101,147 | 110,641 | |
Operating lease assets | 58,649 | 65,909 | |
Other assets | 30,279 | 12,237 | |
Total assets | $ 2,462,313 | $ 2,544,134 | |
LIABILITIES AND SHAREHOLDERS' EQUITY | |||
Current Liabilities: | |||
Current portion of debt including obligations under finance leases | $ 229,911 | $ 229,935 | |
Current portion of operating lease liabilities | 21,941 | 21,168 | |
Accounts payable | 205,933 | 226,299 | |
Accrued expenses and other current liabilities | 147,642 | 172,034 | |
Total current liabilities | 605,427 | 649,436 | |
Long-term debt including obligations under finance leases | 278,853 | 224,391 | |
Noncurrent operating lease liabilities | 37,468 | 45,924 | |
Deferred income taxes and tax uncertainties | 139,283 | 131,801 | |
Total liabilities | $ 1,061,031 | $ 1,051,552 | |
Commitments and Contingencies | |||
Shareholders' Equity: | |||
MSC Industrial Shareholders' Equity: | |||
Preferred Stock | — | — | |
Class A Common Stock | 57 | 48 | |
Class B Common Stock | — | 9 | |
Additional paid-in capital | 1,070,269 | 849,502 | |
Retained earnings | 456,850 | 755,007 | |
Accumulated other comprehensive loss | (21,144) | (17,725) | |
Class A treasury stock, at cost | (114,235) | (107,677) | |
Total MSC shareholders' equity | 1,391,797 | 1,479,164 | |
Noncontrolling interest | 9,485 | 13,418 | |
Total shareholders' equity | 1,401,282 | 1,492,582 | |
Total liabilities and shareholders' equity | $ 2,462,313 | $ 2,544,134 |
MSC INDUSTRIAL DIRECT CO., INC. | |||||||
Consolidated Statements of Income | |||||||
(In thousands, except per share data) | |||||||
(Unaudited) | |||||||
Fiscal Quarters Ended | Fiscal Years Ended | ||||||
August 31, | September 2, | August 31, | September 2, | ||||
Net sales | $ 952,284 | $ 1,035,441 | $ 3,820,951 | $ 4,009,282 | |||
Cost of goods sold | 561,676 | 615,907 | 2,248,168 | 2,366,317 | |||
Gross profit | 390,608 | 419,534 | 1,572,783 | 1,642,965 | |||
Operating expenses | 297,011 | 299,264 | 1,167,870 | 1,151,295 | |||
Restructuring and other costs | 2,739 | 2,215 | 14,526 | 7,937 | |||
Income from operations | 90,858 | 118,055 | 390,387 | 483,733 | |||
Other income (expense): | |||||||
Interest expense | (6,615) | (4,630) | (25,770) | (22,543) | |||
Interest income | 110 | 270 | 412 | 1,034 | |||
Other income (expense), net | (8,213) | 2,027 | (22,280) | (6,068) | |||
Total other expense | (14,718) | (2,333) | (47,638) | (27,577) | |||
Income before provision for income taxes | 76,140 | 115,722 | 342,749 | 456,156 | |||
Provision for income taxes | 22,188 | 28,281 | 86,792 | 113,049 | |||
Net income | 53,952 | 87,441 | 255,957 | 343,107 | |||
Less: Net (loss) income attributable to noncontrolling interest | (1,740) | (158) | (2,637) | (126) | |||
Net income attributable to MSC Industrial | $ 55,692 | $ 87,599 | $ 258,594 | $ 343,233 | |||
Per share data attributable to MSC Industrial: | |||||||
Net income per common share: | |||||||
Basic | $ 0.99 | $ 1.57 | $ 4.60 | $ 6.14 | |||
Diluted | $ 0.99 | $ 1.56 | $ 4.58 | $ 6.11 | |||
Weighted average shares used in computing net income per common share: | |||||||
Basic | 56,061 | 55,939 | 56,257 | 55,918 | |||
Diluted | 56,223 | 56,269 | 56,441 | 56,210 |
MSC INDUSTRIAL DIRECT CO., INC. | |||
Consolidated Statements of Comprehensive Income | |||
(In thousands) | |||
Fiscal Years Ended | |||
August 31, | September 2, | ||
Net income, as reported | $ 255,957 | $ 343,107 | |
Other comprehensive income, net of tax: | |||
Foreign currency translation adjustments | (4,715) | 7,091 | |
Comprehensive income | 251,242 | 350,198 | |
Comprehensive income attributable to noncontrolling interest: | |||
Net loss | 2,637 | 126 | |
Foreign currency translation adjustments | 1,296 | (1,695) | |
Comprehensive income attributable to MSC Industrial | $ 255,175 | $ 348,629 |
MSC INDUSTRIAL DIRECT CO., INC. | |||
Consolidated Statements of Cash Flows | |||
(In thousands) | |||
Fiscal Years Ended | |||
August 31, 2024 | September 2, 2023 | ||
Cash Flows from Operating Activities: | |||
Net income | $ 255,957 | $ 343,107 | |
Adjustments to reconcile net income to net cash provided by operating activities: | |||
Depreciation and amortization | 80,886 | 75,129 | |
Amortization of cloud computing arrangements | 1,988 | 1,192 | |
Non-cash operating lease cost | 22,973 | 20,966 | |
Stock-based compensation | 18,848 | 18,639 | |
Loss on disposal of property, plant and equipment | 687 | 557 | |
Non-cash changes in fair value of estimated contingent consideration | 906 | 104 | |
Provision for credit losses | 7,355 | 10,275 | |
Expenditures for cloud computing arrangements | (20,282) | (2,748) | |
Deferred income taxes and tax uncertainties | 9,706 | 6,697 | |
Changes in operating assets and liabilities, net of amounts associated with business acquired: | |||
Accounts receivable | 18,846 | 247,653 | |
Inventories | 85,098 | (4,860) | |
Prepaid expenses and other current assets | 2,027 | (6,605) | |
Operating lease liabilities | (23,383) | (21,173) | |
Other assets | 3,149 | 628 | |
Accounts payable and accrued liabilities | (54,065) | 10,021 | |
Total adjustments | 154,739 | 356,475 | |
Net cash provided by operating activities | 410,696 | 699,582 | |
Cash Flows from Investing Activities: | |||
Expenditures for property, plant and equipment | (99,406) | (92,493) | |
Cash used in acquisitions, net of cash acquired | (23,990) | (20,182) | |
Net cash used in investing activities | (123,396) | (112,675) | |
Cash Flows from Financing Activities: | |||
Repurchases of Class A Common Stock | (187,695) | (95,779) | |
Payments of regular cash dividends | (187,280) | (176,715) | |
Proceeds from sale of Class A Common Stock in connection with associate stock purchase plan | 4,426 | 4,415 | |
Proceeds from exercise of Class A Common Stock options | 9,587 | 28,677 | |
Borrowings under credit facilities | 434,500 | 333,000 | |
Payments under credit facilities | (381,000) | (548,000) | |
Payments under Shelf Facility Agreements and Private Placement Debt | (50,000) | (125,000) | |
Proceeds from other long-term debt | 50,000 | — | |
Payments on finance lease and financing obligations | (3,625) | (2,193) | |
Other, net | 3,735 | 1,195 | |
Net cash used in financing activities | (307,352) | (580,400) | |
Effect of foreign exchange rate changes on cash and cash equivalents | (412) | 8 | |
Net increase (decrease) in cash and cash equivalents | (20,464) | 6,515 | |
Cash and cash equivalents—beginning of period | 50,052 | 43,537 | |
Cash and cash equivalents—end of period | $ 29,588 | $ 50,052 | |
Supplemental Disclosure of Cash Flow Information: | |||
Cash paid for income taxes | $ 79,088 | $ 106,962 | |
Cash paid for interest | $ 24,721 | $ 22,432 |
Non-GAAP Financial Measures
To supplement MSC's unaudited selected financial data presented consistent with accounting principles generally accepted in
These non-GAAP financial measures are not presented in accordance with GAAP or an alternative for GAAP financial measures and may be different from similar non-GAAP financial measures used by other companies. The presentation of this additional information is not meant to be considered in isolation or as a substitute for the most directly comparable GAAP financial measure and should only be used to evaluate MSC's results of operations in conjunction with the corresponding GAAP financial measure.
This press release also includes certain forward-looking information that is not presented in accordance with GAAP. The Company believes that a quantitative reconciliation of such forward-looking information to the most directly comparable financial measure calculated and presented in accordance with GAAP cannot be made available without unreasonable efforts because a reconciliation of these non-GAAP financial measures would require the Company to predict the timing and likelihood of potential future events such as restructurings, M&A activity, capital expenditures and other infrequent or unusual gains and losses. Neither the timing or likelihood of these events, nor their probable significance, can be quantified with a reasonable degree of accuracy. Accordingly, a reconciliation of such forward-looking information to the most directly comparable GAAP financial measure is not provided.
- Results Excluding Restructuring and Other Costs, Acquisition-Related Costs, Share Reclassification Costs and ERC Tax Benefit (prior year)
In calculating certain non-GAAP financial measures, we exclude restructuring and other costs, acquisition-related costs, share reclassification costs, ERC tax benefit (prior year) and tax effects. Management makes these adjustments to facilitate a review of the Company's operating performance on a comparable basis between periods, for comparison with forecasts and strategic plans, for identifying and analyzing trends in the Company's underlying business and for benchmarking performance externally against competitors. We believe that investors benefit from seeing results from the perspective of management in addition to seeing results presented in accordance with GAAP for the same reasons and purposes for which management uses such non-GAAP financial measures.
- Return on Invested Capital ("ROIC")
ROIC is calculated using a non-GAAP financial measure. We calculate ROIC by dividing non-GAAP net operating profit after tax ("NOPAT") by average invested capital, a GAAP measure. NOPAT is defined as tax effected income from operations. Average invested capital is defined as net debt plus shareholder's equity using a trailing 13-month average. We believe that ROIC is useful to investors as a measure of performance and of the effectiveness of the use of capital in our operations. We use ROIC as one measure to monitor and evaluate operating performance. This method of determining non-GAAP ROIC may differ from other companies' methods and therefore may not be comparable to those used by other companies. ROIC should be considered in addition to, rather than as a substitute for, other information provided in accordance with GAAP. The financial measure calculated under GAAP which is most directly comparable to ROIC is considered to be the ratio of Net income to Average invested capital. See below for the calculation of ROIC and the reconciliation to the comparable GAAP measure.
- Free Cash Flow ("FCF") and Free Cash Flow Conversion ("FCF Conversion")
FCF is a non-GAAP financial measure which we define as cash flow from operations reduced by "Expenditures for property, plant and equipment". We believe that FCF, although similar to cash flow from operations, is a useful additional measure since capital expenditures are a necessary component of ongoing operations. FCF Conversion is a percentage calculated by dividing FCF by GAAP net income. We believe FCF Conversion is useful to investors for the same reasons as FCF and as a measure of the rate at which the Company converts its net income reported in accordance with GAAP to cash inflows, which helps investors assess whether the Company is generating sufficient cash flow to provide an adequate return.
MSC INDUSTRIAL DIRECT CO., INC. | |||||||
Reconciliation of GAAP and Non-GAAP Financial Information | |||||||
Fiscal Quarter Ended August 31, 2024 | |||||||
(In thousands, except percentages and per share data) | |||||||
GAAP | Items Affecting Comparability | Non-GAAP | |||||
Total MSC | Restructuring | Acquisition- | Adjusted Total | ||||
Net Sales | $ 952,284 | $ — | $ — | $ 952,284 | |||
Cost of Goods Sold | 561,676 | — | — | 561,676 | |||
Gross Profit | 390,608 | — | — | 390,608 | |||
Gross Margin | 41.0 % | — % | — % | 41.0 % | |||
Operating Expenses | 297,011 | — | 614 | 296,397 | |||
Operating Expenses as % of Sales | 31.2 % | — % | (0.1) % | 31.1 % | |||
Restructuring and Other Costs | 2,739 | 2,739 | — | — | |||
Income from Operations | 90,858 | (2,739) | (614) | 94,211 | |||
Operating Margin | 9.5 % | 0.3 % | 0.1 % | 9.9 % | |||
Total Other Expense | (14,718) | — | — | (14,718) | |||
Income before provision for income taxes | 76,140 | (2,739) | (614) | 79,493 | |||
Provision for income taxes | 22,188 | (797) | (179) | 23,164 | |||
Net income | 53,952 | (1,942) | (435) | 56,329 | |||
Net loss attributable to noncontrolling interest | (1,740) | — | — | (1,740) | |||
Net income attributable to MSC Industrial | $ 55,692 | $ (1,942) | $ (435) | $ 58,069 | |||
Net income per common share: | |||||||
Diluted | $ 0.99 | $ (0.03) | $ (0.01) | $ 1.03 |
*Individual amounts may not agree to the total due to rounding. |
MSC INDUSTRIAL DIRECT CO., INC. | |||||||||
Reconciliation of GAAP and Non-GAAP Financial Information | |||||||||
Fiscal Year Ended August 31, 2024 | |||||||||
(In thousands, except percentages and per share data) | |||||||||
GAAP | Items Affecting Comparability | Non-GAAP | |||||||
Total MSC | Restructuring | Acquisition- | Share | Adjusted | |||||
Net Sales | $ — | $ — | $ — | $ 3,820,951 | |||||
Cost of Goods Sold | 2,248,168 | — | — | — | 2,248,168 | ||||
Gross Profit | 1,572,783 | — | — | — | 1,572,783 | ||||
Gross Margin | 41.2 % | — % | — % | — % | 41.2 % | ||||
Operating Expenses | 1,167,870 | — | 1,079 | 1,187 | 1,165,604 | ||||
Operating Expenses as % of Sales | 30.6 % | — % | 0.0 % | 0.0 % | 30.5 % | ||||
Restructuring and Other Costs | 14,526 | 14,526 | — | — | — | ||||
Income from Operations | 390,387 | (14,526) | (1,079) | (1,187) | 407,179 | ||||
Operating Margin | 10.2 % | 0.4 % | 0.0 % | 0.0 % | 10.7 % | ||||
Total Other Expense | (47,638) | — | — | — | (47,638) | ||||
Income before provision for income taxes | 342,749 | (14,526) | (1,079) | (1,187) | 359,541 | ||||
Provision for income taxes | 86,792 | (3,577) | (266) | (293) | 90,928 | ||||
Net income | 255,957 | (10,949) | (813) | (894) | 268,613 | ||||
Net loss attributable to noncontrolling interest | (2,637) | — | — | — | (2,637) | ||||
Net income attributable to MSC Industrial | $ 258,594 | $ (10,949) | $ (813) | $ (894) | $ 271,250 | ||||
Net income per common share: | |||||||||
Diluted | $ 4.58 | $ (0.19) | $ (0.01) | $ (0.02) | $ 4.81 |
*Individual amounts may not agree to the total due to rounding. |
MSC INDUSTRIAL DIRECT CO., INC. | |||||||||
Reconciliation of GAAP and Non-GAAP Financial Information | |||||||||
Fiscal Quarter Ended September 2, 2023 | |||||||||
(In thousands, except percentages and per share data) | |||||||||
GAAP | Items Affecting Comparability | Non-GAAP | |||||||
Total MSC | Restructuring | Share | ERC Tax | Adjusted Total | |||||
Net Sales | $ 1,035,441 | $ — | $ — | $ — | $ 1,035,441 | ||||
Cost of Goods Sold | 615,907 | — | — | — | 615,907 | ||||
Gross Profit | 419,534 | — | — | — | 419,534 | ||||
Gross Margin | 40.5 % | — % | — % | — % | 40.5 % | ||||
Operating Expenses | 299,264 | — | 10,139 | — | 289,125 | ||||
Operating Expenses as % of Sales | 28.9 % | — % | (1.0) % | — % | 27.9 % | ||||
Restructuring and Other Costs | 2,215 | 2,215 | — | — | — | ||||
Income from Operations | 118,055 | (2,215) | (10,139) | — | 130,409 | ||||
Operating Margin | 11.4 % | 0.2 % | 1.0 % | — % | 12.6 % | ||||
Total Other Expense | (2,333) | — | — | 6,566 | (8,899) | ||||
Income before provision for income taxes | 115,722 | (2,215) | (10,139) | 6,566 | 121,510 | ||||
Provision for income taxes | 28,281 | (523) | (2,394) | 1,550 | 29,648 | ||||
Net income | 87,441 | (1,692) | (7,745) | 5,016 | 91,862 | ||||
Net loss attributable to noncontrolling | (158) | — | — | — | (158) | ||||
Net income attributable to MSC | $ 87,599 | $ (1,692) | $ (7,745) | $ 5,016 | $ 92,020 | ||||
Net income per common share: | |||||||||
Diluted | $ 1.56 | $ (0.03) | $ (0.14) | $ 0.09 | $ 1.64 |
*Individual amounts may not agree to the total due to rounding. |
MSC INDUSTRIAL DIRECT CO., INC. | |||||||||||
Reconciliation of GAAP and Non-GAAP Financial Information | |||||||||||
Fiscal Year Ended September 2, 2023 | |||||||||||
(In thousands, except percentages and per share data) | |||||||||||
GAAP | Items Affecting Comparability | Non-GAAP | |||||||||
Total MSC | Restructuring | Acquisition- | Share | ERC Tax | Adjusted Total | ||||||
Net Sales | $ 4,009,282 | $ — | $ — | $ — | $ — | $ 4,009,282 | |||||
Cost of Goods Sold | 2,366,317 | — | — | — | — | 2,366,317 | |||||
Gross Profit | 1,642,965 | — | — | — | — | 1,642,965 | |||||
Gross Margin | 41.0 % | — % | — % | — % | — % | 41.0 % | |||||
Operating Expenses | 1,151,295 | — | 398 | 12,388 | — | 1,138,509 | |||||
Operating Expenses as % of | 28.7 % | — % | 0.0 % | (0.3) % | — % | 28.4 % | |||||
Restructuring and Other Costs | 7,937 | 7,937 | — | — | — | — | |||||
Income from Operations | 483,733 | (7,937) | (398) | (12,388) | — | 504,456 | |||||
Operating Margin | 12.1 % | 0.2 % | 0.0 % | 0.3 % | — % | 12.6 % | |||||
Total Other Expense | (27,577) | — | — | — | 6,566 | (34,143) | |||||
Income before provision for | 456,156 | (7,937) | (398) | (12,388) | 6,566 | 470,313 | |||||
Provision for income taxes | 113,049 | (2,040) | (100) | (3,183) | 1,687 | 116,685 | |||||
Net income | 343,107 | (5,897) | (298) | (9,205) | 4,879 | 353,628 | |||||
Net income attributable to | (126) | — | — | — | — | (126) | |||||
Net income attributable to | $ 343,233 | $ (5,897) | $ (298) | $ (9,205) | $ 4,879 | $ 353,754 | |||||
Net income per common share: | |||||||||||
Diluted | $ 6.11 | $ (0.10) | $ (0.01) | $ (0.16) | $ 0.09 | $ 6.29 |
*Individual amounts may not agree to the total due to rounding. |
MSC INDUSTRIAL DIRECT CO., INC. | ||||
Reconciliation of GAAP and Non-GAAP Financial Information | ||||
Fiscal Years Ended August 31, 2024 and September 2, 2023 | ||||
(In thousands, except percentages) | ||||
Fiscal Year Ended | Fiscal Year Ended | |||
August 31, 2024 | September 2, 2023 | |||
(a) Net income attributable to MSC Industrial (twelve-month trailing) | $ 258,594 | $ 343,233 | ||
NOPAT | ||||
Income from Operations (twelve-month trailing) | 390,387 | 483,733 | ||
Effective tax rate | 25.3 % | 24.8 % | ||
(b) Non-GAAP NOPAT | 291,532 | 363,850 | ||
(c) Adjusted Non-GAAP NOPAT | 304,072 | 1 | 379,531 | 2 |
Invested Capital | ||||
Total MSC Industrial shareholders' equity | $ 1,391,797 | $ 1,479,164 | ||
Current portion of debt including obligations under finance leases | 229,911 | 229,935 | ||
Long-term debt including obligations under finance leases | 278,853 | 224,391 | ||
Total Debt | 508,764 | 454,326 | ||
Cash and cash equivalents | $ 29,588 | $ 50,052 | ||
Net debt | 479,176 | 404,274 | ||
Invested capital | 1,870,973 | 1,883,438 | ||
(d) Average invested capital (thirteen-month trailing average) | 1,883,503 | 1,951,818 | ||
(e) Adjusted average invested capital (thirteen-month trailing average) | 1,900,259 | 1 | 1,953,516 | 2 |
(a)/(d) Net income to Average invested capital | 13.7 % | 17.6 % | ||
(b)/(d) Non-GAAP ROIC | 15.5 % | 18.6 % | ||
(c)/(e) Adjusted Non-GAAP ROIC | 16.0 % | 19.4 % |
1 Adjusted Non-GAAP NOPAT and invested capital excludes | |||
2 Adjusted Non-GAAP NOPAT and invested capital excludes |
View original content to download multimedia:https://www.prnewswire.com/news-releases/msc-industrial-supply-co-reports-fiscal-2024-fourth-quarter-and-full-year-results-302285538.html
SOURCE MSC Industrial Supply Co.
FAQ
What was MSC Industrial's (MSM) revenue for Q4 2024?
What is MSC Industrial's (MSM) earnings per share for Q4 2024?