Was September the start of the industrial economy’s turnaround?
If you ask the leadership team at Fastenal Co., the answer is a very qualified ‘Maybe.’ Speaking to analysts Oct. 11 after the distributor of industrial and construction supplies reported third-quarter results, CEO Dan Florness said Fastenal “finished the quarter stronger than we started it” even though Hurricane Helene disrupted sales late last month. Adjusted for an extra selling day this year, total daily sales rose 1.9% year over year—which includes Helene’s impact—and those from manufacturing customers climbed 3.0%.
Florness and CFO Holden Lewis said Fastenal teams are taking market share and have done a good job signing up and building business on site with customers. That, they said, is the main driver for Fastenal’s improving momentum. But Lewis also noted that macro commentary from the field is improving slightly nearly two years into a dragging manufacturing slowdown.
“If I think, for instance, about our Midwestern markets in particular, a couple of them actually said, if anything, it was a little bit weaker in September,” Lewis said. “But then there are a whole bunch of markets that said it was kind of stable [and] a couple said that maybe there was a little bit of improvement. […] Now, I would say the last few quarters had been more universally pessimistic. So it does represent an uptick of sentiment.”