Fastenal's 1Q Net Falls 28%, Cut 900 Jobs During Quarter

   DOW JONES NEWSWIRES 
 

Fastenal Co.'s (FAST) first-quarter net income fell 28% on decreased revenue as the construction-equipment retailer said it cut about 900 jobs, or 6.6% of its work force, during the period.

The company, which distributes nuts, bolts, clamps, clips and other industrial and construction supplies, said it ended the quarter with 12,736 employees. It also said it has stopped adding jobs except for new-store openings and has slowed such growth to an annual rate of 2% to 5%; it was 7.5% last year.

Shares were recently down 0.5% at $38 in premarket trading as results fell short of analysts' expectations.

Fastenal seemed impervious for most of last year to the woes plaguing other companies that rely on the construction industry. But after the company posted double-digit sales gains at stores open at least two years in the first three quarters, Fastenal's sales began slowing in October.

Fastenal posted first-quarter net income of $48.7 million, or 33 cents a share, down from $68.1 million, or 46 cents a share, a year earlier. Revenue decreased 14% to $489.3 million.

Analysts surveyed by Thomson Reuters expected earnings of 34 cents a share on revenue of $500 million.

Gross margin edged up to 52.8% from 52.4%.

The company opened 33 new stores in the quarter, putting the total at 2.344. Fastenal also didn't repurchase stock during the quarter.

-By Joan E. Solsman and Kerry E. Grace, Dow Jones Newswires; 201-938-5089; [e-mail]