-- Fastenal (FAST) on Monday posted first-quarter results in line with market expectations amid improved customer contract signings and industrial production.
The industrial and construction supplies distributor's net income rose to $0.30 a share in the March quarter from $0.26 a year earlier, while net sales jumped 12% to $2.20 billion, both matching the consensus on FactSet.
The company attributed the higher sales to improved customer contract signings since the first quarter of 2024, as well as "a slight improvement" in industrial production in the first quarter of this year, it said in a statement.
The impact of product pricing on net sales during the quarter was a roughly 350 basis points increase versus being "immaterial" a year earlier, Fastenal said.
"The industrial economy remains somewhat challenging, with US manufactured (purchasing managers' index) averaging around 52.6%, which is an improvement, but still moderate overall," President and Chief Sales Officer Jeff Watts said on an earnings conference call Monday, according to a FactSet transcript. "We really didn't see much of a tailwind."
The company's shares were down 7.4% in afternoon trade, bringing its year-to-date gains to roughly 14%.
Fastenal's contract sales, which include national multi-site, local and regional, and government customers, accounted for three-fourths of the total revenue and continued to outperform due to incremental sales from customer signings.
"On pricing, we realized approximately 3.5% year-over-year, and that compares to 3.3% in the fourth quarter, not enough to offset inflation," Chief Financial Officer Max Tunnicliff said on the call. "While our pricing execution progressed during the quarter, we did not move quickly enough, related mostly because of tariffs and some other items."
The company signed 6,950 weighted FASTBin and FASTVend devices during the quarter and reiterated its 2026 outlook for signing between 28,000 and 30,000 machine equivalent units.
FASTBin allows clients to digitally view inventory, while FASTVend refers to vending machines.
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