Fastenal Company (NASDAQ:FAST) Q1 2019 Earnings Conference Call Transcript

Apr 11, 2019 • 10:00 am ET

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Fastenal Company (NASDAQ:FAST) Q1 2019 Earnings Conference Call Transcript

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Q & A
Operator
Operator

Thank you. (Operator Instructions) Our first question comes from the line of Robert Barry of Buckingham. Your line is open.

Analyst
Robert Barry

Hey, guys. Good morning.

Executive
Daniel L. Florness

Good morning.

Executive
Holden Lewis

Good morning.

Analyst
Robert Barry

Congrats. Solid start to the year.

Executive
Daniel L. Florness

Thanks.

Analyst
Robert Barry

So, you mentioned in the slide deck that reminded us that Good Friday is in April this year versus in March last year. How much did that impact the March number? And adjusting for that, do you read that things may be decelerated a little bit in March?

Executive
Holden Lewis

Yeah. So, I think it's difficult to really burrow into what that number meant. I mean last year, Good Friday fell on the last day of the month and it fell on a Friday and so we have a lot of sort of month-end payments coming through. So, what was there -- was there a modest impact as a result of the timing of the holidays in the month? There probably was.

But, look, I guess, the perspective that I would give to you -- to you, Rob, is this. If we're going to try to parse out the impact of a holiday, the impact of days in the month, et cetera, we also should probably be talking about variables such as foreign exchange and weather, and all these other things that impact our month.

And if I look at -- if I try to adjust for all of these things, the fact is the growth that we experienced in the first quarter, if I adjust for acquisitions over the past 22 months, if I adjust for foreign exchange, if I adjust for weather events that we call out, we grew north of 13%, adjusting for all of those things. If I look at the six months growth rate, it was a little over 13%. If I look at the 12 months growth rate, it was a little over 13%.

So the question that you're trying to get at the end of the day is, if you take out one piece, does that suggest that we're growing more slowly? And the answer I would give you is, that's not what we're experiencing in the market through March. I would say that, if you try to adjust for all the pieces, our growth rate has been remarkably stable at a fairly high level.

And I think that with the exception of oil and gas, it's reflective of a business environment that remains fairly healthy through March. So, that's probably how I'd characterize. So -- no, I think you're right. But let's not lose sight of the fact that foreign exchange was as big of a drag on this quarter as we've seen, since we began to grow. There's a lot of moving pieces that go into it. But generally speaking, the environment feels healthy to us.

Executive
Daniel L. Florness

Rob, I'm going to throw in a little adder. Holden's dead on right. And he comes out -- I can always tell he worked in your world for many years. He thinks about