fast-20240630

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

(Mark One)


☒			Quarterly report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

For the quarterly period ended June 30, 2024, or


☐			Transition report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

For the transition period from __________ to __________

Commission file number 0-16125

FASTENAL COMPANY

(Exact name of registrant as specified in its charter)


Minnesota						41-0948415
(State or other jurisdiction of incorporation or organization)						(I.R.S. Employer Identification No.)


2001 Theurer Boulevard, Winona, Minnesota						55987-1500
(Address of principal executive offices)						(Zip Code)


			(507) 454-5374
			(Registrant's telephone number, including area code)

Not Applicable

(Former name, former address and former fiscal year, if changed since last report)

Securities registered pursuant to Section 12(b) of the Act:


Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common stock, par value $.01 per share	FAST	The Nasdaq Stock Market LLC

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ý No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files.) Yes ý No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of "large accelerated filer", "accelerated filer", "smaller reporting company", and "emerging growth company" in Rule 12b-2 of the Exchange Act.

Large Accelerated Filer

Accelerated Filer

☐

Non-accelerated Filer

☐

Smaller Reporting Company

☐

Emerging Growth Company

☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ý

As of July 11, 2024, there were approximately 572,646,104 shares of the registrant's common stock outstanding.

Table of Contents

FASTENAL COMPANY

INDEX


		Page
PART I	FINANCIAL INFORMATION

ITEM 1.	FINANCIAL STATEMENTS

	Condensed Consolidated Balance Sheets	1

	Condensed Consolidated Statements of Income	2

	Condensed Consolidated Statements of Comprehensive Income	3

	Condensed Consolidated Statements of Stockholders' Equity	4

	Condensed Consolidated Statements of Cash Flows	5

	Notes to Condensed Consolidated Financial Statements	6

ITEM 2.	MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS	12

ITEM 3.	QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK	27

ITEM 4.	CONTROLS AND PROCEDURES	27

PART II	OTHER INFORMATION

ITEM 1.	LEGAL PROCEEDINGS	28

ITEM 1A.	RISK FACTORS	28

ITEM 2.	UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS	28

ITEM 5.	OTHER INFORMATION	28

ITEM 6.	EXHIBITS	28

Table of Contents

PART I — FINANCIAL INFORMATION

ITEM 1 — FINANCIAL STATEMENTS

FASTENAL COMPANY AND SUBSIDIARIES

Condensed Consolidated Balance Sheets

(Amounts in millions except share information)


	(Unaudited)
Assets	June 30, 2024		December 31, 2023
Current assets:
Cash and cash equivalents	$	255.5	221.3
Trade accounts receivable, net of allowance for credit losses of $4.2 and $6.4, respectively	1,204.8		1,087.6
Inventories	1,504.6		1,522.7
Prepaid income taxes	16.5		17.5
Other current assets	165.3		171.8
Total current assets	3,146.7		3,020.9

Property and equipment, net	1,025.8		1,011.1
Operating lease right-of-use assets	275.5		270.2
Other assets	155.5		160.7

Total assets	$	4,603.5	4,462.9

Liabilities and Stockholders' Equity
Current liabilities:
Current portion of debt	$	110.0	60.0
Accounts payable	292.6		264.1
Accrued expenses	216.2		241.0
Current portion of operating lease liabilities	98.2		96.2
Total current liabilities	717.0		661.3

Long-term debt	125.0		200.0
Operating lease liabilities	183.0		178.8
Deferred income taxes	74.2		73.0
Other long-term liabilities	8.7		1.0

Stockholders' equity:
Preferred stock: $0.01 par value, 5,000,000 shares authorized, no shares issued or outstanding	—		—
Common stock: $0.01 par value, 800,000,000 shares authorized, 572,620,247 and 571,982,367 shares issued and outstanding, respectively	5.7		5.7
Additional paid-in capital	63.6		41.0
Retained earnings	3,500.8		3,356.9
Accumulated other comprehensive loss	(74.5)		(54.8)
Total stockholders' equity	3,495.6		3,348.8
Total liabilities and stockholders' equity	$	4,603.5	4,462.9

See accompanying Notes to Condensed Consolidated Financial Statements.

Table of Contents

FASTENAL COMPANY AND SUBSIDIARIES

Condensed Consolidated Statements of Income

(Amounts in millions except income per share)


	(Unaudited)			(Unaudited)
	Six Months Ended June 30,			Three Months Ended June 30,
	2024		2023	2024		2023
Net sales	$	3,811.3	3,742.2	$	1,916.2	1,883.1
Cost of sales	2,086.2		2,034.7	1,052.7		1,025.6
Gross profit	1,725.1		1,707.5	863.5		857.5

Selling, general, and administrative expenses	948.0		919.4	476.6		462.6
Operating income	777.1		788.1	386.9		394.9

Interest income	2.9		1.0	1.3		0.6
Interest expense	(3.8)		(6.8)	(1.8)		(2.9)
Income before income taxes	776.2		782.3	386.4		392.6

Income tax expense	185.8		189.2	93.7		94.6
Net income	$	590.4	593.1	$	292.7	298.0

Basic net income per share	$	1.03	1.04	$	0.51	0.52
Diluted net income per share	$	1.03	1.04	$	0.51	0.52

Basic weighted average shares outstanding	572.5		571.0	572.6		571.1
Diluted weighted average shares outstanding	574.1		572.8	574.1		572.9

See accompanying Notes to Condensed Consolidated Financial Statements.

Table of Contents

FASTENAL COMPANY AND SUBSIDIARIES

Condensed Consolidated Statements of Comprehensive Income

(Amounts in millions)


	(Unaudited)			(Unaudited)
	Six Months Ended June 30,			Three Months Ended June 30,
	2024		2023	2024		2023
Net income	$	590.4	593.1	$	292.7	298.0
Other comprehensive (loss) income, net of tax:
Foreign currency translation adjustments (net of tax of $0.0 in 2024 and 2023)	(19.7)		7.9	(7.8)		3.6
Comprehensive income	$	570.7	601.0	$	284.9	301.6

See accompanying Notes to Condensed Consolidated Financial Statements.

Table of Contents

FASTENAL COMPANY AND SUBSIDIARIES

Condensed Consolidated Statements of Stockholders' Equity

(Amounts in millions except per share information)


	(Unaudited)			(Unaudited)
	Six Months Ended June 30,			Three Months Ended June 30,
	2024		2023	2024		2023
Common stock
Balance at beginning of period	$	5.7	5.7	$	5.7	5.7
Balance at end of period	5.7		5.7	5.7		5.7
Additional paid-in capital
Balance at beginning of period	41.0		3.6	58.8		11.4
Stock options exercised	18.6		12.5	2.8		6.6
Stock-based compensation	4.0		3.8	2.0		1.9
Balance at end of period	63.6		19.9	63.6		19.9
Retained earnings
Balance at beginning of period	3,356.9		3,218.7	3,431.4		3,314.0
Net income	590.4		593.1	292.7		298.0
Cash dividends paid	(446.5)		(399.7)	(223.3)		(199.9)
Balance at end of period	3,500.8		3,412.1	3,500.8		3,412.1
Accumulated other comprehensive (loss) income
Balance at beginning of period	(54.8)		(64.8)	(66.7)		(60.5)
Other comprehensive (loss) income	(19.7)		7.9	(7.8)		3.6
Balance at end of period	(74.5)		(56.9)	(74.5)		(56.9)
Total stockholders' equity	$	3,495.6	3,380.8	$	3,495.6	3,380.8

Cash dividends paid per share of common stock	$	0.78	0.70	$	0.39	0.35

See accompanying Notes to Condensed Consolidated Financial Statements.

Table of Contents

FASTENAL COMPANY AND SUBSIDIARIES

Condensed Consolidated Statements of Cash Flows

(Amounts in millions)


	(Unaudited)			(Unaudited)
	Six Months Ended June 30,			Three Months Ended June 30,
	2024		2023	2024		2023
Cash flows from operating activities:
Net income	$	590.4	593.1	$	292.7	298.0
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation of property and equipment	81.2		84.0	41.0		42.2
Gain on sale of property and equipment	(1.7)		(1.2)	(1.1)		(0.6)
Bad debt (recoveries) expense	(0.6)		0.2	0.3		1.6
Deferred income taxes	1.2		0.6	0.4		0.3
Stock-based compensation	4.0		3.8	2.0		1.9
Amortization of intangible assets	5.4		5.4	2.7		2.7
Changes in operating assets and liabilities:
Trade accounts receivable	(120.9)		(155.0)	6.7		(21.3)
Inventories	12.2		145.6	(9.7)		87.9
Other current assets	6.5		23.7	(28.4)		(21.7)
Accounts payable	30.7		9.9	15.1		1.4
Accrued expenses	(22.5)		(11.3)	9.4		0.6
Income taxes	1.0		(6.6)	(73.5)		(90.5)
Other	6.7		(1.6)	0.4		(0.4)
Net cash provided by operating activities	593.6		690.6	258.0		302.1

Cash flows from investing activities:
Purchases of property and equipment	(106.9)		(89.6)	(56.1)		(55.9)
Proceeds from sale of property and equipment	6.0		4.8	3.5		2.0
Other	(0.2)		(0.4)	(0.1)		(0.3)
Net cash used in investing activities	(101.1)		(85.2)	(52.7)		(54.2)

Cash flows from financing activities:
Proceeds from debt obligations	385.0		635.0	225.0

SEC Form 10-Q filed by Fastenal Company