BlackRock, Inc., the world’s largest asset manager, has reported a highly successful third quarter for 2024, marked by strong financial growth. The firm’s total assets under management (AUM) surged to a record $11.5 trillion, driven by $221 billion in net inflows during the quarter. This represents a significant year-over-year increase of $2.4 trillion in AUM, showcasing BlackRock's continued leadership in the asset management industry.
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MSC Industrial Supply Co. Reports Fiscal 2024 Third Quarter Results
MSC Industrial Supply Co. (NYSE: MSM), a leading North American distributor of metalworking and MRO (maintenance, repair, and operations) products and services, has announced its financial results for the fiscal 2024 third quarter, which ended on June 1, 2024. The company's performance saw a decline in several key metrics, influenced by various market factors and non-repeating orders from the prior year.
Fiscal 2024 Q3 Highlights
- Net Sales: $979.4 million, a decrease of 7.1% year-over-year (YoY), reflecting a roughly 300 basis point headwind from non-repeating Public Sector orders in the prior year.
- Operating Income: $106.8 million, with an adjusted figure of $111.5 million excluding restructuring and other costs.
- Operating Margin: Reported at 10.9%, or 11.4% when adjusted for the aforementioned costs.
- Diluted EPS: $1.27, down from $1.69 in the previous fiscal year's third quarter.
- Adjusted Diluted EPS: $1.33, compared to $1.74 in the prior fiscal year quarter.
Financial Performance Breakdown
Comparison with Fiscal 2023 Q3:
- Net Sales: $979.4 million vs. $1,054.5 million (down 7.1%)
- Income from Operations: $106.8 million vs. $135.4 million (down 21.1%)
- Operating Margin: 10.9% vs. 12.8%
- Net Income Attributable to MSC: $71.7 million vs. $95.2 million (down 24.7%)
- Diluted EPS: $1.27 vs. $1.69 (down 24.9%)
Year-to-Date Comparison with Fiscal 2023:
- Net Sales: $2,868.7 million vs. $2,973.8 million (down 3.5%)
- Income from Operations: $299.5 million vs. $365.7 million (down 18.1%)
- Operating Margin: 10.4% vs. 12.3%
- Net Income Attributable to MSC: $202.9 million vs. $255.6 million (down 20.6%)
- Diluted EPS: $3.59 vs. $4.56 (down 21.3%)
Adjusted Financial Highlights
Fiscal 2024 Q3 vs. Fiscal 2023 Q3:
- Adjusted Income from Operations: $111.5 million vs. $138.6 million (down 19.6%)
- Adjusted Operating Margin: 11.4% vs. 13.1%
- Adjusted Net Income Attributable to MSC: $75.2 million vs. $97.5 million (down 22.9%)
- Adjusted Diluted EPS: $1.33 vs. $1.74 (down 23.6%)
Year-to-Date Adjusted Comparison:
- Adjusted Income from Operations: $313.0 million vs. $374.0 million (down 16.3%)
- Adjusted Operating Margin: 10.9% vs. 12.6%
- Adjusted Net Income Attributable to MSC: $213.2 million vs. $261.9 million (down 18.6%)
- Adjusted Diluted EPS: $3.77 vs. $4.67 (down 19.3%)
Executive Commentary
Erik Gershwind, President and CEO, highlighted unexpected gross margin pressures and slower-than-expected recovery in average daily sales, especially within the Core customer base, as primary reasons for the underperformance. The company has implemented corrective actions to improve gross margin trends and enhance its web presence.
Kristen Actis-Grande, Executive Vice President and CFO, noted a 7.1% decline in average daily sales for the third quarter, attributing it to non-repeating Public Sector orders and softness in manufacturing verticals. Despite strong cash flow generation, the results fell short of expectations.
Fiscal 2024 Full Year Financial Outlook
- ADS Growth (YoY): Expected to decline by 4.7% to 4.3%, compared to previous guidance of 0% to 5%.
- Adjusted Operating Margin: Revised down to 10.5% - 10.7% from the prior 12.0% - 12.8%.
- Depreciation and Amortization Expense: Approximately $80 million.
- Interest and Other Expense: Estimated at $45 million.
- Operating Cash Flow Conversion: Over 125%.
- Tax Rate: 24.0% - 24.5%.
Gershwind concluded by reaffirming the company's commitment to its Mission Critical initiatives, emphasizing maintaining momentum, reenergizing the Core Customer, and optimizing cost to serve as key strategies for future growth and value creation.
(Source: MSC)
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