MSC Industrial (MSM) Misses Q3 EPS by 1c, Revenues Miss; Offers 4Q EPS/Revenue Outlook Below Consensus

MSC Industrial (NYSE: MSM) reported Q3 EPS of $1.39, $0.01 worse than the analyst estimate of $1.40. Revenue for the quarter came in at $828.3 million versus the consensus estimate of $832.27 million.

Fiscal Q3 2018 Highlights

• Net sales of $828.3 million, an 11.3% YoY increase, with approximately 500 basis points of acquisitive growth
• Operating income of $115.4 million, an increase of approximately 13.4% YoY
• Operating margin of 13.9% (14.5% excluding acquisitions*, an 80-basis point expansion YoY)
• Diluted EPS of $1.39, $0.01 above the guidance midpoint which did not include $0.02 of dilution from the AIS acquisition, versus $1.09 in the prior year quarter

Outlook

The Company expects net sales for the fourth quarter of fiscal 2018 to be between $829 million and $844 million. At the midpoint, average daily sales are expected to increase roughly 9.3% compared to last year\'s fourth quarter. Inclusive of net dilution of 3 cents from AIS, the Company expects diluted earnings per share for the fourth quarter of fiscal 2018 to be between $1.24 and $1.30.

Excluding acquisitions, the Company expects net sales for the fourth quarter of fiscal 2018 to be between $778 million and $793 million, with average daily sales at the midpoint expected to increase roughly 4.0% compared to last year\'s fourth quarter. The Company expects diluted earnings per share for the fourth quarter of fiscal 2018 to be between $1.26 and $1.32.

GUIDANCE:

MSC Industrial sees Q4 2018 EPS of $1.24-$1.30, versus the consensus of $1.36. MSC Industrial sees Q4 2018 revenue of $829-844 million, versus the consensus of $849.28 million.

For earnings history and earnings-related data on MSC Industrial (MSM) click here.

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