MSC Industrial Direct (MSM) - 2026 Q1 - Quarterly Results

Financial Performance - Net sales for Q1 FY26 were $965.7 million, representing a 4.0% increase year-over-year compared to $928.5 million in Q1 FY25[2] - Operating income was reported at $76.2 million, with an adjusted operating income of $81.2 million, reflecting an 8.8% increase from $74.6 million in the prior year[2] - The operating margin improved to 7.9%, or 8.4% on an adjusted basis, compared to 7.8% in the previous fiscal year[2] - Net income attributable to MSC was $51.8 million, an 11.1% increase from $46.6 million in Q1 FY25[2] - Diluted EPS increased to $0.93, up 12.0% from $0.83 in the prior year quarter, while adjusted diluted EPS rose to $0.99, a 15.1% increase from $0.86[2] - Net income for the thirteen weeks ended November 29, 2025, was $51,108,000, an increase of 11% compared to $45,694,000 for the same period in 2024[16] - Comprehensive income attributable to MSC Industrial was $50,794,000 for the current period, up from $42,791,000 in the prior year, reflecting a growth of 18.5%[16] - The diluted net income per common share increased to $0.93 from $0.83, reflecting a growth of 12%[25] Future Outlook - The company anticipates average daily sales growth of 3.5% to 5.5% for Q2 FY26[4] - Full-year fiscal 2026 outlook for certain financial metrics has been maintained, indicating confidence in continued growth[5] Capital Expenditures and Cash Flow - Capital expenditures are projected to be between $100 million and $110 million, with free cash flow conversion expected to be around 90%[9] - Cash flows from operating activities decreased to $29,411,000 from $101,868,000 year-over-year, a decline of 71%[18] - Free Cash Flow (FCF) is calculated as cash flow from operations minus capital expenditures, indicating the company's ability to fund dividends and stock repurchases[22] - Net cash used in investing activities was $21,189,000, slightly higher than $20,408,000 in the previous year[18] - The company repurchased $12,959,000 of Class A Common Stock during the period, compared to $18,072,000 in the same quarter last year[18] Balance Sheet - The company reported a total asset value of $2.487 billion as of November 29, 2025, an increase from $2.462 billion at the end of the previous quarter[12] - Current liabilities totaled $726.3 million, with long-term debt increasing to $214.1 million from $168.8 million in the prior quarter[12] - The company reported a provision for income taxes of $16,406,000, compared to $14,908,000 in the previous year, an increase of 10%[25]