W.W. Grainger Inc. (GWW, Financial) filed Quarterly Report for the period ended 2010-06-30.
W.w. Grainger Inc. has a market cap of $8.08 billion; its shares were traded at around $110.78 with a P/E ratio of 18.7 and P/S ratio of 1.3. The dividend yield of W.w. Grainger Inc. stocks is 1.9%. W.w. Grainger Inc. had an annual average earning growth of 12.7% over the past 10 years. GuruFocus rated W.w. Grainger Inc. the business predictability rank of 2.5-star.GWW is in the portfolios of Columbia Wanger of Columbia Wanger Asset Management, Pioneer Investments, Chuck Royce of Royce& Associates, Bruce Kovner of Caxton Associates, First Pacific Advisors of First Pacific Advisors, LLC, Steven Cohen of SAC Capital Advisors, Jim Simons of Renaissance Technologies LLC, Jeremy Grantham of GMO LLC.
Net earnings for the six months of 2010 increased by 20.9% to $228.3 million from $188.8 million in the six months of 2009. The increase in net earnings for the six months primarily resulted from an increase in operating earnings. Diluted earnings per share of $3.04 in the six months of 2010 were 23.6% higher than the $2.46 for the six months of 2009 due to increased net earnings and fewer shares outstanding. Grainger recorded a non-cash charge of $11.2 million, or $0.15 cents per share, during the first quarter of 2010 to write down a deferred income tax asset related to the tax treatment of the Medicare Part D Subsidy retiree healthcare benefit following the passage of the Patient Protection and Affordable Care Act. Grainger also recognized a $20.6 million benefit that resulted from a paid time off policy change, which reduced the related liability and which positively benefited earnings per share by $0.17 cents. Excluding these items, earnings per share would have been $3.02 or 22.8% higher than the six months of 2009.
For the six months ended June 30, 2010, working capital of $1,323.9 million decreased by $30.8 million when compared to $1,354.7 million at December 31, 2009. The decrease in working capital primarily relates to a lower cash balance. The ratio of current assets to current liabilities was 2.7 at June 30, 2010, flat to 2.7 at December 31, 2009.
Net cash provided by operating activities was $286.3 million and $232.6 million for the six months ended June 30, 2010 and 2009, respectively. Net cash flows from operating activities serve as Grainger s primary source to fund its growth initiatives. Contributing to cash flows from operations were net earnings in the six months ended June 30, 2010 of $229.1 million and the effect of non-cash expenses such as depreciation and amortization. Partially offsetting these amounts were changes in operating assets and liabilities, which resulted in a net use of cash of $38.5 million for the six months of 2010.
Net cash used in investing activities was $68.0 million and $49.6 million for the six months ended June 30, 2010 and 2009, respectively. Net cash expended for additions to property, buildings, equipment and capitalized software was $26.9 million in the six months of 2010 versus $51.9 million in the six months of 2009. Capital expenditures in 2010 included funding of infrastructure improvement projects in the distribution centers in the United States, Canada and Mexico. Cash expended for business acquisitions and other investments was $41.0 million for the six months of 2010, versus net cash received in business acquisitions and other investments of $2.3 million for the six months of 2009.
Net cash used in financing activities was $287.1 million and $163.8 million for the six months ended June 30, 2010 and 2009, respectively. The $123.3 million increase in cash used in financing activities for the six months ended June 30, 2010 was due primarily to higher treasury share repurchases. Cash paid for treasury stock purchases was $256.5 million for the six months of 2010 versus $127.7 million for the six months of 2009. Grainger also used cash to pay dividends to shareholders of $74.6 million and $65.2 million for the six months of 2010 and 2009, respectively, and repaid $20.6 million of long-term debt in the first six months of 2010.
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W.w. Grainger Inc. has a market cap of $8.08 billion; its shares were traded at around $110.78 with a P/E ratio of 18.7 and P/S ratio of 1.3. The dividend yield of W.w. Grainger Inc. stocks is 1.9%. W.w. Grainger Inc. had an annual average earning growth of 12.7% over the past 10 years. GuruFocus rated W.w. Grainger Inc. the business predictability rank of 2.5-star.GWW is in the portfolios of Columbia Wanger of Columbia Wanger Asset Management, Pioneer Investments, Chuck Royce of Royce& Associates, Bruce Kovner of Caxton Associates, First Pacific Advisors of First Pacific Advisors, LLC, Steven Cohen of SAC Capital Advisors, Jim Simons of Renaissance Technologies LLC, Jeremy Grantham of GMO LLC.
Highlight of Business Operations:
Net earnings for the second quarter of 2010 increased by 39.6% to $129.1 million from $92.5 million in the second quarter of 2009. The increase in net earnings for the quarter primarily resulted from an increase in operating earnings. Diluted earnings per share of $1.73 in the second quarter of 2010 were 43.0% higher than the $1.21 for the second quarter of 2009 due to increased net earnings and fewer shares outstanding. Excluding the benefit for the paid time off policy change, earnings per share would have been $1.65 or 36.4% higher than the second quarter of 2009.Net earnings for the six months of 2010 increased by 20.9% to $228.3 million from $188.8 million in the six months of 2009. The increase in net earnings for the six months primarily resulted from an increase in operating earnings. Diluted earnings per share of $3.04 in the six months of 2010 were 23.6% higher than the $2.46 for the six months of 2009 due to increased net earnings and fewer shares outstanding. Grainger recorded a non-cash charge of $11.2 million, or $0.15 cents per share, during the first quarter of 2010 to write down a deferred income tax asset related to the tax treatment of the Medicare Part D Subsidy retiree healthcare benefit following the passage of the Patient Protection and Affordable Care Act. Grainger also recognized a $20.6 million benefit that resulted from a paid time off policy change, which reduced the related liability and which positively benefited earnings per share by $0.17 cents. Excluding these items, earnings per share would have been $3.02 or 22.8% higher than the six months of 2009.
For the six months ended June 30, 2010, working capital of $1,323.9 million decreased by $30.8 million when compared to $1,354.7 million at December 31, 2009. The decrease in working capital primarily relates to a lower cash balance. The ratio of current assets to current liabilities was 2.7 at June 30, 2010, flat to 2.7 at December 31, 2009.
Net cash provided by operating activities was $286.3 million and $232.6 million for the six months ended June 30, 2010 and 2009, respectively. Net cash flows from operating activities serve as Grainger s primary source to fund its growth initiatives. Contributing to cash flows from operations were net earnings in the six months ended June 30, 2010 of $229.1 million and the effect of non-cash expenses such as depreciation and amortization. Partially offsetting these amounts were changes in operating assets and liabilities, which resulted in a net use of cash of $38.5 million for the six months of 2010.
Net cash used in investing activities was $68.0 million and $49.6 million for the six months ended June 30, 2010 and 2009, respectively. Net cash expended for additions to property, buildings, equipment and capitalized software was $26.9 million in the six months of 2010 versus $51.9 million in the six months of 2009. Capital expenditures in 2010 included funding of infrastructure improvement projects in the distribution centers in the United States, Canada and Mexico. Cash expended for business acquisitions and other investments was $41.0 million for the six months of 2010, versus net cash received in business acquisitions and other investments of $2.3 million for the six months of 2009.
Net cash used in financing activities was $287.1 million and $163.8 million for the six months ended June 30, 2010 and 2009, respectively. The $123.3 million increase in cash used in financing activities for the six months ended June 30, 2010 was due primarily to higher treasury share repurchases. Cash paid for treasury stock purchases was $256.5 million for the six months of 2010 versus $127.7 million for the six months of 2009. Grainger also used cash to pay dividends to shareholders of $74.6 million and $65.2 million for the six months of 2010 and 2009, respectively, and repaid $20.6 million of long-term debt in the first six months of 2010.
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