If “slow and steady” indeed wins the race, Fastenal Co. has found the right pace for navigating the nation’s ongoing coronavirus crisis.

Winona, Minneosta-based Fastenal (Nasdaq: FAST) reported August sales of $465.2 million, down 2.2% over the year-ago period, but the fasteners and industrial distributor notched another month of righting its sales mix after an extended period that saw safety sales — i.e., products related to fighting COVID-19 — overshadow its traditional fasteners category.

Safety sales did continue to drive the company’s top line, increasing 35.1%, which was down slightly from the 38% growth Fastenal posted in July.

The company’s sales of fasteners declined 7.3%, which was a slight improvement from -7.5% in July and a significant improvement from -11.4% in June. And sales of the company’s “other” product categories declined 1.9%.

By end market, manufacturing sales decreased 5% while non-residential construction sales decreased 13.5%, the company said. And by region for the month, U.S. sales grew 1.9%, while Canada/Mexico grew 3.8% and “rest of world” grew 15%.

Another positive result from Fastenal’s August sales report: Average daily sales for the month increased 2.5% to $22.2 million. However, the company’s relative momentum six months into the coronavirus crisis and resultant economic slowdown could hit a wall next month, according to Baird analyst Dave Manthey.

In a note to clients, he wrote, “Looking forward, we model some headline deceleration in September (-3.7%) due to: 1) our conservative assumption for safety moderation and 2) two additional days m/m relative to normal seasonality. Net, headline August daily sales beat on safety upside but underlying sales also showed sequential improvement; we continue to like FAST based on company-specific and cyclical factors.”

Manthey also noted that the latest Fastener Distributor Index (FDI) was consistent with Fastenal’s monthly sales performance. The August FDI was 49.2, down from 54.6 in July.  Manthey wrote that the August FDI “… at a near-neutral reading of 50, was very consistent with only modest sequential improvement in FAST ex-safety sales (underlying sales -4.2% in August, -4.6% July) and relatively stable fastener sales (fasteners -7.3% in August, -7.5% July).”

Employee Count Trends Downward

Meanwhile, Fastenal’s headcount continues to shrink. In August, Fastenal saw its total “absolute” headcount decrease 7.5% to 20,280 from the same month a year ago. Full-time equivalent employment declined 8.6% and total “selling” personnel declined 9.3%.

All these dips were consistent with the previous month’s declines, but as MDM wrote in the most recent Market Leaders whitepaper, Fastenal’s personnel count fits the greater industry trend.

“The evolution of a market leader like Fastenal, now heavily invested in shifting to an e-commerce and omnichannel approach, represents where the industry is headed,” according to our recent report. “Fastenal is closing locations, consolidating inventory, putting its personnel inside customer locations and moving toward e-commerce. Fewer branches, more touchpoints, as indicated in its most recent report that 65% of national account customers use e-commerce and Fastenal has 105,000 vending machines installed at customer locations.”

Shares of Fastenal were down $2.37, or 5.1%, to $43.90 at market close Tuesday. The company’s stock is down about 12% in September, although it still far above its mid-March nadir of $28.18.