Grainger (NYSE: GWW), Chicago, IL, reported sales for the third quarter of $2.6 billion, a 3 percent increase over the same period a year ago. Profit decreased 3 percent to $186 million.
The sales performance included a 2 percentage point contribution from Cromwell Group (Holdings) Ltd., acquired on Sept. 1, 2015, and a 1 percentage point contribution from foreign exchange. Excluding acquisitions and foreign exchange, organic sales were flat consisting of a 1 percentage point contribution from sales of seasonal products offset by a 1 percentage point reduction in price.
"We continue to operate in a challenging economic environment," said CEO DG Macpherson. "The third quarter results were within our expectations. I'm pleased with our ability to continue to effectively manage costs in this low growth environment while still investing in our future success."
Sales for the U.S. segment declined 1 percent versus the 2015 third quarter. The decline was driven by a 1 percentage point decrease in volume and a 1 percentage point decline in price, partially offset by a 1 percentage point contribution from increased sales to Zoro, the single channel online business in the United States. Government and retail customers posted the strongest sales growth in the quarter for the segment.
Canada sales in the third quarter declined 16 percent in U.S. dollars and local currency, consisting of 15 percentage points from lower volume and a 1 percentage point decline in price. Daily sales in the province of Alberta, which currently represents about 30 percent of the company's business in Canada, were down 22 percent versus the prior year, while daily sales for all other provinces were down 12 percent in the quarter.
Sales for other businesses increased 36 percent for the 2016 third quarter versus the prior year, consisting of 16 percentage points from Cromwell, 15 percentage points from volume and price and a 5 percentage point benefit from foreign exchange. Strong performance for the other businesses was driven by 38 percent sales growth for the single channel online businesses.
For the first nine months, sales were $7.7 billion, up 2 percent from the same period a year ago. Profit decreased 13 percent to $545 million.
