Grainger to close 25 branches
Despite an anticipated 11% to 12% sales increase for the year, Grainger told financial analysts that it plans to close 25 branches by the end of December.
At the company's annual analyst meeting in Lake Forest, Illinois, executives said fourth-quarter sales will likely increase 12% to 13%, and expects earnings per share for the quarter to be between $1.94 and $2.09. As a result of the branch closings, Grainger expects to incur a charge of approximately $14 to $18 million, or 12 cents to 15 cents per share, which is excluded from fourth quarter and 2011 guidance.
For the full year 2012, the company is forecasting sales to increase 10% to 14%, and expects earnings per share to be between $9.90 and $10.65. Organic sales growth for 2012 is forecasted at 6% to 10%.
The company also reviewed its longer term operating margin objectives. Grainger reiterated its operating margin expansion target of approximately 50 basis points per year when organic sales grow in the mid to high single digits, and raised its long term operating margin target to a range of 15% to 17%, up from the previous objective of 14% to 16%.
