MSC INDUSTRIAL SUPPLY CO. (MSM) Q2 2026 Financial Results Summary

2026-01-07 · Stocks · QuoteReporter

MSC Industrial Supply Co. (MSM) Q1 2026 Financial Results Summary

MELVILLE, N.Y. and DAVIDSON, N.C. (JANUARY 7, 2026) – MSC Industrial Supply Co. reported its financial results for the first quarter of fiscal 2026, which ended on November 29, 2025.

Financial Highlights

Net Sales:
$965.7 million, a 4.0% increase compared to $928.5 million in Q1 FY25.
Income from Operations:
$76.2 million, a 5.5% increase from $72.3 million in Q1 FY25.
Operating Margin:
7.9%, slightly improved from 7.8% in Q1 FY25.
Net Income Attributable to MSC:
$51.8 million, an 11.1% increase from $46.6 million in Q1 FY25.
Diluted EPS:
$0.93, a 12.0% increase from $0.83 in the prior fiscal year quarter.
Adjusted Financial Metrics:
Adjusted Net Sales: Remained at $965.7 million (+4.0% YoY).
Adjusted Income from Operations: $81.2 million (+8.8% YoY from $74.6 million).
Adjusted Operating Margin: 8.4% compared to 8.0% in Q1 FY25.
Adjusted Net Income: $55.5 million (+14.8% YoY from $48.4 million).
Adjusted Diluted EPS: $0.99, reflecting a 15.1% increase from $0.86 in Q1 FY25.

Overview of Operations and Financial Position

Cash and Cash Equivalents: $40.25 million, down from $56.23 million at the end of the previous quarter.
Accounts Receivable: $430.73 million, slightly higher than the previous quarter’s $423.31 million.
Inventories: Increased to $660.48 million from $644.09 million.
Total Assets: Reached $2.49 billion compared to $2.46 billion in the previous quarter.

Dividend and Share Repurchase

Quarterly Dividend: MSC declared regular cash dividends of $48.6 million in Q1, compared to $47.5 million in Q1 FY25, indicating a continuation of shareholder returns.
Share Repurchase: The company repurchased $12.96 million of Class A common stock during the first quarter, down from $18.07 million in the same quarter last year.

Guidance and Outlook

Second Quarter FY26 Guidance:
Anticipated Average Daily Sales Growth (YoY): 3.5% – 5.5%
Adjusted Operating Margin: Projected at 7.3% – 7.9%.
Full-Year FY26 Financial Outlook Maintained:
Depreciation and Amortization expense: ~$95 million – $100 million.
Interest and other expenses: ~$35 million.
Capital Expenditures: ~$100 million – $110 million.
Free Cash Flow Conversion: Targeting ~90%.
Effective Tax Rate: Estimated at ~24.5%-25.5%.

Management Commentary

Martina McIsaac, President and Chief Executive Officer, highlighted the company’s solid start to the fiscal year, benefiting from effective sales growth strategies that provided a 1.8% lead over the Industrial Production Index despite challenges from external factors, such as the government shutdown.
Greg Clark, Interim Chief Financial Officer, noted successful margins of expansion that contributed to double-digit growth in earnings per share, emphasizing the importance of ongoing operational enhancements.

Conclusion

MSC Industrial Supply Co. demonstrated positive financial performance in its fiscal Q1 2026 results, achieving increases in revenue, margin, and earnings across key metrics compared to the previous year. The declaration of dividends and share repurchases reflects the company’s commitment to returning value to shareholders while navigating operational challenges.

For more detailed financial information, MSC will hold a conference call today at 8:30 a.m. EDT, which can be accessed via their investor relations website. The next earnings report for Q2 FY26 is scheduled for April 1, 2026.

Here are the extracted tables from the press release:

Condensed Consolidated Statements of Income

(In thousands, except per share data)

Thirteen Weeks Ended	November 29, 2025	November 30, 2024
Net sales	$965,684	$928,484
Cost of goods sold	573,007	550,297
Gross profit	392,677	378,187
Operating expenses	311,568	303,563
Restructuring and other costs	4,870	2,344
Income from operations	76,239	72,280
Interest expense	-5,416	-6,075
Interest income	275	341
Other expense, net	-3,584	-5,944
Total other expense	-8,725	-11,678
Income before provision for income taxes	67,514	60,602
Provision for income taxes	16,406	14,908
Net income	51,108	45,694
Less: Net loss attributable to noncontrolling interest	-696	-929
Net income attributable to MSC Industrial	$51,804	$46,623
Net income per common share: Basic	$0.93	$0.83
Net income per common share: Diluted	$0.93	$0.83
Weighted-average shares used in computing net income per common share: Basic	55,804	55,897
Weighted-average shares used in computing net income per common share: Diluted	55,975	56,068

Condensed Consolidated Balance Sheets

(In thousands)

	November 29, 2025	August 30, 2025
ASSETS	-Unaudited
Cash and cash equivalents	$40,254	$56,228
Accounts receivable, net of allowance for credit losses	430,733	423,306
Inventories	660,483	644,090
Prepaid expenses and other current assets	128,052	102,930
Total current assets	1,259,522	1,226,554
Property, plant and equipment, net	346,776	346,706
Goodwill	723,348	723,702
Identifiable intangibles, net	81,518	85,455
Operating lease assets	48,509	52,464
Other assets	27,393	27,183
Total assets	$2,487,066	$2,462,064
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current portion of debt including obligations under finance leases	$316,872	$316,868
Current portion of operating lease liabilities	21,667	22,236
Accounts payable	220,113	225,150
Accrued expenses and other current liabilities	167,649	165,092
Total current liabilities	726,301	729,346
Long-term debt including obligations under finance leases	214,095	168,831
Noncurrent operating lease liabilities	27,393	30,872
Deferred income taxes and tax uncertainties	136,450	136,513
Total liabilities	1,104,239	1,065,562
Preferred Stock	—	—
Class A Common Stock	57	57
Additional paid-in capital	1,097,059	1,093,630
Retained earnings	426,719	432,622
Accumulated other comprehensive loss	-21,746	-20,736
Class A treasury stock, at cost	-120,918	-117,363
Total MSC Industrial shareholders’ equity	1,381,171	1,388,210
Noncontrolling interest	1,656	8,292
Total shareholders’ equity	1,382,827	1,396,502
Total liabilities and shareholders’ equity	$2,487,066	$2,462,064