MSC Industrial profit falls after acquisition

Erik Gershwind is president and chief executive of Erik Gershwind is president and chief executive of MSC Industrial Direct Co., one of the largest public companies headquartered on Long Island. (March 27, 2013) Photo Credit: Johnny Milano

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Melville-based MSC Industrial Direct Co., one of the largest public companies headquartered on Long Island, said Wednesday its fiscal third-quarter net income fell 11.1 percent, partly because of expenses associated with a recent acquisition and a new co-headquarters building in North Carolina.

The distributor of industrial tools and supplies last year announced plans to "co-locate" its headquarters to Davidson, N.C. Chief executive Erik Gershwind has said MSC has no plans to leave Long Island.

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Net income in the quarter ended June 1 fell to $62.4 million, from $70.2 million last year. Earnings per share dropped to 98 cents, from $1.10 a year ago, but beat the 94-cent estimate of analysts surveyed by Bloomberg News.

Despite slowing demand for its products, the company eked out a 4.1 percent increase in revenue for the quarter and exceeded analysts' estimates. Sales rose to $636.9 million, from $612 million last year. The latest number topped the $621.7 million analysts were expecting.

The fiscal third-quarter revenue includes about $34.7 million from Barnes Distribution North America, a Cleveland distributor that MSC acquired in April.

"We continue to fuel share gains in our targeted markets, despite a sluggish manufacturing sector," Gershwind said. "The organic growth investments we have made in e-commerce, vending and other areas are offsetting a weak demand environment."

MSC shares closed at $80.31, up 40 cents in New York Stock Exchange trading Wednesday. That price compares with its 52-week high of $87.92.

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