What changed in this filing

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Item 1. Financial Statements

2025-04-16 compared with 2024-10-16 · 112 added, 96 removed, 259 unchanged (45% of the section changed)

ITEM 1 — FINANCIAL STATEMENTS

FASTENAL COMPANY AND SUBSIDIARIES

FASTENAL COMPANY

Condensed Consolidated Balance Sheets

(Amounts in millions except share and per share information)

Assets September 30,

Assets March 31,

2025 December 31,

17 unchanged sentences

Current portion of operating lease liabilities 101.4 98.8

Income taxes payable 52.0 —

Total current liabilities 785.2 687.1

3 unchanged sentences

Other long-term liabilities 6.4 14.1

Commitments and contingencies (Notes 3, 5, 6, and 8)

Stockholders' equity:

9 unchanged sentences

See accompanying Notes to Condensed Consolidated Financial Statements.

FASTENAL COMPANY AND SUBSIDIARIES

FASTENAL COMPANY

Condensed Consolidated Statements of Income

(Amounts in millions except income per share)

(Unaudited) (Unaudited)

Nine Months Ended

September 30, Three Months Ended

September 30,

2024 2023 2024 2023

Three Months Ended

Net sales $ 1,959.4 1,895.1

13 unchanged sentences

See accompanying Notes to Condensed Consolidated Financial Statements.

FASTENAL COMPANY AND SUBSIDIARIES

FASTENAL COMPANY

Condensed Consolidated Statements of Comprehensive Income

(Amounts in millions)

(Unaudited) (Unaudited)

Nine Months Ended

September 30, Three Months Ended

September 30,

2024 2023 2024 2023

Three Months Ended

Net income $ 298.7 297.7

Other comprehensive (loss) income, net of tax:

Foreign currency translation adjustments (net of tax of $ 0.0 in 2024 and 2023)

( 2.3 ) ( 6.7 ) 17.4 ( 14.6 )

Other comprehensive income (loss), net of tax:

Foreign currency translation adjustments 8.8 ( 11.9 )

Comprehensive income $ 307.5 285.8

See accompanying Notes to Condensed Consolidated Financial Statements.

FASTENAL COMPANY AND SUBSIDIARIES

FASTENAL COMPANY

Condensed Consolidated Statements of Stockholders' Equity

(Amounts in millions except per share information)

(Unaudited) (Unaudited)

Nine Months Ended

September 30, Three Months Ended

September 30,

2024 2023 2024 2023

Three Months Ended

Balance at beginning of period $ 5.7 5.7

10 unchanged sentences

Balance at end of period 3,665.5 3,431.4

Accumulated other comprehensive (loss) income

Accumulated other comprehensive income (loss)

Balance at beginning of period ( 91.5 ) ( 54.8 )

Other comprehensive (loss) income ( 2.3 ) ( 6.7 ) 17.4 ( 14.6 )

Other comprehensive income (loss) 8.8 ( 11.9 )

Balance at end of period ( 82.7 ) ( 66.7 )

2 unchanged sentences

See accompanying Notes to Condensed Consolidated Financial Statements.

FASTENAL COMPANY AND SUBSIDIARIES

FASTENAL COMPANY

Condensed Consolidated Statements of Cash Flows

(Amounts in millions)

(Unaudited) (Unaudited)

Nine Months Ended

September 30, Three Months Ended

September 30,

2024 2023 2024 2023

Three Months Ended

Cash flows from operating activities:

3 unchanged sentences

Gain on sale of property and equipment ( 0.3 ) ( 0.6 )

Bad debt (recoveries) expense ( 0.2 ) 1.4 0.4 1.2

Bad debt expense (recoveries) 1.8 ( 0.9 )

Deferred income taxes 0.7 0.8

22 unchanged sentences

Effect of exchange rate changes on cash and cash equivalents 3.1 ( 4.0 )

Net increase in cash and cash equivalents 70.9 67.4 36.7 53.9

Net (decrease) increase in cash and cash equivalents ( 24.0 ) 15.8

Cash and cash equivalents at beginning of period 255.8 221.3

3 unchanged sentences

Net cash paid for income taxes $ 21.9 15.9

Leased assets obtained in exchange for new operating lease liabilities $ 75.5 96.3 $ 26.1 32.0

Operating lease right-of-use assets obtained in exchange for new operating lease liabilities $ 30.4 30.4

See accompanying Notes to Condensed Consolidated Financial Statements.

FASTENAL COMPANY AND SUBSIDIARIES

FASTENAL COMPANY

Notes to Condensed Consolidated Financial Statements

(Amounts in millions except share and per share information and where otherwise noted)

September 30, 2024 and 2023

March 31, 2025 and 2024

(1) Basis of Presentation

2 unchanged sentences

They do not include all information and footnotes required by U.S.

GAAP for complete financial statements.

GAAP for a complete set of financial statements.

However, except as described herein, there has been no material change in the information disclosed in the Notes to Consolidated Financial Statements included in our consolidated financial statements as of and for the year ended December 31, 2024.

In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included.

Beginning in the first quarter of 2024, references to 'net earnings', 'operating and administrative expenses', and 'earnings before income taxes' have been revised in our condensed consolidated financial statements and financial reports, including this quarterly report on Form 10-Q, to 'net income', 'selling, general, and administrative (SG&A) expenses', and 'income before income taxes', respectively.

In the opinion of management, all adjustments (consisting of normal recurring adjustments) considered necessary for a fair statement have been included.

Recently Issued Accounting Pronouncements

In November 2023, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) 2023-07, Segment Reporting (Topic 280):

Improvements to Reportable Segment Disclosures , which enhances reporting requirements under Topic 280.

The enhanced disclosure requirements include:

title and position of the Chief Operating Decision Maker (CODM), significant segment expenses provided to the CODM, extending certain annual disclosures to interim periods, clarifying single reportable segment entities must apply Accounting Standards Codification 280 in its entirety, and permitting more than one measure of segment profit or loss to be reported under certain circumstances.

This change is effective for fiscal years beginning after December 15, 2023 and interim periods beginning after December 15, 2024.

This change will apply retrospectively to all periods presented.

We are currently evaluating the impact that the adoption of ASU 2023-07 will have on our consolidated financial statements and disclosures and plan to adopt the standard in our 2024 annual report on Form 10-K.

In December 2023, the FASB issued ASU 2023-09, Improvements to Income Tax Disclosures (Topic 740) , which establishes new income tax disclosure requirements in addition to modifying and eliminating certain existing requirements.

In December 2023, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) 2023-09, Improvements to Income Tax Disclosures (Topic 740) , which establishes new income tax disclosure requirements in addition to modifying and eliminating certain existing requirements.

The new guidance requires consistent categorization and greater disaggregation of information in the rate reconciliation, as well as further disaggregation of income taxes paid.

2 unchanged sentences

However, retrospective application in all prior periods presented is permitted.

We are currently evaluating the impact that the adoption of ASU 2023-09 will have on our consolidated financial statements and disclosures and we anticipate adoption in our 2025 annual report on Form 10-K.

ASU 2023-09 is expected to impact our income tax disclosures beginning with the consolidated financial statements included in the annual report on Form 10-K for the fiscal year ending December 31, 2025, but will have no impact on our results of operations, cash flows, or financial condition.

In November 2024, the FASB issued ASU 2024-03, Disaggregation of Income Statement Expenses (DISE), which adds new disclosure requirements including the composition of certain income statement expense line items (such as purchases of inventory, employee compensation, and 'other expenses') and a separate disclosure for selling expenses.

This change is effective for fiscal years beginning after December 15, 2026, and interim periods beginning after December 15, 2027, however, early adoption is permitted.

We are currently evaluating the impact that the adoption of ASU 2024-03 will have on our consolidated financial statements and disclosures and anticipate adoption in our annual report on Form 10-K for the fiscal year ending December 31, 2027.

Revenue Recognition

2 unchanged sentences

All revenue is recognized when or as we satisfy our performance obligations under the contract.

We recognize revenue by transferring control of the promised products to the customer, with the majority of revenue recognized at the point in time the customer obtains control of the products.

We recognize revenue by transferring control of the promised products to the customer, which primarily occurs when products are delivered or picked up by the customer.

We recognize revenue for shipping and handling charges at the time the products are delivered to or picked up by the customer.

3 unchanged sentences

Sales taxes and value added taxes in foreign jurisdictions that are collected from customers and remitted to governmental authorities are accounted for on a net basis and therefore are excluded from net sales.

FASTENAL COMPANY AND SUBSIDIARIES

FASTENAL COMPANY

Notes to Condensed Consolidated Financial Statements

(Amounts in millions except share and per share information and where otherwise noted)

September 30, 2024 and 2023

March 31, 2025 and 2024

Disaggregation of Revenue

Revenues are attributable to countries based on the selling location from which the sale occurred.

Our revenues related to the following geographic areas were as follows for the periods ended September 30:

Nine-month Period Three-month Period

2024 2023 2024 2023

Our revenues related to the following geographic areas were as follows for the periods ended March 31:

Three-month Period

United States $ 1,629.4 1,578.9

2 unchanged sentences

% of revenues 13.7 % 13.5 %

North America 5,543.9 5,419.5 1,851.3 1,790.3

% of revenues 96.9 % 97.0 % 96.9 % 97.0 %

All other foreign countries 61.1 60.6

1 unchanged sentence

Total revenues $ 1,959.4 1,895.1

The percentages of our sales by end market were as follows for the periods ended September 30:

Nine-month Period Three-month Period

2024 2023 2024 2023

The percentages of our sales by end market were as follows for the periods ended March 31:

Three-month Period

Manufacturing 76.4 % 75.0 %

2 unchanged sentences

100.0 % 100.0 %

The percentages of our sales by product line were as follows for the periods ended September 30:

Nine-month Period Three-month Period

The percentages of our sales by product line were as follows for the periods ended March 31:

Three-month Period

Type Introduced 2025 2024

12 unchanged sentences

(1) The fastener product line represents fasteners and miscellaneous supplies.

FASTENAL COMPANY AND SUBSIDIARIES

FASTENAL COMPANY

Notes to Condensed Consolidated Financial Statements

(Amounts in millions except share and per share information and where otherwise noted)

September 30, 2024 and 2023

March 31, 2025 and 2024

(3) Stockholders' Equity

On October 10, 2024, our board of directors declared a quarterly dividend of $ 0.39 per share of common stock to be paid in cash on November 22, 2024 to shareholders of record at the close of business on October 25, 2024.

On April 10, 2025, our board of directors declared a quarterly dividend of $ 0.44 per share of common stock to be paid in cash on May 23, 2025 to shareholders of record at the close of business on April 25, 2025.

The following table presents the cash dividends either paid previously or declared by our board of directors for future payment on a per share basis:

3 unchanged sentences

Fourth quarter 0.39

Fourth quarter (special) 0.38

Total $ 0.87 $ 1.56

Stock Options

The following tables summarize the details of options granted under our stock option plans that were outstanding as of September 30, 2024, and the assumptions used to value those grants.

All such grants were effective at the close of business on the date of grant.

The following tables summarize the details of options granted under our stock option plans that were outstanding as of March 31, 2025, and the assumptions used to value those grants.

All such grants were effective at the close of business on the grant date.

Granted Option Exercise

Price Closing Stock Price on Date

of Grant September 30, 2024

Price Closing Stock Price on Grant Date March 31, 2025

Date of Grant Options

8 unchanged sentences

January 2, 2018 1,087,936 $ 27.50 $ 27.270 297,182 263,626

January 3, 2017 1,529,578 $ 23.50 $ 23.475 128,407 128,407

April 19, 2016 1,690,880 $ 23.00 $ 22.870 24,943 24,943

Total 10,552,702 4,524,721 2,213,633

FASTENAL COMPANY AND SUBSIDIARIES

FASTENAL COMPANY

Notes to Condensed Consolidated Financial Statements

(Amounts in millions except share and per share information and where otherwise noted)

September 30, 2024 and 2023

March 31, 2025 and 2024

Date of Grant Risk-free

Interest Rate Expected Life of

Option in Years Expected

Interest Rate Expected Life

Years Expected

Yield Expected

9 unchanged sentences

January 2, 2018 2.2 % 5.00 2.3 % 23.45 % $ 5.02

January 3, 2017 1.9 % 5.00 2.6 % 24.49 % $ 4.20

April 19, 2016 1.3 % 5.00 2.6 % 26.34 % $ 4.09

1 unchanged sentence

Generally, each option will terminate approximately 10 years after the grant date.

The fair value of each share-based option is estimated on the date of grant using a Black-Scholes valuation method that uses the assumptions listed above.

The risk-free interest rate is based on the U.S.

Treasury rate over the expected life of the option at the time of grant.

The expected life is the average length of time over which we expect the employee groups will exercise their options, net of forfeitures, which is based on historical experience with similar grants.

The fair value of each share-based option is estimated on the grant date using a Black-Scholes valuation method that uses the assumptions listed above.

The risk-free interest rate is based on the United States (U.S.) Treasury rate over the expected life of the option at the time of grant.

The expected life is the average length of time over which we expect the employee groups will exercise their options, net of cancellations, which is based on historical experience with similar grants.

The dividend yield is estimated over the expected life of the option based on our current dividend payout, historical dividends paid, and expected future cash dividends.

1 unchanged sentence

Compensation expense equal to the grant date fair value is recognized for all of these awards over the vesting period.

The stock-based compensation expense for the nine-month periods ended September 30, 2024 and 2023 was $ 6.0 and $ 5.6 , respectively, while the third quarter of 2024 and 2023 was $ 2.0 and $ 1.8 , respectively.

Unrecognized stock-based compensation expense related to outstanding unvested stock options as of September 30, 2024 was $ 20.9 and is expected to be recognized over a weighted average period of 4.25 years.

The stock-based compensation expense for each of the three-month periods ended March 31, 2025 and 2024 was $ 2.0 .

Unrecognized stock-based compensation expense related to outstanding unvested stock options as of March 31, 2025 was $ 26.2 and is expected to be recognized over a weighted average period of 4.45 years.

Any future changes in estimated forfeitures will impact this amount.

Income Per Share

The following tables present a reconciliation of the denominators used in the computation of basic and diluted income per share and a summary of the options to purchase shares of common stock which were excluded from the diluted income per share calculation because they were anti-dilutive:

Nine-month Period Three-month Period

Net Income Per Share

The following tables present a reconciliation of the denominators used in the computation of basic and diluted net income per share and a summary of the options to purchase shares of common stock which were excluded from the diluted net income per share calculation because they were anti-dilutive:

Three-month Period

Reconciliation 2025 2024

2 unchanged sentences

Diluted weighted average shares outstanding 574,756,112 574,090,707

Nine-month Period Three-month Period

Three-month Period

Summary of Anti-dilutive Options Excluded 2025 2024

2 unchanged sentences

Any dilutive impact summarized above related to periods when the average market price of our stock exceeded the exercise price of the potentially dilutive stock options then outstanding.

FASTENAL COMPANY AND SUBSIDIARIES

FASTENAL COMPANY

Notes to Condensed Consolidated Financial Statements

(Amounts in millions except share and per share information and where otherwise noted)

September 30, 2024 and 2023

March 31, 2025 and 2024

(4) Income Taxes

We file income tax returns in the United States federal jurisdiction, all states, and various local and foreign jurisdictions.

We are no longer subject to income tax examinations by taxing authorities for taxable years before 2021 in the case of United States federal examinations, and with limited exception, before 2018 in the case of foreign, state, and local examinations.

During the first nine months of 2024, there were no material changes in unrecognized tax benefits.

We file income tax returns in the U.S.

federal jurisdiction, all states, and various local and foreign jurisdictions.

We are no longer subject to income tax examinations by taxing authorities for taxable years before 2021 in the case of U.S.

federal examinations, and with limited exceptions, before 2019 in the case of foreign, state, and local examinations.

During the first quarter of 2025, there were no material changes in unrecognized tax benefits.

(5) Operating Leases

5 unchanged sentences

Debt obligations and letters of credit outstanding at the end of each period consisted of the following:

Average Interest Rate at September 30, 2024

Average Interest Rate at March 31, 2025

Debt Outstanding

Date September 30,

Date March 31,

2025 December 31,

Unsecured revolving credit facility 5.35 % September 28, 2027 $ — —

Senior unsecured promissory notes payable, Series C 3.22 % March 1, 2024 — 60.0

Senior unsecured promissory notes payable, Series D 2.66 % May 15, 2025 75.0 75.0

7 unchanged sentences

Unsecured Revolving Credit Facility

We have an $ 835.0 committed unsecured revolving credit facility (Credit Facility) with an uncommitted accordion option to increase the aggregate revolving commitment by an additional $ 365.0 for a total amount of $ 1,200.0 .

We have an $ 835.0 committed unsecured revolving credit facility (the Credit Facility) with an uncommitted accordion option to increase the aggregate revolving commitment by an additional $ 365.0 for a total amount of $ 1,200.0 .

The Credit Facility includes a committed letter of credit subfacility of $ 55.0 .

5 unchanged sentences

This fee is either 0.10 % or 0.125 % per annum based on our usage of the Credit Facility.

FASTENAL COMPANY AND SUBSIDIARIES

FASTENAL COMPANY

Notes to Condensed Consolidated Financial Statements

(Amounts in millions except share and per share information and where otherwise noted)

September 30, 2024 and 2023

March 31, 2025 and 2024

Senior Unsecured Promissory Notes Payable

We have issued senior unsecured promissory notes under our master note agreement (the Master Note Agreement) in the aggregate principal amount of $ 200.0 as of September 30, 2024.

We have issued senior unsecured promissory notes under our master note agreement (the Master Note Agreement) in the aggregate principal amount of $ 200.0 as of March 31, 2025.

Our aggregate borrowing capacity under the Master Note Agreement is $ 900.0 ;

3 unchanged sentences

The Master Note Agreement contains certain financial and other covenants and we are currently in compliance with these covenants.

(7) Segment Reporting

Each of our geographic regions (U.S., Canada, Mexico, Central & South America, Europe, Asia, and SE Asia) is engaged in business activities for which it may earn sales and incur expenses.

Discrete financial information is available at the geographic region level through our internal Return on Asset (ROA) reporting.

The ROA reporting is ultimately a selling location income statement with an ROA calculation and the results are compiled by geographic region.

ROA pre-tax profit measures financial performance and drives compensation programs.

Our Chief Operating Decision Maker (CODM) is a group consisting of our Chief Executive Officer and President/Chief Sales Officer.

We consider each geographic region to be an operating segment.

The CODM regularly reviews ROA pre-tax profit to make decisions about the allocation of resources at the geographic region level.

Operating segment significant expense categories and amounts are not regularly reviewed by or provided to our CODM.

Segment expenses represent the difference between net sales and ROA pre-tax profit and consist of cost of sales and selling, general, and administrative (SG&A) expenses.

However, our CODM reviews consolidated expense information to manage the operations of the business.

Considering our operating segments outside of the U.S.

individually represent less than 10% of our total operating segment net sales, ROA pre-tax profit, and ROA assets, we do not consider them reportable segments.

Therefore, we report the results of our one reportable segment (U.S.) below.

Further details on our significant accounting policies can be found in Note 1 of our most recently filed annual report on Form 10-K, which are applied company wide.

Our measure of profit or loss is ROA pre-tax profit and our measure of assets is ROA assets.

ROA pre-tax profit is not a financial measure calculated in accordance with GAAP and excludes inter-company transactions.

The following table presents reportable segment net sales from external customers for the periods ended March 31:

Three-month Period

net sales from external customers $ 1,629.4 1,578.9

The following table presents a reconciliation of reportable segment ROA pre-tax profit to condensed consolidated income before income taxes for the periods ended March 31:

Three-month Period

ROA pre-tax profit $ 340.5 338.2

Other operating segment pre-tax profit (1)

Income before income taxes $ 393.1 389.8

(1) Other operating segment pre-tax profit includes ROA pre-tax profit for all other operating segments that are below the reportable segment quantitative threshold and immaterial allocations excluded from ROA pre-tax profit.

FASTENAL COMPANY

Notes to Condensed Consolidated Financial Statements

(Amounts in millions except share and per share information and where otherwise noted)

March 31, 2025 and 2024

The following table presents reportable segment ROA assets for the periods ended:

2025 December 31,

ROA assets (1)

$ 2,408.5 2,189.6

(1) Operating segment ROA assets primarily include accounts receivable, inventory, and in-market location vehicles, and exclude certain centrally managed assets.

Other Segment Disclosures

Interest revenue and interest expense included in the ROA pre-tax profit are not material.

The following table presents reportable segment ROA pre-tax profit depreciation and amortization expense for the periods ended March 31:

Three-month Period

ROA pre-tax profit depreciation and amortization expense $ 40.3 36.1

(8) Legal Contingencies

The nature of our potential exposure to legal contingencies is described in our 2024 annual report on Form 10-K in Note 11 of the Notes to Consolidated Financial Statements.

As of September 30, 2024, there were no litigation matters that we consider to be probable or reasonably possible to have a material adverse outcome.

As of March 31, 2025, there were no litigation matters that we consider to be probable or reasonably possible to have a material adverse outcome.

(9) Subsequent Events

1 unchanged sentence

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements