MSC Industrial Direct Co., Inc. ( MSM) F4Q11 (Qtr End 08/27/2011) Earnings Call October 26, 2011 11:00 pm ET Executives Eric Boyriven - IR, FTI Consulting David Sandler - President and CEO Erik Gershwind - President and COO Jeff Kaczka - EVP and CFO Shelley Boxer - VP, Finance and Accounting Analysts Sam Darkatsh - Raymond James Hamzah Mazari - Credit Suisse Ryan Merkel - William Blair Matt Duncan - Stephens Inc. Adam Uhlman - Cleveland Research David Manthey - Robert Baird Scott Graham - Jefferies John Inch - Bank of America-Merrill Lynch Brent Rakers - Morgan, Keegan Presentation Operator
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These forward-looking statements involve risks and uncertainties that could cause the actual results to differ materially from those anticipated by this statement. Information about these risks is noted in the earnings press release and the risk factors and the MD&A sections of the Company's latest Annual Report on Form 10-K filed with the SEC as well as in the Company's other SEC filings. These forward-looking statements are based on the Company's current expectations and the Company assumes no obligation to update these statements. Investors are cautioned not to place undue reliance on these forward-looking statements.I would now like to introduce MSC Industrial Direct's President and Chief Executive Officer, David Sandler. David Sandler Thank you Eric. Good morning everyone and thank you for joining us this morning. With me are Erik Gershwind, President and Chief Operating Officer; Jeff Kaczka, our Executive Vice President and Chief Financial Officer and Shelley Boxer, Vice President, Finance and Accounting. Before getting into the quarter, I want to take this opportunity to say a few words about the promotions of Erik Gershwind and Eileen McGuire. We are fortunate to have two such outstanding executives among those leading our company. It's been gratifying for me to watch their continued growth and development, through the many years we've been together. I have the privilege to work closely and get a first hand view of their integrity, incredible skills in business acumen, intense focus and their passion for fulfilling our mission statement to be the best, the long term growth vision that MSC has for the future has never been more secure then with the team leading our company today. Turning to the quarter, I'll give our perspective on fiscal '11 to current economy and how we intent to manage our business during this time. Erik will provide an update on the execution of our model and Jeff will provide details on our financial performance.
We achieved and surpassed many important milestones this past year. We passed the $2 billion mark in sales and did so while delivering record levels of profitability. We make two acquisitions in the metalworking states, our first in several years. The business development team put in place during this past year will continue their focus on targets that meet our strict criteria with the goals of generating faster topline growth and greater share gains, becoming quickly accretive to earnings, further enhancing our metalworking capabilities and lengthening our lead in this key marketplace.The growth that we achieved reflects our market share gains as we continue to outgrow the market by a wide margin. Operating margins return to near record levels and incremental was strong. It is clear that our investment program and operating plans delivered substantial results. And I am gratified that we were able to achieve all that we promise to 2011. These accomplishments are indicative of our leadership position in the marketplace. Now let me provide our view of the broader picture. Like everyone, we've been concerned by recent market volatility, a moderating ISM trend, domestic and world events and how they are impact, might translate within our customer base. Given the uncertainty of the current environment, I wanted to spend some time laying out what we are hearing from our customer's about business conditions. And then explain our approach to managing our business. Let me start with business conditions. As you know, we have a thorough process to provide us with field data from all markets across the country. That process is used in conjunction with the field and customer business regularly made by our management team. To provide us with as clear a picture as possible of customer sentiment and up-to-date trends as much as possible. We pushed hard to identify where customers might be slowing down and how they are being affected by current conditions. Well, there are always pockets of customers who are outpacing or underperforming the market. In general, we are pleasantly surprised by what we continue to consistently hear. Read the rest of this transcript for free on seekingalpha.com