What This Means to Distributors: Modest sales growth paired with margin expansion shows distributors can still improve profitability through pricing discipline and cost control even as industrial demand and volume growth remain uneven.
MSC Industrial Supply Co. reported higher sales and earnings in its fiscal second quarter, with gains in both quarterly and year-to-date results as the distributor posted modest margin improvement.
For the quarter ending Feb. 28, net sales increased 2.9% to $917.8 million from $891.7 million a year earlier. Operating income rose 4.1% to $64.8 million from $62.2 million, while net income attributable to MSC increased 8.1% to $42.5 million from $39.3 million.
For the first six months of fiscal 2026, net sales increased 3.5% to $1.88 billion from $1.82 billion in the prior-year period. Operating income rose 4.8% to $141.0 million from $134.5 million, while net income attributable to MSC increased 9.7% to $94.3 million from $85.9 million.
On an adjusted basis, second-quarter operating income increased 8.5% to $69.1 million from $63.7 million.
For the year to date, adjusted operating income increased 8.7% to $150.3 million from $138.3 million, while adjusted net income attributable to MSC rose 14.1% to $101.3 million from $88.8 million.
CEO Martina McIsaac said the company delivered year-over-year operating margin expansion for the second consecutive quarter, even as volume trends remained soft.
“While we have not yet seen volumes return to a positive trend, our core customer daily sales outperformed total company for the third consecutive quarter, and we expect our volume performance to improve throughout the remainder of the fiscal year,” McIsaac said.
Interim chief financial officer Greg Clark said sales were below expectations, but margin performance improved because of gross margin expansion and cost actions.
MSC said it expects third-quarter average daily sales growth of 5% to 7% year over year and adjusted operating margin of 9.7% to 10.3%.
The company maintained its full-year outlook for depreciation and amortization expenses of about $95 million to $100 million, interest and other expenses of about $35 million, capital expenditures of about $100 million to $110 million, free cash flow conversion of about 90%, and a tax rate of about 24.5% to 25.5%.
MSC Industrial, based in Melville, New York, and Davidson, North Carolina, distributes metalworking and maintenance, repair, and operations products across North America.
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