GRAINGER REPORTS RESULTS FOR THE FOURTH QUARTER AND FULL YEAR 2024

Published: 2025-01-31 08:01:08 ET GWW

Focused execution driving strategy forward and powering continued solid results;Issues 2025 guidance, including 4.0% - 6.5% daily, constant currency sales growth

Fourth Quarter 2024 Highlights

Full Year 2024 Highlights

CHICAGO, Jan. 31, 2025 /PRNewswire/ -- Grainger (NYSE: GWW) today reported results for the fourth quarter and full year 2024. Sales of $4.2 billion in the fourth quarter 2024 increased 5.9%, or 4.7% on a daily, organic constant currency basis versus the fourth quarter 2023. For the full year, sales of $17.2 billion increased 4.2%, or 4.7% on a daily, organic constant currency basis compared to the prior year.

"Amidst a stable, yet muted demand environment throughout 2024, our team delivered strong performance by staying focused on what matters and delivering an outstanding customer experience. Across both our High-Touch Solutions and Endless Assortment segments, we deepened our customer relationships and advanced our capabilities, all while delivering on our commitments to shareholders," said D.G. Macpherson, Chairman and CEO. "Looking to 2025, we remain committed to our purpose, We Keep the World Working®, as we continue to provide exceptional service for our customers."

2024 Financial Summary

($ in millions), except per share amount

Q4 2024

FY 2024

Change vs. Prior

(Fav. vs. (Unfav.))

Change vs. Prior

(Fav. vs. (Unfav.))

Reported

Adjusted

Reported

Adjusted(1)

Reported

Adjusted(2)

Reported

Adjusted(2)

Net Sales

$4,233

5.9 %

$17,168

4.2 %

Gross Profit

$1,676

7.2 %

$6,758

4.0 %

Operating Earnings

$633

13.6 %

8.6 %

$2,637

$2,653

2.8 %

2.4 %

Net Earnings Attributable to W.W. Grainger, Inc.

$475

20.3 %

13.9 %

$1,909

$1,921

4.4 %

3.8 %

Diluted Earnings Per Share

$9.71

23.1 %

16.6 %

$38.71

$38.96

6.8 %

6.2 %

Gross Profit Margin

39.6 %

50 bps

39.4 %

— bps

Operating Margin

15.0 %

110 bps

40 bps

15.4 %

15.5 %

(20) bps

Effective Tax Rate

20.1 %

370 bps

340 bps

23.0 %

90 bps

80 bps

(1)

Reflects the adjustment for the loss on divestiture of Grainger's subsidiary, E&R Industrial Sales, Inc., reported in the Company's HTS-N.A. segment completed in the fourth quarter of 2023.

(2)

Reflects the adjustment for restructuring costs incurred in Grainger's HTS-N.A. segment and Other businesses in the second quarter of 2024 and the loss on divestiture of Grainger's subsidiary, E&R Industrial Sales Inc., reported in the Company's HTS-N.A. segment completed in the fourth quarter of 2023.

See the supplemental information of this release for further information regarding the Company's non-GAAP measures including reconciliations to the most directly comparable GAAP measure.

RevenueFor the fourth quarter 2024, total Company sales were up 5.9%, or up 4.2% on a daily basis compared to the fourth quarter 2023. Normalizing for the impact of foreign currency exchange and the divestiture of the Company's subsidiary, E & R Industrial Sales, Inc., sales on a daily, organic constant currency basis were up 4.7% versus the fourth quarter 2023.

In the High-Touch Solutions N.A. segment, sales were up 4.0%, or 3.0% on a daily, organic constant currency basis versus the fourth quarter 2023 driven by continued growth across all geographies. In the Endless Assortment segment, sales were up 15.1%, or 13.2% on a daily, constant currency basis versus the prior year quarter. Growth was driven by core B2B customers across the segment as well as enterprise customer growth at MonotaRO.

For the full year 2024, total Company sales increased 4.2% versus the full year 2023. Daily sales on an organic, constant currency basis increased 4.7% versus the prior year driven by growth in both segments.

Gross Profit MarginFor the fourth quarter 2024, total Company gross profit margin was 39.6%, up 50 basis points compared to the fourth quarter 2023.

In the High-Touch Solutions N.A. segment, gross margin increased 90 basis points compared to the fourth quarter 2023 driven by a lap of year-end inventory cost adjustments from the prior year period, as well as slight freight and mix favorability in the current year. In the Endless Assortment segment, gross margin declined by 10 basis points versus the fourth quarter 2023.

For the full year 2024, total Company gross profit margin was 39.4%, flat versus the prior year as various factors offset.

EarningsFor the fourth quarter 2024, reported operating earnings for the total Company were $633 million, up 13.6% over the fourth quarter 2023. Reported operating margin was 15.0%, a 110 basis point increase compared to the prior year quarter. On an adjusted basis, which excludes the impacts from the divestiture of the Company's subsidiary, E & R Industrial Sales, Inc., fourth quarter 2024 operating earnings were up 8.6% and operating margin was up 40 basis points over the fourth quarter 2023. The increase in adjusted operating margin was driven by High-Touch Solutions N.A. gross margin favorability coupled with strong expense leverage in Endless Assortment.

Diluted EPS for the fourth quarter 2024 was $9.71, up 23.1% on a reported basis, or up 16.6% on an adjusted basis versus the prior year quarter. The increase in earnings per share was primarily due to strong operating performance, aided by a lower share count and favorable tax rate versus the fourth quarter 2023.

For the full year 2024, reported operating earnings for the total Company of $2.6 billion were up 2.8% versus the prior year, and resulted in reported operating margin of 15.4%, a decrease of 20 basis points over prior year. On an adjusted basis, 2024 operating earnings of $2.7 billion were up 2.4%, and resulted in adjusted operating margin of 15.5%, a decrease of 20 basis points compared to 2023 as stable gross margin was partially offset by continued demand generation investment.

Diluted EPS for the full year 2024 was $38.71 on a reported basis, up 6.8% versus 2023. On an adjusted basis, 2024 diluted EPS was $38.96, up 6.2% versus the prior year. The increase in earnings per share was due primarily to the strong operating performance in the year, aided by a lower share count and favorable tax rate versus 2023.

Tax RateFor the fourth quarter 2024, the reported effective tax rate was 20.1% compared to 23.8% in the fourth quarter 2023. On an adjusted basis, the tax rate was 20.1% compared to 23.5% in the prior year quarter.

For the full year 2024, the reported effective tax rate was 23.0% versus 23.9% in 2023. On an adjusted basis, the full year effective tax rate was 23.0% versus 23.8% in the prior year.

The variance for both the fourth quarter and full year reported and adjusted tax rates was primarily driven by the expiration of a statute of limitation period in 2024.

Cash FlowDuring the fourth quarter 2024, the Company generated $428 million of cash flow from operating activities as solid net earnings were partially offset by investments in working capital. The Company invested $258 million in capital expenditures which was higher than prior year driven by the purchase of a new bulk warehouse. This resulted in free cash flow for the period of $170 million. During the quarter, the Company returned $562 million to Grainger shareholders through dividends and share repurchases.

For the full year 2024, the Company generated $2.1 billion of cash flow from operating activities as solid net earnings were slightly offset by unfavorable working capital. As compared to 2023, operating cash flow increased $80 million, up 3.9%. The Company invested $541 million in capital expenditures, resulting in free cash flow of $1.6 billion in 2024. During the year, the Company returned $1.6 billion to Grainger shareholders through dividends and share repurchases.

2025 Company GuidanceThe Company is providing the following outlook for 2025:

Total Company(1)

2025 Guidance Range

Net Sales

$17.6 - $18.1 billion

Sales growth

2.7% - 5.2%

Daily, constant currency sales growth

4.0% - 6.5%

Gross Profit Margin

39.1% - 39.4%

Operating Margin

15.1% - 15.5%

Diluted Earnings per Share

$39.00 - $41.50

Operating Cash Flow

$2.05 - $2.25 billion

CapEx (cash basis)

$0.45 - $0.55 billion

Share Buyback

$1.15 - $1.25 billion

Effective Tax Rate

~23.8%

Segment Operating Margin

High-Touch Solutions N.A.

17.0% - 17.4%

Endless Assortment

8.5% - 9.0%

(1)

Guidance provided is on an adjusted basis. Daily, constant currency sales growth is adjusted for the impact of one less selling day in 2025 as compared to 2024 and changes in foreign currency exchange. The Company does not reconcile forward-looking non-GAAP financial measures. For further details see the supplemental information of this release.

WebcastThe Company will conduct a live conference call and webcast at 11:00 a.m. ET on January 31, 2025, to discuss the fourth quarter and full-year results. The event will be hosted by D.G. Macpherson, Chairman and CEO, and Deidra Merriwether, Senior Vice President and CFO, and can be accessed at invest.grainger.com. To access the conference call via phone, please send a request to [email protected]. For those unable to participate in the live event, a webcast replay will be available for 90 days at invest.grainger.com.

About GraingerW.W. Grainger, Inc., is a leading broad line distributor with operations primarily in North America, Japan and the United Kingdom. At Grainger, We Keep the World Working® by serving more than 4.5 million customers worldwide with products and solutions delivered through innovative technology and deep customer relationships. Known for its commitment to service and award-winning culture, the Company had 2024 revenue of $17.2 billion across its two business models. In the High-Touch Solutions segment, Grainger offers approximately 2 million maintenance, repair and operating (MRO) products and services, including technical support and inventory management. In the Endless Assortment segment, Zoro.com offers customers access to more than 14 million products, and MonotaRO.com offers more than 24 million products. For more information, visit www.grainger.com.

Visit invest.grainger.com to view information about the Company, including a supplement regarding 2024 fourth quarter results. Additional Company information can be found on the Grainger Investor Relations website which includes our Company snapshot and ESG report.

Forward-Looking StatementsFrom time to time in this Annual Report on Form 10-K as well as in other written reports, communications and verbal statements, Grainger (as defined below) makes forward-looking statements that are not historical in nature but concern forecasts of future results, business plans, analyses, prospects, strategies, objectives and other matters that may be deemed to be "forward-looking statements" under the federal securities laws. Forward-looking statements can generally be identified by their use of terms such as "anticipate," "estimate," "believe," "expect," "could," "forecast," "may," "intend," "plan," "predict," "project," "will," or "would," and similar terms and phrases, including references to assumptions.

Grainger cannot guarantee that any forward-looking statement will be realized and achievement of future results is subject to risks and uncertainties, many of which are beyond Grainger's control, which could cause Grainger's results to differ materially from those that are presented.

Important factors that could cause actual results to differ materially from those presented or implied in the forward-looking statements include, without limitation: inflation, higher product costs or other expenses, including operational and administrative expenses; a major loss of customers; loss or disruption of sources of supply; changes in customer or product mix; increased competitive pricing pressures; changes in third-party practices regarding digital advertising; failure to enter into or sustain contractual arrangements on a satisfactory basis with group purchasing organizations; failure to develop, manage or implement new technology initiatives or business strategies, including with respect to Grainger's eCommerce platforms and artificial intelligence; failure to adequately protect intellectual property or successfully defend against infringement claims; fluctuations or declines in Grainger's gross profit margin; Grainger's responses to market pressures; the outcome of pending and future litigation or governmental or regulatory proceedings, including with respect to wage and hour, anti-bribery and corruption, environmental, regulations related to advertising, marketing and the Internet, consumer protection, pricing (including disaster or emergency declaration pricing statutes), product liability, compliance or safety, trade and export compliance, general commercial disputes, or privacy and cybersecurity matters; investigations, inquiries, audits and changes in laws and regulations; failure to comply with laws, regulations and standards, including new or stricter environmental laws or regulations; government contract matters; the impact of any government shutdown; disruption or breaches of information technology or data security systems involving Grainger or third parties on which Grainger depends; general industry, economic, market or political conditions; general global economic conditions including existing, new, or increased tariffs, trade issues and changes in trade policies, inflation, and interest rates; currency exchange rate fluctuations; market volatility, including price and trading volume volatility or price declines of Grainger's common stock; commodity price volatility; facilities disruptions or shutdowns; higher fuel costs or disruptions in transportation services; effects of outbreaks of pandemic disease or viral contagions, global conflicts, natural or human induced disasters, extreme weather, and other catastrophes or conditions; effects of climate change; failure to execute on our efforts and programs related to environmental, social and governance matters; competition for, or failure to attract, retain, train, motivate and develop executives and key team members; loss of key members of management or key team members; loss of operational flexibility and potential for work stoppages or slowdowns if team members unionize or join a collective bargaining arrangement; changes in effective tax rates; changes in credit ratings or outlook; Grainger's incurrence of indebtedness or failure to comply with restrictions and obligations under its debt agreements and instruments and other factors identified under Part I, Item 1A: Risk Factors and elsewhere in this Form 10-K.

The preceding list is not intended to be an exhaustive list of all of the factors that could impact Grainger's forward-looking statements. Given these risks and uncertainties, you are cautioned not to place undue reliance on Grainger's forward looking-statements and Grainger undertakes no obligation to update or revise any of its forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law.

W.W. Grainger, Inc. and SubsidiariesCONDENSED CONSOLIDATED STATEMENTS OF EARNINGS(In millions of dollars, except for per share amounts)(Unaudited)

Three Months EndedDecember 31,

Twelve Months EndedDecember 31,

2024

2023

2024

2023

Net sales

$ 4,233

$ 3,997

$ 17,168

$ 16,478

Cost of goods sold

2,557

2,434

10,410

9,982

Gross profit

1,676

1,563

6,758

6,496

Selling, general and administrative expenses

1,043

1,006

4,121

3,931

Operating earnings

633

557

2,637

2,565

Other (income) expense:

Interest expense – net

Other – net

(6)

(7)

(24)

(28)

Total other expense – net

Earnings before income taxes

622

541

2,584

2,500

Income tax provision

125

129

595

597

Net earnings

497

412

1,989

1,903

Less net earnings attributable to noncontrolling interest

Net earnings attributable to W.W. Grainger, Inc.

$ 475

$ 395

$ 1,909

$ 1,829

Earnings per share:

Basic

$ 9.74

$ 7.93

$ 38.84

$ 36.39

Diluted

$ 9.71

$ 7.89

$ 38.71

$ 36.23

Weighted average number of shares outstanding:

Basic

48.6

49.5

48.9

49.9

Diluted

48.7

49.7

49.0

50.1

W.W. Grainger, Inc. and SubsidiariesCONDENSED CONSOLIDATED BALANCE SHEETS (In millions of dollars)(Unaudited)

As of

(Unaudited)

Assets

December 31, 2024

December 31, 2023

Current assets

Cash and cash equivalents

$ 1,036

$ 660

Accounts receivable (less allowance for credit losses of $32and $35, respectively)

2,232

2,192

Inventories – net

2,306

2,266

Prepaid expenses and other current assets

163

156

Total current assets

5,737

5,274

Property, buildings and equipment – net

1,927

1,658

Goodwill

355

370

Intangibles – net

243

234

Operating lease right-of-use

371

429

Other assets

196

182

Total assets

$ 8,829

$ 8,147

Liabilities and Shareholders' Equity

Current liabilities

Current maturities

499

Trade accounts payable

952

954

Accrued compensation and benefits

324

327

Operating lease liability

Accrued expenses

407

397

Income taxes payable

Total current liabilities

2,305

1,831

Long-term debt

2,279

2,266

Long-term operating lease liability

327

381

Deferred income taxes and tax uncertainties

101

104

Other non-current liabilities

114

124

Shareholders' equity

3,703

3,441

Total liabilities and shareholders' equity

$ 8,829

$ 8,147

W.W. Grainger, Inc. and SubsidiariesCONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS(In millions of dollars)(Unaudited)

Three Months Ended December 31,

Twelve Months Ended December 31,

2024

2023

2024

2023

Cash flows from operating activities:

Net earnings

$ 497

$ 412

$ 1,989

$ 1,903

Adjustments to reconcile net earnings to net cash provided by operating activities:

Provision for credit losses

Deferred income taxes and tax uncertainties

(32)

(29)

(8)

(9)

Depreciation and amortization

237

214

Non-cash lease expense

Net losses (gains) from sales of assets and business divestitures

—

Stock-based compensation

Change in operating assets and liabilities:

Accounts receivable

253

(110)

(98)

Inventories

(163)

(58)

(77)

(16)

Prepaid expenses and other assets

(10)

(3)

(36)

101

Trade accounts payable

(79)

(120)

(65)

Operating lease liabilities

(23)

(96)

(88)

Accrued liabilities

(16)

(91)

Income taxes – net

(3)

(4)

Other non-current liabilities

Net cash provided by operating activities

428

604

2,111

2,031

Cash flows from investing activities:

Capital expenditures

(258)

(127)

(541)

(445)

Proceeds from sale of assets and business divestitures

Other – net

(1)

Net cash used in investing activities

(258)

(115)

(520)

(422)

Cash flows from financing activities:

Proceeds from debt

—

503

Payments of debt

(1)

—

(39)

(37)

Proceeds from stock options exercised

Payments for employee taxes withheld from stockawards

(6)

(5)

(50)

(37)

Purchases of treasury stock

(462)

(344)

(1,201)

(850)

Cash dividends paid

(100)

(92)

(421)

(392)

Other – net

—

(3)

(2)

(3)

Net cash used in financing activities

(565)

(439)

(1,180)

(1,278)

Exchange rate effect on cash and cash equivalents

(17)

(35)

Net change in cash and cash equivalents

(412)

376

335

Cash and cash equivalents at beginning of period

1,448

601

660

325

Cash and cash equivalents at end of period

$ 1,036

$ 660

$ 1,036

$ 660

SUPPLEMENTAL INFORMATION - RECONCILIATION OF GAAP TO NON-GAAPFINANCIAL MEASURES (Unaudited)

The Company supplements the reporting of financial information determined under U.S. generally accepted accounting principles (GAAP) with the non-GAAP financial measures as defined below. The Company believes these non-GAAP financial measures provide meaningful information to assist investors in understanding financial results and assessing prospects for future performance as they provide a better baseline for analyzing the ongoing performance of its business by excluding items that may not be indicative of core operating results.

Basis of presentationThe Company has a controlling ownership interest in MonotaRO, which is part of our Endless Assortment segment. MonotaRO's results are fully consolidated, reflected in U.S. GAAP, and reported one-month in arrears. Results will differ from MonotaRO's externally reported financials which follow Japanese GAAP.

Adjusted gross profit, adjusted SG&A, adjusted operating earnings, adjusted operating margin, adjusted net earnings, adjusted diluted EPSExclude certain non-recurring items, like restructuring charges, asset impairments, gains and losses associated with business divestitures and other non-recurring, infrequent or unusual gains and losses (together referred to as "non-GAAP adjustments"), from the Company's most directly comparable reported U.S. GAAP figures (reported gross profit, SG&A, operating earnings, net earnings and EPS).The Company believes these non-GAAP adjustments provide meaningful information to assist investors in understanding financial results and assessing prospects for future performance as they provide a better baseline for analyzing the ongoing performance of its business by excluding items that may not be indicative of core operating results.

Free cash flow (FCF) Calculated using total cash provided by operating activities less capital expenditures. The Company believes the presentation of FCF allows investors to evaluate the capacity of the Company's operations to generate free cash flow.

Daily sales Refers to sales for the period divided by the number of U.S. selling days for the period.

Daily, constant currency salesRefers to the daily sales adjusted for changes in foreign currency exchange rates.

Daily, organic constant currency salesRefers to daily sales excluding the sales of certain divested businesses in the comparable prior year period post date of divestiture and changes in foreign currency exchange rates.

Foreign currency exchangeCalculated by dividing current period local currency daily sales by current period average exchange rate and subtracting the current period local currency daily sales divided by the prior period average exchange rate.

U.S. selling days:2023: Q1-64, Q2-64, Q3-63, Q4-63, FY-2542024: Q1-64, Q2-64, Q3-64, Q4-64, FY-2562025: Q1-63, Q2-64, Q3-64, Q4-64, FY-255

As non-GAAP financial measures are not standardized, it may not be possible to compare these measures with other companies' non-GAAP measures having the same or similar names. These non-GAAP measures should not be considered in isolation or as a substitute for reported results. These non-GAAP measures reflect an additional way of viewing aspects of operations that, when viewed with GAAP results, provide a more complete understanding of the business. This press release also includes certain non-GAAP forward-looking information. The Company believes that a quantitative reconciliation of such forward-looking information to the most comparable financial measure calculated and presented in accordance with GAAP cannot be made available without unreasonable efforts. A reconciliation of these non-GAAP financial measures would require the Company to predict the timing and likelihood of future restructurings, asset impairments, and other charges. Neither of these forward-looking measures, nor their probable significance, can be quantified with a reasonable degree of accuracy. Accordingly, a reconciliation of the most directly comparable forward-looking GAAP measures is not provided.

The reconciliations provided below reconciles GAAP financial measures to non-GAAP financial measures used in this release: daily sales; daily, organic constant currency sales; free cash flow; adjusted operating margin; and adjustments reflected in the consolidated statements of earnings.

Sales growth for the three and twelve months ended December 31, 2024(percent change compared to prior year period) (unaudited)

Total Company

High-Touch Solutions - N.A.

Endless Assortment

Q4 2024

FY 2024

Q4 2024

FY 2024

Q4 2024

FY 2024

Reported sales

5.9 %

4.2 %

4.0 %

3.4 %

15.1 %

7.5 %

Daily impact

(1.7) %

(0.8) %

(1.7) %

(0.8) %

(1.8) %

(0.9) %

Daily sales(1)

4.2 %

3.4 %

2.3 %

2.6 %

13.3 %

6.6 %

Business divestiture(2)

0.3 %

0.4 %

0.5 %

— %

Foreign currencyexchange(3)

0.2 %

0.9 %

0.3 %

0.1 %

(0.1) %

5.0 %

Daily, organic constantcurrency sales

4.7 %

3.0 %

3.2 %

13.2 %

11.6 %

(1)

Based on U.S. selling days, there were 64 and 63 selling days in Q4 2024 and Q4 2023, respectively; there were 256 and 254 selling days in 2024 and 2023, respectively.

(2)

Reflects the divestiture of Grainger's subsidiary, E & R Industrial Sales, Inc., in the fourth quarter of 2023.

(3)

Excludes the impact of year-over-year foreign currency exchange rate fluctuations.

Free cash flow (FCF) for the three and twelve months ended December 31, 2024(in millions of dollars) (unaudited)

Q4 2024

FY 2024

Net cash flows provided by operating activities

$ 428

$ 2,111

Capital expenditures

(258)

(541)

Free cash flow

$ 170

$ 1,570

Income statement adjustments for the three and twelve months ended December 31, 2024(in millions of dollars) (unaudited)

Q4 2024

Reported

Adjusted(4)

Reported

Adjusted

Reported

Adjustment(1)

Adjusted

% of Net sales

Y/Y(2)

Earnings reconciliation:

SG&A

$ 1,043

$ —

$ 1,043

24.6 %

3.7 %

6.4 %

Operating earnings

633

—

633

15.0

13.6

8.6

Other expense — net

(11)

—

(11)

(0.3)

(31.3)

Earnings before incometaxes

622

—

622

14.7

15.0

9.7

Income tax provision(3)

(125)

—

(125)

(3.0)

(3.1)

(6.0)

Net earnings

497

—

497

11.7

20.6

14.5

Noncontrolling interest(5)

(22)

—

(22)

(0.5)

(29.4)

29.4

Net earnings attributable to W.W. Grainger, Inc.

$ 475

$ —

$ 475

11.2 %

20.3 %

13.9 %

Diluted earnings per share:

$ 9.71

$ —

$ 9.71

23.1 %

16.6 %

(1)

Reflects the adjustment for the loss on divestiture of Grainger's subsidiary, E&R Industrial Sales, Inc., reported in the Company's HTS-N.A. segment completed in the fourth quarter of 2023. There were no non-GAAP adjustments in the fourth quarter of 2024.

(2)

For prior year financial information regarding Grainger's non-GAAP measures, including reconciliations to the most directly comparable GAAP measures, refer to the Company's Form 8-K filed with the SEC on February 2, 2024.

(3)

Reported and adjusted effective tax rate was 20.1% for the fourth quarter of 2024.

(4)

Calculated on the basis of reported net sales for the fourth quarter of 2024.

(5)

The Company has a controlling ownership interest in MonotaRO, with the residual representing noncontrolling interest.

FY 2024

Reported

Adjusted(4)

Reported

Adjusted

Reported

Adjustment(1)

Adjusted

% of Net sales

Y/Y(2)

Earnings reconciliation:

SG&A

$ 4,121

$ (16)

$ 4,105

24.0 %

23.9 %

4.8 %

5.1 %

Operating earnings

2,637

2,653

15.4

15.5

2.8

2.4

Other expense — net

(53)

—

(53)

(0.3)

(18.5)

Earnings before incometaxes

2,584

2,600

15.1

15.2

3.4

2.9

Income tax provision(3)

(595)

(4)

(599)

(3.5)

(0.3)

Net earnings

1,989

2,001

11.6

11.7

4.5

3.9

Noncontrolling interest(5)

(80)

—

(80)

(0.5)

(8.1)

8.1

Net earnings attributableto W.W. Grainger, Inc.

$ 1,909

$ 12

$ 1,921

11.1 %

11.2 %

4.4 %

3.8 %

Diluted earnings per share:

$ 38.71

$ 0.25

$ 38.96

6.8 %

6.2 %

(1)

Reflects restructuring costs incurred in the second quarter of 2024 of $15M and $1M in Grainger's HTS-N.A. segment and Other businesses, respectively.

(2)

(3)

Reported and adjusted effective tax was 23.0% for the year ending December 31, 2024.

(4)

Calculated on the basis of reported net sales for the year ending December 31, 2024.

(5)

The Company has a controlling ownership interest in MonotaRO, with the residual representing noncontrolling interest.

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SOURCE W.W. Grainger, Inc.