Grainger names Ernst & Young LLP as auditor
Danaher comments on Q1 outlook
ITW sees revenue increase in recent three months
Applied wins supplier award from Vulcan Materials Co.
Timken increases prices on aerospace steel
ISA accepting American Eagle award nominations
Toronto distributor opens Chicago location
Hughes Supply 4th quarter earnings leap 120 percent

Grainger names Ernst & Young LLP as auditor
Grainger's audit committee on its board of directors appointed Ernst & Young LLP as the company's new independent auditor, effective for calendar year 2005.

Ernst & Young LLP replaces Grant Thornton LLP, which served as the company's independent auditor since before the company went public in 1967.

"We appreciate the hard work and professionalism of Grant Thornton over the years," said Brian P. Anderson, chairman of the audit committee. "Coming to this decision has been a long and thoughtful process, which included a review of proposals and oral presentations by several leading firms, including Grant Thornton LLP. The audit committee decided to engage Ernst & Young LLP, after this competitive selection process."

The change in auditor was not related to any disagreement between the company and Grant Thornton LLP on any matter of accounting principles or practices, financial statement disclosure or auditing scope or procedures.

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Danaher comments on Q1 outlook
Danaher Corp. president and CEO H. Lawrence Culp Jr. commented March 9 on the company’s performance at the Smith Barney Citigroup Global Industrial Manufacturing Conference in New York City. 

Culp said earnings per share for the 2005 first quarter will likely be in the range of 55 cents to 57 cents vs. the previous range of 52 cents to 57 cents with year-over-year revenue growth from existing operations likely to be in the mid-single-digit range.

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ITW sees revenue increase in recent three months
Illinois Tool Works Inc. today reported an operating revenue increase of 17 percent for the three months ended Feb. 28.

Operating revenues for the three-month period consisted of 9 percent growth from base revenues, a 6 percent increase from acquisitions, and a 3 percent contribution from currency translation.

Leasing and investments and intercompany revenues reduced top line growth 1 percent in the three-month period. Base revenues reflected continued strength in businesses that serve a broad array of worldwide end markets, particularly those in the company's North America specialty systems segment.

On a manufacturing segment basis, the company's three-month moving average percentage change for operating revenues, comprised of base revenues and acquisitions, is provided below.

After two months of actual results in the 2005 first quarter, the company reaffirmed its earnings range estimate of $1.01 to $1.07 for income per diluted share from continuing operations.

For full-year 2005, the company is reaffirming its earnings range estimate of $4.96 to $5.16 for income per diluted share from continuing operations.

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Applied wins supplier award from Vulcan Materials Co.
Applied Industrial Technologies received the 2004 Gold Alliance Supplier Award from Vulcan Materials Company.

Vulcan presents this honor annually based on a review that rates each supplier on quality of product, service, support, ease of doing business and value.

Applied received the Bronze Alliance Supplier Award from Vulcan in 2000 and the Silver Alliance Supplier Award in 2001, 2002 and 2003.

"At Applied, we are committed to becoming total partners with our customers to ensure they receive high levels of support in their operations in addition to world-class products. The secret to our success lies in the dedication, persistence and compassion of Applied associates nationwide who serve Vulcan. People make the difference, and we have the finest in the industry," said Ted Carl, vice president of strategic alliances for Applied. "We are very pleased to receive this prestigious award from Vulcan Materials and look forward to continuing our partnership in 2005."

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Timken increases prices on aerospace steel
Timken Latrobe Steel, a subsidiary of The Timken Co., increased prices by 5 percent to 10 percent on all remelted aerospace alloys and air melt stainless steel grades.

The price change weht effective with all new orders received after March 15. Raw material surcharges will remain in effect.

"Increasing operational costs and other key factors have made this price increase necessary," said Hans J. Sack, president of Timken Latrobe Steel.

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ISA accepting American Eagle award nominations
The Industrial Supply Association is now accepting nominations for its redesigned American Eagle Awards competition. The deadline for ISA member companies to enter the competition is April 11. The program replaces the former American Eagle and Value-Added Partner of the Year awards.

“Under the new format, we’re retaining the best of two former awards programs. In the newly revamped program, we’ve also introduced new categories that demonstrate how ISA members help customers cut costs, increase productivity or benefit their communities. We believe these changes make the program more meaningful, more powerful and better exemplify the value that ISA member companies bring to the channel,” says Kathy Durbin, chairperson of the ISA Partnership Enhancement and Awards Committee.

The program offers manufacturers and distributors of all sizes a chance to compete in five categories. The top award, the American Eagle Value-Added Partner Award, will recognize the combined efforts of a manufacturer and distributor that worked together to demonstrate cost savings or productivity improvements based on a single event or an annual program. Additional categories include the American Eagle Value-Added Distributor Award, the American Eagle Value-Added Manufacturer Award, and two separate Corporate Citizenship awards.

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Toronto distributor opens Chicago location
Brafasco Inc., a Toronto-based industrial supply company specializing in fasteners, safety supplies and other industrial tools and supplies, opened a Chicago-area showroom in Elk Grove Village, Ill. The new location marks Brafasco's first entry into the Chicago area in a Midwest expansion planned to include three locations in the coming year.

"Chicago remains a major industrial market and Elk Grove Village has one of the largest concentrations of manufacturing businesses in the world. A location here gives us the opportunity to expand," said Bob San Julian, Brafasco president and CEO.

Brafasco is a portfolio company of Chicago-based private equity firm Glencoe Capital. Glencoe, which manages $950 million in alternative assets for institutional investors, bought Brafasco as part of an earlier portfolio company, Kar Products, that the firm sold in 2003.

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Hughes Supply 4th quarter earnings leap 120 percent
Hughes Supply grew earnings by 120 percent in the fourth quarter that ended Jan. 31. Revenues reached $1.12 billion, an increase of 41 percent from $796 million in the previous year's fourth quarter. Organic sales growth was 16 percent, with double-digit growth reported in the majority of the business segments for the fourth consecutive quarter.

Net income grew to $20.7 million compared to $9.4 million in the prior year's fourth quarter. Earnings per diluted share grew 55 percent to 31 cents, compared to 20 cents per diluted share in the previous year's fourth quarter.

For the full year, sales grew 36 percent to $4.42 billion from $3.25 billion in the previous year. Organic sales grew a record 16 percent, with double-digit growth reported in six of eight business segments. Annual net income grew 114 percent to $123.7 million from $57.7 million in the previous year.

"Strong financial performance, significant progress on operational initiatives, three strategic and accretive acquisitions, and a strengthened capital structure made fiscal year 2005 the best year in our Company's history," said Tom Morgan, president and CEO.

He added that the company is encouraged by the strengthening demand in both the commercial construction and the industrial end markets. Residential activity also continues to be very strong in the geographic markets in which we operate. He anticipates single-digit organic sales growth for fiscal 2006/

"In the first quarter, we expect demand to continue to be good, with stable to moderately increasing commodity prices. While we expect good organic growth in the quarter and for the year, we do not expect the extraordinary level of growth experienced last year. Gross margin in the first quarter of last year was the highest gross margin in the company's history, as rapidly rising commodity prices and strong demand expanded margins considerably. Accordingly, we expect gross margins to return to a more normal level in the first quarter of fiscal 2006 compared to last year's first quarter; however, expenses as a ratio to sales should improve as our level of investment spending begins to moderate," Morgan said.

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