- MSM reported Q4 2024 revenue of $952.3 million, down 8% year over year, as soft conditions persisted across manufacturing end markets. Gross margin was 41.0% and operating margin (GAAP) was 9.5% with adjusted (non-GAAP) operating margin of 9.9%. Net income was $55.7 million and diluted EPS was $0.99 for the quarter.
- The fourth quarter showcased margin resilience driven by pricing realignment actions, favorable mix (notably core customers and implant/vending solutions), and ongoing productivity initiatives. Management highlighted that the company has returned gross margins to expected levels after a pricing-system rollout volatility in Q3 2024 and that 4Q 2024 gross margin exceeded historical sequential averages. The Columbus CFC closure is already delivering targeted savings of $5–$7 million annually starting in fiscal 2025.
- For 2025, MSM provided a cautious quarterly outlook with a first-quarter ADS decline of 4.5% to 5.5% and an adjusted operating margin target of 7.0% to 7.5%. The company expects depreciation and amortization of $90–$95 million for the year, capital expenditures of $100–$110 million, and free cash flow roughly equal to net income. Management stressed a longer-term view toward improving growth and margins, aided by a robust productivity pipeline and accelerating gains from e-commerce, pricing, and large-account wins. Investors should monitor macro sensitivity (interest rates, election timing), execution of the productivity initiatives, and the ramp of the new website/marketing program.