Fastenal : Q4 2020 Investor Teleconference Presentation

Investor Teleconference Presentation

Fourth Quarter 2020

Fastenal Company

January 20, 2021

1

Safe Harbor Statement

All statements made herein that are not historical facts (e.g., future operating results and business activity in light of the COVID-19 pandemic, as well as expectations regarding operations, including gross margin and capital expenditures) are "forward- looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements involve known and unknown risks, uncertainties, and other factors that may cause actual results to differ materially. More information regarding such risks can be found in Fastenal's Form 10-K for the year ended December 31, 2019 and subsequently filed Form 10-Qs filed with the Securities and Exchange Commission. Any numerical or other representations in this presentation do not represent guidance by management and should not be construed as such. The appendix to the following presentation includes a discussion of certain non-GAAP financial measures. Information required by Regulation G with respect to such non-GAAP financial measures can be found in the appendix.

2

CEO Messages on 4Q20

18%			Daily Sales Rate (DSR) Growth
16%
14%	13.2% 13.1% 13.0%	13.2%	12.2%
12%
									10.3%
10%
					7.9%
8%
						6.1%					6.4%
6%
							3.7%
4%								2.8%		2.5%
2%
0%
	1Q18	2Q18	3Q18	4Q18	1Q19	2Q19	3Q19	4Q19	1Q20	2Q20	3Q20	4Q20
						EPS

Daily sales grew 6.4%, with improving industrial activity as we exited 2020. The Blue Team's management of operating cost was excellent, producing 10.6% operating income growth.

Safety has over performed over time, providing about 26% of our growth in the two years from 2017 to 2019 despite being less than 20% of sales. In 2020, amid economic contraction and a COVID-linked surge in PPE demand, its contribution swelled to 156%. Our presence and capabilities in safety allowed us to serve, highlighted our 'problem solving' culture, and should open up new customer and end market opportunities to us.

Customer engagement on growth drivers has improved. Still, COVID has caused customers to slow the sales cycle and pace

$0.45

(Fully Diluted)

of signings, including amid the 4Q20 COVID case surge.

$0.40

$0.35$0.31$0.34 $0.30

$0.25 $0.20 $0.15 $0.10 $0.05 $0.00

1Q18 2Q18 3Q18 4Q18 1Q19 2Q19 3Q19 4Q19 1Q20 2Q20 3Q20 4Q20

• 2020 was important in terms of becoming a better supply chain partner. Our purchase of certain Apex assets, utilization of e-commerce, commercialization of FAST Bin, deployment of mobility, and evolution of our branch model is creating more ways for the Blue Team to illuminate our customer's supply chains and bring them (and ourselves) efficiencies.
• Strong profits and working capital management produced strong cash flow in 2020, allowing us to pay a special dividend while retaining a conservative capital structure.

3

CEO Messages on 4Q20

Product Dispenses Through Vending, by Week

125														120.75
120														115.07
115												112.49
110									108.78
				104.78
105
100					103.15							103.94
95
90									93.30
85
80
75							76.20
70
65
Oct-	Nov-	Dec-	Jan-	Feb-	Mar-	Apr-	May-	Jun-	Jul-	Aug-	Sep-	Oct-	Nov-	Dec-
19	19	19	20	20	20	20	20	20	20	20	20	20	20	20

		Oct'19-Dec'20		Benchmark Oct-Sep (Four Yr. Avg.)	Note: Dec'20 through Dec 29th

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