WW Grainger Inc reported solid Q4 2024 results, underpinned by revenue growth and strong profitability, supported by robust cash flow generation. Revenue for the quarter was $4.233 billion, up 5.9% year over year, but down 3.5% quarter over quarter due to seasonal and channel mix dynamics. The company delivered an operating margin of 15.0% and a net margin of 11.2%, with net income of $475 million and basic EPS of $9.74 (diluted $9.71). Free cash flow amounted to $170 million, while operating cash flow was $428 million, highlighting meaningful cash generation even as the company executed sizable stock repurchases ($462 million) and paid a $100 million cash dividend. Net debt stood at approximately $2.15 billion, with EBITDA of $701 million, yielding a net debt to EBITDA of about 3.1x, signaling a disciplined but levered capital structure customary for a large US industrial distributor.
Although the quarter showed year-over-year improvement in revenue and margins, sequential performance moderated due to seasonality and ongoing mix effects between HighTouch Solutions NA and Endless Assortment. The balance sheet remains well-capitalized, with liquidity supported by $1.04 billion of cash and equivalents and a current ratio of 2.49x. Management commentary in the absence of a formal earnings call transcript suggests continued focus on service levels, inventory discipline, and leveraging e-commerce and VMI capabilities to sustain growth in a steady-to-modest macro environment. Going forward, Grainger faces ongoing macro uncertainty, currency translation considerations for international operations, and competition from other large distributors, but remains well-positioned to convert demand stability into earnings and cash flow while maintaining a conservative balance sheet.