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updated: 4/16/2013 5:31 PM

Mettawa-based Grainger 1Q profit up, strength across regions

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Associated Press

W.W. Grainger Inc. said Tuesday that its first-quarter net income climbed 13 percent, in part because of increased prices and strength across all regions.

The company, which sells power tools and other industrial equipment, also boosted the low end of its full-year earnings and revenue outlook ranges given its strong quarterly performance.

Shares rose more than 6 percent in morning trading.

W.W. Grainger earned $211.8 million, or $2.94 per share, for the three months ended March 31. That's up from $187.5 million, or $2.57 per share, a year earlier.

Analysts, on average, predicted earnings of $2.73 per share, according to FactSet.

Revenue climbed 4 percent to $2.28 billion from $2.19 billion, bolstered by improved volume, higher prices, acquisitions and increased sales of seasonal products. Wall Street's estimate was for $2.3 billion in revenue.

There was one less selling day in the current quarter. W.W. Grainger also said that uncertainty around sequestration hurt its sales to the government end market, which made up 15 percent of U.S. sales.

U.S. and Canadian sales rose 4 percent, as did sales for other businesses -- which includes operations mostly in Asia, Europe and Latin America. Sales for the U.S. and Canada comprised about 89 percent of total sales for the quarter.

The Chicago company said that it now anticipates full-year earnings of $11.30 to $12 per share, up from $10.85 to $12 per share. It also raised the low end of its revenue forecast. W.W. Grainger now expects revenue will rise 5 percent to 9 percent. Its prior outlook called for 3 percent to 9 percent growth. Based on 2012's revenue of $8.95 billion, this implies $9.4 billion to $9.76 billion.

Analysts expect full-year earnings of $11.74 per share, on revenue of $9.59 billion.

W.W. Grainger's stock climbed $14.94, or 6.6 percent, to $240.64. In the first few minutes of trading, the shares hit a new all-time high of $245.46.

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