W.W. Grainger, Inc. Reports Record 1998 Second Quarter, First Half

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W.W. Grainger, Inc. Reports Record 1998 Second Quarter, First Half
    CHICAGO, July 15 /PRNewswire/ -- W.W. Grainger, Inc. (NYSE: GWW) reported
that sales increased 6.4% to $1,118,970,000 for the second quarter ended June
30, 1998, from $1,051,206,000 reported for the same 1997 period.  Net earnings
increased 2.9% to $59,250,000, compared with 1997 second quarter net earnings
of $57,559,000.  On a diluted basis, earnings per share increased 7.1% to 60
cents per share, compared with 1997 second quarter earnings per share of 56
cents.
    For the 1998 first half, sales increased 6.8% to $2,176,077,000 from sales
of $2,036,762,000 reported for the same 1997 period.  Net earnings increased
3.8% to $116,422,000, compared with 1997 first half net earnings of
$112,168,000.  On a diluted basis, earnings per share increased 9.3% to $1.18
per share, compared with 1997 first half earnings per share of $1.08.
    Earnings per share are based on the average number of shares outstanding
during each period after reflecting the 2-for-1 stock split effective at the
close of business on May 11, 1998.
    W.W. Grainger, Inc. (GWW), with 1997 sales of $4.1 billion, is the leading
distributor of maintenance, repair, and operating (MRO) supplies and related
information to the commercial, industrial, contractor, and institutional
markets in North America.  GWW shares are traded on the New York and Chicago
stock exchanges.  For more information, visit Grainger on-line at
http://www.grainger.com.

               CONSOLIDATED STATEMENTS OF EARNINGS (Unaudited)

                    (In thousands of dollars except for per share amounts)
                             Three Months ended         Six Months ended
                                  June 30                    June 30
                            1998          1997          1998         1997

    Net sales           $1,118,970    $1,051,206   $2,176,077    $2,036,762

    Cost of merchandise
      sold                 717,011       680,177    1,388,963     1,312,453

      Gross profit         401,959       371,029      787,114       724,309

    Warehousing, marketing,
      and administrative
      expenses             301,193       273,044      588,757       534,349

      Operating earnings   100,766        97,985      198,357       189,960

    Other income or (deductions)
      Interest income          142           512          480         1,902
      Interest expense      (1,614)       (1,428)      (3,297)       (2,576)
      Unclassified -- net      286          (332)         127          (769)

                            (1,186)       (1,248)      (2,690)       (1,443)

      Earnings before
        income taxes        99,580        96,737      195,667       188,517

    Income taxes            40,330        39,178       79,245        76,349

      Net earnings         $59,250       $57,559     $116,422      $112,168

    Net earnings per share
     - Basic                 $0.62         $0.57        $1.20         $1.09
     - Diluted               $0.60         $0.56        $1.18         $1.08

    Average number of shares
      outstanding
      - Basic           97,246,552   100,887,998   97,235,431   102,642,671
      - Diluted         99,061,632   102,287,338   99,021,684   104,082,083

    Earnings per share and the average number of shares outstanding reflect
the 2-for-1 stock split effective at the close of business on May 11, 1998.
    (Supplemental financial information concerning the Quarter and First Half
ended June 30, 1997 is available upon request.  Contact Bill Chapman, Investor
Relations Manager. 847-793-6435.)
SOURCE W.W. Grainger, Inc.
http://www.grainger.com
CONTACT:
Bill Chapman, Investor Relations Manager of
W.W. Grainger, 847-793-6435