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Fastenal’s Dan Florness One of 25 “Best CFOs”

Florness is known for his tight expense and inventory control measures, according to The Wall Street Journal.
August 10, 2012

Fastenal Company CFO Dan Florness is one of the 25 best chief financial officers in the country, according to The Wall Street Journal.

Florness, who has served as CFO at the Winona-based company since 1996, ranked ninth on the national newspaper’s “Best CFOs” list.

The Wall Street Journal compiled the list, its first, using both quantitative and qualitative measures, including the role the CFO plays in each company and how peers, competitors, and analysts regard the CFO’s work. The national newspaper said that it sought to identify executives who run finance operations that perform well and who, at the same time, take a lead role in setting strategy at their companies.

At Fastenal, Florness is known for his tight expense and inventory control measures, according to The Wall Street Journal. In 2007, he reportedly helped create the Pathway to Profit program—which focused on opening fewer new stores each year, but leveraging existing ones by adding more outside sales representatives and other “growth drivers.”

Meanwhile, the company—which sells industrial and construction supplies—has “amazing margins,” Brent Rakers, an analyst at Wunderlich Securities, told The Wall Street Journal.

Fastenal’s earnings growth reportedly surpasses its sales growth regularly; in 2011, the company achieved 35 percent earnings growth compared to 22 percent growth in sales.

The company has also reportedly been able to increase its pre-tax profitability from approximately 18 percent to 22 percent of sales over the last five years.

Florness is not the only Fastenal executive to be called out recently by a national publication. In April, Forbes included CEO Willard Oberton on a list of 10 public company CEOs in the country who are the “best bosses for the buck”—those who have delivered the highest returns to their companies’ shareholders relative to their total compensation.

Meanwhile, IBM CFO Mark Loughridge topped The Wall Street Journal’s list, followed by Carol Tomé of Home Depot, Karen Hoguet of Macy’s, Intel’s Stacy Smith, and Paul Clancy of Biogen Idec.

Fastenal is among Minnesota’s 25-largest public companies based on revenue, which totaled approximately $2.8 billion in 2011.