Welcome to our new facility here. You know, 25 years ago, we started out in the lunchroom, then we moved to the truck bays. Now we're in the warehouse. Next year, it's either up on the roof or out by the barbecue tent. We're going to do things a little bit differently. I'm going to come down to Monsignor Habiger for the invocation. Monsignor has been with us since 1987 and always has done a great job with the invocation. It always seems to have helped with the stock price for the year. Once again, I'll turn this over to Monsignor Habiger.
It's good for me to be here. I think at my age, it's good to be anywhere. Good morning, God. You redeemed yourself to us in your creation. For this, we are grateful. We thank you for Mother Earth and our atmosphere. We thank you for our mountains and our meadows. We thank you for the forests and fields, for our oceans, lakes, and rivers, and all the creatures therein. Help us to respect these sacraments of your presence and to use them for our needs with reverence and restraint. Grant that carelessness and greed may stop me facing your creation.
Help us, creator of all the world and lover of each of us, to realize the beauty with which you surround us: the colors, the shades, the lights, the shadows, the shapes, the patterns, all the dazzling array of enchantments of the eye and ear to which we usually take a little note and a little attention. Help us to realize that we men and women are the crown of this wonder. Male and female, you created us in this image of life. We are grateful to you. Can we not hear Ferozi maybe? is born and is feeding the founders of the happenings, the resolution that I will bring to you.
Whereas Monsignor James D. Habiger, Father Jim, has been a friend, porter, and spiritual guidance of the founders of the company for over 50 years, whereas Father Jim has endured selfishness.
I believe all you need to do is hear me. All the mysteries.
We wanted to give Father Jim something special. I think we all know sometimes when a nut comes off your toaster or your alarm clock, it's always nice to have a spare on hand. We have Father Jim here.
The annual meeting of shareholders of Fastenal Company is now convened. I am Robert A. Kierlin, Chairman of the Board of the company. Stephen M. Slaggie, who will act as Secretary at this meeting, and I will act as Chairman. Also present, we stand, are Michael M. Gostomski, Willard D. Oberton, Michael J. Dolan, Reyne K. Wisecup, Michael J. Ancius, and Scott A. Satterlee, who are directors of the company. Thank you. And Hugh L. Miller, a friend of the company. He is currently in China and is viewing this meeting via webcast. Hello, Hugh. I would first like to welcome all of you to this annual meeting, and next, I'll record on the number of shares present at this meeting to conduct the voting of the proposals to be considered at this meeting and report to you on the company.
The record date for the determination of the holders of the company's common stock entitled to receive notice of and to vote at this meeting was fixed by the Board of Directors as February 22nd, 2012. Over here, I present to the meeting a certified list of shareholders of the company issued and outstanding common stock as of the close of business on the record date. The list will be kept open and subject to the inspection of all shareholders during the meeting. I also present to the meeting an affidavit of a manager of Broadridge Financial Solutions, that's over here, attesting that a notice of meeting together with a proxy statement, proxy card, and certain other documents were mailed on or about March 2nd, 2012, to each holder of record of the company's common stock as of the close of business on the record date.
The affidavit of mailing of the notice of this meeting will be attached to the minutes of this meeting as Exhibit A. The certified list of the holders of the company's common stock will be filed with the books and records of the company. As of the close of business on the record date, there were outstanding and entitled to vote at this meeting 295,323,074 shares of common stock. Each share of the common stock is entitled to one vote. For a quorum to be present, a majority of the 295,323,074 votes entitled to be cast must be present in person or by proxy at this meeting. On a preliminary count, there are represented at the meeting either in person or by proxy, a majority of the votes entitled to be cast at the meeting. Therefore, a quorum is present for this transaction of business.
Anybody here present who has not submitted a proxy or registration form? Thank you. A record of the proxy submitted to the meeting and the ballots of the individuals appointed as proxies and of the shareholders voting in person at the meeting will be filed with the books and records of this company. Tina Abrams and Kimberly McCrate, again, for this year, are hereby appointed to act as the Inspectors of Election with respect to all matters to be voted upon at the meeting or any adjournment thereof. The oath of the Inspectors of Election will be administered and will be attached to the minutes of this meeting as Exhibit B. We hereby make available to the Inspectors of Election the list of shareholders, the registration forms, and a record of all proxies submitted to this meeting.
Copies of the minutes of the last annual meeting of the company held on April 19th, 2011, are available at the right side of the room. We will therefore dispense with the reading of the minutes of that meeting. All shareholders of record as of the close of business on February 22nd, 2012, may vote on the matters to be considered today. If you wish to vote by ballot, please raise your hand when I ask you to do so, and a ballot will be given to you. Shareholders who have appointed others as proxy to vote their shares, whether in writing or by telephone or over the internet, and have not terminated those proxies, should not vote by ballot. This procedure will be followed for all of the votes to be taken today and will now take up the business of the meeting.
First, we'll proceed with the election of nine directors for the coming year. I therefore open the floor for nomination for directors to serve until the next regular meeting of shareholders or until their successors are elected and shall qualify. I'll recognize Mr. Nate Hansen.
Mr. Chairman, my name is Nate Hansen, and I'm a shareholder of the company. I nominate the following nine persons for election to the board of directors to serve until the next regular meeting of shareholders or until their successors are elected and qualified: Robert A. Kierlin, Stephen M. Slaggie, Michael M. Gostomski, Willard D. Oberton, Michael J. Dolan, Reyne K. Wisecup, Hugh L. Miller, Michael J. Ancius, and Scott A. Satterlee.
Thank you. Chair recognizes Mr. Zach Weiss.
Mr. Chairman, my name is Zach Weiss. I'm a shareholder of the company, and I second the nominations.
Thank you. Are there any other nominations? Hearing no other nominations, I declare the nominations to be closed. If you wish to vote for the election of directors by ballot, please raise your hand, and a ballot will be given to you. If you have appointed another person or proxy to vote your shares and have not terminated that proxy, you should not vote by ballot. After you've executed your ballot, it'll be collected and tabulated. Anybody needing a ballot to vote again? Thank you. The polls are now closed, and ballots for the election of directors will be counted. While the inspectors are completing the tally on the election of directors, we'll move on to the next matter for consideration today, ratification of the appointment of KPMG LLP as our independent registered public accounting firm for fiscal 2012. I'd like to introduce Mr. Jeffrey Hahn. Is he here?
There's Jeffrey, a partner of that firm who's here today to answer any questions you may have. Load up your questions for him. I will now open the floor to a motion concerning the ratification of the appointment of KPMG LLP as our independent registered public accounting firm for fiscal 2012. I'll recognize Dr. Robert Schell.
Good morning, Mr. Chairman. My name is Bob Schell, and I am a shareholder of the company. At this time, I'd like to move a motion that the following resolution be adopted: Resolved, that the appointment of KPMG LLP as the independent registered public accounting firm for the company for the fiscal year ending December 31st, 2012, be and is hereby ratified.
Thank you. Chair recognizes Mr. Roland Solberg.
Mr. Chairman, my name is Roland Solberg. I'm a shareholder of the company. I second the motion.
Thank you. Any discussion on that motion? It has been moved and seconded that the appointment of KPMG LLP as an independent registered public accounting firm for the company for the fiscal year ending December 31, 2012, be ratified. If you wish to vote on this motion by ballot, please raise your hand, and the ballot will be given to you. If you have appointed another person to have proxy to vote your shares and have not terminated that proxy, you should not vote by ballot. After you've executed your ballot, it'll be collected and tabulated. Anybody needing a ballot? Thank you. Polls are now closed, and ballots for the motion to ratify the appointment of KPMG LLP as our independent registered public accounting firm for fiscal 2012 will be counted. I'll now open the floor to a motion concerning the approval of executive compensation. Chair recognizes Mr. Robert Craig.
Mr. Chairman, my name is Robert Craig, and I'm the shareholder of the company. I move that the following resolution be adopted. Resolved that the shareholders of the company approve, on an advisory basis, the compensation of the company's named executive officers as disclosed in the compensation discussion and analysis, compensation tables, and related disclosures contained in the section of the proxy statement for the 2012 annual meeting of shareholders captioned executive compensation.
Thank you. Chair recognizes Ms. Elizabeth Oliver.
Mr. Chairman, my name is Elizabeth Oliver, and I'm a shareholder of the company. I second the motion.
Thank you. Any discussion on that motion? It has been moved and seconded that the compensation of certain of our executive officers be approved. If you wish to vote on this motion by ballot, please raise your hand, and the ballot will be given to you. If you have appointed another person as proxy to vote your shares and have not terminated that proxy, you should not vote by ballot. After you have executed your ballot, it'll be collected and tabulated. The polls are now closed, and ballots for the motion to approve the compensation of certain of our executive officers will be counted. I will now open the floor to a motion concerning the approval of an amended and restated Fastenal Company Incentive Plan.
Under the Fastenal Company Incentive Plan, employees of the company and subsidiaries who participate in the plan will have an opportunity to receive awards under the plan payable in cash. The payout of these awards is contingent upon the degree of attainment of specified performance measures over an applicable performance period. Because five years have passed since the adoption of the Fastenal Company Incentive Plan, Section 162(k) of the Internal Revenue Code requires us to obtain shareholders' reapproval of the material terms of the plan in order to preserve our ability to deduct for federal income tax purposes performance-based incentive compensation pay to certain of our executive officers. In connection with the five-year refinishing of the plan, our compensation committee has proposed and our board of directors has approved several changes to our incentive plan.
The amended and restated plan reflecting those changes is described and discussed in detail in the proxy statement. A copy of the amended and restated plan is attached as Appendix A to the proxy statement. I will now open the floor to a motion concerning whether to approve the amended and restated Fastenal Company Incentive Plan. Chair recognizes Mr. David Wickstrom.
Mr. Chairman, my name is David B. Wickstrom, and I am a shareholder of the company. I move that the following resolution be adopted. Resolved that the amended and restated Fastenal Company Incentive Plan in the form attached to the proxy statement for the 2012 annual meeting of shareholders as Appendix A, B, and hereby is approved.
Thank you. Chair recognizes Ms. Sue Stratt.
Mr. Chairman, my name is Sue Stratt, and I am a shareholder of the company. I second the motion.
Thank you. Any discussion on that motion? It has been moved and seconded that the amended and restated Fastenal Company Incentive Plan be approved. If you wish to vote on this motion by ballot, please raise your hand, and the ballot will be given to you. If you have appointed another person as proxy to vote your shares and have not terminated that proxy, you should not vote by ballot. After you've executed your ballot, it'll be collected and tabulated. Anybody needing a ballot? Thank you. Polls are now closed, and ballots for the motion to approve the amended and restated Fastenal Company Incentive Plan will be counted. I'll now open the floor to a motion concerning the approval of amendments to the restated articles of incorporation of the company. Chair recognizes Ms. Madison Jansen.
Mr. Chairman, my name is Madison Jansen, and I am a shareholder of the company. I move that the following resolution be adopted. Resolved that the restated articles of incorporation of the company as heretofore amended are hereby further amended by adding thereto a new Article 11 in the form attached to the proxy statement for the 2012 annual meeting of shareholders as Appendix B.
Thank you. Chair recognizes Ms. Jan Northam.
Mr. Chairman, my name is Jan Northam, and I'm a shareholder of the company, and I second the motion.
Thank you. Any discussion on that motion? It has been moved and seconded that an amendment to the restated articles of incorporation of the company be approved. If you wish to vote on this motion by ballot, please raise your hand, and the ballot will be given to you. If you have appointed another person as proxy to vote your shares, you should not vote by ballot. After you've executed your ballot, it'll be collected and tabulated. The polls are now closed, and ballots for the motion to approve an amendment to the restated articles of the company will be counted. While the ballots are being counted, Mr. Will Oberton, our President and Chief Officer, will report to you on the company. After the conclusion of this report, we will answer any questions you may have related to the company and its activities.
As Will is coming up here, somebody has pointed out to me that he's our birthday boy today. We will not be singing "Happy Birthday" because we don't want to pay the royalty on the music. We will give Will a second brownie at lunch. There are probably two or three more birthdays out there, so if you have birthdays today, you get a second brownie. Will?
The only problem with the birthday is birthday, but the boy problem is long gone. Before I get started with the highlight of 2011, we have a lot of Fastenal employees here today. We have one group that's in for meetings, our Regional Vice President. I'd like to take a minute. I'd like to ask all of you to stand, the Regional Vice President, and just make a couple of comments about this group.
First thing I'd like to say is this is a group of very good friends of mine, a great group of Fastenal people. If you look at the group, they manage businesses anywhere from about a low of around $50 million a year to a high of over $500 million a year. Every one of them runs a large business. The average age of this group is just over 40 years old. I talked to most of them last night. I had the opportunity to have dinner with them. We have a group of people that are just over 40 years old, and they have greater than 20 years' tenure with our company. It's really representative of our entire company. A bunch of people who start here at a young age have worked very hard and have performed at a very high level.
One of the reasons I am so confident that Fastenal will continue to grow well into the future is because we have groups of people like this that have been here for a long time but have a long time left, or many years left to work, and they're just going to continue to get better. I want to thank all of them for everything they do. If you happen to see them here after lunch, if you can give them a thank you, give them a pat on the back. I'd also like to mention that Bob Hopper, who's our Florida, one of our newer Regional Vice Presidents, it's his birthday tomorrow, and I think he's going to be 40. Is that right, Bob? If you see Bob, you can give him a big 40th attaboy. Thank you very much, guys. 2011 was a very good year for Fastenal.
I'm very proud of the results that we were able to put up. As you see on the screen, we had 21.9% sales growth, very nice sales growth. We were able to grow our earnings at almost 35%, 34.9%. We need to learn to be a little bit better at rounding. That'd be 22% and 35%, Dan, wherever you are. No, a little bit better. Our commission, our employees, and this is an important part, our employee commission and bonuses grew by 28%. Not only are the shareholders being taken care of, our employees continue to do better every year as we move forward. I think that's very important.
One of the things that I'm most proud of is that we were able to add 1,883 people onto our team. At a time when the economy is tough and unemployment is still higher than any of us would like, we're out there doing the right things. It's about the people in the field servicing the customers and creating a greater need for more people. We've been able to continue to add to the team and do our part with helping the economy. I want to thank all the Fastenal employees for that. That's a great accomplishment. Our dividends paid in 2011 only grew 4.9%, but I have to make sure you understand that's only because in 2010 we paid a special dividend, which pushed it way up. If you look at a normalized pattern, that would be over 20% growth if you took out the special dividend.
The employees are getting paid and the shareholders are getting paid also. More importantly, if you look at the market value added, we added more than $4 billion in market value to our company in one year. That's another thing I think we should be very proud of. I'm guessing that makes most of our shareholders extremely happy. Hit on a couple of our growth drivers, our main growth driver. We continue to add new stores. Stores are not our main growth driver as they were for the last 20 years, but we continue to find markets that can be supported or that will support a store, and we continue to add them. This year, the number will probably be down a little bit also. We'll continue to look for the right markets, continue to add stores.
National Account Sales Specialists, Government Sales, Product Sales Specialists, mainly focusing on metalworking with their cutting tools and safety products. FAST Solutions Sales Specialists, they're the people out selling our industrial vending. All told, we added 120 people outside of the stores, all well-trained, focusing on either specific products or specific customer types. This is the number that's kind of offsetting the growth we're losing from not opening as many stores. We're reinvesting that in outside salespeople. These programs are working very well, hence the almost 22% sales growth. One of the things I have to talk about a little bit is our FAST Solutions, our industrial vending. We've been talking about the last three shareholder meetings. We had by far the best year with industrial vending in 2011 that we've ever had. Just this week, we installed our 10,000 industrial vending machine at a customer site.
That's a huge accomplishment for us. Probably doesn't sound like that much to you, but as hard as we've been working, as hard as our team's been working, this is a big milestone. The picture here just represents all the different types of machines that we have today. My prediction is if we show this picture a year or two down the road, we'll need a wider screen because there'll be more and more machines as we understand customer needs. We just continue to work hard to understand our customer needs. These are the results of our industrial vending. Through the end of the year, the green number or the green bar is the number of machines that we've installed at customer sites, and the blue bar is the number that we're signing.
We dropped off a little bit in the fourth quarter, as you can see by the last blue bar, but we roared back in the first quarter. In the fourth quarter, we signed just under 2,100 machines, 2,084. In the first quarter, we came back with new motivation, and we signed more than 4,500 machines. We more than doubled our productivity in the first quarter from the fourth quarter. Great job by the blue team going out there and meeting with our customers. In wrapping up my section, I use this slide all the time because I'm a very visual person or learner, and this really makes it out for me. The way the wheel turns for Fastenal, we go out and we hire people. If you look at the first chart, it's employee headcount. As you can see, it's continued to ramp up over the last 10 years.
When we do a good job, we put them in, or we open stores. If we do a good job hiring people, we put them in stores, we open stores. Stores do a good job, the sales goes up. Sales goes up, turns into earnings, and what do we do with the earnings? We reinvest it in new people. The visual is just like a big flywheel. If we continue to hire people, put them to work selling, create the sales, make money, reinvest, we should be able to continue to do this for a long time. Bob taught us how to do this a long time ago. We've taught thousands of people in the organization how to do it now, and that's really the story of Fastenal. Good people make money, and we reinvest and we'll just continue to do that.
Today, I have the opportunity, that'll end my section for now, but I have the opportunity to have two guest speakers. I'm going to first introduce Todd Ratio. Todd is our Store Manager from Muskegon, Michigan. I've been with the company 14 years, I believe, 14 years, and he'll talk a little bit about that. I had the opportunity to listen to Todd speak. I was at a manager's meeting in Indianapolis, Indiana, back in January, and Todd was one of the featured speakers. I enjoyed his talk so much that I called him about a week later and said, "Todd, would you be willing to come to Winona for our annual meeting and tell your story about how he's built this store up in somewhat of a difficult time in Michigan?" With that, I'll introduce Todd, and we'll go from there. Thank you.
Thanks, Will. It's an honor and a privilege to stand up here in front of you investors today to speak a little bit about some of the successes we've had with the FAST Solutions Industrial Vending Program. To start off with, I've been employed with Fastenal for 14 years. The Muskegon store has been open since 1987. A little history, in 2009, our store sales were averaging about $100,000 a month. At that time, we had one vending machine installed, and that was the Lakeshore Technologies Ring. To go into a little bit more history, in 2009, the unemployment rate was at 15.7%. We had a bunch of companies going out, Sappi Fine Paper, completely closed up. That was one of the staples of the community. It had about 190 employees. It's been there for over 100 years.
Lift-Tech International was another company that had been there for over 100 years, closed up, moved. It was kind of a grim time. I can remember driving down, leaving a customer, and wasn't getting a whole lot of success. When I left that customer, I had a national account guy with me, and I said, "There's something we're missing." We had had the vending machine program. They had had one installed. The phrase "sell more by selling less" popped in my head. I really started thinking about that. It's like, what does selling more by selling less really mean? The whole concept of the industrial vending solutions is to control costs to the customers. With the economy the way it was, I started thinking, "Hey, this economy is bad. They're looking to way cut costs. What a perfect time." I guess I'll go on a little bit of a story.
One of the customers I was having a real difficult time with selling the vending machines, I had went and did a plant tour, and we were walking through the plant, and I had rubbed my hand up against the machine, and I had grease on my hands. One of the guys that was running me through said, "You can go in here into the employee bathroom and wash your hands." I was in there washing my hands, and I saw these employees coming in, and they were throwing these gloves into a trash receptacle, and it was huge.
I asked them, I said, "What's the deal with this?" He says, "Oh, that's gloves." I said, "Where did they get these gloves from?" They said, "We got a cabinet that's wide open, and they just help themselves with gloves when they're done at the end of the day." I thought, "There might be something here." I went to the first thing agent and started talking with them, and I said, "Hey, do you have any way you control your cost on gloves?" They're like, "What do you mean control your cost?" I said, "I just noticed there's a receptacle full of gloves back there that are just getting wasted." They said, "Oh, you know, we have to buy gloves." I said, "I'm not saying we're not taking gloves away." I said, "Let's control that." I introduced the vending solutions program to them, and it took about six months to convince them.
Now that we put it in, they say they love the program, and according to their data, we're saving them over $70,000 a year just in cost reduction of gloves. Today, we have eight customers with the FAST 5000 machines installed. This slide's a little old. I've actually got 15 machines now installed. I signed one last week, and we just signed one yesterday. In 2011, we achieved $430,000 in just vending sales alone coming out of the vending machine. It's been a real huge success for us. Our store average now is $250,000. In a two-year period of time, we've grown from $100,000 to $250,000. All the machines that we've installed have been, with the exception of one, to customers we did very little to no business with. I put a couple of examples up here on the board showing some of those numbers.
We're opening up a new market for us, getting in front of more customers and getting them a tool that promotes their growth. I see the business environment changing. Everybody's probably heard of Just In Time. It's been a term that's been out for about 20 years, getting products to customers as they need it. I think that has shifted now. I think it's become right now. We got customers demanding products right now. With this Fastenal industrial vending solutions program we have, we are able to bridge that gap. We've got the product in front of the customer right now available 24 hours a day, seven days a week, and the customers love it.
If I could predict the future, and this is for my store, I can see our store having 50- 75 machines installed, upwards of 20- 30 customers having these machines in the next five years. It's just, it's only going to grow. I believe it is the best program in the industry. I have gone up against other competitors, and we've won businesses based on that. I believe we are the leaders in the market on that. We've got case studies, and this is from my store, this is Lakeshore Technologies. I'll read this real quick just in case you can't read it. It essentially does the job of an inventory control manager. We've cut inventory by at least 75%, and we've seen a huge drop in consumption because people are accountable for what they're using.
The biggest thing from a reporting standpoint is being able to clearly see that usage jibes with what is supposed to be. That is huge for us. That's from Ricardo Lopez. He's the VP of Operations of Lakeshore Technologies. We've got another one, CWC Textron. They make camshafts in Muskegon, Michigan. We're always looking for ways to cut costs and run more effectively and efficiently. The Fastenal vending machine has provided us with a way to work smarter, not harder. That's from Pat Runyon. She's a Senior Buyer there. These numbers here show our sales just in vending machines from 2009 all the way up to 2011. As you can see, it's kind of a nice trend. I enjoy that trend, and I'm sure most of you enjoy that trend. There's this effect, and I call it the explosion effect.
Once we put a machine, have installed the machine, there's like an explosion effect. We seem to get more sales because that's there. It's kind of like planting a flag. This next slide represents that. This is sales that we have from just the vending machine customers. It's the vending machine lines that are blue, and then the sales other than we get from them. There is this explosion effect we get that has helped tremendously. Most of these customers we were selling nothing to back in the day. It's been a huge success, and I thank Will for promoting this program. I'm a strong supporter of it. I can't say enough good about it. I really enjoy working for this company and the programs that are put in front of us. I thank you for your time.
If I had about 2,500 more stores with that graph, we'd be doing a little better. Oh, thanks a lot, Todd. You did a wonderful job. Our next guest speaker is Ken Nance. Ken is a good friend of mine. He's in his 20th year at Fastenal. His position, and Ken has lived all over the country for us, as far away as Puerto Rico. He's managed a lot of Fastenal at different points in his career. Today, his job as a Regional Vice President, he covers a region out of Dallas, Texas, runs a business that'll do about $270 million this year. Is that what we're saying? About $270 million business. A big business. The way we measure our people, we call it a scorecard. It's an internal ranking system. Each Regional Vice President, each store, district, and Regional Vice President has their own scorecards.
In 2011, Ken won the scorecard competition. The people I introduced earlier, a competitive group, great group of young leaders, Ken actually performed at the highest level of this group. Because of his great performance, we asked him to come here and speak today and kind of just give you some insight about what it takes to stay on top in a very competitive world with a very competitive group that he works with. Ken, if you'd like to take the stage. Thank you.
I was glad to see Todd's here from Muskegon. He's probably... I've never been in a room outside of Michigan where there's another Detroit Lions fan.
Red Wings.
Red Wings, yeah. I've said it before. I'll say it again. What a great time to be working for Fastenal. I mean, it's just a phenomenal time. I said that 20 years ago when I came on with the company. I've been saying it ever since, and it is more exciting now than it was 20 years ago. It's also a great time to be buying from Fastenal, as you know, some of the things that Todd was talking about, some of the other initiatives that we have going on. From a customer standpoint, I'm visiting with customers all the time. They're more and more excited to be buying from Fastenal. Obviously, this is a shareholders' meeting. Over the past few years, it's been a pretty good time to be owning shares in Fastenal.
I started with Fastenal in Joplin, Missouri, and I went down to Dallas for a sales meeting, and I met some people down there. Matter of fact, they're still with the company. Nick Lundquist, I think I saw him around here. He was the regional manager. It was a very small territory. I met a couple of people down there. Matter of fact, after I got back to Joplin, I called the district manager, and I said, "Hey, I really want to be part of the expansion of Texas." I had never been to Texas. I had driven through there a couple of times, seen some cowboy hats and some steers and that sort of thing. I knew nothing about Texas. All I knew is that there were a lot of people there, a lot of business, and a lot of opportunity.
My manager in Joplin, Missouri, said I was an idiot. He said, "There's no way you're going to be successful down there. There's too much competition. They're not going to take the northern companies. You're not going to find good people." All I can say is, wow, since then, it's just been a great ride, and he was definitely wrong. I'm going to talk a little bit. I'll go through a little bit real quick about the history of the region and kind of where we've been and where we're going. If you look at the public stores, in 1992, when I started, we had 11 stores in the state of Texas. In 2007, we went up to 139. This year, we'll end up with 200 or 205 public stores. That's without the customer-only sites, so the, you know, the implants and that sort of thing.
That's just phenomenal, phenomenal growth. We'll probably end up with about 250 total, 275. Dan likes to use windows, so we'll say 250- 275 total stores in the state of Texas. The next screen I really like to look at, it really tells a story. It actually tells a lot of stories. It looks at, you look at the dots that are coming up. This is how we grew Texas and my region, which is Texas and New Mexico, and a little bit of a couple of border states. Each dot shows a store closer to the customer. Really, what that does, it gives us a competitive advantage over our national competitors. We have national competitors. We have local and regional competitors. From a national standpoint, there's no one that has the footprint that we have. With each dot, basically, we're closer to the customer.
Really, the biggest story is that each dot, we also have given opportunity to an existing or a potential employee to come on with the company and start a career with Fastenal Company. With that, obviously, they're buying houses, cars, saving for retirement, and really building a career with a great organization. I think that's just a phenomenal footprint. Let's look at the number of employees that we've had over the years. This is just store employees. You can see in 1992, we had 25. I was one of them. We still have a lot of the same employees in leadership positions down in the state of Texas and New Mexico. It's pretty impressive. This year, we'll end up with about 760 employees in the store. That does not include all the other employees that are within the region.
Will mentioned the sales specialists, the vending solutions people, the DC people. All in all, we'll have about 1,000 people. Over the last 20 years, we've added about 970 people or 975 people, which is pretty impressive. We're not done yet either. We're going to continue to grow. You look at the next slide, shows our net sales. You can see when Nick Lundquist was running the region, we only did $1.3 million. It's changed a lot since then. I think I saw Nick somewhere. Yeah, once we got rid of him, we started to grow. Anyway, it's been a really good ride. Luckily, the 2000, I did it in five-year increments, and luckily, the 2009 number wasn't in there. Obviously, in 2007, we did about $146 million, and we'll almost double that this year to $270 million. That's our goal.
We like to overachieve, so we'll probably hit a little bit more than that. Really, we're not done. We have the footprint. We have the infrastructure. We have the products. We have the Fastenal machine behind us, which is just incredible. Last but not least, we probably have some of the best people in the industry working in our stores in the company now. Obviously, 5, 10, 15 years ago, we had a lot of people with very little experience running our stores. Now we have managers with 5, 10, 15 years experience, district managers with 20, 25 years experience. In order to move forward, it just takes a clear focus. That really involves a lot of a few things. There are other initiatives that we have in the company. For the purpose of this presentation, I wanted to narrow it down. It all is about personnel.
It starts and ends with good people. That's the bottom line. Return on assets, product development is huge. Key accounts are our potential. How are we going to get them? Our existing, what have you done lately? FAST Solutions is a big part of both of those factors. The basics of the branch business. FAST Solutions and the company's scorecard. Todd did a great job talking about the company's scorecard. As a matter of fact, I was recruiting him earlier to come down to the state of Texas. I don't know, we'll talk later. We'll exchange cards. If you look at the last four in red, they're really related in pairs. If you look at key accounts and Fast Solutions, they are related very, very closely. Not really for existing accounts, but for potential accounts as well.
I only have a limited amount of time, but I could go through a laundry list of accounts that we have got in, we have been able to close on in the last couple of years that we could not snip over the last couple of decades. It's just been unbelievable. There are examples of accounts that we've been calling on for 10, 15 years, and they won't give us the time of day. We go by, we show them FAST Solutions. All of a sudden, we're in the door. We do $3,000. The next thing you know, we're doing $50,000, $60,000, $70,000 a month. What it has done is it's eliminated the me-too factor in the business. We're not just a commodity-driven. We've always had services, but this really takes it to the next level.
My presentation is about the company's scorecard, and that drives the basics of the business. You have your key accounts, and then you have your branch basics of the business, and that's the company's scorecard. This is the company's scorecard real quick. Obviously, you have your total points. Daily average growth is mission-critical. We're a growth organization. Everybody knows that, who owns stock or works with the company. Margin, huge. Freight spread, active growth. OSP is a big part of that. Basically, that's a combination of our OSP scorecards and then dollars per FTE, and you can read the rest. A big number at the bottom is vending, and what that is is implemented vending. This is the company's scorecard.
What it is, is every branch has a scorecard, and then those scorecards combine into a district scorecard, and then those scorecards, the district scorecards, compile into the regional scorecard, which is what I see. Some people say, "You know, scorecard, it's that scorecard, it doesn't really help this," or they think about that's just a contest that you run every year. Really, at the end of the day, the scorecard is the beginning of a good return on asset. That's what it's all about at the end of the day. Will talks about earnings, and that really is what it is about. I mean, you can sell till the end of tomorrow, but if you don't make any money and get a good return, then it doesn't matter. When you have good branch scorecards, it leads up to good ROAs. I just wanted to give a couple of examples.
The number one district in March for the company, just coincidentally, was in Houston. His name is Steve Diekman. He had 53% sales growth for the quarter, 57% pre-tax growth, and 295% performance factor. The performance factor is a combination between your sales growth and your ROA. The number two district in March was a person in Dallas, Ron Kitcher. His sales growth for the quarter was 37%, which is huge because he runs close to a $2 million district, a 58% pre-tax growth, and he had a performance factor of 232%, which is huge. It really starts and ends with the branch. What I did is I took the number one branch in Dallas from last year. This was a little buddy, a really good friend of mine who runs this branch. It was one of these branches where we opened it up. It's out in Podunk.
Basically, there's some opportunity there, but it really came down to the individual running of the branch. He wants to win. He hates to lose. He had a great scorecard. What that did is it emerged into a huge business. He had 59% sales growth in Q1. His ROA was almost 100%, and he had a 523% performance factor. The number two branch in Dallas last year, and again, the branch scorecards lead up to the next year. That's really what it's all about. The number two branch in 2011 had 121% sales growth, an ROA of 111%, and over 1,000% performance factor. When I get together with the branches, I'll try to make this quick. I used to do this, and now they've caught on to my game. I go out around the room and I say, "Who's the competition?" I get different answers from different people.
You can only imagine, I get this person, or this company, that company, this company. I've listed a few. I've changed some of the names. I didn't want to infringe on any copyright deals, but I've changed some of the names: Ranger, CFM, Flossen, Snowman, Spendriz. Obviously, you know some of these organizations. If you're within Fastenal, then you know exactly who I'm talking about. Those are national competitors. I look at the group and I say, "You know what? Really, it's not about those other competitors because we don't have to worry about them." When we have the best, when we have the right person in the right position, we dominate the market every single time.
Really, it's about, "Let's stop looking at them and let's start looking at the people with the stores with the better scorecard down the street from you." Really, it's about anyone who's ahead of you. If someone's ahead of you on the scorecard, call them up. Find out what they're doing. Find out where they're better than you on the scorecard. Find out what that individual's doing so you can get to that level. What that does is it makes everyone better. When I work with the branches, the spread between the number one branch in a category and the number 50 branch is microscopic. It boils down to just a little bit extra every day. It comes down to literally two more sales calls per day, two more points of margin, three days off of your days out. Dan will like that.
Two more new accounts, which doesn't sound like a lot, but that's what the difference is. If you look at the spread on the scorecard, that's really what the difference is. Three more actives, a quarter of a percent in chargebacks, a quarter to a half percent. What it boils down to is ownership and the desire to win. That's what it really boils down to. It's the little things. It's the branches that you call at 6:00 P.M. and they're still there working it. It's the branches that you call at 5:30 A.M. or 6:00 A.M. for some unknown reason, and they just happen to be there working hard. Those are the branches that win. Those are the branches that the following year see the numbers that you saw earlier.
The summary of effects of the scorecard really is when a branch in a district in a region are doing well at the scorecard, it really does radiate pride throughout the branch, the district, and the region. It's a team effort. When the district is doing well, there's a lot of pride there. When the region's doing really well, there's a lot of pride there. The same goes within the branch. It's not about knowing that you're doing well. You know you're doing well against other branches in the best company in the industry. You're not doing well against Ranger or Spendriz. You're doing really well against other branches in Fastenal, which is the best company in the industry. A positive scorecard shows that the branch is executing on the basic fundamentals of what we need to be doing that'll move us forward into the future.
Last but not least, when you're going to compare your business or any other thing, if you're competitive, you know that. When you're comparing business to other businesses, you may as well start from the best and go from there. Thank you for your time and have a nice day.
Ken will be holding a small tutorial up front on acronym when this is done. I'm going to hit two more slides, and we're going to open it up. I have questions right after that, and we're going to open it up for questions. I want to show this because this is our stock performance from 1987. I always like to show this, but there's a reason I'm showing it, and it's because of the Bloomberg Businessweek article that came out February 27 . I don't know if you saw that article, but it was an article that the person who wrote the article went back and looked at all the companies, you know, 506 S&P 500 companies from the 1987 crash till 2012 and looked at the stock performance.
When they boiled it all down, Fastenal was the number one performing stock that they analyzed out of all the stocks out there. We beat Microsoft. We beat Apple. We beat the S&P by a mile. When I sit back and think about that, and I'm looking at it, it makes me feel great. I'm proud. Everyone on the Fastenal team should be proud. I start thinking about it, and I'm going, "Okay, let's look at that time period. We have about 25 years." There is 25 years. Manufacturing in the United States and Canada didn't do very well over that period of time. It's been kind of a slow time. A lot of companies have migrated to China. It's been an okay manufacturing environment. We haven't invented anything new. We haven't invented an iPad. We didn't invent a new software system. We're kind of in a boring business.
We're in a good business. Industrial supplies are a good business. The way we did it is we had a good plan, and we've hired great people. If people got up every day and just went to work and moved it, just moved the ball an inch further down the field. That's probably what I'm most proud of, and that's why I'm so proud of our blue team, is that we've been able to do it in a boring old industry, but we've done it by working harder and working smarter and just coming to work and doing it. For that, I just, I read the article a couple of times and thought about that. I'm very, very proud of that because all of us have done it together. Thank you to the Fastenal people. With that, there's a microphone down here.
If you have a question, please raise your hand. I guess there's a few microphones in the room, and we'll try and take some questions before we go on to the ballot and see if these go on jobs.
Good morning.
Morning.
My name is John Gindel. I'm from Crystal, Minnesota. I'm thrilled that Fastenal is increasing its customer base, and as a result, it's also helping the shareholders. I want you to know that the shareholders are also looking out for you. Here's a for instance. I wrote a letter a couple of years ago, even though it's dated in 2008, it still applies today, written to Warren Buffett, the Chairperson of Berkshire Hathaway. I said, "Dear Mr. Buffett, we are shareholders of Berkshire Hathaway. Because you made it known that you are seeking suggestions from the public in regards to possible further acquisitions of companies, we have taken the liberty to share with you the annual report and forms 8-K, 10-K, and 10-Q of Fastenal, a company headquartered in Winona." Now, skip down.
"It is our hope that you have an opportunity to review the enclosed materials with the idea of possibly purchasing Fastenal as a new company under the Berkshire umbrella." She wrote back, "Fastenal is a great company. I know the people, and we are a vendor, however, not for sale. I just want to let you know some of your shareholders are looking out for you.
Thank you.
I'm Mary Ann Peace. I'm a...
Let's turn the mic.
Mary Ann Peace from Wisconsin. I've been a shareholder for a long time. What I would like to know is how are we doing in the world market? Asia, South America, Europe. Are we in there? I know you have to change the gears to make metric and all that. How are you there? How are you there?
The question is how are we doing in the international market? We're actually doing very well. Steve, yours was at 40% last year, Steve? Our international business grew just over 40% last year, double what the company grew. Our strongest countries, we're doing very, very well in Mexico, China, Malaysia, Singapore. Europe is doing well for several countries. I think we're in about seven or eight countries in Europe. We recently opened in Brazil. We've been in Panama for about a year and a half. We have a big effort. International business represents about 12% of our revenue at this point. This year, it will be roughly a $350 million business.
I'm Herb Peter. Will, you stole my thunder because I was going to mention that 38,000%. That excludes dividends.
Oh, thank you.
The name is Dwayne Carlson, and I'm a stockholder. The stock market hasn't been treating you very well the last two days. I'm assuming a bunch of short sellers are laying in wait for you. How are you going to cope with that one?
The question is the market hasn't been trading as well the last couple of weeks, the comment, which is correct. We're down a little bit from our high. He's assuming it's thinking it might be a bunch of short sellers, and how would we account for it? We really don't worry about the short sellers. It's a market condition. People have the right to short our stock, and people have the right to buy it long. If we do our job as individuals and as leaders, we should be able to grow the stock going forward. As Ken mentioned about our competition, we try to focus. If we spend all of our time focusing on our customers, not the short sellers and not the competition, I think we'll be just fine for a long time. It's about focusing on the customers. We only have so much energy.
My name is Dwayne Jacobs. I've been watching with interest your new facility to the left of this. What's going to happen to all of this space in here?
Will all of this material go over there? As you can see, some of you saw we're building a big automated warehouse off to the, I guess it'd be the west side of our building. Actually, that's just going to cover our expansion. We've been very much squeezed into this building for a long time. If you talk to people in this building, we waited a few years longer than we maybe should have. It's just about handling growth. We built a similar facility in Dallas, Texas, and then in Indianapolis over the last several years. What we found is we've become far more efficient.
What it allows us to do is it allows us to pull our orders over a shorter period of time, which means our trucks get to leave earlier, which means we service our customers earlier in the day. Instead of a truck maybe arriving in Fargo, North Dakota, at 9:00 A.M. tomorrow morning, maybe it's there at 7:00 A.M., giving us an ability to give better service to those customers and just ship more product in less time. I think we have 120,000 locations. We can put 120,000 different parts in that facility when it's done.
My name is Barry Nelson, and I'm interested in how well we might be doing in our activity in North Dakota if we are.
Yeah, we're doing very well in North Dakota. There are two quick stories. Our store in Williston, which is really in our, I'm guessing you're talking about fracking or oil business. Our business in Williston, which has been up there, I don't know when we opened, probably the late 1980s, at least 15 to 20 years. Over the last four years, it's more than five times bigger than it was four years ago. The business is on fire. Gary Polipnik, our Regional Vice President, came to me maybe a year ago, and he said, "Will, I'm opening a store in a town that I'd never heard of." What's the name of it, Gary? Watford City.
I said, "Why are you telling me this?" He said, "Because it's a population of about 300 people, and I'm putting a store there." He said, "Just go with me, man." Gary and I have worked together forever. I looked it up the other day, and the brand new store did $200,000 last month. It had a very high profitability because we cannot keep up. Basically, as fast as we can bring product in, we're shipping it out the other door. We have other areas in the country that we're doing exceptionally well with oil too. You look at the Williamsburg, Pennsylvania area. You look at Midland Odessa, Texas. You look at Lafayette, Louisiana. The oil industry in the United States right now is doing well, and we're capitalizing on it.
There are lots of cities I'm not thinking of, but those are the big bold ones that I see on the report. It's a team in the field doing it. We have no further questions. I'll turn it back over to Bob to read the results of the elections.
Thank you, Will and gentlemen. Some of the statements as far as projections of plans and objectives are forward-looking statements and actual results could differ materially from those projections and statements. The factors that could cause those results to differ are those mentioned in the company's annual report in Form 10-K. The ballots have now been counted and reported to the inspection. The inspectors of the election indicate that Robert A. Kierlin, Stephen M. Slaggie, Michael M. Gostomski, Willard D. Oberton, Michael J. Dolan, Reyne K. Wisecup, Hugh L. Miller, Michael J. Ancius, and Scott A. Satterlee have received the required number of votes and are hereby elected the directors of the company.
The report of the inspectors of election also indicates that, number one, the resolution for the ratification of KPMG LLP as the independent registered public accounting firm for the company for fiscal year ending December 31, 2012, has received the required number of votes and has been adopted. Two, the resolution for the approval on an advisory basis of the compensation of certain of our executive officers has received the required number of votes and has been adopted. Three, the resolution approving the amended and restated Fastenal Company Incentive Plan has received the required number of votes and has been adopted. Four, the resolution approving an amendment to the restated articles of incorporation of the company has received the required number of votes and has been adopted.
All ballots and the record of all proxies will be filed with the books and records of the company, and the certificate of the inspectors of election will be attached to the minutes of the meeting as Exhibit C. I have been handed the names of the two lucky people who won the attendance prizes, which are still on the registration table, I believe. Robert Kennedy, you are a winner. The second one, I believe the name is George H. Fency. Yep. Very good. Congratulations. Before we have the final resolution here, I remind you there's a free lunch. I'll be taking down the tarp here. There will be eight lines, so you don't have to get in a single line. The people over here mentioned that they were going to make a charge for the line. We'll get that out of the way.
I will now entertain a motion for adjournment, and the chair recognizes Mr. Michael Rusk.
Mr. Chairman, I am Michael Rusk, a shareholder of the company, and I move that the meeting be adjourned.
Thank you. The Chair recognizes Ms. Dawn Rasmussen.
Mr. Chairman, my name is Dawn Rasmussen. I am a shareholder of the company, and I second the motion.
Thank you. The move is seconded. The meeting be adjourned.