Industrial and construction supplies provider Fastenal Co. reported Thursday a profit for the third quarter that increased 13 percent from last year, boosted by lower expenses and a 10 percent sales growth. Earnings per share for the quarter met analysts' expectations, while revenues missed their estimates by a whisker.

The company noted that it grows continuously by adding customers and by increasing the activity with each customer. This growth is enhanced by the close proximity to its customers, which allows it to provide a range of services and product availability that competitors can't easily match, the company added.

The Winona, Minnesota-based company reported net earnings of $109.32 million or $0.37 per share for the third quarter, up from $96.80 million or $0.33 per share in the prior-year quarter.

On average, 11 analysts polled by Thomson Reuters expected the company to earn $0.37 per share in the third quarter. Analysts' estimates typically exclude special items.

Net sales for the quarter increased 10.4 percent to $802.58 million from $726.74 million in the same quarter last year, but missed eleven Wall Street analysts' consensus estimate of $804.80 million by a whisker.

The latest quarter contained 63 business days, compared to 64 business days in the same period in 2011.

The company's monthly net sales for July grew 12.1 percent, August sales increased 12 percent, and September sales rose 12.9 percent from the same months last year.

Operating margin for the third quarter expanded 50 basis points to 21.9 percent from last year's 21.4 percent, as operating and administrative expenses, as a percentage of sales, decreased 80 basis points, while gross profit margin contracted 30 basis points from a year ago.

The company is currently continuing its five-year old 'Pathway to Profit' program, modified in 2010, that was launched in 2007 to boost profitability. The plan has reduced in-store sales employees and instead added resources focused on specific sales opportunities.

"We achieve improvements in our relative profitability by increasing our gross margin, by structurally lowering our operating expenses, or both. We advance on the 'pathway to profit' by increasing the average store size (measured in terms of monthly sales), and by allowing the changing store mix to improve our profits," the company noted.

The company now believes that it can accomplish the 'pathway to profit' goal with an average store size of about $100,000 to $110,000 per month.

FAST closed Wednesday's regular trading session at $42.32 down $0.64 on a volume of 2.58 million shares, higher than the three-month average volume of 1.82 million shares. In the past 52-week period, the stock has been trading in a range of $32.26 to $55.05.