#1MSC BUILT TO MAKE YOU BETTER® MSC INDUSTRIAL SUPPLY CO. General Investor Presentation Fiscal 2021#2Cautionary Note Regarding Forward-Looking Statements Statements in this presentation may constitute "forward-looking statements" under the Private Securities Litigation Reform Act of 1995. All statements, other than statements of historical fact, that address activities, events or developments that we expect, believe or anticipate will or may occur in the future, including statements about the future impact of COVID-19 on our business operations, results of operations and financial condition, expected future results, expected benefits from our investment and strategic plans and other initiatives, and expected future growth, profitability and return on invested capital, are forward-looking statements. The words "will,", "may," "believes," "anticipates," "thinks," "expects," "estimates," "plans," "intends," and similar expressions are intended to identify forward-looking statements. Forward-looking statements involve risks and uncertainties that could cause actual results to differ materially from those anticipated by these forward-looking statements. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date hereof. The inclusion of any statement in this presentation does not constitute an admission by MSC Industrial or any other person that the events or circumstances described in such statement are material. Factors that could cause actual results to differ materially from those in forward-looking statements include the following, many of which are and will be amplified by the COVID-19 pandemic: the impact of the COVID-19 pandemic on our sales, operations and supply chain; general economic conditions in the markets in which we operate, including conditions resulting from the COVID-19 pandemic; changing customer and product mixes; competition, including the adoption by competitors of aggressive pricing strategies and sales methods; industry consolidation and other changes in the industrial distribution sector; our ability to realize the expected benefits from our investment and strategic plans, including our transition from being a spot-buy supplier to a mission-critical partner to our customers; our ability to realize the expected cost savings and benefits from our restructuring activities and structural cost reductions; the retention of key personnel; volatility in commodity and energy prices; the credit risk of our customers, including changes in credit risk as a result of the COVID-19 pandemic; the risk of customer cancellation or rescheduling of orders; difficulties in calibrating customer demand for our products, in particular personal protective equipment or "PPE" products, which could cause an inability to sell excess products ordered from manufacturers resulting in inventory write-downs or could conversely cause inventory shortages of such products; work stoppages, labor shortages or other business interruptions (including those due to extreme weather conditions or as a result of the COVID-19 pandemic) at transportation centers, shipping ports, our headquarters or our customer fulfillment centers; disruptions or breaches of our information systems, or violations of data privacy laws; the retention of qualified sales and customer service personnel and metalworking specialists; the risk of loss of key suppliers or key brands or supply chain disruptions, including due to import restrictions resulting from the COVID-19 pandemic; changes to governmental trade policies, including the impact from significant import restrictions or tariffs; risks related to opening or expanding our customer fulfillment centers; our ability to estimate the cost of healthcare claims incurred under our self-insurance plan; litigation risk due to the nature of our business; risks associated with the integration of acquired businesses or other strategic transactions; financial restrictions on outstanding borrowings; our ability to maintain our credit facilities; the interest rate uncertainty due to the London Interbank Offered Rate ("LIBOR") reform; the failure to comply with applicable environmental, health and safety laws and regulations, including government action in response to the COVID-19 pandemic, and other laws applicable to our business; the outcome of government or regulatory proceedings or future litigation; goodwill and intangible assets recorded resulting from our acquisitions could be impaired; our common stock price may be volatile due to factors outside of our control; and our principal shareholders exercise significant control over us, which may result in our taking actions or failing to take actions that are in the best interests of other shareholders. Additional information concerning these and other risks is described under "Risk Factors" and "Management's Discussion and Analysis of Financial Condition and Results of Operations" in our Annual and Quarterly Reports on Forms 10-K and 10-Q, respectively, and in the other reports and documents that we file with the U.S. Securities and Exchange Commission. We expressly disclaim any obligation to update any of these forward-looking statements, except to the extent required by applicable law. MSC 2#3MSC Industrial Direct: Company Overview MSC is a leading value-add industrial distributor offering products, services and solutions that enable its customers to achieve higher levels of growth, productivity, and profitability Founded in 1941 and listed on NYSE (MSM) since 1995 Leader in highly fragmented industrial distribution market 6,300 associates 17 branches and 5 primary distribution centers Broad offering: 1.9 million+ SKUs from 3,000+ suppliers Value-add solutions: metalworking expertise, supply chain management, e-commerce, productivity improvement and training $3.2B Total Revenues 11.0% Operating Margin 1 1 7% 20-Yr Sales CAGR 10% 20-Year EPS CAGR 2 2 $1.1B Operating Cash Flows (over the last 3 years) $886M Returned to Shareholders (over the last 3 years) 3 MSC Driving Growth, Productivity, and Profitability MSC is NYSE: MSM Let's get to work. Here are ways to contact customer support Find out about how to get financing. Email customer support 1Year Ended August 29, 2020 220-Year CAGR calculated through August 29, 2020 3Over the last three fiscal years ended August 29, 2020 MSC 3#4Key MSC Investment Highlights Leader in the highly fragmented North American industrial distribution market with significant opportunities for organic and acquisitive growth Value-added solutions approach focuses on addressing customer total cost of ownership with highly technical expertise and a broad portfolio of products and services Industry-leading customer satisfaction ratings driven by customer-centric culture and obsession with delivering solutions that enable customer success > > MSC Implementing Mission Critical, a major program to return to above market growth and improve profitability Capital allocation strategy based on an owner mindset and focused on long-term value creation for shareholders 4#5Highly Fragmented Industrial Distribution Market The North American industrial distribution market is very large and highly fragmented both across the addressable market and the customer landscape Total Addressable Market (~$200 Billion in Sales) The top 50 distributors represent less than 30% of Industrial Distribution Customer Landscape Company Size (# employees) Customer Count Revenue Potential the market Large (>250) 39% Complex Solutions 1% MSC Medium 2% 26% (50-249) Small 11% 20% (10-49) -$200B of the MRO market in N. America directly addressable by MSC² Highly fragmented with ~145K distributors in the US1 Very Small 16% 86% (1-9) MSC 1MDM Analytics (figures are approximate) 2Calculation performed by MSC (figures are approximate) Simple Transactions 5#6MSC's Position in the Market MSC's target manufacturing market makes up about 50% of total addressable marketplace spend, making brand awareness and equity critical to attract and maintain customers Total Addressable Market (~$200 Billion in Sales 1,2) The top 50 distributors represent less than 30% of the market MSC Fiscal Year 2020 Sales ($3.2 Billion) Metalworking MSC MSC MRO VMI -$200B of the MRO market in N. America directly addressable by MSC1,2 Addressable market is comprised of approximately ~19M total potential customers² Within the approximately ~19M total potential customers, MSC can serve the ~700k metalworking customers² These ~700k customers make up a large amount of the overall spend in manufacturing² ~200K are larger customers, while ~500K are smaller customers² 1MDM Analytics (figures are approximate) 2Calculation performed by MSC (figures are approximate for N. America) 6#7MSC's Differentiator in the Market: Built to Make You Better MSC's value-added solutions approach focuses on addressing customer total cost of ownership with highly technical expertise with a broad portfolio of products and services Industry Model (Product Price Driven) MSC Solutions Approach (Total Cost of Ownership Focused) Procurement Costs MSC Inventory and Operational Costs $ Product Price Inventory and Operational Costs Customer Value Drivers Growth TAPP Product Price Productivity Profitability Procurement Costs 7#8MSC Customer Care Ensuring Customer Satisfaction Obsession with delivering personalized and effortless customer experiences that enable success, measured directly from our customers Customer Care Delivery Customer Care Center Satisfaction Levels 4 High-Touch Customer Care Technical and Sourcing Experts Poor Consistent Customer Service Creative Problem Solving Focus on Customer Satisfaction Build Trust and Loyalty Mean 4.4 Mean 4.0 Excellent Poor Excellent MSC Other Contact Center Average MSC 1 ForeSee- Web Browse Measurement Feb. 28, 2021 CSAT Scale (1-5) Excellent 5 Very Good 4 Good Fair Poor 321 8#9MSC Solutions: Turning Expertise and Data into Information and Savings MSC provides continuous improvement solutions for customers by combining technical expertise and data analytics, driving significant and documented customer cost savings Technical Solutions Industry Manufacturer Application Objective Cycle Time Reduction Capacity Gained Annual Cost Savings MSC MillMax® (Ap Op™) Aerospace & Defense Kennametal Solid Milling Reduce Cycle Time 50% 625 hours $78,125 New Opportunity Capture (Ap Op™) Medical Devices Iscar Turning Improve Tool Life 32% 1,150 hours $179,998.50 SKU Consolidation Product 22 Oz. Multi-Purpose Cleaner Continuous Improvement 22 Oz. Premium Degreaser MSC Solution 32 Oz. All Purpose Cleaner and Degreaser Cost (per unit) Usage (units) Total Cost $0.277 45,936 $1.32 Item and standardize in all locations. 792 Consolidate to a single $0.20 46,728 $12,740.88 $1,048.32 $9,345.60 Annual Cost Savings $4,443.60 MSC 6#10Customer Value: True Stories. True Results. Documentation program delivered >$350 million in cost savings for MSC customers in 2020 430 hours ↑ Annual Capacity Gained Contract Machine Shop Improving cycle time on a 6061T6 Aluminum Chassis created time on existing machines, Allowing the customer to add even more work. $43,000 ↑ Profit Improvement Energy Sector National Account A simple, 15-minute MSC MillMaxⓇ impact test in a milling operation improved profits while reducing cycle time from 132 seconds to 34 seconds. $1.6 million ↓ Total Cost Savings Aerospace Defense Contractor One of the US's largest manufacturers savings resulting from supply chain and operational improvements. $1.5 million ↓ Savings in Tooling Costs Moeller Aircraft division specializes in machined parts for the gas turbine aircraft engine and power generation industries, including airfoils $2.3 million↓ Productivity Savings Global Truck Manufacturer One of North America's largest producers of heavy duty Class 8 trucks, engines and transmissions MSC 10#11Overview of Mission Critical The Mission Critical growth initiative was established to recapture market share while delivering cost savings on the path to accelerating profitability Solid program execution and tracking to high end of targeted total gross savings of $90M-$100M by FY23 vs. FY19 OBJECTIVE: Reaccelerate market share capture KEY PRIORITIES OBJECTIVE: Grow profits faster than sales KEY AREAS Solidify Metalworking Leverage Portfolio Strength Expand Solutions Grow E-commerce Diversify Customers & End Markets . MSC GOAL: Outgrow market by at least 400 bps over cycle Sales & Services Gl Supply Chain General & Administrative GOAL: Achieve high-teens ROIC by end of 2023 11#12Fiscal Year 2023 Targets Mission Critical Objectives Reaccelerate market share capture Grow profits faster than sales Sales Growth 2020 -5.1% ~6%-7% At least 400 bps of share capture 2%-3% market growth 2023 * See appendix for non-GAAP reconciliations. MSC Return on Invested Capital (ROIC)* High- Teens 14.1% 2020 2023 12#13Mission Critical: Strong Progress on Cost Savings $100 $80 $60 Total Gross Savings Target: $90M - $100M by end of FY23 versus FY19 Q3 FY2021: $12M $40 Q2 FY2021: $9M Q1 FY2021: $8M $20 $0 MSC FY2020: $20M KEY AREAS Sales and service Supply chain General & Administrative $40M expected in FY2021 • Raised FY21 target to $40M gross cost savings • FY21 growth investments ~$25M Net savings of -$15M FY21 Continue to target $90M to $100M in total cost savings by end of FY23 versus FY19; trending to high end of range • Projected improvement in OpEx to Sales ratio of roughly 200 bps by end of FY23 23 13#14Billions Track Record of Growth and Resilience $3.5 $3.0 $2.5 50% $450 $400 40% $350 $300 30% $2.0 $250 $1.5 $1.0 $0.5 $0.0 2000 2002 2004 2006 2008 2010 2012 2014 2016 2018 2020 MSC Revenue Opex % of Revenue Gross Margin Operating Income Operating Margin 20% Millions $200 $150 $100 10% $50 0% $0 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 Operating Cash Flow CapEx 14#15Capital Allocation Philosophy MSC's capital allocation strategy is based on an owner mindset and focused on long-term value creation for shareholders Priorities Organic 1 Investments 2 Cash Returned to 600 Shareholders 3 500 Opportunistic M&A 400 MSC 300 200 100 0 Cash Returned to Shareholders 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 Net Share Repurchases Common Dividends Special Dividends Dividend Payout Ratio 80% 70% 60% 50% 40% 30% 20% 10% 0% 1Dividend Payout Ratio calculated as common dividends per share / diluted EPS. 2018 ratio reflects the benefits to EPS from the Tax Cuts & Jobs Act. 15#16Key MSC Investment Highlights Leader in the highly fragmented North American industrial distribution market with significant opportunities for organic and acquisitive growth Value-added solutions approach focuses on addressing customer total cost of ownership with highly technical expertise and a broad portfolio of products and services Industry-leading customer satisfaction ratings driven by customer-centric culture and obsession with delivering solutions that enable customer success > > MSC Implementing Mission Critical, a major program to return to above market growth and improve profitability Capital allocation strategy based on an owner mindset and focused on long-term value creation for shareholders 16#17APPENDIX MSC 17#18Full Year 2020 Reported Results • Sales (millions) Operating Profit (millions and % of sales) $400.0 $3,363.8 $3,192.4 11.9% $350.7 11.0% 2019 2020 Average Daily Sales (ADS) declined 5.1% Safety and janitorial product sales improved 30%+ YOY Sales for the rest of the business declined YoY MSC • • Earnings (per diluted share) $5.20 $4.51 2019 2020 FY 2020 gross margin was 42.1%, 50 bps lower than FY 2019 Includes $6.7 million in severance costs in FY 2019 and Includes $17.0 million in severance costs and consulting fees related to the operating model review in FY 2020 • 2019 2020 Effective tax rate of 24.6% in FY 2019 and 24.7% in FY 2020 EPS in FY 2020 includes $0.23 impact of severance costs and consulting fees related to operating model review 18#19Fiscal 2020 Adjusted Results* . • $3,363.8 Sales (millions) Adjusted Operating Profit (millions and % of sales) Adjusted Earnings (per diluted share) $406.7 $3,192.4 $367.8 12.1% 11.5% 2019 2020 Average Daily Sales (ADS) declined 5.1% Safety and janitorial product sales improved 30%+ YOY Sales for the rest of the business declined YoY . 2019 2020 Solid underlying gross margins offset by PPE-related mix headwinds Excludes $6.7 million in severance costs in FY 2019 Excludes $17.0 million in severance costs and consulting fees related to the operating model review in FY 2020 See appendix for non-GAAP reconciliations. Individual amounts may not agree to the total due to rounding MSC • $5.29 $4.74 2019 2020 Effective tax rate of 24.6% in FY 2019 and 24.7% in FY 2020 • Excludes $0.09 impact of severance costs in FY 2019 . Excludes $0.23 impact of severance costs and consulting fees related to operating model review in FY 2020 19#20Fiscal Third Quarter and YTD 2021 Reported Results Gross Profit (millions and % of sales) Operating Profit (millions and % of sales) Earnings (per diluted share) $866.3 $366.5 $354.0 Net Sales (millions) $835.0 $128.6 $1.68 $109.9 $1.40 42.4% 42.3% 13.2% 14.8% Q3 2020 Q3 2021 Q3 2020 Q3 2021 Q3 2020 Q3 2021 Q3 2020 Q3 2021 $277.8 $2,444.7 $2,412.2 $3.57 $1,032.2 $984.5 $210.6 11.4% 42.2% 40.8% 8.7% $2.69 YTD 2020 YTD 2021 YTD 2020 YTD 2021 YTD 2020 YTD 2021 YTD 2020 YTD 2021 MSC 20 20#21Fiscal Third Quarter and YTD 2021 Adjusted Results* Net Sales (millions) $835.0 Adjusted Gross Profit (millions and % of sales) Adjusted Operating Profit (millions and % of sales) Adjusted Earnings (per diluted share) $866.3 $366.5 $354.0 $111.2 $109.5 $1.42 $1.42 42.4% 42.3% 13.3% 12.6% Q3 2020 Q3 2021 Q3 2020 Q3 2021 Q3 2020 Q3 2021 Q3 2020 Q3 2021 $2,444.7 $2,412.2 $1,032.2 $283.7 $984.5 $274.9 YTD 2020 YTD 2021 42.2% 40.8% 11.6% 11.4% YTD 2020 YTD 2021 YTD 2020 YTD 2021 $3.65 $3.55 YTD 2020 YTD 2021 * Represents a non-GAAP financial measure. See appendix for non-GAAP reconciliations. Individual amounts may not agree to the total due to rounding. MSC 21#22Industrial Production Index (IP) Change (Year-Over-Year) MSC Total Organic Growth 3-Month Average 20.0% 15.0% 10.0% 5.0% 0.0% -5.0% -10.0% -15.0% -20.0% 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 MSC Total Organic Growth (3 Mo Avg) IP Growth (3 Mo Avg) MSC 22 242#23Fiscal 2021 Framework* Revenue Growth (YoY) Operating Margin Range (%) Low single digits - Flat 10.2%-10.6% 9.9%-10.3% Low single digits 9.6%- 10.0% MSC * Includes $26.7 million in an asset impairment. 23 23#24Fiscal 2021 Framework - Adjusted* Revenue Growth (YoY) Adjusted Operating Margin Range (%) Low single digits - Flat Low single digits 11.5% -11.9% 11.2% -11.6% 11.0% -11.4% Excludes approximately $30 million of restructuring and other charges, $30.1 million in PPE-related inventory write-downs, $26.7 million in an asset impairment, partially offset by $20.8 million in loss recovery MSC 24 24#25Reconciliations Non-GAAP Financial Measures • Free Cash Flow ("FCF") FCF is a non-GAAP financial measure. FCF is used in addition to and in conjunction with results presented in accordance with accounting principles generally accepted in the United States ("GAAP"), and FCF should not be relied upon to the exclusion of GAAP financial measures. Management strongly encourages investors to review our financial statements and publicly-filed reports in their entirety and to not rely on any single financial measure. FCF, which we reconcile to "Net cash provided by operating activities," is cash flow from operations reduced by "Expenditures for property, plant and equipment". We believe that FCF, although similar to cash flow from operations, is a useful additional measure since capital expenditures are a necessary component of ongoing operations. Management also views FCF, as a measure of the Company's ability to reduce debt, add to cash balances, pay dividends, and repurchase stock. FCF has limitations due to the fact that it does not represent the residual cash flow available for discretionary expenditures. For example, FCF does not incorporate payments made on finance lease obligations or required debt service payments. In addition, different companies define FCF differently. Therefore, we believe it is important to view FCF as a complement to our entire consolidated statements of cash flows. A reconciliation of cash provided by operating activities to FCF for the thirteen and thirty-nine-week periods ended May 29, 2021 and May 30, 2020, respectively is shown below. Return on Invested Capital ("ROIC") ROIC is calculated using a non-GAAP financial measure. We calculate ROIC by dividing non-GAAP net operating profit after tax ("NOPAT") by average invested capital, a GAAP measure. NOPAT is defined as tax effected income from operations. Average invested capital is defined as net debt plus shareholder's equity using a trailing 13-month average. We believe that ROIC is useful to investors as a measure of performance and of the effectiveness of the use of capital in our operations. We use ROIC as one measure to monitor and evaluate operating performance. This method of determining non-GAAP ROIC may differ from other companies' methods and therefore may not be comparable to those used by other companies. ROIC should be considered in addition to, rather than as a substitute for, other information provided in accordance with GAAP. The financial measure calculated under GAAP which is most directly comparable to ROIC is considered to be the ratio of Net income to Average invested capital. See below for the calculation of ROIC and the reconciliation to the comparable GAAP measure. MSC 25 25#26Reconciliations Results Excluding Impairment Loss (Loss Recovery), Restructuring Costs, Inventory Write-downs, and Other Charges To supplement MSC Industrial's unaudited selected financial data presented consistent with accounting principles generally accepted in the United States ("GAAP"), the Company discloses certain non-GAAP financial measures, including non-GAAP gross profit, non-GAAP operating expenses, non-GAAP income from operations, non-GAAP operating margin, non-GAAP provision for income taxes, non-GAAP net income and non-GAAP diluted earnings per share, that exclude impairment losses (loss recovery), restructuring costs, inventory write-downs related to certain PPE inventory, and other related costs and tax effects. These non-GAAP financial measures are not presented in accordance with GAAP or an alternative for GAAP financial measures and may be different from similar non-GAAP financial measures used by other companies. The presentation of this additional information is not meant to be considered in isolation or as a substitute for the most directly comparable GAAP financial measures and should only be used to evaluate MSC Industrial's results of operations in conjunction with the corresponding GAAP financial measures. In calculating non-GAAP financial measures, we exclude impairment losses (loss recovery), restructuring costs, inventory write-downs related to certain PPE inventory, and other related costs and tax effects. Management makes these adjustments to facilitate a review of the Company's operating performance on a comparable basis between periods, for comparison with forecasts and strategic plans, for identifying and analyzing trends in the Company's underlying business and for benchmarking performance externally against competitors. We believe that investors benefit from seeing results from the perspective of management in addition to seeing results presented in accordance with GAAP for the same reasons and purposes for which management uses such non-GAAP financial measures. MSC 26#27Reconciliations GAAP Measure Net cash provided by operating activities Thirteen Weeks Ended May 29, 2021 $ 20,426 MSC INDUSTRIAL DIRECT CO., INC. Reconciliation of GAAP and Non-GAAP Information Thirteen and Thirty-Nine Weeks Ended May 29, 2021 and May 30, 2020 (dollars in thousands) Items Affecting Comparability Expenditures for property, plant and equipment Thirteen Weeks Ended May 30, 2020 May 29, 2021 $ 59,126 $ (17,644) GAAP Measure Net cash provided by operating activities Thirty-Nine Weeks Ended May 29, 2021 $ 139,360 MSC Non-GAAP Measure Free cash flow Thirteen Weeks Ended $ May 30, 2020 (10,183) $ May 29, 2021 2,782 $ May 30, 2020 48,943 Items Affecting Comparability Expenditures for property, plant and equipment Thirty-Nine Weeks Ended May 30, 2020 May 29, 2021 $ 214,941 (37,598) Non-GAAP Measure Free cash flow Thirty-Nine Weeks Ended May 30, 2020 $ (35,920) May 29, 2021 101,762 May 30, 2020 $ 179,021 27 22#28Reconciliations Net Sales Cost of Goods Sold Gross Profit Gross Margin Operating Expenses MSC INDUSTRIAL DIRECT CO., INC. Reconciliation of GAAP and Non-GAAP Financial Information Thirteen Weeks Ended May 29, 2021 (dollars in thousands, except percentages and per share data) $ GAAP Financial Measure Items Affecting Comparability Total MSC Industrial Impairment Loss (Loss Recovery) Restructuring Costs Legal Costs-impairment of prepaid for PPE 866,294 $ 499,823 366,471 42.3% Operating Exp as % of Sales 257,336 29.7% Impairment Loss (Loss Recovery) (20,840) (20,840) Restructuring Costs Income from Operations Operating Margin Non-GAAP Financial Measure Adjusted Total MSC Industrial 866,294 499,823 366,471 42.3% 401 0.0% 256,935 29.7% 1.349 1,349 128,626 20,840 (1,349) (401) 109,536 14.8% 2.4% -0.2% 0.0% 12.6% (2,550) (2,550) 126,076 20,840 (1,349) (401) 106,986 5,263 (341) (100) 26,319 15,577 (1,008) (301) 80,667 501 (1,008) $ (301) $ 80,166 Total Other Expense Income before provision for income taxes Provision for income taxes 31,141 Net income 94,935 Net income attributable to noncontrolling interest 501 Net income attributable to MSC Industrial $ 94,434 $ 15,577 Net income per common share: Diluted MSC $ 1.68 $ 0.28 $ (0.02) $ (0.01) $ 1.42 28#29Reconciliations Net Sales Cost of Goods Sold Gross Profit Gross Margin Operating Expenses Operating Exp as % of Sales Impairment Loss Restructuring Costs Income from Operations Operating Margin Total Other Expense Income before provision for income taxes Provision for income taxes Net income Net income attributable to noncontrolling interest Net income attributable to MSC Industrial Net income per common share: Diluted MSC MSC INDUSTRIAL DIRECT CO., INC. Reconciliation of GAAP and Non-GAAP Financial Information Thirty-Nine Weeks Ended May 29, 2021 (dollars in thousands, except percentages and per share data) GAAP Financial Measure Items Affecting Comparability Non-GAAP Financial Measure Total MSC Industrial Inventory Write- down Restructuring Costs Impairment Loss Legal Costs - impairment of prepaid for PPE Adjusted Total MSC Industrial 2,412,193 $ $ $ 2,412,193 1,427,653 30,091 1,397,562 $ 984,540 40.8% (30,091) -1.2% 741,156 30.7% 5,886 26.943 26.943 5,886 1,014,631 42.1% 1,421 0.1% 739,735 30.7% 210,555 8.7% (30,091) -1.2% (26,943) -1.1% (5,886) -0.2% (1,421) -0.1% 274,896 11.4% (8,856) (8,856) 201,699 (30,091) (26,943) (5,886) (1,421) 266,040 49,639 152,060 (7,392) (22,699) (6,620) (1,446) (20,323) (4,440) (349) (1,072) 65,446 200,594 1,087 $ 150,973 S (22,699) $ (20,323) $ (4,440) $ (1,072) $ 1,087 199,507 $ 2.69 $ (0.40) $ (0.36) $ (0.08) $ (0.02) $ 3.55 29 29#30Reconciliations Net Sales Cost of Goods Sold Gross Profit Gross Margin MSC INDUSTRIAL DIRECT CO., INC. Reconciliation of GAAP and Non-GAAP Financial Information Thirteen and Thirty-Nine Weeks Ended May 30, 2020 (dollars in thousands, except percentages and per share data) GAAP Financial Measure Items Affecting Comparability 1 Non-GAAP Financial Measure MSC Industrial excluding Restructuring Costs Total MSC Industrial Thirteen Weeks Ended Restructuring Costs Thirty-Nine Weeks Ended Thirteen Weeks Ended Thirty-Nine Weeks Ended Thirteen Weeks Ended Thirty-Nine Weeks Ended May 30, 2020 May 30, 2020 May 30, 2020 834,972 2,444,667 $ 834,972 $ 2,444,667 481,010 1,412,457 481,010 1,412,457 353,962 42.4% 1,032,210 42.2% 353,962 1,032,210 42.4% 42.2% Operating Expenses 242,751 748,519 Operating Exp as % of Sales 29.1% 30.6% Restructuring Costs 242,751 748,519 29.1% 30.6% 1,359 5,871 1,359 5,871 Income from Operations Operating Margin 109,852 277,820 (1,359) (5,871) 111,211 283,691 13.2% 11.4% -0.2% -0.2% 13.3% 11.6% Total Other Expense Income before provision for income taxes Provision for income taxes Net income (5,838) (12,375) (5,838) (12,375) 104,014 265,445 (1,359) (5,871) 105,373 271,316 25,900 66,323 78,114 199,122 (338) (1,021) (1,468) 26.238 67,791 (4,403) 79,135 203,525 Net income attributable to noncontrolling interest 411 Net income attributable to MSC Industrial $ 77,703 $ 501 198,621 411 501 $ (1,021) $ (4,403) $ 78,724 $ 203,024 Net income per common share: Diluted $ 1.40 3.57 $ (0.02) $ (0.08) $ 1.42 $ 1The thirteen and thirty-nine weeks ended May 30, 2020 include only restructuring costs. Items of note excluded from the current period results, including inventory write-downs, an impairment loss (loss recovery) and associated legal costs, did not occur in the prior year periods. MSC 3.65 30#31Reconciliations MSC INDUSTRIAL DIRECT CO., INC. Reconciliation of GAAP and Non-GAAP Information As of August 29, 2020 (dollars in thousands, except percentages) Fiscal Year Ended August 29, 2020 (a) Net income attributable to MSC Industrial (twelve-month trailing) NOPAT Income from Operations (twelve-month trailing) Effective tax rate (b) Non-GAAP NOPAT Invested Capital Total MSC Industrial shareholders' equity Current portion of debt including obligations under finance leases Long-term debt including obligations under finance leases Total Debt Cash and cash equivalents Net debt Invested capital (c) Average invested capital (thirteen-month trailing average) (a)/(c) Net income to Average invested capital (b)/(c) Non-GAAP ROIC MSC 251,117 350,740 24.7% 264,177 1,314,945 122,248 497,018 619,266 125,211 494,055 1,809,000 1,876,934 13.4% 14.1% 31#32MSC