Daniel L. Florness
President and Chief Executive Officer at Fastenal
Thank you, Taylor. Good morning, everybody, and thank you for joining our third quarter call. I'll start on the -- reference the flip book on Page 3. Conditions remained challenging in the third-quarter of '23 reflected in daily sales growth rate of 4%. Still regardless of the year, we celebrate milestones when they occur. I remember just over 10 years ago when we hit $10 billion in daily sales for the first time, we recognized that. On this call, as well as internally to celebrate that milestone of some years later we hit $20 billion. Here, in the month of September, we broke $30 million in sales per day for the first time in our history and my congratulations to the Fastenal organization for hitting that milestone.
Our sales growth in the quarter translated into EPS growth or EPS of $0.52, 4.1% growth over the same-period last year. Our results reflect the unique product profile of our business. Fasteners still constitute about a third of our sales and within that sub-category, about 63% is an OEM oriented fastener and that business can be very cyclical because of the production needs of each of the customers we're serving. If you look at the rest of the business, it tends to be much more MRO oriented. Our fastener daily sales as you've seen in our monthly sales release have decelerated at a faster rate than our non-fastener business as we've gone through the calendar year.
The third quarter operating margin was 21%, which matched last year despite the one less selling day and so you know what, earlier I spoke about the $30 million we do on a day. The quarter had one less day. Some of our expenses are tethered to the day, most are not and so pleased that the team was able to match the operating margin of 21% from last year. But I believe that understates the reality of the performance. If you looked at it on a same day basis, we believe we would have increased the operating margin because we'd had roughly $10 million more, about a third of that $30 million in operating income because that -- a good chunk of that flows through because of the change in the nature of the expense.
The Blue Team, if I think about the last several years, we had a unique opportunity to serve the marketplace because of our pristine balance sheet. When COVID hit the globe back in 2020, we were able to step forward and secure and purchase and fund with cash a meaningful increase in inventory primarily centered on safety supplies because our customers and society in general needed something to get through that period. We were proud to be part of the solution. We were able to do that because of our balance sheet.
As the global economy reemerged from the pandemic, we saw firsthand and you saw it in daily news clippings about congestion that was going on in supply chains around the planet. Again, as supply chains became more rocky and you couldn't rely on how many days it would take to get product, there is a solution to that. It's stock more products and we beefed up our balance sheet and our cash flow suffered as a result, but I believe our standing with our customers and in the marketplace never performed better because the market could rely on the covenant that Fastenal provided to them in being a great supply chain partner.
As we moved deeper into 2022 and now into 2023, we've been able to unwind a piece of that and as a result, on a year-to-date basis, we have converted 121% of our net earnings into operating cash flow. That's our highest performance in a decade that's averaged just shy of 100%, about 95%. If I look at it from the standpoint of relative to a year ago, in the quarter, our operating cash grew about 51%. Year-to-date, our operating cash has grown 69%. Again, part of that's a reflection of the investments we made to serve our marketplace and our ability to unwind that in the current environment and translate that into cash flow for the organization to serve our shareholders and to serve the business as we move into the future.
Our Onsite and FMI installed bases in our digital footprint continue to expand and earlier this year, we did some restructuring and we announced the elevation of Jeff Watts to Chief Sales Officer in the organization. We did some restructuring of the sales side of our organization because we wanted to double down on the challenge we put in place in front of everybody going back to the 2015 time frame and that was really stepping into what we saw is an untapped opportunity to grow our business faster and that was to expand our onsite presence.
It was earlier this year that for the first time, the number of Onsites in the organization outnumbered the number of branches in the organization and that delta continues to expand. And we believe that each of our district managers has the potential in their market to land two Onsites per year and it's our job and part of the purpose of the restructuring of the sales team was to really decide hey, we believe it, but we haven't done it. Let's do this thing. We expanded -- not too many years ago, we were signing 80 Onsites a year and we laid out a plan to get to 400 a year.
We expect as you see on the next page, we'll do about 350 this year, but we haven't hit that number and we've been kind of stuck. Now COVID threw some challenges our way. It's never an easy time to move in with somebody when they're trying to isolate from the rest of the world and that challenged our ability to grow coming out of COVID. But looking at the opportunity that's out there, I believe we can do that. We need to turn that belief into reality.
Flipping to Page 4. Speaking of Onsites, we just signed 93 in the quarter. So our active sites, there are 1,778, 13.5% greater than they were at the end of third quarter of 2022 and our daily sales in those Onsites excluding transferred business when you open an Onsite is in the low-double-digit rate. So we're seeing good growth there. We're just not signing enough and as I said, we still anticipate signing roughly 350 this year. FMI technology, there we set lofty goals as well. We said can we do 100 a day, down to 100 a quarter, but 100 a day of our weighted device count.
Now we did 5,969 during the quarter, 95 per day versus 81 a year ago. The team is performing really well here. We're not at the 100. The 100 is a goal and we will push and push and push till we get there, but I'm really proud of what the team is doing. And you see that shine through when you look at our sales by product line in our monthly and quarterly releases. One thing you do see is our safety business grew almost 10% in the month of September and a lot of that could be attributed to the success we're seeing in FMI and it's our anticipation we'll sign between 23,000 and 25,000 MAUs this year and that's a combination of FASTBin and FASTVend.
E-commerce, it's still in the scheme of things a relatively small piece of our business. It's just under 25%, but it's up from single-digits not too many years ago and it currently grows -- it grew about 41% during the quarter and that's really a case of the marketplace saying to us we'd prefer to purchase from you this way. And our team in the field and our team and technology building an ever better mousetrap to serve into that market. As I've shared on prior calls, we still believe to go on this piece of our business because a chunk of e-commerce is that unplanned spend and our goal is to keep making that easier for our team to do in the field.
Finally, if you roll up FMI and e-commerce, we talk about our digital footprint. How much of our revenue is touching some digital aspect of engagement? We were at 57% in the quarter versus 49.5% a year ago. Our challenge to the team is targeting 60% sometime before we exit this year and our long-term expectation is still at that 85% we've talked about in the past that we believe will be part of our digital footprint as we move into the future. In addition to our earnings release, there's several 8-Ks that have gone out around the earnings time and I thought I'd share just some insight on the three.
The first one and I believe it went out yesterday evening after market close, we announced as we do typically on a quarterly basis the dividend. We announced a $0.35 dividend, which is consistent with the dividend we paid in each of the first three quarters of the year. We also announced a few leadership changes. One is a press release we put out. One of the individuals that's been very influential in our ability to beef up our inventory during COVID and ramp it back down and overseeing the distribution and transportation teams as well is Tony Broersma.
Tony has been with the organization roughly 20 years and he has demonstrated through a career and we identify -- we lay out his career in the press release the different roles he has had, but he has demonstrated excellence. And yesterday, I asked the Board of Directors to elevate him to Executive Vice President over operations, so essentially elevating his role and that his responsibility will be largely unchanged from what he had previously, but it's recognizing his performance and what we see in the future of Tony within the organization.
A second filing went out. It's a required filing related to one of our officers who has decided to move on to a new chapter in his career and it's Terry Owen, our Chief Operations Officer. I've known Terry for many years. He's been with the organization. I believe all told, he has been at the organization about 28 years. The official documents say it's 24.5 because he was in the -- early years part time with the organization, but then he came full time. He had break and service their. But Terry has demonstrated a career of exemplary service to the organization.
We've had some conversation in recent months about some aspirations he had and he is looking at the number of years he has left in his career and what he wants to do as he moves into his next chapter life. He discovered an opportunity thought was quite compelling that would serve his desire for the future as well as his family. Terry relocated to the East Coast of the U.S. several years ago for family reasons and all I can say that Terry is good friend. I wish you best of luck in your next endeavor and thank you for the team that you developed, Tony being one of them, but thank you for the team you developed.
The organization has always prided itself on our ability to build leaders and promote from within. And every time we see a person decide to take a new chapter in life, whether that chapter is retirement or going into a family business or whatever the case might be, we always see another layer of talent right behind that person ready to step in and discover their future and their opportunity.
With that, I'll turn it over to Holden.
