10-Q 1 gww-20210930.htm 10-Q gww-20210930
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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
                          FORM 10-Q
 
(Mark One)
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
 
For the quarterly period ended September 30, 2021
OR
 
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
 
For the transition period from ______ to _______
 
Commission file number 1-5684

W.W. Grainger, Inc.
(Exact name of registrant as specified in its charter)
Illinois 36-1150280
(State or other jurisdiction of incorporation or organization) (I.R.S. Employer Identification No.)
100 Grainger Parkway,Lake Forest,Illinois 60045-5201
(Address of principal executive offices) (Zip Code)
(847)  535-1000
(Registrant’s telephone number including area code)
Not Applicable
(Former name or former address, if changed since last report)
     Securities registered pursuant to Section 12(b) of the Act:
Title of Each ClassTrading SymbolName of Each Exchange on Which Registered
Common StockGWWNew York Stock Exchange
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.  Yes ☒  No ☐
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).  Yes ☒  No ☐
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company.  See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
Large Accelerated Filer ☒  Accelerated Filer ☐   Non-accelerated Filer ☐   Smaller Reporting Company
Emerging Growth Company
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).
Yes   No ☒ 

There were 51,520,047 shares of the Company’s Common Stock, par value $0.50, outstanding as of September 30, 2021.
1


TABLE OF CONTENTS
 Page
PART I - FINANCIAL INFORMATION 
   
Item 1:Financial Statements (Unaudited) 
 Condensed Consolidated Statements of Earnings 
    for the Three and Nine Months Ended September 30, 2021 and 2020
 Condensed Consolidated Statements of Comprehensive Earnings 
    for the Three and Nine Months Ended September 30, 2021 and 2020
 Condensed Consolidated Balance Sheets
    as of September 30, 2021 and December 31, 2020
 Condensed Consolidated Statements of Cash Flows
    for the Nine Months Ended September 30, 2021 and 2020
Condensed Consolidated Statements of Shareholders' Equity
    for the Three and Nine Months Ended September 30, 2021 and 2020
 Notes to Condensed Consolidated Financial Statements
Item 2:Management's Discussion and Analysis of Financial Condition and Results of Operations
Item 3:Quantitative and Qualitative Disclosures About Market Risk
Item 4:Controls and Procedures
PART II - OTHER INFORMATION

   
Item 1:Legal Proceedings
Item 1A:Risk Factors
Item 2:Unregistered Sales of Equity Securities and Use of Proceeds
Item 6:Exhibits
Signatures 
  

2


PART I – FINANCIAL INFORMATION

Item 1:  Financial Statements

W.W. Grainger, Inc. and Subsidiaries
CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS
(In millions of dollars and shares, except for per share amounts)
(Unaudited)
Three Months EndedNine Months Ended
 September 30,September 30,
 2021202020212020
Net sales$3,372 $3,018 $9,663 $8,856 
Cost of goods sold2,122 1,944 6,196 5,645 
Gross profit1,250 1,074 3,467 3,211 
Selling, general and administrative expenses812 694 2,337 2,467 
Operating earnings438 380 1,130 744 
Other (income) expense:  
Interest expense - net22 23 65 72 
Other - net(6)(5)(19)(16)
Total other expense - net16 18 46 56 
Earnings before income taxes
422 362 1,084 688 
Income tax provision107 106 271 118 
Net earnings315 256 813 570 
Less: Net earnings attributable to noncontrolling interest18 16 53 43 
Net earnings attributable to W.W. Grainger, Inc.$297 $240 $760 $527 
Earnings per share:  
Basic$5.68 $4.43 $14.48 $9.74 
Diluted$5.65 $4.41 $14.40 $9.70 
Weighted average number of shares outstanding:    
Basic51.8 53.6 52.1 53.6 
Diluted52.1 53.9 52.4 53.8 
Cash dividends paid per share$1.62 $1.53 $4.77 $4.41 
 
The accompanying notes are an integral part of these financial statements.
3


W.W. Grainger, Inc. and Subsidiaries
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE EARNINGS
(In millions of dollars)
(Unaudited)
 Three Months EndedNine Months Ended
September 30,September 30,
 2021202020212020
Net earnings$315 $256 $813 570 
Other comprehensive earnings (losses):  
Foreign currency translation adjustments, net of reclassification to earnings(17)24 (43)30 
Postretirement benefit plan losses, net of tax benefit of $1, $1, $3, and $3, respectively
(4)(2)(10)(8)
Other  1 4 
Total other comprehensive earnings (losses)(21)22 (52)26 
Comprehensive earnings - net of tax294 278 761 596 
Less: Comprehensive earnings (losses) attributable to noncontrolling interest
Net earnings
18 16 53 43 
Foreign currency translation adjustments
(1)5 (19)6 
Total comprehensive earnings (losses) attributable to noncontrolling interest17 21 34 49 
Comprehensive earnings attributable to W.W. Grainger, Inc.
$277 $257 $727 $547 


The accompanying notes are an integral part of these financial statements.
4


W.W. Grainger, Inc. and Subsidiaries
CONDENSED CONSOLIDATED BALANCE SHEETS
(In millions of dollars, except for share and per share amounts)
As of
Assets(Unaudited) September 30, 2021December 31, 2020
Current assets  
Cash and cash equivalents$328 $585 
Accounts receivable (less allowances for credit losses of $29 and $27, respectively)
1,742 1,474 
Inventories - net1,786 1,733 
Prepaid expenses and other current assets149 127 
Total current assets4,005 3,919 
Property, buildings and equipment - net1,429 1,395 
Goodwill387 391 
Intangibles - net233 228 
Other assets336 362 
Total assets$6,390 $6,295 
Liabilities and shareholders' equity
Current liabilities  
Current maturities of long-term debt$ $8 
Trade accounts payable933 779 
Accrued compensation and benefits259 307 
Accrued expenses336 305 
Income taxes payable22 42 
Total current liabilities1,550 1,441 
Long-term debt (less current maturities)2,372 2,389 
Deferred income taxes and tax uncertainties88 110 
Other non-current liabilities263 262 
Shareholders' equity  
Cumulative preferred stock – $5 par value – 12,000,000 shares authorized; none issued nor outstanding
  
Common Stock – $0.50 par value – 300,000,000 shares authorized; issued 109,659,219 shares
55 55 
Additional contributed capital1,255 1,239 
Retained earnings9,301 8,779 
Accumulated other comprehensive losses(94)(61)
Treasury stock, at cost – 58,139,172 and 57,134,828 shares, respectively
(8,690)(8,184)
Total W.W. Grainger, Inc. shareholders’ equity1,827 1,828 
Noncontrolling interest290 265 
Total shareholders' equity2,117 2,093 
Total liabilities and shareholders' equity$6,390 $6,295 
  
The accompanying notes are an integral part of these financial statements.
5


W.W. Grainger, Inc. and Subsidiaries
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(In millions of dollars)
(Unaudited)
Nine Months Ended
 September 30,
 20212020
Cash flows from operating activities:  
Net earnings$813 $570 
Provision for credit losses12 18 
Deferred income taxes and tax uncertainties(7)9 
Depreciation and amortization137 137 
Impairment of goodwill, intangible and long-lived assets 177 
Net (gains) losses from sale or redemption of assets and business divestitures(3)104 
Stock-based compensation33 36 
Subtotal 172 481 
Change in operating assets and liabilities:  
Accounts receivable(298)(145)
Inventories(64)(222)
Prepaid expenses and other assets(1)(29)
Trade accounts payable167 145 
Accrued liabilities(13)(13)
Income taxes - net(42)(19)
Other non-current liabilities(10)19 
Subtotal (261)(264)
Net cash provided by operating activities724 787 
Cash flows from investing activities:  
Additions to property, buildings, equipment and intangibles(197)(152)
Proceeds from sale or redemption of assets and business divestitures17 22 
Other - net (2)
Net cash used in investing activities(180)(132)
Cash flows from financing activities:  
Borrowings under lines of credit 12 
Payments against lines of credit (65)
Proceeds from long-term debt 1,583 
Payments of long-term debt(8)(1,361)
Proceeds from stock options exercised31 47 
Payments for employee taxes withheld from stock awards(29)(16)
Purchases of treasury stock(525)(101)
Cash dividends paid(261)(246)
Other - net2  
Net cash used in financing activities(790)(147)
Exchange rate effect on cash and cash equivalents(11)(9)
Net change in cash and cash equivalents(257)499 
Cash and cash equivalents at beginning of year585 360 
Cash and cash equivalents at end of period$328 $859 
 
The accompanying notes are an integral part of these financial statements.
6


W.W. Grainger, Inc. and Subsidiaries
CONDENSED CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY
(In millions of dollars, except for per share amounts)
(Unaudited)

Common StockAdditional Contributed CapitalRetained EarningsAccumulated Other Comprehensive Earnings (Losses)Treasury StockNoncontrolling
Interest
Total
Balance at January 1, 2020$55 $1,182 $8,405 $(154)$(7,633)$205 $2,060 
Stock-based compensation— 10 — — 13 — 23 
Purchases of treasury stock— — — — (100)— (100)
Net earnings— — 173 — — 12 185 
Other comprehensive earnings (losses)— — — (63)— 3 (60)
Cash dividends paid ($1.44 per share)
— — (78)— — — (78)
Balance at March 31, 2020$55 $1,192 $8,500 $(217)$(7,720)$220 $2,030 
Stock-based compensation— 6 — — 11 — 17 
Purchases of treasury stock— — — — — (1)(1)
Net earnings— — 114 — — 15 129 
Other comprehensive earnings (losses)— — — 66 — (2)64 
Cash dividends paid ($1.44 per share)
— — (78)— — (9)(87)
Balance at June 30, 2020$55 $1,198 $8,536 $(151)$(7,709)$223 $2,152 
Stock-based compensation— 16 — — 11 — 27 
Net earnings— — 240 — — 16 256 
Other comprehensive earnings (losses)
— — — 17 — 5 22 
Cash dividends paid ($1.53 per share)
— — (82)— — — (82)
Balance at September 30, 2020$55 $1,214 $8,694 $(134)$(7,698)$244 $2,375 

The accompanying notes are an integral part of these financial statements.











7


W.W. Grainger, Inc. and Subsidiaries
CONDENSED CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY
(In millions of dollars, except for per share amounts)
(Unaudited)

Common StockAdditional Contributed CapitalRetained EarningsAccumulated Other Comprehensive Earnings (Losses)Treasury StockNoncontrolling
Interest
Total
Balance at January 1, 2021$55 $1,239 $8,779 $(61)$(8,184)$265 $2,093 
Stock-based compensation— 9 — — 5 — 14 
Purchases of treasury stock— — — — (175)— (175)
Net earnings— — 238 — — 17 255 
Other comprehensive earnings (losses)— — — (20)— (18)(38)
Reclassification due to the adoption of ASU 2019-12— — 12 — — — 12 
Cash dividends paid ($1.53 per share)
— — (81)— — — (81)
Balance at March 31, 2021$55 $1,248 $8,948 $(81)$(8,354)$264 $2,080 
Stock-based compensation— (1)— — 12 1 12 
Purchases of treasury stock— — — — (107)(1)(108)
Net earnings— — 225 — — 18 243 
Other comprehensive earnings (losses)— — — 7 — — 7 
Capital contribution— — — — — 2 2 
Cash dividends paid ($1.62 per share)
— — (84)— — (11)(95)
Balance at June 30, 2021$55 $1,247 $9,089 $(74)$(8,449)$273 $2,141 
Stock-based compensation— 8 — — 1 — 9 
Purchases of treasury stock— — — — (242)— (242)
Net earnings— — 297 — — 18 315 
Other comprehensive earnings (losses)— — — (20)— (1)(21)
Cash dividends paid ($1.62 per share)
— — (85)— — — (85)
Balance at September 30, 2021$55 $1,255 $9,301 $(94)$(8,690)$290 $2,117 

The accompanying notes are an integral part of these financial statements.
8

W.W. Grainger, Inc. and Subsidiaries
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)

NOTE 1 - BACKGROUND AND BASIS OF PRESENTATION
W.W. Grainger, Inc. is a broad line, business-to-business distributor of maintenance, repair and operating (MRO) products and services with operations primarily in North America (N.A.), Japan and the United Kingdom (U.K.). In this report, the words “Company” or “Grainger” mean W.W. Grainger, Inc. and its subsidiaries, except where the context makes it clear that the reference is only to W.W. Grainger, Inc. itself and not its subsidiaries.

The Company's Condensed Consolidated Financial Statements (Financial Statements) and the related notes are unaudited and should be read in conjunction with the consolidated financial statements and associated notes for the year ended December 31, 2020 included in the Company’s Annual Report on Form 10-K filed with the Securities and Exchange Commission (SEC) on February 24, 2021 (2020 Form 10-K). The Condensed Consolidated Balance Sheet as of December 31, 2020 has been derived from the audited consolidated financial statements at that date but does not include all of the disclosures required by accounting principles generally accepted in the United States of America (U.S.) for complete financial statements.
 
The unaudited financial information reflects all adjustments (primarily consisting of normal recurring adjustments) which, in the opinion of management, are necessary for a fair presentation of the statements contained in this report.

Changes to Reportable Segments
Effective January 1, 2021, Grainger's two reportable segments are High-Touch Solutions N.A. and Endless Assortment. On March 8, 2021, the Company provided investors with segment summary historical financial information and segment historical data that is consistent with its new reportable segment structure and reflective of the intersegment accounting policies described in Note 10 - Segment Information.

The Company's High-Touch Solutions N.A. segment provides value-added MRO solutions that are rooted in deep product knowledge and customer expertise. This segment includes the Grainger-branded businesses in the U.S., Canada, Mexico and Puerto Rico. The Company’s Endless Assortment segment provides a simple, transparent and streamlined experience for customers to shop millions of products online. This segment includes the Company’s Zoro Tools, Inc. (Zoro) businesses in the U.S. and U.K. and MonotaRO Co., Ltd. (MonotaRO), which operates predominately in Japan. The remaining international High-Touch Solutions businesses, operating primarily in the U.K., are classified as “Other” to reconcile to consolidated results. These businesses individually do not meet the criteria of a reportable segment.

NOTE 2 - NEW ACCOUNTING STANDARDS
Accounting Pronouncements Recently Adopted
In December 2019, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) 2019-12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes. This ASU clarifies and simplifies accounting for income taxes by eliminating certain exceptions for intra-period tax allocation principles, the methodology for calculating income tax rates in an interim period, and recognition of deferred taxes for outside basis differences in an investment, among other updates. The effective date of this ASU was for fiscal years and interim periods beginning after December 15, 2020. The Company adopted this ASU effective January 1, 2021 and it did not have a material impact on the Financial Statements.

In January 2020, the FASB issued ASU 2020-01, Investments - Equity Securities (Topic 321), Investments - Equity Method and Joint Ventures (Topic 323), and Derivatives and Hedging (Topic 815), Clarifying the Interactions between Topic 321, Topic 323 and Topic 815. This ASU simplifies the understanding and application of the codification topics by eliminating inconsistencies and providing clarifications. The effective date of this ASU was for fiscal years and interim periods beginning after December 15, 2020. The Company adopted this ASU effective January 1, 2021 and it did not have a material impact on the Financial Statements.

In October 2020, the FASB issued ASU 2020-10, Codification Improvements. These amendments improve consistency by amending the codification to include all disclosure guidance in the appropriate disclosure sections and clarifies application of various provisions in the codification by amending and adding new headings, cross referencing to other guidance and refining or correcting terminology. The effective date of this ASU was for fiscal
9

W.W. Grainger, Inc. and Subsidiaries
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Unaudited)
years and interim periods beginning after December 15, 2020. The Company adopted this ASU effective January 1, 2021 and it did not have a material impact on the Financial Statements.

Accounting Pronouncements Recently Issued
In March 2020, the FASB issued ASU 2020-04, Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting as modified by subsequently issued ASU 2021-01. This update provides optional expedients and exceptions for applying generally accepted accounting principles to certain contract modifications and hedging relationships that reference London Inter-bank Offered Rate (LIBOR) or another reference rate expected to be discontinued. The guidance is effective upon issuance and generally can be applied prospectively to contract modifications made and hedging relationships entered into or evaluated on or before December 31, 2022. The Company is evaluating the impact of this ASU and does not expect a material impact on the Financial Statements.

NOTE 3 - REVENUE
Company revenue is primarily comprised of MRO product sales and related activities, such as freight and services. Total service revenue is not material and accounted for approximately 1% of the Company's revenue for the three and nine months ended September 30, 2021 and 2020, respectively.

Grainger serves a large number of customers in diverse industries, which are subject to different economic and market-specific factors. The Company's presentation of revenue by segment and industry most reasonably depicts how the nature, amount, timing and uncertainty of Company revenue and cash flows are affected by economic and market-specific factors. In addition, the segments have unique underlying risks associated with customer purchasing behaviors. In the High-Touch Solutions N.A. segment, more than two-thirds of revenue is derived from customer contracts whereas in the Endless Assortment segment, a majority of revenue is derived from customer spot buys. The following table presents the Company's percentage of revenue by reportable segment and by major customer industry:
Three Months Ended September 30,
20212020
High-Touch Solutions N.A.Endless Assortment
Total Company(2)
High-Touch Solutions N.A.Endless Assortment
Total Company(2)
Contractors9 %15 %10 %8 %15 %10 %
Commercial9 %15 %10 %9 %15 %10 %
Government18 %3 %15 %22 %3 %18 %
Healthcare7 %2 %6 %8 %2 %6 %
Manufacturing29 %30 %29 %27 %27 %28 %
Retail/Wholesale9 %10 %10 %9 %10 %9 %
Transportation5 %3 %5 %5 %3 %5 %
Others(1)
14 %22 %15 %12 %25 %14 %
Total100 %100 %100 %100 %100 %100 %
Percent of Total Company Revenue79 %19 %100 %79 %19 %100 %

(1) Others primarily includes revenue from industries and customers that are not material individually, including agriculture, mining, natural resources and resellers not aligned to a major industry segment.
(2) Total Company includes other businesses, which includes the Cromwell business in the U.K., as well as the China business in the period prior to its divestiture in the third quarter of 2020. Other businesses account for approximately 2% of revenue for the three months ended September 30, 2021 and September 30, 2020.
10

W.W. Grainger, Inc. and Subsidiaries
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Unaudited)
Nine Months Ended September 30,
20212020
High-Touch Solutions N.A.Endless Assortment
Total Company(2)
High-Touch Solutions N.A.Endless Assortment
Total Company(2)
Contractors9 %15 %10 %9 %15 %10 %
Commercial9 %15 %10 %9 %15 %9 %
Government19 %3 %15 %20 %3 %16 %
Healthcare7 %2 %6 %9 %2 %7 %
Manufacturing30 %29 %29 %28 %29 %29 %
Retail/Wholesale9 %10 %10 %9 %10 %9 %
Transportation5 %3 %5 %5 %3 %5 %
Others(1)
12 %23 %15 %11 %23 %15 %
Total100 %100 %100 %100 %100 %100 %
Percent of Total Company Revenue78 %20 %100 %78 %18 %100 %

(1) Others primarily includes revenue from industries and customers that are not material individually, including agriculture, mining, natural resources and resellers not aligned to a major industry segment.
(2) Total Company includes other businesses, which includes the Cromwell business in the U.K., as well as the Fabory and China businesses in the period prior to their divestitures in the second and third quarter of 2020, respectively. Other businesses account for approximately 2% and 4% of revenue for the nine months ended September 30, 2021 and September 30, 2020.

Total accrued sales returns were approximately $41 million and $31 million as of September 30, 2021 and December 31, 2020, respectively and are reported as a reduction of Accounts receivable, net. Total accrued sales incentives were approximately $65 million and $58 million as of September 30, 2021 and December 31, 2020 and are reported as part of Accrued expenses. The Company had no material unsatisfied performance obligations, contract assets or liabilities as of September 30, 2021 and December 31, 2020.

NOTE 4 - PROPERTY, BUILDINGS AND EQUIPMENT
Property, buildings and equipment consisted of the following (in millions of dollars):
As of
September 30, 2021December 31, 2020
Land$329 $329 
Building, structures and improvements1,445 1,330 
Furniture, fixtures, machinery and equipment1,566 1,878 
Property, buildings and equipment$3,340 $3,537 
Less: Accumulated depreciation and amortization1,911 2,142 
Property, buildings and equipment - net$1,429 $1,395 

NOTE 5 - GOODWILL AND OTHER INTANGIBLE ASSETS
Grainger tests reporting units' goodwill and intangible assets for impairment annually during the fourth quarter and more frequently if impairment indicators exist. Accordingly, Grainger performs quarterly qualitative assessments of significant events and circumstances such as reporting units' historical and current results, assumptions regarding future performance, strategic initiatives and overall economic factors, including the current global outbreak of the Coronavirus (COVID-19 pandemic) and macro-economic developments, to determine the existence of potential indicators of impairment and assess if it is more likely than not that the fair value of reporting units' goodwill or intangible assets is less than their carrying value. If indicators of impairment are identified, a quantitative impairment test is performed. The Company did not identify any significant events or changes in circumstances that indicated
11

W.W. Grainger, Inc. and Subsidiaries
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Unaudited)
the existence of impairment indicators during the three and nine months ended September 30, 2021. As such, quantitative assessments were not required.

The balances and changes in the carrying amount of Goodwill (net of cumulative goodwill impairments) by segment are as follows (in millions of dollars):
High-Touch Solutions N.AEndless AssortmentOtherTotal
Balance at January 1, 2020$318 $52 $59 $429 
Acquisition 15  15 
Impairment  (58)(58)
Translation3 3 (1)5 
Balance at December 31, 2020321 70  391 
Translation (4) (4)
Balance at September 30, 2021$321 $66 $ $387 
The cumulative goodwill impairments as of September 30, 2021, were $137 million and consisted of $32 million within High-Touch Solutions N.A. and $105 million in Other. During the first quarter of 2020, the Company recorded $58 million of impairment charges in Selling, general and administrative expenses (SG&A) in connection with the impairment of Fabory's goodwill. The impairment is presented in Other in the table above. The Company divested the Fabory business during the second quarter of 2020. Grainger's current business portfolio had no impairments to goodwill for the three and nine months ended September 30, 2021 and 2020.
The balances in Intangible assets, net are as follows (in millions of dollars):
September 30, 2021December 31, 2020
Weighted average lifeGross carrying amountAccumulated amortizationNet carrying amountGross carrying amountAccumulated amortizationNet carrying amount
Customer lists and relationships11.8 years$221 $175 $46 $223 $171 $52 
Trademarks, trade names and other14.1 years36 24 12 36 22 14 
Non-amortized trade names and otherIndefinite26  26 28  28 
Capitalized software4.2 years510 361 149 461 327 134 
Total intangible assets6.9 years$793 $560 $233 $748 $520 $228 












12

W.W. Grainger, Inc. and Subsidiaries
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Unaudited)
NOTE 6 - DEBT
There was no short-term debt as of September 30, 2021 and December 31, 2020.

Long-term debt, including current maturities and debt issuance costs and discounts, net, consisted of the following (in millions of dollars):
As of September 30, 2021As of December 31, 2020
Carrying Value
Fair Value(4)
Carrying Value
Fair Value(4)
4.60% senior notes due 2045(1)
$1,000 $1,298 $1,000 $1,343 
3.75% senior notes due 2046(1)
400 463 400 479 
4.20% senior notes due 2047(1)
400 497 400 514 
1.85% senior notes due 2025(2)
500 515 500 526 
Japanese Yen term loan(3)
81 81 87