“Our second quarter’s results are a reflection of our AutoZoners’ continued commitment to delivering exceptional service to our customers during these unique times. Our retail and commercial sales performance remained strong this quarter. While our commercial sales growth continued to be elevated at 32.1%, our retail sales growth also remained healthy with over 10% growth against a tough comparison from a year ago. We believe the initiatives we have in place position us well for the remainder of our fiscal year,” said
For the quarter, gross profit, as a percentage of sales, was 53.0%, a decrease of 59 basis points versus the prior year. The decrease in gross margin was primarily driven by initiatives to accelerate Commercial growth. Operating expenses, as a percentage of sales, was 34.4% versus 37.0% last year. The decrease in operating expenses, as a percentage of sales, was driven by strong sales growth and approximately
Operating profit increased 30.1% to
Under its share repurchase program, AutoZone repurchased 783 thousand shares of its common stock for
The Company’s inventory increased 6.2% over the same period last year, driven by new stores, hubs and megahubs with the remaining growth primarily due to inflation. Net inventory, defined as merchandise inventories less accounts payable, on a per store basis, was negative
“As we continue to focus on the health and well-being of our customers and AutoZoners, we remain committed to providing the best and safest place to shop for everyone’s automotive needs. During these unique and challenging times, we strive to deliver the best customer service possible. As we continue to prudently invest capital in our business, we remain focused on returns on capital. We are committed to our long-term approach of increasing operating earnings and free cash flows while utilizing our balance sheet effectively,” said Rhodes.
During the quarter ended
AutoZone is the leading retailer and distributor of automotive replacement parts and accessories in the
AutoZone will host a conference call this morning,
This release includes certain financial information not derived in accordance with generally accepted accounting principles (“GAAP”). These non-GAAP measures include adjustments to reflect return on invested capital, adjusted debt and adjusted debt to EBITDAR. The Company believes that the presentation of these non-GAAP measures provides information that is useful to investors as it indicates more clearly the Company’s comparative year-to-year operating results, but this information should not be considered a substitute for any measures derived in accordance with GAAP. Management targets the Company’s capital structure in order to maintain its investment grade credit ratings. The Company believes this is important information for the management of its debt levels and share repurchases. We have included a reconciliation of this additional information to the most comparable GAAP measures in the accompanying reconciliation tables.
Certain statements contained in this press release constitute forward-looking statements that are subject to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements typically use words such as “believe,” “anticipate,” “should,” “intend,” “plan,” “will,” “expect,” “estimate,” “project,” “positioned,” “strategy,” “seek,” “may,” “could” and similar expressions. These are based on assumptions and assessments made by our management in light of experience and perception of historical trends, current conditions, expected future developments and other factors that we believe to be appropriate. These forward-looking statements are subject to a number of risks and uncertainties, including without limitation: product demand; energy prices; weather; competition; credit market conditions; cash flows; access to available and feasible financing; future stock repurchases; the impact of recessionary conditions; consumer debt levels; changes in laws or regulations; risks associated with self-insurance; war and the prospect of war, including terrorist activity; the impact of public health issues, such as the ongoing global coronavirus pandemic; inflation; the ability to hire, train and retain qualified employees; construction delays; the compromising of confidentiality, availability or integrity of information, including due to cyber-attacks; historic growth rate sustainability; downgrade of our credit ratings; damage to our reputation; challenges in international markets; failure or interruption of our information technology systems; origin and raw material costs of suppliers; inventory availability; disruption in our supply chain; impact of tariffs; anticipated impact of new accounting standards; and business interruptions. Certain of these risks and uncertainties are discussed in more detail in the “Risk Factors” section contained in Item 1A under Part 1 of the Company’s Annual Report on Form 10-K for the year ended
Contact Information:
Financial:
Media:
AutoZone's 2nd Quarter Highlights - Fiscal 2022 | |||||||||||||||
Condensed Consolidated Statements of Operations | |||||||||||||||
2nd Quarter, FY2022 | |||||||||||||||
(in thousands, except per share data) | |||||||||||||||
GAAP Results | |||||||||||||||
12 Weeks Ended | 12 Weeks Ended | ||||||||||||||
Net sales | $ | 3,369,750 | $ | 2,910,818 | |||||||||||
Cost of sales | 1,584,524 | 1,351,435 | |||||||||||||
Gross profit | 1,785,226 | 1,559,383 | |||||||||||||
Operating, SG&A expenses | 1,158,466 | 1,077,616 | |||||||||||||
Operating profit (EBIT) | 626,760 | 481,767 | |||||||||||||
Interest expense, net | 42,471 | 46,012 | |||||||||||||
Income before taxes | 584,289 | 435,755 | |||||||||||||
Income tax expense(1) | 112,534 | 89,809 | |||||||||||||
Net income | $ | 471,755 | $ | 345,946 | |||||||||||
Net income per share: | |||||||||||||||
Basic | $ | 23.00 | $ | 15.27 | |||||||||||
Diluted | $ | 22.30 | $ | 14.93 | |||||||||||
Weighted average shares outstanding: | |||||||||||||||
Basic | 20,513 | 22,648 | |||||||||||||
Diluted | 21,158 | 23,168 | |||||||||||||
(1)The twelve weeks ended | |||||||||||||||
(2)The twelve weeks ended | |||||||||||||||
Year-To-Date 2nd Quarter, FY2022 | |||||||||||||||
(in thousands, except per share data) | |||||||||||||||
GAAP Results | |||||||||||||||
24 Weeks Ended | 24 Weeks Ended | ||||||||||||||
Net sales | $ | 7,038,653 | $ | 6,065,078 | |||||||||||
Cost of sales | 3,328,267 | 2,830,078 | |||||||||||||
Gross profit | 3,710,386 | 3,235,000 | |||||||||||||
Operating, SG&A expenses | 2,329,141 | 2,138,008 | |||||||||||||
Operating profit (EBIT) | 1,381,245 | 1,096,992 | |||||||||||||
Interest expense, net | 85,755 | 92,191 | |||||||||||||
Income before taxes | 1,295,490 | 1,004,801 | |||||||||||||
Income taxes(1) | 268,500 | 216,422 | |||||||||||||
Net income | $ | 1,026,990 | $ | 788,379 | |||||||||||
Net income per share: | |||||||||||||||
Basic | $ | 49.49 | $ | 34.37 | |||||||||||
Diluted | $ | 48.03 | $ | 33.59 | |||||||||||
Weighted average shares outstanding: | |||||||||||||||
Basic | 20,750 | 22,935 | |||||||||||||
Diluted | 21,383 | 23,473 | |||||||||||||
(1)The twenty-four weeks ended | |||||||||||||||
(2)The twenty-four weeks ended | |||||||||||||||
Selected Balance Sheet Information | |||||||||||||||
(in thousands) | |||||||||||||||
Cash and cash equivalents | $ | 239,423 | $ | 1,026,164 | $ | 1,171,335 | |||||||||
Merchandise inventories | 5,031,222 | 4,736,826 | 4,639,813 | ||||||||||||
Current assets | 5,903,770 | 6,326,845 | 6,415,303 | ||||||||||||
Property and equipment, net | 4,879,079 | 4,627,993 | 4,856,891 | ||||||||||||
Operating lease right-of-use assets | 2,743,771 | 2,660,667 | 2,718,712 | ||||||||||||
Total assets | 14,078,473 | 14,159,993 | 14,516,199 | ||||||||||||
Accounts payable | 6,378,606 | 5,351,096 | 6,013,924 | ||||||||||||
Current liabilities | 7,684,645 | 6,804,271 | 7,369,754 | ||||||||||||
Operating lease liabilities, less current portion | 2,641,555 | 2,566,974 | 2,632,842 | ||||||||||||
Total debt | 5,840,884 | 5,516,396 | 5,269,820 | ||||||||||||
Stockholders' deficit | (3,137,477 | ) | (1,523,573 | ) | (1,797,536 | ) | |||||||||
Working capital | (1,780,875 | ) | (477,426 | ) | (954,451 | ) | |||||||||
AutoZone's 2nd Quarter Highlights - Fiscal 2022 | |||||||||||||||||||
Condensed Consolidated Statements of Operations | |||||||||||||||||||
Adjusted Debt / EBITDAR | |||||||||||||||||||
(in thousands, except adjusted debt to EBITDAR ratio) | Trailing 4 Quarters | ||||||||||||||||||
Net income | $ | 2,408,925 | $ | 1,871,731 | |||||||||||||||
Add: Interest expense | 188,901 | 205,278 | |||||||||||||||||
Income tax expense | 630,954 | 529,701 | |||||||||||||||||
EBIT | 3,228,780 | 2,606,710 | |||||||||||||||||
Add: Depreciation and amortization | 422,938 | 401,073 | |||||||||||||||||
Rent expense(1) | 354,410 | 335,969 | |||||||||||||||||
Share-based expense | 62,672 | 46,906 | |||||||||||||||||
EBITDAR | $ | 4,068,800 | $ | 3,390,658 | |||||||||||||||
Debt | $ | 5,840,884 | $ | 5,516,396 | |||||||||||||||
Financing lease liabilities | 272,719 | 225,411 | |||||||||||||||||
Add: Rent x 6(1) | 2,126,460 | 2,015,814 | |||||||||||||||||
Adjusted debt | $ | 8,240,063 | $ | 7,757,621 | |||||||||||||||
Adjusted debt to EBITDAR | 2.0 | 2.3 | |||||||||||||||||
Adjusted Return on | |||||||||||||||||||
(in thousands, except ROIC) | |||||||||||||||||||
Trailing 4 Quarters | |||||||||||||||||||
Net income | $ | 2,408,925 | $ | 1,871,731 | |||||||||||||||
Adjustments: | |||||||||||||||||||
Interest expense | 188,901 | 205,278 | |||||||||||||||||
Rent expense(1) | 354,410 | 335,969 | |||||||||||||||||
Tax effect(2) | (113,008 | ) | (119,616 | ) | |||||||||||||||
Adjusted after-tax return | $ | 2,839,228 | $ | 2,293,362 | |||||||||||||||
Average debt(3) | $ | 5,433,252 | $ | 5,482,877 | |||||||||||||||
Average stockholders' deficit(3) | (2,069,346 | ) | (1,354,477 | ) | |||||||||||||||
Add: Rent x 6(1) | 2,126,460 | 2,015,814 | |||||||||||||||||
Average financing lease liabilities(3) | 255,497 | 220,550 | |||||||||||||||||
Invested capital | $ | 5,745,863 | $ | 6,364,764 | |||||||||||||||
Adjusted After-Tax ROIC | 49.4 | % | 36.0 | % | |||||||||||||||
(1) The table below outlines the calculation of rent expense and reconciles rent expense to total lease cost, per ASC 842, the most directly comparable GAAP financial measure, for the trailing four quarters ended | |||||||||||||||||||
Trailing 4 Quarters | |||||||||||||||||||
(in thousands) | |||||||||||||||||||
Total lease cost, per ASC 842, for the trailing four quarters | $ | 442,950 | $ | 418,100 | |||||||||||||||
Less: Financing lease interest and amortization | (62,607 | ) | (55,880 | ) | |||||||||||||||
Less: Variable operating lease components, related to insurance and common area maintenance | (25,933 | ) | (26,251 | ) | |||||||||||||||
Rent expense for the trailing four quarters | $ | 354,410 | $ | 335,969 | |||||||||||||||
(2) Effective tax rate over trailing four quarters ended | |||||||||||||||||||
(3) All averages are computed based on trailing five quarter balances | |||||||||||||||||||
Other Selected Financial Information | |||||||||||||||||||
(in thousands) | |||||||||||||||||||
Cumulative share repurchases ($ since fiscal 1998) | $ | 28,192,426 | $ | 23,932,433 | |||||||||||||||
Remaining share repurchase authorization ($) | 957,574 | 717,567 | |||||||||||||||||
Cumulative share repurchases (shares since fiscal 1998) | 151,586 | 149,033 | |||||||||||||||||
Shares outstanding, end of quarter | 19,967 | 22,183 | |||||||||||||||||
12 Weeks Ended | 12 Weeks Ended | 24 Weeks Ended | 24 Weeks Ended | ||||||||||||||||
Depreciation and amortization | $ | 99,692 | $ | 94,476 | $ | 199,282 | $ | 184,027 | |||||||||||
Capital spending | 105,874 | 125,608 | 208,143 | 238,644 | |||||||||||||||
AutoZone's 2nd Quarter Highlights - Fiscal 2022 | |||||||||||||||||||||||
Selected Operating Highlights | |||||||||||||||||||||||
Condensed Consolidated Statements of Operations | |||||||||||||||||||||||
Store Count & Square Footage | |||||||||||||||||||||||
12 Weeks Ended | 12 Weeks Ended | 24 Weeks Ended | 24 Weeks Ended | ||||||||||||||||||||
Domestic: | |||||||||||||||||||||||
Beginning stores | 6,066 | 5,924 | 6,051 | 5,885 | |||||||||||||||||||
Stores opened | 26 | 27 | 41 | 66 | |||||||||||||||||||
Stores closed | (1 | ) | - | (1 | ) | - | |||||||||||||||||
Ending domestic stores | 6,091 | 5,951 | 6,091 | 5,951 | |||||||||||||||||||
Relocated stores | 1 | 1 | 4 | 5 | |||||||||||||||||||
Stores with commercial programs | 5,233 | 5,088 | 5,233 | 5,088 | |||||||||||||||||||
Square footage (in thousands) | 40,037 | 39,003 | 40,037 | 39,003 | |||||||||||||||||||
Beginning stores | 666 | 621 | 664 | 621 | |||||||||||||||||||
Stores opened | 3 | 7 | 5 | 7 | |||||||||||||||||||
Ending | 669 | 628 | 669 | 628 | |||||||||||||||||||
Beginning stores | 53 | 45 | 52 | 43 | |||||||||||||||||||
Stores opened | 2 | 1 | 3 | 3 | |||||||||||||||||||
Ending | 55 | 46 | 55 | 46 | |||||||||||||||||||
Total | 6,815 | 6,625 | 6,815 | 6,625 | |||||||||||||||||||
Square footage (in thousands) | 45,433 | 44,021 | 45,433 | 44,021 | |||||||||||||||||||
Square footage per store | 6,667 | 6,645 | 6,667 | 6,645 | |||||||||||||||||||
Sales Statistics | |||||||||||||||||||||||
($ in thousands, except sales per average square foot) | |||||||||||||||||||||||
12 Weeks Ended | 12 Weeks Ended | Trailing 4 Quarters | Trailing 4 Quarters | ||||||||||||||||||||
Total AutoZone Stores (Domestic, | |||||||||||||||||||||||
Sales per average store | $ | 486 | $ | 433 | $ | 2,282 | $ | 2,011 | |||||||||||||||
Sales per average square foot | $ | 73 | $ | 65 | $ | 343 | $ | 303 | |||||||||||||||
Total auto parts sales | $ | 3,306,223 | $ | 2,859,698 | $ | 15,332,148 | $ | 13,158,997 | |||||||||||||||
% Increase vs. LY | 15.6 | % | 16.0 | % | 16.5 | % | 11.0 | % | |||||||||||||||
Domestic Commercial | |||||||||||||||||||||||
Total domestic commercial sales | $ | 843,889 | $ | 638,912 | $ | 3,755,003 | $ | 2,883,615 | |||||||||||||||
% Increase vs. LY | 32.1 | % | 14.7 | % | 30.2 | % | 7.6 | % | |||||||||||||||
Average sales per program per week | $ | 13.5 | $ | 10.5 | $ | 14.0 | $ | 11.1 | |||||||||||||||
% Increase vs. LY | 28.6 | % | 11.7 | % | 26.1 | % | 6.7 | % | |||||||||||||||
All Other, including | |||||||||||||||||||||||
All other sales | $ | 63,527 | $ | 51,120 | $ | 271,012 | $ | 231,348 | |||||||||||||||
% Increase vs. LY | 24.3 | % | 5.0 | % | 17.1 | % | 4.7 | % | |||||||||||||||
12 Weeks Ended | 12 Weeks Ended | 24 Weeks Ended | 24 Weeks Ended | ||||||||||||||||||||
Domestic same store sales | 13.8 | % | 15.2 | % | 13.7 | % | 13.6 | % | |||||||||||||||
Inventory Statistics (Total Stores) | |||||||||||||||||||||||
as of | as of | ||||||||||||||||||||||
Accounts payable/inventory | 126.8 | % | 113.0 | % | |||||||||||||||||||
($ in thousands) | |||||||||||||||||||||||
Inventory | $ | 5,031,222 | $ | 4,736,826 | |||||||||||||||||||
Inventory per store | 738 | 715 | |||||||||||||||||||||
Net inventory (net of payables) | (1,347,384 | ) | (614,270 | ) | |||||||||||||||||||
Net inventory / per store | (198 | ) | (93 | ) | |||||||||||||||||||
Trailing 5 Quarters | |||||||||||||||||||||||
Inventory turns | 1.6 | x | 1.4 | x | |||||||||||||||||||
Source:
2022 GlobeNewswire, Inc., source