) witnessed a 17.8% rise in earnings to $8.46 per share in the
fiscal fourth quarter ended August 25, 2012 from $7.18 per share in
the corresponding quarter last year. The company's earnings
surpassed the Zacks Consensus Estimate of $8.39 per share.
In absolute terms, profits escalated 7.4% to $323.7 million from
$301.5 million in the year-ago quarter.
The company's revenues for the quarter went up 4.6% to $2.76
billion, marginally down from the Zacks Consensus Estimate of $2.79
billion. Domestic same-store sales (sales for stores open at least
one year) increased 2.1% during the quarter.
Gross profit increased 6% to $1.43 billion or 51.8% of sales from
$1.35 billion or 51.2% in the year-ago quarter. The year-over-year
growth in margins was attributable to higher merchandise margins
(55 basis points) due to reduction in acquisition costs.
Operating income swelled 7% to $560.1 million from $524.0 million
recorded in the fourth quarter of fiscal 2011. Operating expenses
were $872.3 million or 31.6% of sales versus $828.6 million a year
The higher operating expenses was attributable to lower
incentive compensation, which was partially offset by higher store
payroll (45 basis points) and higher self-insurance costs (39 basis
ADVANCE AUTO PT (AAP): Free Stock Analysis
AUTOZONE INC (AZO): Free Stock Analysis Report
O REILLY AUTO (ORLY): Free Stock Analysis
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Fiscal 2012 Performance
AutoZone posted a 20.6% rise in earnings to $23.48 per share in the
fiscal year ended August 25, 2012 compared with $19.47 per share in
fiscal 2011. Profits went up 9.6% to $930.4 million from $849.0
million in the year-ago period.
Revenues improved 6.6% to $8.6 billion and domestic same-store
sales swelled 3.9% during the year. Operating income augmented 9%
to $1.6 billion or 18.9% of sales from $1.5 billion or 18.5% in the
Store Opening and Inventory
AutoZone opened 72 new stores in the U.S and 24 new stores in
Mexico and relocated 2 stores in the U.S. As of August 25, 2012,
the company had 4,685 stores in 49 states, the District of Columbia
and Puerto Rico in the U.S. and 321 stores in Mexico.
The company's inventory grew 6.6% in the quarter, driven by new
store openings. Inventory per store increased marginally by 2.5% to
$525 thousand from $512 thousand in the corresponding quarter of
last year; however it declined from $536 thousand in the third
quarter of fiscal 2012.
During the quarter, AutoZone repurchased 1.3 million shares for
$480 million, with an average price of $374. During fiscal 2012,
the company has repurchased 3.8 million shares for $1.4 billion, at
an average price of $359. The company has $356 million worth of
shares remaining for repurchase at the end of the fiscal year ended
on August 25, 2012.
The company had cash and cash equivalents of $103.1 million as of
August 25, 2012, up from $97.6 million as of August 27, 2011. Total
debt amounted to $3.8 billion as of August 25, 2012 compared with
$3.4 billion as of August 27, 2011. The company had a stockholder
deficit of $1.5 billion as of August 25, 2012, up from $1.3 billion
as of August 27, 2011.
During fiscal 2012, the company generated net cash flow of $949.6
million before share repurchases and changes in debt compared with
$1.0 billion in fiscal 2011. Capital spending increased to $378.1
million from $321.6 million in fiscal 2011.
AutoZone is a leading retailer and distributor of automotive
replacement parts & accessories with stores located in the U.S.
and Mexico. The company is focused on aggressive share repurchase
program along with expansion of hub stores. However, rising gas
prices poses a threat to the company.
AutoZone, which competes with
O'Reilly Automotive Inc.
Advance Auto Parts Inc.
), maintains a Zacks #3 Rank, which translates into a short-term (1
to 3 months) Hold rating. Currently, we have a long-term Neutral
recommendation on its shares.