O'Reilly Automotive Inc.
) posted a 23% increase in earnings to $1.40 per share in the
fourth quarter of 2013, compared with $1.14 in the year-ago
quarter. Earnings also exceeded the Zacks Consensus Estimate of
$1.32. Net income improved 15% to $152 million (9.4% of sales)
from $133 million (8.9%) in the fourth quarter of 2012.
Quarterly revenues scaled up 9% to $1.62 billion from $1.49
billion in the same period a year ago. Revenues surpassed the
Zacks Consensus Estimate of $1.6 billion. Comparable store sales
increased 5.4% in the reported quarter versus 4.2% in the fourth
Gross profit ascended 9% to $819 million (50.5% of sales) from
$750 million (50.4% of sales) a year ago. Selling, general and
administrative expenses rose 7% to $564 million (34.8% of sales)
from $527 million (35.4%) in the year-ago quarter. Operating
income increased 15% to $256 million (15.8% of sales) from $223
million (15% of sales) for the same period last year.
O'Reilly reported earnings of $6.03 per share in 2013, rising
from $4.75 in 2012. Earnings per share surpassed the Zacks
Consensus Estimate of $5.96.
Revenues increased 8% to $6.65 billion from $6.18 billion in
2012, exceeding the Zacks Consensus Estimate of $6.63
During the quarter, O'Reilly opened 32 stores and closed 1
store, bringing its total store count to 4166 in 42 states as of
Dec 31, 2013. Sales per weighted average-store increased to
$387,000 from $377,000 a year ago.
During the quarter, O'Reilly repurchased 2 million shares of
its common stock for $246 million, reflecting an average price of
$124.11. During 2013, the company bought back 8.5 million shares
for $933 million at an average price of $109.38.
Since the inception of the share repurchase program in Jan
2011, O'Reilly has repurchased a total of 40.6 million shares for
$3.35 billion, reflecting an average price of $82.61.
Concurrently, the board of directors approved a $500-million
increase in the share buyback authorization to $4 billion. As of
Feb 5, 2014, the company had remaining shares repurchase
authorization worth approximately $645 million under its share
O'Reilly had cash and cash equivalents of $231.3 million as of
Dec 31, 2013, compared with $248.1 million as of Dec 31, 2012.
Long-term debt increased to $1.4 billion as of Dec 31, 2013 from
$1.1 billion as of Dec 31, 2012. This translated into a long-term
debt-to-capitalization ratio of 41.5% as of Dec 31, 2013 compared
with 34.2% as of Dec 31, 2012.
In 2013, net cash flow from operations declined to $908
million from $1.25 billion in the previous year. Meanwhile,
capital expenditures increased to $395.9 million from $300.7
million in 2012.
For first-quarter 2014, O'Reilly projects earnings per share
in the range of $1.53-$1.57. The company expects consolidated
comparable store sales to increase by 4% to 6%.
For full-year 2014, the company expects earnings per share of
$6.74 to $6.84. It expects consolidated comparable store sales to
increase between 3% and 5% during the year. The company also
revealed revenue guidance of $7 billion to $7.2 billion for 2014,
gross margin guidance of 50.9%-51.4% and operating margin
guidance of 17% to 17.4%.
O'Reilly expects capital expenditures within the range of $390
million to $420 million and free cash flow between $570 million
and $620 million for the year.
Based on opportunities for new stores in both existing and new
markets, the company plans to open 200 new stores in 2014.
O'Reilly Automotive is a prominent player in the automotive
replacement parts and accessories industry along with
Advance Auto Parts Inc.
). It sells its products to both Do-it-Yourself (DIY) customers
and Do-it-for-Me (DIFM) or professional installers. Currently, it
has a Zacks Rank #3 (Hold).
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