AutoZone reported net sales of $3.3 billion for its fourth quarter (16 weeks) ended Aug. 29, 2015, an increase of 7.9 percent from the fourth quarter of fiscal 2014 (16 weeks).

Net income for the quarter increased 7.4 percent over the same period last year to $401.1 million, while diluted earnings per share increased 13 percent to $12.75 per share from $11.28 per share in the year-ago quarter. For the quarter, gross profit, as a percentage of sales, was 52.5 percent (versus 52.3 percent for the same period last year). The company said the improvement in gross margin was attributable to higher merchandise margins, partially offset by higher supply chain costs associated with current year inventory initiatives and the impact of the Interamerican Motor Corp. (IMC) acquisition finalized in September 2014.

For the fiscal year ended Aug. 29, 2015, sales were $10.2 billion, an increase of 7.5 percent from the prior year, while domestic same store sales were up 3.8 percent for the year. Operating profit increased 6.7 percent on an operating margin of 19.2 percent. For fiscal 2015, net income increased 8.5 percent to $1.2 billion, while diluted earnings per share for the period increased 14.1 percent to $36.03 from $31.57. Return on invested capital was 31.2 percent, while full year cash flow before share repurchases and changes in debt was $1.018 billion.

Under its share repurchase program, AutoZone repurchased 633,000 shares of its common stock for $430 million during the fourth quarter, at an average price of $680 per share. For the fiscal year, the company repurchased 2 million shares of its common stock for $1.3 billion, at an average price of $632 per share. At year’s end, the company had $348 million remaining under its current share repurchase authorization.

AutoZone’s inventory increased 9 percent over the same period last year, driven by increased product placement, new stores during the fiscal year and the acquisition of IMC. Inventory per location was $610 thousand versus $582 thousand last year and $629 thousand last quarter. The IMC acquisition increased inventory per location by $15,000 this quarter. Net inventory, defined as merchandise inventories less accounts payable, on a per location basis was a negative $79,000 versus negative $87,000 last year and negative $68,000 last quarter.

“I would like to thank our entire organization for the strong performance delivered this past fiscal year,” said Bill Rhodes, chairman, president and CEO. “We are pleased to report our 36th consecutive quarter of double digit earnings per share growth. Since our inception, we’ve been committed to providing exceptional customer service and trustworthy advice; our key point of differentiation. This commitment to our customers leads us to deliver exceptional financial performance.

“For the year, we reached many milestones, which included generating over $10 billion in sales and completing the IMC acquisition,” Rhodes said. “Our testing of our inventory availability initiatives, including expanding our multi-deliveries per week to stores and opening mega hub locations has concluded. We have determined that these tests were successful and we will begin implementing our new supply chain strategy now and complete it in a few years. Additionally, as we have routinely stated, we will remain committed to our disciplined approach to growing operating earnings and utilizing our capital effectively.”