O’Reilly Automotive has announced record revenues and earnings for its fourth quarter and full year ended Dec. 31, 2015. The results represent 23 consecutive years of comparable store sales growth and record revenue and operating income for O’Reilly since becoming a public company in April of 1993.
Sales for the fourth quarter increased $185 million, or 10 percent, to $1.95 billion from $1.76 billion for the same period one year ago. Gross profit for the fourth quarter increased to $1.03 billion (or 52.7 percent of sales) from $912 million (or 51.7 percent of sales) for the same period one year ago, representing an increase of 13 percent. Operating income for the fourth quarter increased to $363 million (or 18.6 percent of sales) from $303 million (or 17.2 percent of sales) for the same period one year ago, representing an increase of 20 percent.
Net income for the fourth quarter increased $37 million, or 20 percent, to $219 million (or 11.2 percent of sales) from $182 million (or 10.3 percent of sales) for the same period one year ago. Diluted earnings per common share for the fourth quarter increased 24 percent to $2.19 on 100 million shares versus $1.76 on 103 million shares for the same period one year ago.
Greg Henslee, O’Reilly’s president and CEO, commented, “We are very pleased to once again report another very profitable quarter and a very strong finish to a record-breaking year. Our team’s dedication to providing consistent, excellent customer service every day drove our very robust fourth quarter comparable store sales increase of 7.7 percent, which was on top of a strong comparable store sales increase of 6.3 percent in the fourth quarter of 2014. This industry-leading comparable store sales performance represents our 9th consecutive quarter of comparable store sales growth greater than 5 percent, with increases of over 7 percent in each quarter of 2015. Our relentless focus on profitable growth translated our strong top line performance into a 24 percent increase in fourth quarter diluted earnings per share of $2.19, which represents our 28th consecutive quarter of diluted earnings per share growth greater than 15 percent, and I would like to thank each of our team members for their continued hard work and commitment to our ongoing success.”
Full-Year Financial Results
Sales for the year ended Dec. 31, 2015, increased $751 million, or 10 percent, to $7.97 billion from $7.22 billion for the same period one year ago. Gross profit for the year increased to $4.16 billion (or 52.3 percent of sales) from $3.71 billion (or 51.4 percent of sales) for the same period one year ago, representing an increase of 12 percent. Operating income for the year increased to $1.51 billion (or 19 percent of sales) from $1.27 billion (or 17.6 percent of sales) for the same period one year ago, representing an increase of 19 percent.
Net income for the year increased $153 million, or 20 percent, to $931 million (or 11.7 percent of sales) from $778 million (or 10.8 percent of sales) for the same period one year ago. Diluted earnings per common share for the year increased 25 percent to $9.17 on 102 million shares versus $7.34 on 106 million shares for the same period one year ago.
Henslee continued, “Team O’Reilly’s dedication to unsurpassed service levels resulted in a full-year comparable stores sales increase of 7.5 percent, a record 19 percent operating margin and a 25 percent increase in full-year diluted earnings per share to $9.17, which represents our seventh consecutive year of 20 percent or greater annual diluted earnings per share growth. We are very proud of our record breaking 2015 financial results, as well as the addition of 205 net, new stores and the expansion into Connecticut, our 44th state, and we are intensely focused on extending our proven record of profitable growth in 2016.
“In the coming year, we expect to see continued strong demand in our industry, and more importantly, we remain very confident in our team’s commitment to providing consistently high levels of service to our customers. We will, however, face very difficult same store sales comparisons in each quarter of 2016, and, based on these factors, we are establishing our first quarter and full-year 2016 comparable store sales guidance ranges at 3 percent to 5 percent. We will see a top-line benefit in 2016 from one additional calendar day, due to Leap Day in February; however, our comparable store sales guidance ranges for both the first quarter and full-year exclude this additional day.”
Share Repurchase Program
During the fourth quarter, the company repurchased 1.1 million shares of its common stock at an average price per share of $256.93, for a total investment of $287 million. During the year ended Dec. 31, 2015, the company repurchased 4.9 million shares of its common stock at an average price per share of $231.81, for a total investment of $1.14 billion. Subsequent to the end of the fourth quarter and through the date of this release, the company repurchased an additional 0.6 million shares of its common stock, at an average price per share of $243.96, for a total investment of $141 million. The company has repurchased a total of 51.8 million shares of its common stock under its share repurchase program since the inception of the program in January of 2011 and through the date of this release, at an average price of $106.08, for a total aggregate investment of $5.5 billion.
Today, the company also announced that its board of directors approved a resolution to increase the authorization amount under its share repurchase program by an additional $750 million, raising the aggregate authorization under the program to $6.25 billion. The additional $750 million authorization is effective for a three-year period, beginning on Feb. 10.
As of the date of this release, the company had approximately $750 million remaining under its current share repurchase authorizations.
