SPRINGFIELD, Mo. – O’Reilly Automotive has announced record revenues and earnings for its fourth quarter and full year ended Dec. 31, 2012. The results represent 20 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 ended Dec. 31, 2012, increased $97 million, or 7 percent, to $1.49 billion from $1.39 billion for the same period one year ago. Gross profit for the fourth quarter increased to $750 million (or 50.4 percent of sales) from $695 million (or 49.9 percent of sales) for the same period one year ago, representing an increase of 8 percent.
 
Operating income for the fourth quarter increased to $223 million (or 15 percent of sales) from $207 million (or 14.9 percent of sales) for the same period one year ago, representing an increase of 8 percent.
 
Net income for the fourth quarter ended Dec. 31, 2012, increased $10 million, or 8 percent, to $133 million (or 8.9 percent of sales) from $123 million (or 8.8 percent of sales) for the same period one year ago. Diluted earnings per common share for the fourth quarter ended Dec. 31, 2012, increased 21 percent to $1.14 on 116 million shares versus 94 cents for the same period one year ago on 130 million shares.
 
As previously announced, the company’s results for the fourth quarter ended Dec. 31, 2011, included nonrecurring income related to a settlement between the Securities and Exchange Commission and a former CSK Auto Corp. officer that resulted in the reimbursement to CSK of $3 million ($2 million, net of tax) of incentive-based compensation and stock sale profits previously received by the officer. This “clawback” amount was included in “operating income” on the company’s condensed consolidated statements of income for the fourth quarter ended Dec. 31, 2011.
 
Adjusted operating income for the fourth quarter ended Dec. 31, 2012, increased to $223 million (or 15 percent of sales) from $204 million (or 14.7 percent of sales) for the same period one year ago, representing an increase of 9 percent. Adjusted net income for the fourth quarter ended Dec. 31, 2012, increased $12 million, or 10 percent, to $133 million (or 8.9 percent of sales) from $121 million (or 8.7 percent of sales) for the same period one year ago. Adjusted diluted earnings per common share for the fourth quarter ended Dec. 31, 2012, increased 23 percent to $1.14 on 116 million shares versus 93 cents for the same period one year ago on 130 million shares.
 
Commenting on O’Reilly’s quarterly results, Greg Henslee, president and CEO, stated, “We are pleased to report a strong fourth quarter, highlighted by a comparable stores sales increase of 4.2 percent, which exceeded our guidance range of 2 percent to 4 percent. We believe our strong performance is the result of our team’s continued efforts to provide the highest levels of service in our industry. Over time, these outstanding service levels, coupled with the strength of our industry-leading supply chain, build strong relationships with our customers and allow us to incrementally gain market share. Our focus remains on profitable growth, exemplified by our record fourth quarter operating margin of 15 percent, which represents our 14th consecutive quarter of record quarterly operating margin results. I would like to take this opportunity to congratulate Team O’Reilly on a strong fourth quarter and to thank each of you for your hard work and continued commitment to providing industry leading customer service.”
 
Sales for the year ended Dec. 31, 2012, increased $393 million, or 7 percent, to $6.18 billion from $5.79 billion for the same period one year ago. Gross profit for the year ended Dec. 31, 2012, increased to $3.10 billion (or 50.1 percent of sales) from $2.84 billion (or 49 percent of sales) for the same period one year ago, representing an increase of 9 percent. SG&A for the year ended Dec. 31, 2012, increased to $2.12 billion (or 34.3 percent of sales) from $1.97 billion (or 34.1 percent of sales) or the same period one year ago, representing an increase of 7 percent. Operating income for the year ended Dec. 31, 2012, increased to $977 million (or 15.8 percent of sales) from $867 million (or 15.0 percent of sales) for the same period one year ago, representing an increase of 13 percent .
 
Net income for the year ended Dec. 31, 2012, increased $78 million, or 15 percent, to $586 million (or 9.5 percent of sales) from $508 million (or 8.8 percent of sales) for the same period one year ago. Diluted earnings per common share for the year ended Dec. 31, 2012, increased 28 percent to $4.75 on 123 million shares versus $3.71 for the same period one year ago on 137 million shares.
 
Adjusted operating income for the year ended Dec. 31, 2012, increased to $977 million (or 15.8 percent of sales) from $864 million (or 14.9 percent of sales) for the same period one year ago, representing an increase of 13 percent. Adjusted net income for the year ended Dec. 31, 2012, increased $64 million, or 12 percent, to $586 million (or 9.5 percent of sales) from $522 million (or 9 percent of sales) for the same period one year ago.
 
Adjusted diluted earnings per common share for the year ended Dec. 31, 2012, increased 25 percent to $4.75 on 123 million shares versus $3.81 for the same period one year ago on 137 million shares.
 
Henslee commented on O’Reilly’s 2012 full year results, stating, “2012 was another very successful and profitable year for O’Reilly. Our continued focus on managing our working capital, coupled with our focus on profitable growth, resulted in $951 million of free cash flow for the year, representing a 20 percent increase, on top of very strong 2011 free cash flow of $791 million. For the year, our dedication to excellent customer service and relentless expense control generated a record operating margin of 15.8 percent, surpassing the goal we established in 2008 of 15 percent operating margin one full year earlier than we had originally anticipated. As a result of our strong free cash flow and prudent leverage growth, we were able to return $1.4 billion to our shareholders during 2012 by repurchasing over 16 million shares. These repurchased shares, along with our very profitable growth, resulted in a 25 percent increase in adjusted earnings per share to $4.75, representing four consecutive years of 20 percent or greater earnings per share growth.”
 
He continued, “We are confident the fundamental drivers for demand in our industry remain intact and based on this continued demand, our guidance for 2013 comparable store sales is an increase in the range of 3 percent to 5 percent. We face our most difficult quarterly comparable store sales comparisons in 2013 during our first quarter, which was an increase of 7.4 percent in 2012 and includes approximately 130 bps from the impact of Leap Day in 2012, and as an additional headwind, Easter will fall in the first quarter this year versus the second quarter in 2012. We have seen continued solid performance through the first several weeks of 2013; however, the comparisons get progressively more difficult as we move through the quarter. Therefore, with consideration to the approximate 150 bp headwind we have due to the Leap Day and Easter, we are guiding comparable stores sales in the range of flat to positive 2 percent for the first quarter of 2013 with the remainder of the year’s comparable store sales expectations anticipated to be much stronger, to arrive at our full-year guidance of 3 percent to 5 percent. During 2013, we will continue our unyielding focus on profitable growth and on providing unsurpassed customer service and we look forward to another profitable year. I would again like to thank all of our hard working Team Members for your commitment to our success, your efforts continue to drive our strong performance.”