O’Reilly Automotive has reported record revenues and earnings for its first quarter ended March 31, 2019.
Sales for the first quarter ended March 31 increased $128 million, or 6%, to $2.41 billion from $2.28 billion for the same period one year ago. Gross profit for the first quarter increased 6% to $1.28 billion (or 53.1% of sales) from $1.2 billion (or 52.6% of sales) for the same period one year ago. Selling, general and administrative expenses for the first quarter increased 7% to $835 million (or 34.6% of sales) from $778 million (or 34.1% of sales) for the same period one year ago. Operating income for the first quarter increased 5% to $445 million (or 18.5% of sales) from $423 million (or 18.5% of sales) for the same period one year ago.
According to O’Reilly CEO and Co-President Greg Johnson, weather in the first quarter has historically driven volatility in the O’Reilly business, and the company experienced significant demand volatility this quarter. “While we saw a fair amount of frigid, snowy weather that drove business during the quarter, and should help drive demand for the remainder of the year, we also experienced abnormally high levels of rain, which is not conducive to our business,” Johnson said.
Net income for the first quarter increased $16 million, or 5%, to $321 million (or 13.3% of sales) from $305 million (or 13.4% of sales) for the same period one year ago. Diluted earnings per common share for the first quarter increased 12% to $4.05 on 79 million shares versus $3.61 on 85 million shares for the same period one year ago.
Johnson added that delays in tax refunds and a reduction of total refund dollars during the quarter were a headwind to the business.
O’Reilly opened a new 580,000-square-foot building in northern Mississippi during the first quarter, which will be the location for O’Reilly’s newest distribution center project, allowing for an even higher level of service to the Memphis area markets, while also adding capacity for additional store growth throughout the central and southern regions of the country.
Share Repurchase Program
During the first quarter, the company repurchased 0.9 million shares of its common stock, at an average price per share of $347.09, for a total investment of $322 million. Subsequent to the end of the first quarter and through the date of this release, the company did not repurchase any additional shares of its common stock. The company has repurchased a total of 73.2 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 $151.16, for a total aggregate investment of $11.07 billion. As of the date of this release, the company had approximately $680 million remaining under its current share repurchase authorization.
