Advance Auto Parts has announced its financial results for the third quarter ended Oct. 7, 2017.
“We continue to take steps to build the foundation for future growth. We executed key transformational initiatives, including a complete restructure of our field operations and professional sales leadership teams. This important step in our journey sets us up well for the future. In the third quarter, we delivered improvements in cost initiatives while positioning the business for future success. We remain on track to deliver our 2017 guidance,” said Tom Greco, president and CEO.
Third Quarter 2017 Highlights
Total net sales for the third quarter came in at $2.18 billion, a 3 percent decrease versus the prior-year period. Comparable store sales for the quarter decreased 3.4 percent.
The company’s gross profit margin decreased 51 basis points year-over-year to 43.4 percent. The decline was primarily driven by increased supply chain costs and shrink, which negatively impacted margins by 44 basis points. In addition, the non-cash impact of inventory optimization efforts negatively impacted gross margins by 23 basis points. These were partially offset by 17 basis points in favorable material cost improvements.
The company’s adjusted operating income was $172.2 million, 7.9 percent of net sales, which declined 178 basis points versus the prior-year period, primarily driven by the declines in gross profit and SG&A factors described above. On a GAAP basis, the company’s operating income was $156.6 million, 7.2 percent of net sales, a decline of 144 basis points.