MEMPHIS, Tenn. — AutoZone has reported net sales of $1.8 billion for its second quarter (12 weeks) ended Feb. 11, an increase of 8.6 percent from the second quarter of fiscal 2011 (12 weeks). Domestic same store sales, or sales for stores open at least one year, increased 5.9 percent for the quarter.
Net income for the quarter increased $18.9 million, or 12.7 percent, over the same period last year to $166.9 million, while diluted earnings increased 24.4 percent to $4.15 per share from $3.34 per share in the year-ago quarter.
For the quarter, gross profit, as a percentage of sales, was 51.3 percent (versus 50.9 percent for last year’s quarter). The improvement in gross margin was primarily attributable to lower shrink expense (35 bps). Operating expenses, as a percentage of sales, were 34.7 percent (versus 34.6 percent last year).
AutoZone said the primary contributor to the increase in operating expenses, as a percentage of sales, was higher self-insurance costs (59 bps), partially offset by leverage of other operating expenses due to higher sales volumes.
Under its share repurchase program, AutoZone repurchased 501,000 shares of its common stock for $173 million during the second quarter, at an average price of $345 per share. At quarter end, the company had $486 million remaining under its current share repurchase authorization.
The company’s inventory increased 6.6 percent over the same period last year, driven by an increase in store count and continued strategic investments in hard parts assortment. However, inventory per store was $530,000 versus $517,000 last year, an increase of 2.3 percent.
"We are pleased to announce another quarter of strong performance. This marks the 13th consecutive quarter of 20-percent-plus growth in earnings per share and our 22nd consecutive quarter of double-digit growth. We remain committed to executing our 2012 operating theme of ‘1TEAM; Driving our Future.’
"We continued our focus on improving parts coverage; hiring, retaining and training the best automotive parts professionals; and growing our commercial business. The commitment of our more than 65,000 AutoZoners to providing trustworthy advice is what sets our company apart, and it is their dedication to meeting and exceeding our customers’ needs that leads to our success. Additionally, our return on invested capital on a trailing four-quarter basis reached another new all-time high at 32.2 percent. We remain committed to our disciplined approach of growing operating earnings while efficiently utilizing our capital," said Bill Rhodes, chairman, president and CEO.
