ROCHESTER, N.Y. – Monro Muffler Brake today announced record financial results for its second quarter ended Sept. 25.
Sales for the second quarter of fiscal 2011 increased 18.6 percent to a record $162.1 million compared to $136.6 million for the second quarter of fiscal 2010. The company said sales growth was driven by recent acquisitions, as well as strong in-store sales execution.
Comparable store sales increased 6.4 percent on top of a 7.4 percent increase last year. Comparable store sales increased approximately 10 percent for tires, 9 percent for shocks, 8 percent for maintenance services, 6 percent for exhaust and 4 percent for alignments, with brakes flat as compared to last year.
Net income for the second quarter increased 33.2 percent to a record $13.3 million from $10 million in the prior year period. The company noted that net income for the second quarter reflects an effective tax rate of 38.2 percent compared with 38.1 percent for the prior year period.
For the six-month period, net sales increased 21 percent to a record $320.3 million from $264.7 million in the same period of the prior year. Net income for the first six months of fiscal 2011 increased 36.7 percent to a record $26.5 million, or $1.26 per diluted share, compared with $19.4 million, or 95 cents per diluted share in the comparable period of fiscal 2010.
Robert Gross, chairman and CEO, stated, "Our continued strong top and bottom-line performance during the first six months was driven by effective in-store sales execution, ongoing out-performance of our recent acquisitions, and our ability to leverage our cost structure on increased sales. Our strong value proposition and reputation as a trusted service provider continue to resonate well with customers, and helped us once again achieve strong same store traffic increases of 5 percent. Additionally, the positive trends we continue to experience across our major service categories reflect our ability to capitalize on favorable economic and consumer trends.
"Specifically, we achieved an approximate 6 percent increase in exhaust comparable store sales, marking the fifth straight quarter of increases in this category, while comparable store sales in our scheduled maintenance category increased nearly 8 percent on top of a 17 percent increase last year. Strong results in both of these categories reinforces to us that consumers are continuing to invest in maintaining older vehicles and that we are gaining market share from dealer displacement. Moreover, we believe that our sweet spot has expanded to include vehicles ranging from four-to-12 years old versus what had previously been a range of six-to-10 years old."
Based on current visibility and business and economic trends, the company said it continues to anticipate fiscal 2011 comparable store sales growth in the range of 4 percent to 6 percent and is increasing its estimated fiscal 2011 diluted earnings per share to a range of $2 to $2.06, from $1.94 to $2.01. The estimate is based on 21.2 million weighted average shares outstanding. The company’s expected sales range for the year remains at $625 million to $640 million.
In other news, Monro also announced today that it has signed a definitive asset purchase agreement to acquire Courthouse Tire in Fredericksburg, Va. The three locations generate annualized sales of approximately $5 million. It is management’s intention to retain store employees. The acquisition is scheduled to close at the end of October. Additionally, the company hopes to complete one more transaction prior to Dec. 31, with sales between $10 million and $15 million annually.
