O'Reilly Automotive Reports Fourth Quarter and Full Year 2008 Results - aftermarketNews

O’Reilly Automotive Reports Fourth Quarter and Full Year 2008 Results

Company reports fourth quarter comparable store sales of 4 percent.

SPRINGFIELD, Mo. – O’Reilly Automotive has announced revenues and earnings for the fourth quarter and year ended Dec. 31, 2008, representing 16 consecutive years of positive comparable store sales increases since the company went public in April 1993.

Sales for the fourth quarter ended Dec. 31, 2008, totaled $1.1 billion, up 84 percent from $604 million for the same period a year ago. Gross profit for the fourth quarter ended Dec. 31, 2008, increased to $515 million (or 46.2 percent of sales) from $270 million (or 44.7 percent of sales) for the same period a year ago, representing an increase of 91 percent. Selling, General and Administrative (“SG&A”) expenses for the fourth quarter of 2008 increased to $435 million (or 39.0 percent of sales) from $207 million (or 34.2 percent of sales) for the same period a year ago, representing an increase of 110 percent.

Net income for the fourth quarter totaled $42.7 million, up 5.2 percent from $40.6 million for the same period in 2007. Diluted earnings per common share for the fourth quarter ended Dec. 31, 2008, decreased 8.6 percent to 32 cents on 135.4 million shares versus 35 cents a year ago on 116.3 million shares.

“We are very pleased to report strong sales results amid these very challenging economic times. Our consolidated comparable store sales growth during the fourth quarter was a strong 4.0 percent,” said Greg Henslee, CEO and co-president. “We are encouraged with the positive CSK same store sales of 0.8 percent for the quarter, making this the first positive same store sales quarter for CSK since the third quarter of 2005.

The integration of CSK is progressing well and we remain confident in the strength and potential benefits of the combined companies. We’re also very encouraged with the 6.2 percent same store sales increase in the ‘core O’Reilly’ stores.”

For the year ended Dec. 31, 2008, sales increased $1.05 billion, or 42 percent, to $3.58 billion from $2.52 billion for the year ended Dec. 31, 2007. Gross profit for the year increased to $1.63 billion (or 45.5 percent of sales) from $1.12 billion (or 44.4 percent of sales) for the year ended Dec. 31, 2007, representing an increase of 45 percent. SG&A expenses for the year ended Dec. 31, 2008, increased to $1.29 billion (or 36.1 percent of sales) from $815 million (or 32.3 percent of sales) for the year ended Dec. 31, 2007, representing an increase of 59 percent. Net income for the year totaled $186.2 million, down 4.0 percent from $194 million for the year ended Dec. 31, 2007. Diluted earnings per common share for the year decreased 11.4 percent to $1.48 on 125.4 million shares versus $1.67 a year ago on 116.1 million shares.

The company’s fourth quarter and full year results include charges related to the July 11, 2008, acquisition of CSK Automotive. Adjusted diluted earnings per share, excluding the impact of acquisition related charges in the fourth quarter of 2008, increased 5.7 percent to 37 cents from the same period one year ago. For the year, adjusted diluted earnings per share, excluding the impact of acquisition related charges in the third and fourth quarters of 2008, decreased 1.8 percent to $1.64 from the same period one year ago.

Comparable store sales for O’Reilly stores open at least one year increased 6.2 percent and 2.6 percent for the fourth quarter and year ended Dec. 31, 2008, respectively. Comparable store sales for CSK stores open at least one year increased 0.8 percent for the fourth quarter, and decreased 1.7 percent for the portion of CSK’s sales in 2008 since the July 11 acquisition. Consolidated comparable store sales for stores open at least one year increased 4 percent and 1.5 percent for the fourth quarter and year ended Dec. 31, 2008, respectively.

Ted Wise, COO and co-president, stated, “We opened 27 net, new stores, converted 51 CSK stores to the O’Reilly brand and merged 19 CSK stores with O’Reilly stores during the fourth quarter. Our total combined store count for 2008 was 3,285 stores, which included 150 net, new core O’Reilly stores. Our new distribution center in Lubbock, Texas, opened in November, which allows us greater growth within that region as well as the ability to convert CSK store locations in the El Paso and New Mexico markets.

“We have purchased existing distribution facilities in metropolitan Denver and Los Angeles and have signed a purchase agreement for a distribution center in the Seattle area. These are the first of four anticipated distribution centers in the western portion of the United States, which are essential to the implementation of our dual-market strategy in the CSK markets. During 2009, we will continue to focus on our CSK conversion plan, as well as open 150 new stores and a distribution center in Greensboro, North Carolina. I would also like to recognize the members of the store conversion teams who braved the cold winter weather of the Northern Plains to convert CSK stores, your dedication is an inspiration and is a true example of the O’Reilly culture at work,” Wise added.

The company estimates diluted earnings per share for the first quarter of 2009 to range from 35 cents to 39 cents and estimates diluted earnings per share for the year ended Dec. 31, 2009, to range from $1.80 to $1.84. Excluding the expected impact of acquisition charges related to CSK of 1 cent per diluted share, adjusted earnings per share is expected to range from 36 cents to 40 cents for first quarter of 2009. Excluding the expected impact of acquisition charges for trade names and trademarks related to CSK of 3 cents for the year ended Dec. 31, 2009, adjusted earnings per share is expected to range from $1.83 to $1.87.

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