’Reilly Automotive Inc. has announced record revenues and earnings for its third quarter ended Sept. 30, 2018.
Sales for the third quarter ended Sept. 30, 2018, increased $143 million, or 6 percent, to $2.48 billion from $2.34 billion for the same period one year ago. Gross profit for the third quarter increased 7 percent to $1.32 billion (or 53 percent of sales) from $1.23 billion (or 52.6 percent of sales) for the same period one year ago.
Net income for the third quarter ended Sept. 30, 2018, increased $82 million, or 29 percent, to $366 million (or 14.7 percent of sales) from $284 million (or 12.1 percent of sales) for the same period one year ago. Diluted earnings per common share for the third quarter increased 40 percent to $4.50 on 81 million shares versus $3.22 on 88 million shares for the same period one year ago.
Greg Johnson, O’Reilly’s CEO and co-president, commented, “We are pleased to report another profitable quarter, driven by Team O’Reilly’s commitment to providing excellent service to every customer. Our third quarter comparable store sales increase of 3.9 percent was at the top end of our guidance range and is a testament to the hard work and dedication of our team. As a reminder, our third quarter comparable store sales results include approximately 50 basis points of headwind from one additional Sunday this year, which is our lowest volume day. Our team’s continued focus on profitable growth generated a solid 5 percent increase in third quarter operating profit dollars and a 40 percent increase in third quarter diluted earnings per share to $4.50, and I would like to thank our team members for their continued hard work, dedication and relentless focus on providing consistently excellent service to our customers.”
Year-to-Date Financial Results
Mr. Johnson continued, “During the third quarter, we opened 43 net, new stores, which brings our year-to-date store openings to 171 net, new stores across 33 states, and we are well positioned to achieve our target of 200 net, new stores for 2018. We continue to be pleased with the performance of our new stores and remain very confident in our opportunities to profitably grow in both existing and new market areas. Based on solid industry demand drivers and our confidence in the ability of our store teams to continue to take market share, we are establishing a target range of 200 to 210 net, new store openings for 2019, supported by our industry-leading distribution network and best-in-class parts availability.”
Sales for the first nine months of 2018 increased $435 million, or 6 percent, to $7.22 billion from $6.79 billion for the same period one year ago. Gross profit for the first nine months of 2018 increased 7 percent to $3.81 billion (or 52.7 percent of sales) from $3.56 billion (or 52.5 percent of sales) for the same period one year ago.
Net income for the first nine months of 2018 increased $193 million, or 23 percent, to $1.02 billion (or 14.2 percent of sales) from $831 million (or 12.3 percent of sales) for the same period one year ago. Diluted earnings per common share for the first nine months of 2018 increased 35 percent to $12.36 on 83 million shares versus $9.15 on 91 million shares for the same period one year ago.
Share Repurchase Program
During the third quarter, the company repurchased 0.9 million shares of its common stock, at an average price per share of $306.22, for a total investment of $285 million. During the first nine months ended Sept. 30, 2018, the company repurchased 4.7 million shares of its common stock, at an average price per share of $266.48, for a total investment of $1.25 billion.
Subsequent to the end of the third quarter and through the date of this release, the company repurchased an additional 0.2 million shares of its common stock, at an average price per share of $340.76, for a total investment of $68 million. The company has repurchased a total of 71.1 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 $145.53, for a total aggregate investment of $10.35 billion. As of the date of this release, O’Reilly had approximately $396 million remaining under its current share repurchase authorization.
3rd Quarter Comparable Store Sales Results
Comparable store sales are calculated based on the change in sales for stores open at least one year and exclude sales of specialty machinery, sales to independent parts stores and sales to team members. Online sales, resulting from ship-to-home orders and pick-up-in-store orders, for stores open at least one year, are included in the comparable store sales calculation. Comparable store sales increased 3.9 percent for the third quarter ended Sept. 30, 2018, on top of 1.8 percent for the same period one year ago. Comparable store sales increased 4 percent for the nine months ended Sept. 30, 2018, on top of 1.5 percent for the same period one year ago.
