Advance Auto Parts Reports Strong Third Quarter 2001 Results

Comparable Store Sales Rise 7.1%

ROANOKE, Va., Nov. 7 -- Advance Auto Parts today announced record sales and profits for the third quarter ended October 6, 2001. The results reflect continued strong comparable store sales growth, increases in gross margin, and leveraging of expenses.

Sales for the third quarter increased 8.4% to $598.8 million from $552.1 million last year. Retail sales rose approximately 10.0% to $580.1 million from $527.4 million.

Comparable store sales increased a strong 7.1% for the fiscal 2001 third quarter compared to a 4.0% increase in the prior-year period. Both the "do-it-yourself" and "do-it-for-me" businesses showed continued sales and customer count growth. Gross profit was up 9.0% from the fiscal 2000 third quarter.

Earnings before interest, taxes, depreciation and amortization (EBITDA) in the fiscal 2001 third quarter rose 20.2% to $56.0 million from $46.6 million in the year-ago quarter.

Operating income in the third quarter of fiscal 2001 increased 24.8% to $37.6 million from $30.1 million.

Net income increased 24.6% to $15.5 million compared to $12.4 million in 2000 and by 63.1% prior to the gain from early extinguishment of debt last year.

Larry Castellani, Chief Executive Officer, said, "We are extremely pleased with our operating performance during the third quarter. Our strong results reflect growth in both the 'do-it-yourself' and 'do-it-for-me' businesses, our ability to leverage expenses, our broad-based merchandising and marketing initiatives, and a fundamentally solid market for auto parts retailers."

Sales for the first three fiscal quarters of 2001 were $1,935.6 million, an increase of 8.3% over prior-year sales of $1,787.4 million. Retail sales for the three quarters increased 10.0% to $1,855.7 million from $1,687.7 million. Comparable store sales increased 6.5% over the year-ago period. Gross profit was up 12.1% for the fiscal 2001 year to date.

EBITDA for the first three quarters of 2001 increased 21.9% to $163.2 million from $133.9 million for the same period last year. The year-to-date results included two non-recurring items that increased EBITDA by $3.2 million. The non-recurring items, reported in the fiscal 2001 first quarter, were related to increased margin from the settlement of a supplier contract and from expenses related to store closings and asset sales. Excluding these non-recurring items, EBITDA increased 19.5% to $160.0 million for the first three quarters.

Operating income for the first three quarters rose to $105.5 million, an increase of 29.4% from $81.5 million in the same period last year. Excluding the non-recurring items, operating income rose 25.5% to $102.3 million. For the first three quarters of 2001, net income increased 68.8% to $36.9 million from $21.9 million in 2000. Excluding the non-recurring items and the gain from the early extinguishment of debt last year, net income rose by 84.9%. The Company opened 30 new stores during the quarter, bringing the total number of new stores opened during the year to 83 locations. In addition, the Company closed four stores in the third quarter and a total of 21 stores year to date, in line with its program to continuously monitor and evaluate store profitability and eliminate underperforming locations.

Net debt at the end of the third quarter was $531.0 million, a reduction of $28.3 million from the same period last year which along with lower rates on variable rate borrowings reduced interest expense by 12.7% year to date.

Mr. Castellani concluded, "The progress that we have made during the third quarter and year to date is a direct result of our dedicated employees. Their continued hard work, coupled with favorable industry conditions, positions us very well. Excluding the effect of the Discount acquisition, we anticipate an increase in EBITDA for the 2001 year to the high end of expectations which we have seen published of $190 - 195 million as well as a mid-single digit same store sales increase in the fourth quarter over a 6.1% increase in the fourth quarter last year."

The Company also announced that the acquisition of Discount Auto Parts, Inc. , a leading specialty replacement parts retailer in the Southeastern United States is progressing well. The HSR waiting period has expired, financing is in place, the merger proxy statement is anticipated to be mailed within the next few days, and the closing is expected to occur in late November / early December. At closing, the Company will trade on the New York Stock Exchange as Advance Auto Parts, Inc. (AAP). With the acquisition closing in the fourth quarter, Discount's results will be included for the remainder of that quarter after closing as well as some one-time items in connection with the consummation of the merger.

Advance Holding Corporation and Subsidiaries Condensed Consolidated Balance Sheet (in thousands)

October 6, December 30, Assets 2001 2000 (unaudited)

Current Assets: Cash and cash equivalents $ 11,918 $ 18,009 Receivables, net 89,632 80,578 Inventories 805,392 788,914 Other current assets 18,462 10,274 Total current assets 925,404 897,775 Property and equipment, net of accumulated depreciation of $226,167 and $191,897 406,531 410,960 Assets held for sale 22,388 25,077 Other assets, net 21,069 22,548 $ 1,375,392 $ 1,356,360

Liabilities and Stockholders' Equity

Current liabilities: Bank overdrafts $ 10,546 $ 13,599 Current portion of long-term debt -- 9,985 Accounts payable 403,668 387,852 Accrued expenses 142,310 124,962 Other current liabilities 50,802 42,794 Total current liabilities 607,326 579,192 Long-term debt 532,382 576,964 Other long-term liabilities 39,311 43,933 Total Stockholders' equity 196,373 156,271 $ 1,375,392 $ 1,356,360

NOTE: The balance sheet at October 6, 2001 has been prepared on a consistent basis with previously presented balance sheets and the balance sheet at December 30, 2000 has been derived from the audited financial statements at that date. These balance sheets do not include the footnotes required by generally accepted accounting principles for complete financial statements.

Advance Holding Corporation and Subsidiaries Condensed Consolidated Statement of Operations (in thousands) (unaudited)

Twelve Week Periods Ended Forty Week Periods Ended October 6, October 7, October 6, October 7, 2001 2000 2001 2000

Net sales $ 598,793 $ 552,138 $ 1,935,630 $ 1,787,370 Cost of sales, including purchasing and warehousing costs 354,730 328,235 1,151,287 1,087,959 Gross profit 244,063 223,903 784,343 699,411 Selling, general and administrative expenses 206,478 193,792 678,839 617,867 Operating income 37,585 30,111 105,504 81,544 Other (expense) income: Interest expense (12,121) (15,183) (45,195) (51,784) Other 310 527 879 1,059 Total other expense, net (11,811) (14,656) (44,316) (50,725) Income before provision for income taxes and extraordinary item 25,774 15,455 61,188 30,819 Provision for income taxes (10,269) (5,948) (24,279) (11,887) Income before extraordinary item 15,505 9,507 36,909 18,932 Extraordinary item, gain on debt extinguishment, net of $1,759 income taxes -- 2,933 -- 2,933 Net income $ 15,505 $ 12,440 $ 36,909 $ 21,865