O'Reilly Automotive, Reports Record 2006 First Quarter Results
SPRINGFIELD, Mo.--April 25, 2006--O'Reilly Automotive, Inc. ("O'Reilly" or "the Company") today announced record revenues and earnings for the first quarter of 2006, representing 50 quarters of record revenues and earnings for O'Reilly since becoming a public company in April 1993.Net income for the first quarter ended March 31, 2006, totaled $40.6 million, up 22.1% from $33.2 million for the same period in 2005. Diluted earnings per common share for the first quarter of 2006 increased 16.7% to $0.35 on 114.6 million shares compared to $0.30 for the first quarter of 2005 on 112.5 million shares. Product sales for the three months ended March 31, 2006, totaled $536.5 million, up 15.1% from $466.2 million for the same period a year ago. Gross profit for the first quarter of 2006 increased to $233.4 million (or 43.5% of product sales) from $196.2 million (or 42.1% of product sales) for the first quarter of 2005, representing an increase of 19.0%. Operating, Selling, General and Administrative ("OSG&A") expenses increased to $168.5 million (or 31.4% of product sales) for the first quarter of 2006 from $142.6 million (or 30.6% of product sales) for the first quarter of 2005, representing an increase of 18.1%.
Comparable store product sales for stores open at least one year increased 3.8% and 7.1% for the first quarter of 2006 and 2005, respectively.
Greg Henslee, CEO and Co-President, stated, "We are pleased with the results this quarter highlighted by a gross margin of 43.5% and an operating margin of 12.1%. Despite above average temperatures this winter throughout our markets, we posted a solid 3.8% increase in comparable store product sales for the quarter. These results demonstrate Team O'Reilly's commitment to consistent and profitable growth."
"In addition to opening 36 stores during the quarter, we continued to prepare for the opening of our newest distribution center in Indianapolis this summer," stated Ted Wise, COO and Co-President. "The opening of this new DC will support our expansion plans of 170 to 175 new stores in 2006."
O'Reilly Automotive, Inc. is one of the largest specialty retailers of automotive aftermarket parts, tools, supplies, equipment and accessories in the United States, serving both the do-it-yourself and professional installer markets. Founded in 1957 by the O'Reilly family, the Company operated 1,506 stores within the states of Alabama, Arkansas, Florida, Georgia, Illinois, Indiana, Iowa, Kansas, Kentucky, Louisiana, Minnesota, Mississippi, Missouri, Montana, Nebraska, North Carolina, North Dakota, Oklahoma, South Carolina, South Dakota, Tennessee, Texas, Virginia, Wisconsin and Wyoming as of March 31, 2006.
O'REILLY AUTOMOTIVE, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands, except per share data)
March 31, December 31,
2006 2005
--------------- --------------
(Unaudited) (Note)
Assets
Current assets:
Cash and cash equivalents $ 55,290 $ 31,384
Accounts receivable, net 74,575 73,849
Amounts receivable from vendors, net 60,372 57,224
Inventory 755,026 726,390
Other current assets 17,739 22,845
--------------- --------------
Total current assets 963,002 911,692
Property and equipment, at cost 1,038,221 992,899
Accumulated depreciation and
amortization 287,576 274,533
--------------- --------------
Net property and equipment 750,645 718,366
Notes receivable, less current portion 27,898 29,062
Other assets, net 61,449 60,827
--------------- --------------
Total assets $ 1,802,994 $ 1,719,947
=============== ==============
Liabilities and shareholders' equity
Current liabilities:
Accounts payable $ 312,509 $ 292,667
Accrued payroll 20,286 19,356
Accrued benefits and withholdings 46,236 49,794
Deferred income taxes 10,868 2,451
Other current liabilities 43,514 47,137
Current portion of long-term debt 75,154 75,313
--------------- --------------
Total current liabilities 508,567 486,718
Long-term debt, less current portion 25,436 25,461
Deferred income taxes 42,882 42,516
Other liabilities 19,637 19,483
Shareholders' equity:
Common stock, $0.01 par value:
Authorized shares - 245,000,000
Issued and outstanding shares -
113,199,354 at March 31, 2006,
and 112,389,002 at December 31,
2005 1,132 1,124
Additional paid-in capital 380,456 360,325
Retained earnings 824,884 784,320
--------------- --------------
Total shareholders' equity 1,206,472 1,145,769
--------------- --------------
Total liabilities and shareholders'
equity $ 1,802,994 $ 1,719,947
=============== ==============
Note: The balance sheet at December 31, 2005, has been derived from
the audited consolidated financial statements at that date, but does
not include all of the information and footnotes required by
accounting principles generally accepted in the United States for
complete financial statements.
O'REILLY AUTOMOTIVE, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(Unaudited)
(In thousands, except per share data)
Three Months Ended
March 31,
-------------------
2006 2005
--------- ---------
Product sales $536,547 $466,239
Cost of goods sold, including warehouse and
distribution expenses 303,119 270,070
--------- ---------
Gross profit 233,428 196,169
Operating, selling, general and administrative
expenses 168,462 142,588
--------- ---------
Operating income 64,966 53,581
Other expense, net (452) (668)
--------- ---------
Income before income taxes 64,514 52,913
Provision for income taxes 23,950 19,700
--------- ---------
Net income $ 40,564 $ 33,213
========= =========
Net income per common share $ 0.36 $ 0.30
========= =========
Net income per common share-assuming dilution $ 0.35 $ 0.30
========= =========
Weighted-average common shares outstanding - basic 112,523 110,896
========= =========
Adjusted weighted-average common shares
outstanding - assuming dilution 114,615 112,510
========= =========
O'REILLY AUTOMOTIVE, INC. AND SUBSIDIARIES
SELECTED FINANCIAL INFORMATION
(Unaudited)
March 31,
---------------
2006 2005
------- -------
Inventory turnover (1) 1.7 1.7
Inventory turnover, net of payables (2) 2.8 2.6
AP to inventory (3) 41.4% 39.8%
Debt-to-capital (4) 7.7% 9.2%
Return on equity (5) 15.2% 14.2%
Return on assets (6) 10.1% 9.3%
Three Months Ended
March 31,
--------------------
2006 2005
---------- ---------
Other information (in thousands):
Capital expenditures $ 47,450 $ 45,570
Depreciation and amortization $ 15,111 $ 13,245
Interest expense $ 1,359 $ 1,100
Lease and rental expense $ 12,239 $ 10,156
Sales per weighted-average square foot (7) $ 53.02 $ 54.41
Sales per weighted-average store
(in thousands) (8) $ 353 $ 363
Square footage (in thousands) 10,046 8,561
Store count:
New stores, net (three months ended) 36 37
Total stores 1,506 1,286
Total employment 20,312 18,238
(1) Calculated as cost of sales for the last 12 months divided by
average inventory. Average inventory is calculated as the simple
average of beginning and ending inventory for the same period used
in determining the numerator.
(2) Calculated as cost of sales for the last 12 months divided by
average inventory less accounts payable. Average inventory is
calculated as the simple average of beginning and ending inventory
for the same period used in determining the numerator.
(3) Accounts payable divided by inventory.
(4) The sum of long-term debt and current portion of long-term debt,
divided by the sum of long-term debt, current portion of long-term
debt and total shareholders' equity.
(5) Last 12 months net income divided by average shareholders' equity.
Average shareholders' equity is calculated by taking a simple
average of the beginning and ending shareholders' equity for the
same period used in determining the numerator.
(6) Last 12 months net income divided by average total assets. Average
total assets is calculated by taking a simple average of the
beginning and ending total assets for the same period used in
determining the numerator.
(7) Total sales less jobber sales, divided by weighted-average square
feet. Weighted-average sales per square foot is weighted to
consider the approximate dates of store openings or expansions.
(8) Total sales less jobber sales, divided by weighted-average stores.
Weighted-average sales per store is weighted to consider the
approximate dates of store openings or expansions.