CSK Auto Corporation Files Fiscal 2005 10-K - Provides Guidance for Fiscal 2006

PHOENIX--CSK Auto Corporation , the parent company of CSK Auto, Inc. (the “Company”), announced today that the Company filed its annual report on Form 10-K for its fiscal year ended January 29, 2006 (“2005 Form 10-K”) with the Securities and Exchange Commission (“SEC”). The 2005 Form 10-K includes full-year financial information for the fiscal year ended January 29, 2006 (“fiscal 2005”) and restated financial information for certain earlier periods.

The primary restatement areas consisted of inventory, vendor allowances, other accrual accounts and related expense accounts. Net sales, net income and diluted earnings per share for fiscal 2005 were $1,651 million, $57.8 million and $1.29, respectively, as compared to $1,605 million, $59.6 million and $1.29, respectively, for fiscal 2004. The full restatements are available in the 2005 Form 10-K, which can be accessed through the investor relations section of the Company’s website at www.cskauto.com.

Preliminary Guidance For Fiscal 2006

The Company has commenced the preparation of its financial statements for its fiscal year ended February 4, 2007 (“fiscal 2006”) and intends to file its Annual Report on Form 10-K for fiscal 2006 with the SEC as soon as practicable. The following information is based on preliminary data and therefore it is possible that such information could change significantly as the Company completes its financial statement preparation and the financial statements are audited by the Company’s independent registered public accounting firm.

The Company previously announced that preliminary net sales in fiscal 2006 increased approximately 15.2% to approximately $1.9 billion from approximately $1.6 billion in fiscal 2005. The Company has since identified additional restatement adjustments to net sales principally in the areas of merchandise core returns and rebates to customers that result in modest increases of approximately equal magnitude in both net sales and cost of sales for each of these fiscal years. The Company does not expect fiscal 2006 net sales or cost of sales or the relationship of net sales for fiscal 2006 and 2005 year over year to change in any material respect as a result of the additional adjustments. The year-over-year revenue increase was primarily attributable to sales from Murray’s Discount Auto Stores (which the Company acquired in December 2005), the additional week in the fiscal 2006 year, and the opening of 55 net new stores in fiscal 2006. As previously reported, comparable store sales declined 1.5% in fiscal 2006.

The Company’s operating profit (exclusive of costs associated with the investigation and restatement) declined in fiscal 2006 as compared to fiscal 2005 notwithstanding the inclusion of the results of the Murray’s stores for the full 2006 fiscal year. The Company believes the primary reason for this decline was the previously reported decline in fiscal 2006 retail comparable store sales of 3.4%. (As previously reported, commercial comparable store sales for fiscal 2006 increased 7.7%.) Although not contributing to the decline in operating profits and although the acquisition of Murray’s has produced the synergies substantially as contemplated, the Murray’s stores fell well short of planned operating performance for fiscal 2006.

In fiscal 2006, the Company incurred approximately $26 million in investigation and restatement expense, approximately $19.4 million in costs associated with debt refinancing necessitated as a result of the failure to make timely SEC filings, and approximately $47.9 million of interest expense as compared to $33.6 million for fiscal 2005. As a result of these expenses and the decline in operating profit, the Company’s net income for fiscal 2006 will be significantly less than that reported for fiscal 2005.

CSK Auto Corporation is the parent company of CSK Auto, Inc., a specialty retailer in the automotive aftermarket. As of April 22, 2007, we operated 1,332 stores in 22 states under the brand names Checker Auto Parts, Schuck’s Auto Supply, Kragen Auto Parts and Murray’s Discount Auto Stores.