Monro Muffler Brake Reports Fourth Quarter Results
18 May 2000
Company Reports 73% Increase in Net Income and $.92 Earnings Per Share for Fiscal 2000
ROCHESTER, N.Y.--Monro Muffler Brake, Inc. , today reported sales and operating results for its fourth quarter and fiscal year ended March 31, 2000.Sales for the fiscal 2000 fourth quarter were $50.0 million, compared to $49.3 million for the corresponding quarter ended March 31, 1999. Comparable store sales increased .6%, and were offset by lost sales related to closed stores. Sales from stores opened since April 1, 1998 increased $1.1 million over the prior year's quarter.
Net income for the quarter was $1.2 million, or $0.13 earnings per diluted share as compared to a net loss of $0.6 million, or $0.07 loss per diluted share for the corresponding 1999 quarter. Operating income increased to $4.5 million as compared to $1.2 million in the prior year period.
Sales for the twelve months ended March 31, 2000 increased 16% to $223.6 million as compared to $193.5 million in the prior year period. Net income for fiscal 2000 increased 73% to $8.2 million, or $0.92 per diluted share as compared to $4.7 million, or $0.53 per diluted share for fiscal 1999. During the year, the Company opened 13 stores, and closed 11 Monro and 14 Speedy stores which were redundant or underperforming. The Company plans to open approximately five stores in fiscal 2001.
Robert Gross, President and Chief Executive Officer of Monro Muffler Brake, commented, "The comparable store sales increases generated during the third and fourth quarters represent our first consecutive quarterly same-store sales increases since fiscal 1997. Our continued ability to realize benefits in conjunction with the Speedy integration has enhanced our profitability. During the quarter, Monro and Speedy locations achieved cost savings in direct store expenses, corporate and field overhead expenses, advertising, and purchasing.
"The quarter's results also reflect our enhanced customer service efforts and store execution. Increased incentives for employees, improving customer satisfaction as measured by our surveys, and Monro's quality service and price guarantees, have helped drive store traffic while satisfying the demands of our customers. With the ground work we have laid, we are very encouraged about our prospects for fiscal 2001."
Mr. Gross concluded, "We completed fiscal 2000 with a healthy balance sheet, as we have reduced our long-term debt, and improved inventory management. In fiscal 2001, the Company will continue to improve its customer service and satisfaction, in addition to focusing on growing brake and exhaust sales and the miscellaneous service revenue category to drive top line growth. Additionally, our commercial accounts program represents a significant opportunity for the Company, as early results from contracts with fleet organizations, rental car companies and businesses are very promising. We were also encouraged by the success of our initial test of air conditioning service conducted in 50 locations last year. As a result, we have certified and trained technicians in an additional 75 stores to expand this new offering.
"Finally, we recently completed the successful conversion of 16 Speedy locations to the Monro Muffler Brake Service brand in the Greater Philadelphia market, giving us a strong market penetration of 42 stores. We will continue this conversion process in at least one market each year, as this will create additional operating synergies and market dominance, and upgrade the look of the former Speedy locations."
Separately, the Company announced that it has purchased a total of 120,000 shares of common stock as part of its original 300,000 share repurchase program announced in the third quarter. In addition, the Company's Board of Directors has authorized the repurchase of an additional 120,000 shares of common stock.
Monro Muffler Brake operates a chain of stores providing automotive undercar repair services in the United States. The Company currently operates 512 stores and has 19 dealer locations in New York, Pennsylvania, Ohio, Connecticut, Massachusetts, West Virginia, Virginia, Maryland, Vermont, New Hampshire, New Jersey, North Carolina, South Carolina, Indiana, Rhode Island, Delaware and Michigan. Monro's stores provide a full range of services for exhaust systems, brake systems, steering and suspension systems and many vehicle maintenance services.
MONRO MUFFLER BRAKE, INC.
Financial Highlights
(Unaudited)
(Dollars in thousands, except per share amounts)
Quarter Ended March 31,
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2000 1999 % Change
--------- --------- --------
Sales $ 50,036 $ 49,288 1.5%
Cost of sales, including
distribution and occupancy costs 31,277 30,183 3.6
Gross profit 18,759 19,105 (1.8)
Operating, selling, general and
administrative expenses 14,273 17,894 (20.2)
Operating income 4,486 1,211 270.5
Interest expense, net 1,733 2,020 (14.2)
Other expense, net 852 105 711.4
Income (loss) before provision for
income taxes 1,901 (914)
Provision for (recovery of) income
taxes 749 (315)
Net income (loss) $ 1,152 $ (599)
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Diluted earnings (loss) per
common share $ 0.13 $ (0.07)
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Weighted average number of
diluted common shares outstanding 8,930 8,322
Number of stores open
(at end of quarter) 512 524
MONRO MUFFLER BRAKE, INC.
Financial Highlights
(Dollars in thousands, except per share amounts)
Year Ended March 31,
--------------------
2000 1999 % Change
---- ---- --------
Sales $ 223,605 $ 193,458 15.6%
Cost of sales, including
distribution and occupancy costs 134,169 115,117 16.6
Gross profit 89,436 78,341 14.2
Operating, selling, general and
administrative expenses 66,889 64,062 4.4
Operating income 22,547 14,279 57.9
Interest expense, net 6,831 5,600 22.0
Other expense, net 2,091 730 186.7
Income before provision for
income taxes 13,625 7,949 71.4
Provision for income taxes 5,418 3,203 69.1
Net income $ 8,207 $ 4,746 72.9
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Diluted earnings per common share $ 0.92 $ 0.53 73.6
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Weighted average number of
diluted common shares outstanding 8,964 8,997
MONRO MUFFLER BRAKE, INC.
Financial Highlights
(Dollars in thousands)
March 31
--------
2000 1999
Assets -------- --------
Cash $ 507 $ 5,599
Inventories 39,698 38,656
Other current assets 7,420 9,092
Total current assets 47,625 53,347
Property, plant and equipment, net 133,875 135,787
Other noncurrent assets 14,013 13,800
Total assets $ 195,513 $ 202,934
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Liabilities and Shareholders' Equity
Current liabilities $ 35,962 $ 35,179
Long-term debt 63,639 78,672
Other long term liabilities 7,137 8,132
Total liabilities 106,738 121,983
Total shareholders' equity 88,775 80,951
Total liabilities and shareholders'
equity $ 195,513 $ 202,934
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