O'Reilly Automotive Announces Q3 Sales and Earnings
25 October 2000
O'Reilly Automotive Announces Third Quarter Operating Margin of 11.5% and Record Sales and Earnings
SPRINGFIELD, Mo. - O'Reilly Automotive, Inc. today announced record revenues and earnings for the third quarter and first nine months of 2000, representing the 27th consecutive quarter of record revenues and earnings for O'Reilly since becoming a public company in April 1993.For the three months ended September 30, 2000, net income totaled $16.6 million, up 23.6% from $13.4 million for the same period a year ago. Earnings per common share (diluted) for the quarter increased 23.1% to $0.32 on 51.9 million shares versus $0.26 a year ago on 51.2 million shares. Product sales for the third quarter totaled $251.4 million, up 20.6% from $208.4 million in the previous year. Gross profit for the third quarter of 2000 increased to $105.9 million (or 42.1% of product sales) from $88.0 million (or 42.2% of product sales) for the third quarter of the prior year, representing an increase of 20.3%.
Net income for the first nine months of 2000 totaled $42.5 million, up 25.8% from $33.8 million for the same period a year ago. Earnings per common share (diluted) for the first nine months of 2000 increased 18.8% to $0.82 on 51.6 million shares versus $0.69 a year ago on 48.7 million shares. Product sales for the first nine months of 2000 totaled $673.5 million, up 18.0% from $570.9 million in the first nine months of the previous year. Gross profit for the first nine months of 2000 increased to $287.8 million (or 42.7% of product sales) from $240.8 million (or 42.2% of product sales) for the first nine months of the prior year, representing an increase of 19.5%.
Comparable store sales for stores open at least one year, increased 6.22% and 4.80% for the third quarter and first nine months of 2000, respectively. Comparable store product sales for only those stores open during both full periods being compared increased 5.03% and 4.12% for the third quarter and the first nine months of 2000, respectively.
David O'Reilly, Co-Chairman of the Board and Chief Executive Officer, stated: "This quarter's results reflect the continued commitment of our 11,000 team members. As a percent of sales for the quarter ended September 30, 2000, our operating margin increased to 11.5%, SG&A expenses decreased to 30.6% and net income increased to 6.6%." Larry O'Reilly, Co-Chairman of the Board and Chief Operating Officer, stated: "We are poised to meet our goal of 100 new stores for 2000 and 120 new stores for 2001. We have opened 79 net new stores since January 1, 2000, including the twelve acquired Gateway stores."
The company will host a conference call Wednesday, October 25, 2000, at 10:00 a.m. Central Time to discuss its results as well as future expectations. The call will be available by webcast at www.oreillyauto.com, www.vcall.com or www.streetevents.com.
O'Reilly today announced the signing of a definitive agreement to buy certain assets of four stores in southeast Louisiana from Rankin Automotive Group, Inc. for approximately $1.3 million in cash. The transaction is expected to close November 30, 2000.
O'Reilly Automotive 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 currently operates 650 stores within the states of Texas, Missouri, Oklahoma, Kansas, Iowa, Arkansas, Louisiana, Nebraska and Illinois as of September 30, 2000.
Certain statements contained in this press release are forward-looking statements. These statements discuss, among other things, expected growth, store development and expansion strategy, business strategies, future revenues and future performance. These forward-looking statements are subject to risks, uncertainties and assumptions including, but not limited to, competition, product demand, the market for auto parts, the economy in general, inflation, consumer debt levels, governmental approvals, our ability to hire and retain qualified employees and the weather. Actual results may materially differ from anticipated results described in these forward-looking statements. Please refer to the Risk Factors sections of the 10-K for the year ended December 31, 1999, for more details.
O'REILLY AUTOMOTIVE, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
September 30, December 31,
2000 1999
------------- ------------
(Unaudited) (Note)
In thousands
Assets
Current assets:
Cash $ 12,269 $ 9,791
Short-term investments 500 500
Accounts receivable, net 36,190 26,462
Amounts receivable from
vendors 27,550 25,984
Inventory 347,922 293,924
Refundable income taxes 592 2,333
Deferred income taxes 642 1,776
Other current assets 3,496 3,583
------------ -----------
Total current assets 429,161 364,353
Property and equipment, at cost 354,862 292,806
Accumulated depreciation and
amortization 72,240 56,289
------------ -----------
282,622 236,517
Other assets 10,224 9,572
------------ -----------
Total assets $ 722,007 $ 610,442
============ ===========
Liabilities and shareholders'
equity
Current liabilities:
Note payable to bank $ 5,000 $ 5,000
Income taxes payable 3,267 --
Accounts payable 72,471 64,885
Accrued payroll 8,847 6,278
Accrued benefits and
withholdings 10,486 10,382
Other current liabilities 14,926 14,099
Current portion of
long-term debt 14,177 14,358
------------ -----------
Total current liabilities 129,174 115,002
Long-term debt, less
current portion 136,983 90,704
Deferred income taxes 3,222 1,214
Other liabilities 448 478
Shareholders' equity:
Common stock, $.01 par value:
Authorized shares -- 90,000,000
Issued and outstanding
shares -- 51,391,188 at
September 30, 2000, and
50,799,353 at December 31, 1999 514 508
Additional paid-in capital 228,266 221,628
Retained earnings 223,400 180,908
------------ -----------
Total shareholders' equity 452,180 403,044
------------ -----------
Total liabilities and
shareholders' equity $ 722,007 $ 610,442
============ ===========
Note: The balance sheet at December 31, 1999, has been derived
from the audited financial statements at that date, but does not
include all of the information and footnotes required by generally
accepted accounting principles for complete financial statements.
O'REILLY AUTOMOTIVE, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(Unaudited)
Three Months Ended Nine Months Ended
September 30, September 30,
-------------- --------------
2000 1999 2000 1999
---- ---- ---- ----
In thousands, except per share data
Product sales $251,413 $208,401 $673,530 $570,912
Cost of goods sold,
including warehouse
and distribution
expenses 145,550 120,400 385,700 330,130
Operating, selling,
general and
administrative
expenses 77,058 65,770 214,822 182,679
-------- -------- -------- --------
222,608 186,170 600,522 512,809
-------- -------- -------- --------
Operating income 28,805 22,231 73,008 58,103
Other expense, net (2,076) (564) (4,530) (3,417)
-------- -------- -------- --------
Income before income
taxes 26,729 21,667 68,478 54,686
Provision for income
taxes 10,157 8,255 25,986 20,901
-------- -------- -------- --------
Net income $ 16,572 $ 13,412 $42,492 $ 33,785
======== ======== ======== ========
Net income per common
share $ 0.32 $ 0.26 $ 0.83 $ 0.70
======== ======== ======== ========
Net income per common
share -- assuming
dilution $ 0.32 $ 0.26 $ 0.82 $ 0.69
======== ======== ======== ========
Weighted average common
shares outstanding 51,301 50,692 51,085 47,974
======== ======== ======== ========
Adjusted weighted
average common shares
outstanding --
assuming dilution 51,856 51,178 51,551 48,686
======== ======== ======== ========