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News   February 13, 2015   by Auto Service World

Advance Auto Parts Announces Fourth Quarter Results


#aftermarket Advance Auto Parts, Inc. has announced its financial results for the fourth quarter ended January 3, 2015. Fourth quarter comparable cash earnings per diluted share (Comparable Cash EPS) were $1.37, an increase of 46% versus the fourth quarter last year. These fourth quarter comparable results exclude $0.08 of amortization of acquired intangible assets, integration costs of $0.30 associated with the acquisition of General Parts International, Inc. (General Parts), $0.01 of integration costs associated with the integration of B.W.P. Distributors, Inc. (BWP) and $0.17 from an additional week of business (53rd week). Full year Comparable Cash EPS of $7.59 increased 33.9% from Fiscal 2013 and exclude $0.36 of amortization of acquired intangible assets, integration costs of $0.61 associated with the acquisition of General Parts,

$0.08 of integration costs associated with the integration of BWP and $0.17 from the 53rd week. On a comparable basis, total sales for the fourth quarter increased 48.1% to $2.09 billion, as compared with total sales during the fourth quarter of fiscal 2013 of $1.41 billion. The sales increase was driven by the acquisition of General Parts, a comparable store sales increase of 1.1% and the addition of new stores over the past 12 months.

On a GAAP basis, total sales for the fourth quarter increased 58.8% to $2.24 billion, as compared with total sales during the fourth quarter of fiscal 2013 of $1.41 billion. On a comparable basis, total sales increased 49.3% to $9.69 billion for fiscal 2014, compared with total sales of $6.49 billion over the same period last year. On a GAAP basis, total sales increased 51.6% to $9.84 billion for fiscal 2014, compared with total sales of $6.49 billion over the same period last year.

The Company’s Comparable Gross Profit rate was 44.9% of sales during the fourth quarter as compared to 49.8% during the fourth quarter last year. The 495 basis-point decrease in gross profit rate was primarily due to the higher mix of commercial sales which has a lower gross margin rate resulting from the acquisition of General Parts partially offset by acquisition synergy savings in the quarter. On a GAAP basis, the Company’s gross profit rate was 44.9% of sales during the fourth quarter as compared to 49.8% during the fourth quarter last year. For fiscal 2014, the Company’s comparable gross profit rate was 45.2%, a 484 basis-point decrease over the same period last year. On a GAAP basis, the Company’s comparable gross profit rate was 45.2% for fiscal 2014, a 484 basis-point decrease over the same period last year.

The Company’s Comparable SG&A rate was 36.6% of sales during the fourth quarter as compared to 41.7% during the same period last year. The 510 basis-point decrease was primarily the result of the acquired General Parts business having lower SG&A costs combined with lower incentive compensation expenses. On a GAAP basis, the Company’s SG&A rate was 38.3% of sales during the fourth quarter as compared to 43.4% during the same period last year. For fiscal 2014, the Company’s Comparable SG&A rate was 35.4% versus 39.4% during fiscal 2013. For fiscal 2014, the Company’s GAAP SG&A rate was 36.6% versus 39.9% during fiscal 2013.

The Company’s Comparable Operating Income was $171.7 million during the fourth quarter, an increase of 50.8% versus the fourth quarter of fiscal 2013. As a percentage of sales, Comparable Operating Income in the fourth quarter was 8.2% compared to 8.1% during the fourth quarter of fiscal 2013. On a GAAP basis, the Company’s operating income during the fourth quarter of $146.1 million increased 60.8% versus the fourth quarter of fiscal 2013.

On a GAAP basis, the Operating Income rate was 6.5% during the fourth quarter as compared to 6.4% during the fourth quarter of fiscal 2013. For fiscal 2014, the Company’s Comparable Operating Income rate was 9.9% versus 10.7% during fiscal 2013. For fiscal 2014, the Company’s GAAP Operating Income rate was 8.7% versus 10.2% during fiscal 2013.

Operating cash flow increased approximately 30.0% to $709.0 million in fiscal 2014 from $545.3 million in fiscal 2013. Free cash flow increased to $480.5 million in fiscal 2014 from $349.5 million in fiscal 2013. Capital expenditures in fiscal 2014 were $228.4 million as compared to $195.8 million for fiscal 2013.

“In our first year as a combined company, we are pleased with our overall performance delivering positivecomparable store sales, strong growth in free cash flow and approximately 38% growth in Comparable Operating Income dollars in fiscal 2014,” said Mike Norona, executive vice president and chief financial officer. “The strength of our commercial business combined with achievement of our targeted synergies and continued disciplined focus on expense management throughout the year allowed us to increase our fiscal 2014 comparable earnings per share 33.9% over last year.”


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