Major U.S. Auto Parts Chain Reports Improved Results

CSK Auto Corporation the parent company of CSK Auto, Inc., which operates stores under the Checker, Shuck’s and Kragen banners, today reported its financial results for the second quarter of fiscal 2002.
The company offered the following highlights for the quarter ended August 4, 2002 (All results in U.S. dollars.):
* Net income increased to approximately $4.1 million from a loss of $23.8 million in the second quarter of 2001;
* Net income before one time items increased 69% to $8.8 million, as compared to the second quarter of fiscal 2001, exceeding by $0.8 million or $0.02 per share the guidance provided by the Company at the time of its recent equity offering;
* Same store sales grew by 7%;
* Successfully completed a common stock offering of approximately 6.9 million primary shares including the exercise of the underwriters’ over-allotment option;
* Reduced total outstanding debt by $89.0 million year over year; and
* Successfully completed the sale of 13 stores that were geographically remote from the Company’s other operations. Net sales for the thirteen weeks ended August 4, 2002 (the “second quarter of fiscal 2002”) increased 4.3% to $398.3 million from sales of $381.7 million in the thirteen weeks ended August 5, 2001 (“the second quarter of fiscal 2001”).
The results were better than analysts had expected.
“The management of CSK Auto is very pleased with the continued operating and financial improvements we have achieved so far this year,” said Maynard Jenkins, chairman and CEO of CSK Auto Corporation. “The improved liquidity from the company’s refinancing at year-end 2001 has already had a significant impact on our operating results. The continued improvement in the second quarter is evidenced by the 7% increase in comparable store sales, a sequential increase in gross profit margins of 170 basis points and the continued leveraging of our selling, general and administrative costs resulting in a net income increase, before one-time items, of almost 70% over the same period of 2001. Since the second quarter of fiscal 2001, our outstanding debt has been reduced by approximately $89.0 million. This is largely the result of the retirement of approximately $71.7 million of 11% senior subordinated notes. As a result, our debt to EBITDA ratio has been reduced from 4.75 times to 4.00 times.”
CSK operates 1,114 stores in 19 states under the brand names Checker Auto Parts, Schuck’s Auto Supply and Kragen Auto Parts.

Looking Ahead
AutoZone will release results for the fourth quarter and fiscal year end that ends August 31, 2002, before the market opens on Wednesday, September 25, 2002. Steve Odland, Chairman, president, and CEO, will host a one hour conference call beginning at 10:00 a.m. (ET), on Wednesday, September 25, 2002, to discuss the results of the quarter and the year.
In advance of that announcement AutoZone, Inc. will be making a presentation to the investment community at the Goldman Sachs Global Retailing Conference on Thursday, September 5, 2002, beginning at 9:35 a.m. (ET). An audiocast of AutoZone’s presentation will be available online at www.autozone.com.