Monro Muffler Brake, Inc. Announces Third Quarter Fiscal 2013 Financial Results

Monro Muffler Brake, Inc. Announces Third Quarter Fiscal 2013 Financial
Results

~ Third Quarter Net Income of $11.3 Million; EPS of $.35 In Line With Guidance
                                      ~
~ Completes Acquisitions for 79 Stores and $138 Million of Annualized Sales ~
        ~ Revises Estimated Fiscal 2013 EPS Range to $1.27 to $1.32 ~
~ Expands Credit Facility to $250 Million and Extends Term to December 2017 ~

ROCHESTER, N.Y., Jan. 29, 2013 (GLOBE NEWSWIRE) -- Monro Muffler Brake, Inc.
(Nasdaq:MNRO), a leading provider of automotive undercar repair and tire
services, today announced financial results for its third quarter ended
December 29, 2012.

Third Quarter Results

Sales for the third quarter of fiscal 2013 increased 7.8% to $190.4 million as
compared to $176.7 million for the third quarter of fiscal 2012. Adjusted for
days, comparable store sales decreased 4.9%, which compares to a 1.3% decrease
for the same period last year. On a reported basis, comparable store sales
decreased 5.9%. Comparable store sales, adjusted for days, were flat to last
year for maintenance services and decreased approximately 2% for tires, 6% for
alignments, 9% for front end/shocks, 12% for brakes and 20% for exhaust. The
total sales increase for the third quarter of $13.7 million was due to an
increase in sales from new stores, including recently acquired stores, of $23
million.

Gross margin decreased to 36.6% in the third quarter from 38.4% in the prior
year quarter due to a sales mix shift to lower margin tire and service
categories and a loss of leverage due to weaker year-over-year comparable
store sales. Total operating expenses were $50.8 million, or 26.7% of sales,
as compared with $45.1 million, or 25.5% of sales, for the same period of the
prior year. The increase in operating expenses as a percent of sales is due to
a loss of leverage as a result of weaker year-over-year comparable store sales
and a $1.7 million gain on the sale of seven stores in the third quarter of
fiscal 2012. Due to cost reduction initiatives, operating expenses in the
third quarter of fiscal 2013 decreased by $.9 million year-over-year excluding
stores acquired in fiscal year 2013 and the $1.7 million gain in fiscal 2012.

Operating income for the quarter decreased 16.8% to $18.8 million from $22.6
million in the third quarter of fiscal 2012. Interest expense was $1.5 million
as compared to $1.2 million in the third quarter of fiscal 2012.

Net income for the third quarter decreased 16.9% to $11.3 million from $13.6
million in the prior year period. Diluted earnings per share for the quarter
decreased 16.7% to $.35, including $.02 dilution from fiscal 2013
acquisitions, and were within the Company's estimated range of $.35 to $.40.
This compares to diluted earnings per share of $.42 in the third quarter of
fiscal 2012, which included a $.03 gain on the sale of seven stores. Net
income for the third quarter reflects an effective tax rate of 35.4% as
compared with 36.9% for the prior year period.

The Company added 65 locations during the quarter, ending the quarter with 918
stores.

John Van Heel, President and Chief Executive Officer stated, "The challenging
economic environment continues to weigh heavily on our customers and the
weather did not provide the tailwind we had anticipated in the third quarter
with the exception of the last two weeks of December, during which our markets
received significant snowfall and comparable store sales increased 10%. Our
customers continue to delay purchases and trade down from higher cost
automotive maintenance and repair purchases. Notably, comparable store oil
change units were flat year-over-year, demonstrating that customers continue
to perform basic maintenance on their vehicles and continue to perform that
basic maintenance at our stores. Our ability to take advantage of increased
acquisition opportunities in this tough sales environment is demonstrated by
our acquisitions in fiscal 2013 of 139 stores and approximately $200 million
in incremental annualized sales, or 29% growth, over fiscal 2012. Further,
these acquisitions are expected to increase our annual tire unit sales by 40%,
which will help us take further advantage of declining tire costs and achieve
greater economies of scale."

First Nine Month Results

For the nine-month period, sales increased 4.1% to $536.1 million from $514.8
million in the same period of the prior year. Adjusted for days, comparable
store sales decreased 5.6%.On a reported basis, comparable store sales
decreased 5.9%. Net income for the first nine months of fiscal 2013 decreased
21.9% to $34.4 million, or $1.07 per diluted share, as compared with $44.1
million, or $1.37 per diluted share in the comparable period of fiscal 2012.

Acquisitions Update

During calendar November and December, Monro completed four acquisitions
totaling 79 stores generating approximately $138 million in annualized sales.
These transactions enable the Company not only to fill in existing markets,
but also expand its footprint into the contiguous states of Tennessee and
Kentucky.

On November 18, 2012, Monro acquired 31 Tire Barn stores with annual sales of
approximately $64 million. The stores, which offer tires and alignment
services similar to the Company's Tire Warehouse brand, include 27 stores in
Indiana, one store in Illinois and three stores in Tennessee. On December 16,
2012, the Company acquired 27 Towery's Tire and Auto Care stores located in
Louisville and Lexington, Kentucky as well as a related wholesale business
which, combined, represent approximately $54million in annualized sales.On
December 30, 2012 (the Company's fiscal fourth quarter), Monro completed the
acquisition of 12 Enger Tire stores in northern Ohio as well as nine Tire King
stores in Durham, North Carolina.The Enger Tire stores generate annual sales
of approximately $9million and the Tire King stores generate annual sales of
approximately $11 million.

Management intends to operate the Tire Barn and Towery stores under their
existing brands, while the Enger Tire and Tire King locations will be
rebranded as Mr. Tire.

Credit Facility

During its third quarter of fiscal 2013, Monro expanded its revolving Credit
Facility to $250 million and extended the term to December 2017. The other
terms of the Credit Facility are unchanged, including the Company's current
borrowing rate of 100 basis points over LIBOR.

Company Outlook

Based on current visibility, business and economic trends, the recent
acquisitions, as well as fiscal 2013 being a 52-week year compared to a
53-week year in fiscal year 2012, the Company now anticipates the change in
fiscal 2013 comparable store sales, adjusted for days, to be in the range of
-6.5% to -5.5% and is revising its estimated fiscal 2013 diluted earnings per
share to a range of $1.27 to $1.32, from the prior range of $1.36 to
$1.50.This compares to diluted earnings per share of $1.69 in fiscal 2012, or
$1.65 excluding an estimated $.07 benefit from the 53^rd week in fiscal 2012
and $.03 of Midas-related due diligence costs incurred in the fourth quarter
of fiscal 2012. The estimate is based on 32.3 million weighted average shares
outstanding. The Company now expects its total sales for the year to be in the
range of $725 million to $735 million.

For the fourth quarter of fiscal 2013, the Company anticipates the change in
comparable store sales to be in the range of -9% to -6%, adjusted for
days.The Company expects diluted earnings per share for the fourth quarter to
be between $.20 and $.25, with the fiscal 2013 completed acquisitions expected
to be breakeven or slightly dilutive. This compares to $.33 diluted earnings
per share for the fourth quarter of fiscal 2012, or $.29 excluding the
aforementioned $.07 benefit from the 53rd week and the $.03 in Midas-related
due diligence costs.

Mr. Van Heel concluded, "Our long-term outlook for the industry and company is
very positive, though, near-term, visibility remains cloudy and we expect
trends will continue to be choppy in our geographic regions as the economic
environment weighs on consumer purchasing behavior. Trends to-date in January
have remained challenged as a result of these economic issues and lack of snow
in our markets. As we actively manage our business through this challenging
environment, we are focused on driving top-line growth and leverage through
acquisitions and aggressively reducing costs. Historically, our strong
business model has allowed us to continue to improve our market share and
expand our operations regardless of the economic or operating environment. The
key long-term macro-economic trends – specifically, the significant number of
vehicles in operation, the increasing average age of those vehicles and the
decreasing number of service bays in operation – are unchanged and remain
positive for the business. Our significant acquisition growth achieved in
fiscal 2013 positions the Company for accelerated earnings growth over the
next several years and we continue to see increased acquisition opportunities
in this challenging market."

Earnings Conference Call and Webcast

The Company will host a conference call and audio webcast on Tuesday, January
29, 2013 at 11:00 a.m. Eastern Time.The conference call may be accessed by
dialing 1-888-230-5549 and using the required pass code 4787656.A replay will
be available approximately one hour after the recording through Tuesday,
February 12, 2013 and can be accessed by dialing 1-877-870-5176. The live
conference call and replay can also be accessed via audio webcast at the
Investor Info section of the Company's website, located at www.monro.com. An
archive will be available at this website through February 12, 2013.

About Monro Muffler Brake

Monro Muffler Brake operates a chain of stores providing automotive undercar
repair and tire services in the United States, operating under the brand names
of Monro Muffler Brake and Service, Mr. Tire, Tread Quarters Discount Tires,
Autotire, Tire Warehouse, Tire Barn and Towery's Tire and Auto Care. The
Company currently operates 939 stores in New York, Pennsylvania, Ohio,
Connecticut, Massachusetts, West Virginia, Virginia, Maryland, Vermont, New
Hampshire, New Jersey, North Carolina, South Carolina, Indiana, Rhode Island,
Delaware, Maine, Illinois, Missouri, Tennessee, Kentucky and Wisconsin.
Monro's stores provide a full range of services for brake systems, steering
and suspension systems, tires, exhaust systems and many vehicle maintenance
services.

The statements contained in this press release that are not historical facts
may contain statements of future expectations and other forward-looking
statements made pursuant to the Safe Harbor provisions of the Private
Securities Litigation Reform Act of 1995. Forward-looking statements are
subject to risks, uncertainties and other important factors that could cause
actual results to differ materially from those expressed. These factors
include, but are not necessarily limited to, product demand, dependence on and
competition within the primary markets in which the Company's stores are
located, the need for and costs associated with store renovations and other
capital expenditures, the effect of economic conditions, the impact of
competitive services and pricing, product development, parts supply restraints
or difficulties, industry regulation, risks relating to leverage and debt
service (including sensitivity to fluctuations in interest rates),continued
availability of capital resources and financing, risks relating to integration
of acquired businesses and other factors set forth elsewhere herein and in the
Company's Securities and Exchange Commission filings, including the report on
Form 10-K for the fiscal year ended March 31, 2012.



MONRO MUFFLER BRAKE, INC.
Financial Highlights
(Unaudited)
(Dollars and share counts in thousands)

                                             Quarter Ended           
                                              Fiscal December
                                             2012        2011        % Change
                                                                   
Sales                                         $ 190,437 $ 176,733 7.8%
                                                                   
Cost of sales, including distribution and     120,827    108,954    10.9%
occupancy costs
                                                                   
Gross profit                                  69,610     67,779     2.7%
                                                                   
Operating, selling, general and               50,782     45,146     12.5%
administrative expenses
                                                                   
Operating income                              18,828     22,633     -16.8%
                                                                   
Interest expense, net                         1,473      1,208      22.0%
                                                                   
Other income, net                             (59)       (34)       75.5%
                                                                   
Income before provision for income taxes      17,414     21,459     -18.8%
                                                                   
Provision for income taxes                    6,159      7,907      -22.1%
                                                                   
Net income                                    $11,255   $ 13,552  -16.9%
                                                                   
Diluted earnings per share:                   $ .35      $.42      -16.7%
                                                                   
Weighted average number of diluted shares     32,240     32,096     
outstanding
                                                                   
Number of stores open (at end of quarter)     918        803        



MONRO MUFFLER BRAKE, INC.
Financial Highlights
(Unaudited)
(Dollars and share counts in thousands)

                                               Nine Months Ended     
                                                Fiscal December
                                               2012       2011       % Change
                                                                   
                                                                   
Sales                                           $ 536,088 $ 514,807 4.1%
                                                                   
Cost of sales, including distribution and       328,515   304,903   7.7%
occupancy costs
                                                                   
Gross profit                                    207,573   209,904   -1.1%
                                                                   
Operating, selling, general and administrative  149,331   135,939   9.9%
expenses
                                                                   
Operating income                                58,242    73,965    -21.3%
                                                                   
Interest expense, net                           4,141     3,663     13.0%
                                                                   
Other income, net                               (250)     (257)     -2.7%
                                                                   
Income before provision for income taxes        54,351    70,559    -23.0%
                                                                   
Provision for income taxes                      19,911    26,449    -24.7%
                                                                   
Net income                                      $ 34,440  $ 44,110  -21.9%
                                                                   
Diluted earnings per share                      $ 1.07    $ 1.37    -21.9%
                                                                   
Weighted average number of diluted shares       32,287    32,243    
outstanding



MONRO MUFFLER BRAKE, INC.
Financial Highlights
(Unaudited)
(Dollars in thousands)
                                                      
                                          December 29, March 31,
                                          2012         2012
                                                      
                                                      
Current Assets                                        
                                                      
Cash                                       $ 7,562      $ 3,257
                                                      
Inventories                                115,334      97,356
                                                      
Other current assets                       37,615       33,687
                                                      
Total current assets                       160,511      134,300
                                                      
Property, plant and equipment, net         240,482      212,994
                                                      
Other non-current assets                   268,871      162,798
                                                      
Total assets                               $ 669,864    $ 510,092
                                                      
Liabilities and Shareholders' Equity                   
                                                      
Current liabilities                        $ 122,591    $ 109,794
                                                      
Obligations under capital leases           45,408       45,504
                                                      
Other Long-term debt                       124,210      5,660
                                                      
Other long-term liabilities                22,354       21,635
                                                      
Total liabilities                          314,563      182,593
                                                      
Total shareholders' equity                 355,301      327,499
                                                      
Total liabilities and shareholders' equity $ 669,864    $ 510,092

CONTACT: John Van Heel
         Chief Executive Officer
         (585) 647-6400
        
         Robert Gross
         Executive Chairman
         (585) 647-6400
        
         Catherine D'Amico
         Executive Vice President - Finance
         Chief Financial Officer
         (585) 647-6400
        
         Investors: Jennifer Milan
         Media: Kelly Whitten
         FTI Consulting
         (212) 850-5600
 
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