AutoZone 2nd Quarter EPS Increases 15.1% to $4.78

AutoZone 2nd Quarter EPS Increases 15.1% to $4.78

MEMPHIS, Tenn., Feb. 26, 2013 (GLOBE NEWSWIRE) -- AutoZone, Inc. (NYSE:AZO)
today reported net sales of $1.9 billion for its second quarter (12 weeks)
ended February 9, 2013, an increase of 2.8% from the second quarter of fiscal
2012 (12 weeks). Domestic same store sales, or sales for stores open at least
one year, decreased 1.8% for the quarter.

Net income for the quarter increased $9.3 million, or 5.6%, over the same
period last year to $176.2 million, while diluted earnings increased 15.1% to
$4.78 per share from $4.15 per share in the year-ago quarter.

For the quarter, gross profit, as a percentage of sales, was 51.9% (versus
51.3% for last year's quarter). The improvement in gross margin was primarily
driven by lower acquisition costs. Operating expenses, as a percentage of
sales, were 34.7% (versus 34.7% last year). Operating expenses, as a
percentage of sales, increased slightly due to the lower sales growth rates,
partially offset by lower incentive compensation (47 bps).

Under its share repurchase program, AutoZone repurchased 513 thousand shares
of its common stock for $185 million during the second quarter, at an average
price of $361 per share. At quarter end, the Company had $603 million
remaining under its current share repurchase authorization.

The Company's inventory increased 7.0% over the same period last year, driven
by an increase in store count and continued strategic investments in hard
parts assortment. Net inventory, defined as merchandise inventories less
accounts payable per store was a negative $54 thousand versus negative $51
thousand last year.

"While we are pleased to report our twenty-sixth consecutive quarter of double
digit earnings per share growth, we were not pleased with our same store sales
results for the quarter. Historically, we have seen our sales increase
significantly during the final two weeks of our second quarter.However,this
year our total domestic auto parts same store sales for the last two weeks
declined by eight percent. Our belief is the approximate two week delay in
processing of income tax returns this year was the key contributor to this
decline in sales. Our expectation is sales in the upcoming quarter should
recover to more normalized sales volumes. Excluding the last two weeks, our
sales were generally consistent with last quarter," said Bill Rhodes,
Chairman, President and Chief Executive Officer."I would like to thank and
congratulate our entire team of 70,000+ AutoZoners for their intense
dedication and hard work which delivered strong earnings per share and return
on invested capital performance in the second quarter. As we enter our key
spring and summer selling season, we are optimistic about our future. We
believe we have the right initiatives in place to meet and exceed our
customer's expectations. We remain committed to our disciplined approach of
growing operating earnings while efficiently utilizing our capital."

During the quarter ended February 9, 2013, AutoZone opened 32 new stores in
the U.S. and opened nine new stores in Mexico.As of February 9, 2013, the
Company had 4,735 stores in 49 states, the District of Columbia and Puerto
Rico in the U.S., 334 stores in Mexico, and one store in Brazil for a total
store count of 5,070.

AutoZone is the leading retailer and a leading distributor of automotive
replacement parts and accessories in the United States. Each store carries an
extensive product line for cars, sport utility vehicles, vans and light
trucks, including new and remanufactured automotive hard parts, maintenance
items, accessories, and non-automotive products. Many stores also have a
commercial sales program that provides commercial credit and prompt delivery
of parts and other products to local, regional and national repair garages,
dealers, service stations, and public sector accounts. AutoZone also sells
the ALLDATA brand diagnostic and repair software through www.alldata.com.
Additionally, we sell automotive hard parts, maintenance items, accessories,
non-automotive products and subscriptions to the ALLDATAdiy product through
www.autozone.com, accessories through www.autoanything.com and our commercial
customers can make purchases through www.autozonepro.com. AutoZone does not
derive revenue from automotive repair or installation.

AutoZone will host a conference call this morning, Tuesday, February 26, 2013,
beginning at 10:00 a.m. (EST) to discuss its second quarter results.Investors
may listen to the conference call live and review supporting slides on the
AutoZone corporate website, www.autozoneinc.com by clicking "Investor
Relations," "Conference Calls."The call will also be available by dialing
(210) 839-8923.A replay of the call and slides will be available on
AutoZone's website.In addition, a replay of the call will be available by
dialing (203) 369-1211 through Tuesday, March 5, 2013 at 11:59 p.m. (EST).

This release includes certain financial information not derived in accordance
with generally accepted accounting principles ("GAAP").These non-GAAP
measures include return on invested capital, adjusted debt, adjusted debt to
EBITDAR, and cash flow before share repurchases.The Company believes that the
presentation of these non-GAAP measures provides information that is useful to
investors as it indicates more clearly the Company's comparative year-to-year
operating results, but this information should not be considered a substitute
for any measures derived in accordance with GAAP.Management targets the
Company's capital structure in order to maintain its investment grade credit
ratings and manages cash flows available for share repurchase by monitoring
cash flows before share repurchases, as shown on the attached tables.The
Company believes this is important information for the management of its debt
levels and share repurchases.We have included a reconciliation of this
additional information to the most comparable GAAP measures in the
accompanying reconciliation tables.

Certain statements contained in this press release are forward-looking
statements. Forward-looking statements typically use words such as "believe,"
"anticipate," "should," "intend," "plan," "will," "expect," "estimate,"
"project," "positioned," "strategy" and similar expressions. These are based
on assumptions and assessments made by our management in light of experience
and perception of historical trends, current conditions, expected future
developments and other factors that we believe to be appropriate. These
forward-looking statements are subject to a number of risks and uncertainties,
including without limitation: credit market conditions; the impact of
recessionary conditions; competition; product demand; the ability to hire and
retain qualified employees; consumer debt levels; inflation; weather; raw
material costs of our suppliers; energy prices; war and the prospect of war,
including terrorist activity; construction delays; access to available and
feasible financing; and changes in laws or regulations. Certain of these risks
are discussed in more detail in the "Risk Factors" section contained in Item
1A under Part 1 of our Annual Report on Form 10-K for the year ended August
25, 2012, and these Risk Factors should be read carefully. Forward-looking
statements are not guarantees of future performance and actual results;
developments and business decisions may differ from those contemplated by such
forward-looking statements, and events described above and in the "Risk
Factors" could materially and adversely affect our business. Forward-looking
statements speak only as of the date made. Except as required by applicable
law, we undertake no obligation to update publicly any forward-looking
statements, whether as a result of new information, future events or
otherwise. Actual results may materially differ from anticipated results.

AutoZone's 2nd Quarter Highlights - Fiscal 2013                           
                                                      
Condensed Consolidated Statements of Operations                            
2nd Quarter, FY2013                                                        
(in thousands, except per share data)                                      
                      GAAP Results                      
                       12 Weeks Ended    12 Weeks Ended
                      February 9, 2013  February 11,    
                                         2012
                                                      
Net sales              $1,855,198      $1,804,069    
Cost of sales          893,217           877,854         
Gross profit           961,981          926,215        
Operating, SG&A        644,410           625,564         
expenses
Operating              317,571          300,651        
profit(EBIT)
Interest expense, net  41,323            38,923          
Income before taxes    276,248          261,728        
Income taxes           100,001           94,798          
Net income             $176,247        $166,930      
Net income per share:                                  
Basic                  $4.86           $4.25         
Diluted                $4.78           $4.15         
Weighted average                                       
shares outstanding:
Basic                  36,258            39,281          
Diluted                36,904            40,237          
                                                      
                                                      
Year-To-Date 2nd Quarter, FY2013                                           
(in thousands, except  GAAP Results                      
per share data)
                       24 Weeks Ended    24 Weeks Ended
                      February 9, 2013  February 11,    
                                         2012
                                                      
Net sales              $3,846,238      $3,728,411    
Cost of sales          1,852,391         1,818,569       
Gross profit           1,993,847        1,909,842      
Operating, SG&A        1,312,999         1,268,257       
expenses
Operating              680,848          641,585        
profit(EBIT)
Interest expense, net  82,428            78,017          
Income before taxes    598,420          563,568        
Income taxes           218,722           205,513         
Net income             $379,698        $358,055      
Net income per share:                                  
Basic                  $10.39          $9.05         
Diluted                $10.19          $8.83         
Weighted average                                       
shares outstanding:
Basic                  36,552            39,573          
Diluted                37,246            40,551          
                                                      
Selected Balance Sheet Information                                         
(in thousands)                                                             
                      February 9, 2013  February 11,    August 25, 2012
                                         2012
                                                      
Cash and cash          $115,548        $103,207      $103,093
equivalents
Merchandise            2,758,543        2,577,704      2,627,983
inventories
Current assets         3,123,368        2,908,564      2,978,946
Property and           2,944,549        2,724,396      2,855,928
equipment, net
Total assets           6,662,188        6,056,464      6,265,639
Accounts payable       3,034,017        2,824,873      2,926,740
Current liabilities*   4,231,808        3,516,789      3,655,592
Total debt*            3,997,806        3,464,360      3,768,183
Stockholders'          (1,550,109)      (1,295,524)    (1,548,025)
(deficit)
Working capital        (1,108,440)      (608,225)      (676,646)
                                                      
* Current liabilities and total debt both include short-term borrowings
of $484,533 at February 9, 2013; $29,560 at February 11, 2012 and
$49,881 at August 25, 2012.

                                                        
Adjusted Debt / EBITDAR (Trailing 4 Qtrs)                                 
(in thousands, except adjusted debt to EBITDAR ratio)                     
                   February 9,    February 11,            
                    2013           2012
Net income          $952,016     $886,898              
Add:Interest      180,316       171,745                
Taxes               535,822       499,877                
EBIT                1,668,154     1,558,520              
                                                        
Add:Depreciation  218,705       203,962                
Rent expense        235,611       220,875                
Share-based expense 34,934        29,551                 
EBITDAR             $2,157,404   $2,012,908            
                                                        
Debt                $3,997,806   $3,464,360            
Capital lease       99,369        103,774                
obligations
Add: rent x 6      1,413,666     1,325,250              
Adjusted debt       $5,510,841   $4,893,384            
                                                        
Adjusted debt to    2.6           2.4                    
EBITDAR
                                                          
                                                        
Selected Cash Flow Information                                            
(in thousands)                                                            
                    12 Weeks Ended 12 Weeks      24 Weeks   24 Weeks
                   February 9,    Ended         Ended      Ended
                    2013           February 11,  February   February
                                   2012          9, 2013    11, 2012
                                                        
Depreciation        $52,344      $47,523     $103,044 $96,170
Capital spending    $89,183      $70,506     $169,613 $132,430
                                                        
Cash flow before                                         
share repurchases:
Increase in cash
and cash            $15,684      $6,531      $12,455  $5,601
equivalents
Subtract increase   195,069       107,856      229,517   113,652
in debt
Add back share      185,016       172,505      502,348   482,270
repurchases
Cash flow before
share repurchases   $5,631       $71,180     $285,286 $374,219
and changes in debt
                                                        
                                                        
Other Selected Financial Information                                      
(in thousands, except ROIC)                                               
                   February 9,    February 11,            
                    2013           2012
                                                        
                                                        
Cumulative share
repurchases ($      $12,046,591  $10,663,643           
since fiscal 1998)
Remaining share     $603,409     $486,357              
authorization ($)
                                                        
Cumulative share
repurchases (shares 132,506       128,799                
since fiscal 1998)
                                                        
Shares outstanding, 36,079        38,951                 
end of quarter
                                                        
                   Trailing 4 Quarters                    
                   February 9,    February 11,            
                    2013           2012
Net income          $952,016     $886,898              
Adjustments:                                             
Interest expense    180,316       171,745                
Rent expense        235,611       220,875                
Tax effect*         (149,733)     (141,523)              
After-tax return    1,218,210     1,137,995              
                                                        
Average debt**      3,727,872     3,328,075              
Average
stockholders'       (1,480,371)   (1,210,962)            
deficit**
Add: Rent x 6       1,413,666     1,325,250              
Average capital     101,446       88,413                 
lease obligations**
Pre-tax invested    $3,762,613   $3,530,776            
capital
                                                        
Return on Invested  32.4%          32.2%                   
Capital (ROIC)
                                                        
* Effective tax rate over the trailing four quarters ended February 9,  
2013 and February 11, 2012 is 36.0%.
** All averages are computed based on trailing 5 quarter balances.        

                                                      
AutoZone's 2nd Quarter Fiscal 2013                                        
Selected Operating Highlights                                             
                                                      
Store Count & Square Footage                                              
                                                      
                   12 Weeks     12 Weeks     24 Weeks     24 Weeks
                  Ended        Ended        Ended        Ended
                   February 9,  February 11, February 9,  February 11,
                   2013         2012         2013         2012
Domestic stores:                                       
Store count:                                           
Beginning domestic 4,703       4,551       4,685       4,534
stores
Stores opened      32          29          51          46
Stores closed      --          --          1           --
Ending domestic    4,735       4,580       4,735       4,580
stores
Relocated stores   3           4           3           5
                                                      
Stores with
commercial         3,146       2,825       3,146       2,825
programs
                                                      
Square footage (in 30,713       29,636      30,713       29,636
thousands):
                                                      
Mexico stores:                                         
Stores opened     9           6           13          8
Total stores in    334         287         334         287
Mexico
                                                      
Brazil stores:                                         
Stores opened     --          --          1           --
Total stores in    1           --          1           --
Brazil
                                                      
Total stores       5,070       4,867       5,070       4,867
chainwide
                                                      
Square footage (in 33,155      31,727      33,155      31,727
thousands):
Square footage per 6,539       6,519       6,539       6,519
store
                                                      
Sales Statistics                                                          
($ in thousands,
except sales per
average square                                         
foot and
percentages)
Total Auto Parts   12 Weeks     12 Weeks     Trailing 4   Trailing 4
(Domestic, Mexico  Ended        Ended        Quarters     Quarters
and Brazil)       February 9,  February 11, February 9,  February 11,
                   2013         2012         2013         2012
Total auto parts   $1,796,280 $1,762,903 $8,520,522 $8,174,796
sales
% Increase vs.    1.9%         8.6%         4.2%         8.1%
LY
                                                      
Sales per average  $356       $364       $1,715     $1,714
store
Sales per average  $54        $56        $263       $263
square foot
                                                      
Domestic                                               
Commercial
Total domestic     $289,915   $266,547   $1,352,473 $ 1,179,408
commercial sales
% Increase vs. LY 8.8%         24.6%        14.7%        23.4%
                                                      
All Other
(ALLDATA,                                              
E-Commerce and
AutoAnything)
All other sales    $58,918    $41,166    $201,166   $ 173,980
% Increase vs.    43.1%        11.3%        15.6%        11.3%
LY
                                                      
                   12 Weeks     12 Weeks     24 Weeks     24 Weeks
                  Ended        Ended        Ended        Ended
                   February 9,  February 11, February 9,  February 11,
                   2013         2012         2013         2012
Domestic same      (1.8%)       5.9%         (0.7%)       5.2%
store sales
                                                      
                                                      
Inventory Statistics (Total Stores)                                       
                   as of        as of
                  February 9,  February 11,             
                   2013         2012
Accounts           110.0%       109.6%                   
payable/inventory
                                                      
($ in thousands)                                       
Inventory          $2,758,543 $2,577,704             
Inventory per      $544       $530                   
store
Net inventory (net $(275,474) $(247,169)             
of payables)
Net inventory/    $(54)      $(51)                  
per store
                                                      
                  Trailing 5 Quarters                   
                  February 9,  February 11,             
                   2013         2012
Inventory turns    1.6 x       1.6 x                   

CONTACT: Financial: Brian Campbell at (901) 495-7005
         brian.campbell@autozone.com
        
         Media: Ray Pohlman at (866) 966-3017
         ray.pohlman@autozone.com

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