* Sales increased 78% to $1.25 billion
* 90% increase in gross profit
* 31% increase in adjusted EPS
SPRINGFIELD, Mo., July 29, 2009 (GLOBE NEWSWIRE) -- O'Reilly Automotive, Inc. ("O'Reilly" or "the Company") (Nasdaq:ORLY) today announced record revenues and earnings for the second quarter ended June 30, 2009.
Sales for the three months ended June 30, 2009, totaled $1.25 billion, up 78% from $0.70 billion for the same period a year ago. Gross profit for the second quarter of 2009 increased to $604 million (or 48.2% of sales) from $317 million (or 45.0% of sales) for the second quarter of 2008, representing an increase of 90%. Selling, General and Administrative ("SG&A") expenses increased to $454 million (or 36.3% of sales) for the second quarter of 2009 from $229 million (or 32.5% of sales) for the second quarter of 2008, representing an increase of 98%.
Net income for the second quarter ended June 30, 2009, totaled $86 million, up 53% from $56 million for the same period in 2008. Diluted earnings per common share for the second quarter of 2009 increased 29% to $0.62 on 137.5 million shares, compared to $0.48 for the second quarter of 2008 on 116.5 million shares.
Sales for the first six months of 2009 totaled $2.42 billion, up 79% from $1.35 billion for the same period a year ago. Gross profit for the first six months of 2009 increased to $1.15 billion (or 47.5% of sales) from $0.61 billion (or 44.8% of sales) for the same period a year ago, representing an increase of 89%. SG&A expenses increased to $883 million (or 36.6% of sales) for the first six months of 2009 from $443 million (or 32.8% of sales) for the same period a year ago, representing an increase of 99%.
Net income for the first six months of 2009 totaled $148 million, up 45% from $102 million for the same period a year ago. Diluted earnings per common share for the first six months of 2009 increased 23% to $1.08 on 136.8 million shares compared to $0.88 for the same period a year ago on 116.4 million shares.
Commenting on the Company's quarterly results, Greg Henslee, CEO and Co-President, stated, "We are pleased to report a solid consolidated comparable store sales increase of 4.8% for the quarter. Stores operating on the O'Reilly systems, including all of the Murray's stores, which are in various conversion stages, as well as all fully-converted stores, generated a comparable store sales increase of 6.1%. This increase was comprised of a 7.8% increase at the "core O'Reilly" stores, a 3.4% decrease at the converted stores and an 11.9% decrease at the Murray's stores. Stores operating on the legacy CSK systems achieved a third consecutive quarter of positive comparable store sales with a 2.1% increase. The converted and Murray's stores comparable sales results include sales after the conversion to the O'Reilly systems and were negatively impacted by the change in systems, the disruption in business created by the closure of the stores during conversion and the ongoing remodeling once the stores were reopened. The converted stores have performed very well in the hard-part categories, which are the staple of the O'Reilly dual market strategy with the overall negative comps driven by non-core automotive sales made in the previous year. The layouts of many of the Murray's stores have been drastically changed to support our dual market strategy and their performance has been negatively impacted by the remodeling work that has been completed while the stores remained open."
Comparable store sales for stores operating on the O'Reilly systems increased 7.1% for the first six months of 2009. Comparable store sales for stores operating on the legacy CSK systems increased 1.8% for the first six months of 2009. Consolidated comparable store sales increased 5.2% for the first six months of 2009.
Ted Wise, COO and Co-President, stated, "We opened 50 new stores during the second quarter, bringing our new store growth for 2009 through the end of June to 108 stores and keeping us on track to meet our goal of adding 150 new stores for the year. Our store conversion teams have been busy completing front room merchandise changeovers in the Murray's locations, which we converted to the O'Reilly point-of-sale system in April. In addition, our conversion teams converted 41 other CSK branded stores to the O'Reilly Brand during the quarter, completing the first phase of our store conversion plan. Our new distribution center in Greensboro, North Carolina, opened as scheduled on May 11, and I would like to thank all of the dedicated Team Members that made the opening possible." Mr. Wise added, "As we continue to grow the O'Reilly Brand across the country, our Team continues to focus on the fundamentals of providing industry-leading customer service to our Professional Installer and DIY customers in all our markets."
The Company's second quarter and year to date results include a charge related to the July 11, 2008, acquisition of CSK Automotive, Inc. ("CSK"). The non-cash charge to amortize the value assigned to CSK's trade names and trademarks, which will be amortized over the next approximately one and a half years, to coincide with the anticipated conversion of CSK branded store locations to O'Reilly branded locations, is included in SG&A. Adjusted diluted earnings per share, excluding the impact of the acquisition related charge during the second quarter, increased 31% to $0.63 from the same period one year ago. For the first six months of 2009, adjusted diluted earnings per share, excluding the impact of the acquisition related charge, increased 25% to $1.10 from the same period one year ago. The impact of the acquisition related charge, net of tax, was as follows:
Diluted Earnings
Net Income Per Share
------------------------- -------------------------
Three Months Six Months Three Months Six Months
Ended Ended Ended Ended
June 30, June 30, June 30, June 30,
2009 2009 2009 2009
------------ ------------ ------------ ------------
(in thousands, except per share data)
Net income
excluding
acquisition-
related charges $ 86,635 $ 150,804 $ 0.63 $ 1.10
============ ============ ============ ============
Acquisition
related charges,
net of tax:
Amortization of
trade names and
trademarks 1,120 2,454 0.01 0.02
------------ ------------ ------------ ------------
Net income and
diluted EPS $ 85,515 $ 148,350 $ 0.62 $ 1.08
============ ============ ============ ============
The Company estimates diluted earnings per share for the third quarter of 2009 to range from $0.53 to $0.57 and estimates diluted earnings per share for the year ended December 31, 2009, to range from $2.06 to $2.10. Excluding the expected impact of acquisition charges for trade names and trademarks related to the acquisition of CSK of $0.03 for the year ended December 31, 2009, adjusted diluted earnings per share is expected to range from $2.09 to $2.13.
Mr. Henslee added, "July 11 marked the first anniversary of our acquisition of CSK and, although there is much more work to be done, the integration is progressing well. As we look to the remainder of this year, we are excited about the opportunities to continue to grow our market share as we convert the CSK branded stores to the O'Reilly Brand and continue to expand our distribution capabilities in the CSK markets. I would like to thank all 44,000 members of Team O'Reilly for their hard work and dedication, and for their consistent execution of our dual market strategy; your efforts continue to drive our strong performance."
Comparable store sales estimates for the third quarter and full year of 2009 are listed below:
Three Months Ended Twelve Months Ended
Comparable Store Brand September 30, 2009 December 31, 2009
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O'Reilly Branded & Converted 4.0% to 6.0% 4.0% to 6.0%
CSK Branded 1.0% to 3.0% 1.0% to 3.0%
Consolidated 3.0% to 5.0% 3.0% to 5.0%
This release contains certain financial information not derived in accordance with United States generally accepted accounting principles ("GAAP"). The Company does not, and nor does it suggest investors should, consider such non-GAAP financial measures in isolation from, or as a substitute for, GAAP financial information. The Company believes that the presentation of financial results and estimates excluding the impact of a non-cash acquisition-related charge provides meaningful supplemental information to both management and investors that is indicative of the Company's core operations. The Company excludes this item in judging its performance and believes this non-GAAP information is useful to investors as well.
