Operating Results

Second Quarter

Sales

Sales for the thirteen weeks ended August 1, 2009 were $488.9 million, as compared to $500.0 million for the thirteen weeks ended August 2, 2008. Comparable sales decreased 2.3%, consisting of a 5.2% comparable service revenue increase and a 4.0% comparable merchandise sales decrease. In accordance with GAAP, service revenue is limited to labor sales and merchandise sales includes merchandise sold through both our service center and retail lines of business. Re-categorizing Sales into the respective lines of business from which they are generated, comparable Service Center Revenue (labor plus installed merchandise and tires) increased 2.3%, while comparable Retail Sales (DIY and Commercial) decreased 6.0%.

Earnings

Earnings From Continuing Operations Before Income Taxes increased to $12.8 million for the second quarter of fiscal 2009 from the $6.6 million recorded in the same period last year. Net Earnings increased to $7.7 million ($0.15 per share) for the second quarter of fiscal 2009 from the $5.4 million ($0.10 per share) recorded in the same period last year. The second quarter 2009 results reflect Service Center revenue growth, improved gross margin rates and tight spending control. The second quarter 2008 results included a $4.1 million gain from the disposition of assets and a one-time $2.2 million tax benefit resulting from the recording of a deferred tax asset.

First Half

Sales

Sales for the twenty-six weeks ended August 1, 2009 were $985.4 million, as compared to $998.1 million for the twenty-six weeks ended August 2, 2008. Comparable sales decreased 1.3%, consisting of a 4.5% comparable service revenue increase and a 2.6% comparable merchandise sales decrease. Re-categorizing Sales (see above), comparable Service Center Revenue increased 2.8%, while comparable Retail Sales decreased 4.6%.

Earnings

Earnings From Continuing Operations Before Income Taxes increased to $32.8 million for the first half of 2009 from the $16.0 million recorded in the same period last year. Net Earnings increased to $18.6 million ($0.36 per share) for the first half of fiscal 2009 from the $10.1 million ($0.19 per share) recorded in the same period last year. The first-half 2009 results reflect Service Center revenue growth, improved gross margin rates, tight spending control and reduced interest expense. The first-half 2009 results also include a $6.2 million gain resulting from bond repurchases.