Tractor Supply Company (TSCO 1.34%), the store for everything rural, had record sales growth in its fiscal second quarter as large swathes of the U.S. economy restarted. "Amid an extremely dynamic and uncertain environment, the Tractor Supply team is executing at a very high level," CFO Kurt Barton said.
For the period, which ended June 27, net sales increased by 35% to $3.18 billion and comp sales rose 30%, with double-digit percentage growth across all categories, as customers still largely stuck at home during the pandemic focused on their land, animals, and houses. Earning per share increased by 61% to $2.90. Gross margin increased from 34.9% to 36.4%.
Image source: Tractor Supply Company.
During the second quarter, the company opened 18 new Tractor Supply stores and three new Petsense stores; it also closed three Petsense stores.
The retailer rose to the pandemic challenge by introducing a mobile app for the first time and adding same-day and next-day delivery options, as well as curbside pickup. These measures paid off on the top line as its e-commerce revenues grew by a triple-digit percentage.
In light of its recent successes in ramping up its e-commerce capabilities, Tractor Supply is rolling out new initiatives to meet demand in the new digital environment. "As we attract new customers and gain market share, now is the time for us to build on Tractor Supply's Out Here lifestyle assortment and convenient shopping format," said CEO Hal Lawton.
The company is introducing a Field Activity Support Team (FAST) and other technological and service enhancements, as well as transforming side lots and older stores to improve space productivity.
Though uncertainty about the economic outlook remains significant, the company did offer third-quarter guidance, forecasting $2.30 billion to $2.42 billion in net sales, 12% to 18% comps growth, $136 million to $162 million in net income, and diluted earnings per share of $1.15 to $1.35.
