On Feb. 27, AutoZone (NYSE:AZO) released second-quarter earnings for the period ended Feb. 10.

  • Net income rose by 6.2% as store improvements generated additional sales and lower inventory costs increased profits.
  • On a per-store level, inventory decreased 20.2%.
  • AutoZone repurchased 1 million shares of its common stock for $128.9 million during the quarter, at an average price of $123 per share.

(Figures in millions, except per-share data)

Income Statement Highlights

Q2 2007

Q2 2006

Change

Sales

$1,300.4

$1,253.8

3.7%

Net Profit

$103.0

$97.0

6.2%

EPS

$1.45

$1.25

16.0%

Diluted Shares

71.2

77.5

(8.1%)

Get back to basics with a look at the income statement.

Margin Checkup

Q2 2007

Q2 2006

Change*

Gross Margin

49.2%

49.2%

0.0

Operating Margin

14.5%

14.2%

0.3

Net Margin

7.9%

7.7%

0.2

*Expressed in percentage points.

Margins are the earnings engine. See how they work.

Balance Sheet Highlights

Assets

Q2 2007

Q2 2006

Change

Inventory

$1,910.8

$1,722.7

10.9%

Total Assets

$4,646.5

$4,401.9

5.6%

Liabilities

Q2 2007

Q2 2006

Change

Accounts Payable

$1,663.0

$1,427.7

16.5%

Debt

$1,854.3

$1,779.3

4.2%

Learn the ways of the balance sheet.

Cash Flow Highlights

Q2 2007

Q2 2006

Change

Cash Flow*

$139.1

$128.5

8.2%

Capital Expenditures

$50.1

$57.4

(12.8%)

Structural Free Cash Flow

$80.0

$71.1

12.5%

*Net income plus depreciation.

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