On May 16, Advance Auto Parts
- Sales grew 5.4% during the quarter, helped by a 1.1% increase in same-store sales.
- The gross margin improved 57 bps (basis points), thanks to improved procurement and logistics costs. Unfortunately, SG&A costs increased 70 bps, as the company did not fully leverage its fixed costs.
- CAPS investors seem to think things look good for most auto parts retailers. Advance Auto and O'Reilly Automotive
(NASDAQ:ORLY) lead the way with four-star and five-star ratings, respectively. Former Inside Value recommendation AutoZone(NYSE:AZO) carries a two-star rating.
(Figures in millions, except per-share data.)
Income Statement Highlights
|
Q1 2007 |
Q1 2006 |
Change |
|
|---|---|---|---|
|
Sales |
$1,468.1 |
$1,393.0 |
5.4% |
|
Net Profit |
$76.1 |
$74.1 |
2.7% |
|
EPS |
$0.71 |
$0.68 |
4.4% |
|
Diluted Shares |
106.6 |
109.3 |
(2.4%) |
Get back to basics with the income statement.
Margin Checkup
|
Q1 2007 |
Q1 2006 |
Change* |
|
|---|---|---|---|
|
Gross Margin |
48.3% |
47.8% |
0.6 |
|
Operating Margin |
9.2% |
9.1% |
0.1 |
|
Net Margin |
5.2% |
5.3% |
(0.1) |
Margins are the earnings engine.
Balance Sheet Highlights
|
Assets |
Q1 2007 |
Q1 2006 |
Change |
|---|---|---|---|
|
Cash + ST Invest. |
$17.0 |
$55.4 |
(69.3%) |
|
Accounts Rec. |
$89.8 |
$84.8 |
5.9% |
|
Inventory |
$1,556.1 |
$1,420.9 |
9.5% |
|
Liabilities |
Q1 2007 |
Q1 2006 |
Change |
|---|---|---|---|
|
Accounts Payable |
$768.6 |
$696.6 |
10.3% |
|
Long-Term Debt |
$404.2 |
$395.3 |
2.2% |
The balance sheet reflects the company's health.
Cash Flow Highlights
|
Q1 2007 |
Q1 2006 |
Change |
|
|---|---|---|---|
|
Cash From Ops. |
$186.9 |
$166.3 |
12.4% |
|
Capital Expenditures |
$75.9 |
$78.0 |
(2.6%) |
|
Free Cash Flow |
$110.9 |
$88.3 |
25.6% |
Free cash flow is a Fool's best friend.
Related Foolishness:
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