AutoZone Q1 Profit Tops View, Sales Miss; Same Store Sales Up

(RTTNews) - AutoZone, Inc. (AZO), an automotive replacement parts retailer, reported Tuesday higher profit in its first quarter with increased net sales and domestic store sales. Earnings per share topped analysts' estimates, while top line missed the view.

Bill Rhodes, Chairman, President and Chief Executive Officer, said, "For the quarter, we reached record first quarter sales and earnings per share while opening 21 new locations and 35 Commercial programs. …. We will continue with our deliberately-paced multiple delivery rollouts in 2017, and we will continue to open more Mega Hub locations... As we continue to invest capital in all our businesses, we remain committed to our disciplined approach of increasing operating earnings and utilizing our capital effectively."

In the pre-market activity on the NYSE, AutoZone shares were gaining 1.10 percent to trade at $784.95.

For the first quarter, net income increased 7.8 percent to $278.13 million from $258.11 million a year ago. Earnings per share increased 13 percent to $9.36 from $8.29 in the year-ago quarter.

On average, 22 analysts polled by Thomson Reuters expected earnings of $9.31 per share for the quarter. Analysts' estimates typically exclude special items.

Net sales for the first quarter increased 3.4 percent to $2.47 billion from $2.39 billion a year ago. Analysts were looking for revenues of $2.49 billion

Domestic same store sales, or sales for stores open at least one year, increased 1.6 percent for the quarter. For the quarter, gross profit, as a percentage of sales, was 52.7 percent, versus 52.5 percent for the same period last year.

The company's inventory increased 7.3 percent over the same period last year, driven by new stores and increased product placement.

During the quarter, AutoZone opened 16 new stores and relocated two stores in the U.S., and opened five new stores in Mexico.

At the end of the first quarter, the company had $783 million remaining under its current share repurchase authorization.