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IndustriFordon & Transport
AutoZone, Inc. retails and distributes automotive replacement parts and accessories. It offers various products for cars, sport utility vehicles, vans, and light trucks, including new and remanufactured automotive hard parts, maintenance items, accessories, and non-automotive products. The company also provides A/C compressors, batteries and accessories, belts and hoses, calipers, carburetors, chassis, clutches, CV axles, engines, fuel pumps, fuses, ignition and lighting products, mufflers, radiators, thermostats, starters and alternators, and water pumps. In addition, it offers maintenance products comprising antifreeze and windshield washer fluids; brake drums, rotors, shoes, and pads; brake and power steering fluids, and oil and fuel additives; oil and transmission fluids; oil, air, fuel, and transmission filters; oxygen sensors; paints and accessories; refrigerants and accessories; shock absorbers and struts; spark plugs and wires; and windshield wipers, as well as discretionary products, such as air fresheners, cell phone accessories, drinks and snacks, floor mats and seat covers, interior and exterior accessories, mirrors, performance products, protectants and cleaners, sealants and adhesives, steering wheel covers, stereos and radios, tools, and wash and wax products. Further, the company provides a sales program that offers commercial credit and delivery of parts and other products. Additionally, it sells automotive diagnostic and repair software under the ALLDATA brand through alldata.com and alldatadiy.com; automotive hard parts, maintenance items, accessories, and non-automotive products through autozone.com; and accessories, performance, and replacement parts through autoanything.com. As of February 28, 2017, the company operated 5,346 stores in the United States, including Puerto Rico; 491 stores in Mexico; 9 stores in Brazil; and 26 Interamerican Motor Corporation branches. AutoZone, Inc. was founded in 1979 and is based in Memphis, Tennessee.
2021-12-07 12:55:00

MEMPHIS, Tenn., Dec. 07, 2021 (GLOBE NEWSWIRE) -- AutoZone, Inc. (NYSE: AZO) today reported net sales of $3.7 billion for its first quarter (12 weeks) ended November 20, 2021, an increase of 16.3% from the first quarter of fiscal 2021 (12 weeks). Domestic same store sales, or sales for stores open at least one year, increased 13.6% for the quarter.

“Our strong sales and earnings this first quarter are a continuing testament to our AutoZoners’ commitment to going the extra mile for our customers. Our retail and commercial sales performance were consistently strong all quarter. Our commercial business growth continues to be exceptionally strong at 29.4% as the investments we are making are positioning us well in the marketplace. We are optimistic about our growth prospects for the balance of the fiscal year,” said Bill Rhodes, Chairman, President and Chief Executive Officer.

For the quarter, gross profit, as a percentage of sales, was 52.5%, a decrease of 65 basis points versus the prior year. The decrease in gross margin was primarily driven by initiatives to accelerate Commercial business growth. Operating expenses, as a percentage of sales, was 31.9% versus 33.6% last year. The decrease in operating expenses, as a percentage of sales, was driven by strong sales growth.

Operating profit increased 22.6% to $754.5 million. Net income for the quarter increased 25.5% over the same period last year to $555.2 million, while diluted earnings per share increased 38.1% to $25.69 from $18.61 in the year-ago quarter. The increase in net income was driven by strong topline growth and operating expense leverage.

Under its share repurchase program, AutoZone repurchased 515 thousand shares of its common stock for $900 million during the first quarter, at an average price of $1,749 per share. At the end of the first quarter, the Company had $1.018 billion remaining under its current share repurchase authorization.

The Company’s inventory increased 3.0% over the same period last year, driven by new stores. Net inventory, defined as merchandise inventories less accounts payable, on a per store basis, was negative $207 thousand versus negative $99 thousand last year and negative $203 thousand last quarter.

“While the COVID-19 pandemic continues to impact our customers’ and AutoZoners’ lives, our primary focus remains the well-being and safety of our customers and AutoZoners. We will continue to invest to make our stores the best and safest place to shop for everyone’s automotive needs. During these unique and challenging times, we will strive to deliver the best customer service possible. As we continue to prudently invest capital in our business, we remain committed to our long-term, disciplined, approach of increasing operating earnings and cash flow while utilizing our balance sheet effectively,” said Rhodes.

During the quarter ended November 20, 2021, AutoZone opened 15 new stores in the U.S., two stores in Mexico and one store in Brazil. As of November 20, 2021, the Company had 6,066 stores in the U.S., 666 in Mexico and 53 in Brazil for a total store count of 6,785.

AutoZone is the leading retailer, and a leading distributor, of automotive replacement parts and accessories in the Americas. Each store carries an extensive product line for cars, sport utility vehicles, vans and light trucks, including new and remanufactured automotive hard parts, maintenance items, accessories, and non-automotive products. Many stores also have a commercial sales program that provides commercial credit and prompt delivery of parts and other products to local, regional and national repair garages, dealers, service stations and public sector accounts. We also have commercial programs in all stores in Mexico and Brazil. AutoZone also sells the ALLDATA brand automotive diagnostic, repair and shop management software through www.alldata.com. Additionally, we sell automotive hard parts, maintenance items, accessories and non-automotive products through www.autozone.com, and our commercial customers can make purchases through www.autozonepro.com. We also provide product information on our Duralast branded products through www.duralastparts.com. AutoZone does not derive revenue from automotive repair or installation.

AutoZone will host a conference call this morning, Tuesday, December 7, 2021, beginning at 10:00 a.m. (EST) to discuss its first quarter results. This call is being web cast and can be accessed, along with supporting slides, at AutoZone’s website at www.autozone.com and clicking on Investor Relations. Investors may also listen to the call by dialing (888) 506-0062. In addition, a telephone replay will be available by dialing (877) 481-4010, replay passcode 43768 through December 21, 2021.

This release includes certain financial information not derived in accordance with generally accepted accounting principles (“GAAP”). These non-GAAP measures include adjustments to reflect return on invested capital, adjusted debt and adjusted debt to EBITDAR. The Company believes that the presentation of these non-GAAP measures provides information that is useful to investors as it indicates more clearly the Company’s comparative year-to-year operating results, but this information should not be considered a substitute for any measures derived in accordance with GAAP. Management targets the Company’s capital structure in order to maintain its investment grade credit ratings. The Company believes this is important information for the management of its debt levels and share repurchases. We have included a reconciliation of this additional information to the most comparable GAAP measures in the accompanying reconciliation tables.

Certain statements contained in this press release constitute forward-looking statements that are subject to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements typically use words such as “believe,” “anticipate,” “should,” “intend,” “plan,” “will,” “expect,” “estimate,” “project,” “positioned,” “strategy,” “seek,” “may,” “could” and similar expressions. These are based on assumptions and assessments made by our management in light of experience and perception of historical trends, current conditions, expected future developments and other factors that we believe to be appropriate. These forward-looking statements are subject to a number of risks and uncertainties, including without limitation: product demand; energy prices; weather; competition; credit market conditions; cash flows; access to available and feasible financing; future stock repurchases; the impact of recessionary conditions; consumer debt levels; changes in laws or regulations; risks associated with self-insurance; war and the prospect of war, including terrorist activity; the impact of public health issues, such as the ongoing global coronavirus pandemic; inflation; the ability to hire, train and retain qualified employees; construction delays; the compromising of confidentiality, availability or integrity of information, including due to cyber-attacks; historic growth rate sustainability; downgrade of our credit ratings; damage to our reputation; challenges in international markets; failure or interruption of our information technology systems; origin and raw material costs of suppliers; inventory availability; disruption in our supply chain; impact of tariffs; anticipated impact of new accounting standards; and business interruptions. Certain of these risks and uncertainties are discussed in more detail in the “Risk Factors” section contained in Item 1A under Part 1 of the Company’s Annual Report on Form 10-K for the year ended August 28, 2021, and these Risk Factors should be read carefully. Forward-looking statements are not guarantees of future performance, and actual results, developments and business decisions may differ from those contemplated by such forward-looking statements, and events described above and in the “Risk Factors” could materially and adversely affect our business. However, it should be understood that it is not possible to identify or predict all such risks and other factors that could affect these forward-looking statements. Forward-looking statements speak only as of the date made. Except as required by applicable law, we undertake no obligation to update publicly any forward-looking statements, whether as a result of new information, future events or otherwise.

Contact Information:
Financial: Brian Campbell at (901) 495-7005, brian.campbell@autozone.com 
Media: David McKinney at (901) 495-7951, david.mckinney@autozone.com

AutoZone's 1st Quarter Highlights - Fiscal 2022    
Condensed Consolidated Statements of Operations      
1st Quarter, FY2022      
(in thousands, except per share data)      
    GAAP Results  
    12 Weeks Ended 12 Weeks Ended  
    November 20, 2021 November 21, 2020  
Net sales $3,668,904  $3,154,261   
Cost of sales  1,743,744   1,478,644   
Gross profit  1,925,160   1,675,617   
Operating, SG&A expenses  1,170,675   1,060,392   
Operating profit (EBIT)  754,485   615,225   
Interest expense, net  43,284   46,179   
Income before taxes  711,201   569,046   
Income tax expense(1)  155,966   126,613   
Net income $555,235  $442,433   
Net income per share:      
 Basic $26.45  $19.05   
 Diluted $25.69  $18.61   
Weighted average shares outstanding:      
 Basic  20,988   23,223   
 Diluted  21,609   23,778   
(1)The twelve weeks ended November 20, 2021 and the comparable prior year period include $11.3M and $7.6M in tax benefits from stock option exercises, respectively
Selected Balance Sheet Information      
(in thousands)      
    November 20, 2021 November 21, 2020 August 28, 2021
Cash and cash equivalents $961,125  $1,664,005  $1,171,335 
Merchandise inventories  4,768,258   4,628,334   4,639,813 
Current assets  6,349,146   6,836,795   6,415,303 
Property and equipment, net  4,857,928   4,586,002   4,856,891 
Operating lease right-of-use assets  2,717,566   2,607,019   2,718,712 
Total assets  14,460,949   14,568,574   14,516,199 
Accounts payable  6,171,344   5,282,313   6,013,924 
Current liabilities  8,087,893   6,456,703   7,369,754 
Operating lease liabilities, less current portion  2,624,676   2,524,008   2,632,842 
Total debt  5,271,266   5,514,874   5,269,820 
Stockholders' deficit  (2,124,750)  (1,026,980)  (1,797,536)
Working capital  (1,738,747)  380,092   (954,451)

AutoZone's 1st Quarter Highlights - Fiscal 2022    
Condensed Consolidated Statements of Operations       
Adjusted Debt / EBITDAR      
(in thousands, except adjusted debt to EBITDAR ratio) Trailing 4 Quarters  
     November 20, 2021 November 21, 2020  
Net income  $2,283,116  $1,825,067   
Add: Interest expense  192,442   203,601   
Income tax expense  608,229   504,213   
EBIT    3,083,787   2,532,881   
Add: Depreciation and amortization  417,722   397,267   
Rent expense(1)  349,680   332,218   
Share-based expense  59,899   45,347   
EBITDAR  $3,911,088  $3,307,713   
Debt   $5,271,266  $5,514,874   
Financing lease liabilities  274,703   232,921   
Add: Rent x 6(1)  2,098,080   1,993,308   
Adjusted debt  $7,644,049  $7,741,103   
Adjusted debt to EBITDAR  2.0   2.3   
Adjusted Return on Invested Capital (ROIC)      
(in thousands, except ROIC)      
     Trailing 4 Quarters  
     November 20, 2021 November 21, 2020  
Net income  $2,283,116  $1,825,067   
Interest expense  192,442   203,601   
Rent expense(1)  349,680   332,218   
Tax effect(2)   (113,846)  (115,737)  
Adjusted after-tax return $2,711,392  $2,245,149   
Average debt(3) $5,368,050  $5,437,062   
Average stockholders' deficit(3)  (1,647,246)  (1,404,980)  
Add: Rent x 6(1)  2,098,080   1,993,308   
Average financing lease liabilities(3)  247,537   214,601   
Invested capital $6,066,421  $6,239,991   
Adjusted After-Tax ROIC  44.7%  36.0%  
(1) The table below outlines the calculation of rent expense and reconciles rent expense to total lease cost, per ASC 842, the most directly comparable GAAP financial measure, for the trailing four quarters ended November 20, 2021 and November 21, 2020
(in thousands)  Trailing 4 Quarters  
     November 20, 2021 November 21, 2020  
Total lease cost, per ASC 842, for the trailing four quarters $436,488  $413,790   
Less: Financing lease interest and amortization  (61,102)  (56,256)  
Less: Variable operating lease components, related to insurance and common area maintenance
     (25,706)  (25,316)  
Rent expense for the trailing four quarters $349,680  $332,218   
(2) Effective tax rate over trailing four quarters ended November 20, 2021 and November 21, 2020 is 21.0% and 21.6%, respectively  
(3)All averages are computed based on trailing 5 quarter balances  
Other Selected Financial Information      
(in thousands)       
     November 20, 2021 November 21, 2020  
Cumulative share repurchases ($ since fiscal 1998) $26,632,428  $23,032,434   
Remaining share repurchase authorization ($)  1,017,572   117,566   
Cumulative share repurchases (shares since fiscal 1998)  150,803   148,281   
Shares outstanding, end of quarter  20,674   22,855   
Depreciation and amortization  99,590   89,551   
Capital spending  102,269   113,036   

AutoZone's 1st Quarter Highlights - Fiscal 2022        
Selected Operating Highlights           
Condensed Consolidated Statements of Operations         
Store Count & Square Footage           
     12 Weeks Ended  12 Weeks Ended      
     November 20, 2021  November 21, 2020      
 Beginning stores  6,051    5,885       
 Stores opened  15    39       
 Ending domestic stores  6,066    5,924       
 Relocated stores  3    4       
 Stores with commercial programs  5,211    5,043       
 Square footage (in thousands)  39,865    38,823       
 Beginning stores  664    621       
 Stores opened  2    -       
 Ending Mexico stores  666    621       
 Beginning stores  52    43       
 Stores opened  1    2       
 Ending Brazil stores  53    45       
Total     6,785    6,590       
 Square footage (in thousands)  45,214    43,781       
 Square footage per store  6,664    6,644       
Sales Statistics           
($ in thousands, except sales per average square foot)           
     12 Weeks Ended  12 Weeks Ended  Trailing 4 Quarters  Trailing 4 Quarters
Total AutoZone Stores (Domestic, Mexico and Brazil) November 20, 2021  November 21, 2020  November 20, 2021  November 21, 2020
 Sales per average store $532   $472   $2,226   $1,960 
 Sales per average square foot $80   $71   $335   $295 
Total Auto Parts (Domestic, Mexico and Brazil)            
 Total auto parts sales $3,605,508   $3,101,597   $14,885,624   $12,764,287 
 % Increase vs. LY  16.2%   13.1%   16.6%   8.2%
Domestic Commercial            
 Total domestic commercial sales $899,919   $695,343   $3,550,026   $2,801,626 
 % Increase vs. LY  29.4%   11.9%   26.7%   6.2%
 Average sales per program per week $14.4   $11.5   $13.3   $10.8 
 % Increase vs. LY  25.2%   9.2%   23.1%   5.3%
All Other, including ALLDATA           
 All other sales $63,396   $52,664   $258,605   $228,902 
 % Increase vs. LY  20.4%   5.8%   13.0%   4.0%
     12 Weeks Ended  12 Weeks Ended      
     November 20, 2021  November 21, 2020      
Domestic same store sales  13.6%   12.3%      
Inventory Statistics (Total Stores)           
     as of  as of      
     November 20, 2021  November 21, 2020      
 Accounts payable/inventory  129.4%   114.1%      
 ($ in thousands)            
 Inventory  $4,768,258   $4,628,334       
 Inventory per store  703    702       
 Net inventory (net of payables)  (1,403,086)   (653,979)      
 Net inventory / per store  (207)   (99)      
     Trailing 5 Quarters      
     November 20, 2021  November 21, 2020      
 Inventory turns  1.5 x  1.3 x