AutoZone 1Q net income rises, margin improves
MEMPHIS, Tenn. (AP) — AutoZone said Tuesday its profit climbed nearly 7 percent in its fiscal first quarter, helped by an improved profit margin and higher sales. But the auto parts retailer's revenue missed analysts' estimates and its stock dropped in premarket trading.
The company also said that it has reached a deal to buy Auto Anything, an online seller of specialized automotive products based in San Diego. Terms were not disclosed.
Memphis, Tenn.-based AutoZone posted net income of $203.5 million, or $5.41 per share, for the quarter ended Nov. 17. That compares with $191.1 million, or $4.68 per share, in the prior-year period.
The results matched the average forecast of analysts, according to FactSet.
The recent quarter's per-share results got a 43-cent boost from an 8 percent drop in the number of outstanding shares, thanks to company buybacks.
Revenue for the period rose more than 3 percent to $1.99 billion from $1.92 billion last year.
Wall Street predicted higher revenue of $2.02 billion.
Shares of AutoZone fell 9.94, or 2.6 percent, to $368.07, in afternoon trading. The stock has changed hands between $313.11 and $300.10 in the past 52 weeks.
Revenue at stores opens at least a year, a key measure of a retailer's health, edged up 0.2 percent. By excluding results from stores recently opened or closed, this measure gives a picture of growth at ongoing locations.
Gross margin climbed to 51.8 percent from 51.1 percent, as merchandise margins improved on reduced acquisition costs and lower expenses due to theft and loss.
Gross margin, a key gauge of performance, is the amount of each dollar in revenue a company actually keeps.
AutoZone Inc. had 4,703 stores in 49 states, the District of Columbia and Puerto Rico, 325 stores in Mexico and one store in Brazil at the quarter's end.