O’Reilly Automotive, Inc. (the “Company” or “O’Reilly”)
(
Nasdaq: ORLY), a leading
retailer in the automotive aftermarket industry, today announced
record revenue and earnings for its third quarter ended
September 30, 2020.
3rd
Quarter Financial ResultsGreg Johnson, O’Reilly’s
CEO and Co-President, commented, “The COVID-19 pandemic continues
to present a significant challenge to consumers, and our number one
priority continues to be protecting the health and wellness of our
Team Members and customers. We are extremely proud of Team
O’Reilly’s ongoing hard work and dedication to serving each
community where we do business, as well as their ability to deliver
another outstanding quarter while providing excellent customer
service during these difficult times. Our Team’s tireless efforts
resulted in our second consecutive quarter of over 16% comparable
store sales growth. Our DIY business was again a larger contributor
to our comparable store sales growth; however, our professional
business performed very well, again generating comparable store
sales above our expectations during the quarter. We were pleased
with our strong sales performance throughout the third quarter, and
our business has continued to perform very well through the first
three weeks of October, generating robust comparable store sales in
the low double digits.”
Mr. Johnson further commented, “Our Team’s hard
work and commitment to expense control resulted in another
extremely profitable quarter, exemplified by our 22.6% operating
profit margin, which represents a 249 basis point improvement over
the prior year, and a 39.2% increase in diluted earnings per share
to $7.07. Through the first nine months of 2020, we also generated
significant growth in cash provided by operations and free cash
flow, increasing both metrics by over $850 million. We continue to
maintain a cautious approach to managing our operating costs in
these uncertain economic conditions and remain steadfastly focused
on providing the excellent customer service that drives long-term
profitable growth. Finally, we would like to thank all of Team
O’Reilly for your tremendous determination and relentless
dedication to taking care of our customers each day – your
countless contributions are absolutely the driver to our ongoing
success.”
Sales for the third quarter ended
September 30, 2020, increased $541 million, or 20%, to
$3.21 billion from $2.67 billion for the same period one year ago.
Gross profit for the third quarter increased 18% to $1.68 billion
(or 52.4% of sales) from $1.42 billion (or 53.3% of sales) for the
same period one year ago. Selling, general and administrative
expenses (“SG&A”) for the third quarter increased 8% to $955
million (or 29.8% of sales) from $886 million (or 33.2% of sales)
for the same period one year ago. Operating income for the third
quarter increased 35% to $725 million (or 22.6% of sales) from $536
million (or 20.1% of sales) for the same period one year ago.
Net income for the third quarter ended
September 30, 2020, increased $136 million, or 35%, to
$527 million (or 16.4% of sales) from $391 million (or 14.7% of
sales) for the same period one year ago. Diluted earnings per
common share for the third quarter increased 39% to $7.07 on 75
million shares versus $5.08 on 77 million shares for the same
period one year ago.
Year-to-Date Financial
ResultsSales for the first nine months of 2020 increased
$1.11 billion, or 14%, to $8.78 billion from $7.67 billion for the
same period one year ago. Gross profit for the first nine months of
2020 increased 13% to $4.61 billion (or 52.6% of sales) from $4.07
billion (or 53.1% of sales) for the same period one year ago.
SG&A for the first nine months of 2020 increased 5% to $2.73
billion (or 31.1% of sales) from $2.59 billion (or 33.8% of sales)
for the same period one year ago. Operating income for the first
nine months of 2020 increased 27% to $1.89 billion (or 21.5% of
sales) from $1.48 billion (or 19.3% of sales) for the same period
one year ago.
Net income for the first nine months of 2020
increased $293 million, or 28%, to $1.36 billion (or 15.5% of
sales) from $1.07 billion (or 13.9% of sales) for the same period
one year ago. Diluted earnings per common share for the first nine
months of 2020 increased 33% to $18.12 on 75 million shares versus
$13.63 on 78 million shares for the same period one year ago.
3rd
Quarter Comparable Store
Sales ResultsComparable store sales are calculated based
on the change in sales for U.S. stores open at least one year and
exclude sales of specialty machinery, sales to independent parts
stores and sales to Team Members, as well as sales from Leap Day in
the nine months ended September 30, 2020. Online sales, resulting
from ship-to-home orders and pick-up-in-store orders, for U.S.
stores open at least one year, are included in the comparable store
sales calculation. Comparable store sales increased 16.9% for the
third quarter ended September 30, 2020, on top of 5.0%
for the same period one year ago. Comparable store sales increased
10.7% for the nine months ended September 30, 2020, on
top of 3.9% for the same period one year ago.
Share Repurchase ProgramDuring
the third quarter ended September 30, 2020, the Company
repurchased 1.0 million shares of its common stock, at an average
price per share of $458.70, for a total investment of $443 million.
During the first nine months ended of 2020, the Company repurchased
2.6 million shares of its common stock, at an average price per
share of $415.28, for a total investment of $1.09 billion.
Subsequent to the end of the third quarter and through the date of
this release, the Company repurchased an additional 0.7 million
shares of its common stock, at an average price per share of
$458.97, for a total investment of $313 million. The Company has
repurchased a total of 79.5 million shares of its common stock
under its share repurchase program since the inception of the
program in January of 2011 and through the date of this release, at
an average price of $170.92, for a total aggregate investment of
$13.59 billion.
Today, the Company also announced that its Board
of Directors (the “Board”) approved a resolution to increase the
authorization amount under its share repurchase program by an
additional $1.0 billion, raising the aggregate authorization under
the program to $14.75 billion. The additional $1.0 billion
authorization is effective for a three-year period, beginning on
October 28, 2020. Stock repurchases under the program may be made
from time to time, as the Company deems appropriate, solely through
open market repurchases effected through a broker dealer at
prevailing market prices, based on a variety of factors such as
price, corporate requirements and overall market conditions. There
can be no assurance as to the number of shares the Company will
purchase, if any. The share repurchase program may be increased or
otherwise modified, renewed, suspended or terminated by the Company
at any time, without prior notice. As of the date of this release,
the Company had approximately $1.16 billion remaining under its
current share repurchase authorizations.
Continued Suspension of
GuidanceAs previously announced, the Company
withdrew all previously issued 2020 guidance, and given the ongoing
uncertainty related to COVID-19, the Company is not resuming
guidance at this time.
Non-GAAP InformationThis
release contains certain financial information not derived in
accordance with United States generally accepted accounting
principles (“GAAP”). These items include adjusted debt to earnings
before interest, taxes, depreciation, amortization, share-based
compensation and rent (“EBITDAR”) and free cash flow. The Company
does not, nor does it suggest investors should, consider such
non-GAAP financial measures in isolation from, or as a substitute
for, GAAP financial information. The Company believes that the
presentation of adjusted debt to EBITDAR and free cash flow provide
meaningful supplemental information to both management and
investors that is indicative of the Company’s core operations. The
Company has included a reconciliation of this additional
information to the most comparable GAAP measure in the selected
financial information below.
Earnings Conference Call
InformationThe Company will host a conference call on
Thursday, October 29, 2020, at 10:00 a.m. Central Time to discuss
its results as well as future expectations. Investors may listen to
the conference call live on the Company’s website at
www.OReillyAuto.com by clicking on “Investor Relations” and
then “News Room.” Interested analysts are invited to join the call.
The dial-in number for the call is (703) 375-5524; the conference
call identification number is 3669318. A replay of the conference
call will be available on the Company’s website through Thursday,
October 28, 2021.
About O’Reilly Automotive,
Inc.O’Reilly Automotive, Inc. was founded in 1957 by the
O’Reilly family and is one of the largest specialty retailers of
automotive aftermarket parts, tools, supplies, equipment and
accessories in the United States, serving both the do-it-yourself
and professional service provider markets. Visit the Company’s
website at www.OReillyAuto.com for additional information
about O’Reilly, including access to online shopping and current
promotions, store locations, hours and services, employment
opportunities and other programs. As of
September 30, 2020, the Company operated 5,592 stores in
47 U.S. states and 21 stores in Mexico.
Forward-Looking StatementsThe
Company claims the protection of the safe-harbor for
forward-looking statements within the meaning of the Private
Securities Litigation Reform Act of 1995. You can identify these
statements by forward-looking words such as “estimate,” “may,”
“could,” “will,” “believe,” “expect,” “would,” “consider,”
“should,” “anticipate,” “project,” “plan,” “intend” or similar
words. In addition, statements contained within this press release
that are not historical facts are forward-looking statements, such
as statements discussing, among other things, expected growth,
store development, integration and expansion strategy, business
strategies, future revenues and future performance. These
forward-looking statements are based on estimates, projections,
beliefs and assumptions and are not guarantees of future events and
results. Such statements are subject to risks, uncertainties and
assumptions, including, but not limited to, the COVID-19 pandemic
or other public health crisis, the economy in general, inflation,
tariffs, product demand, the market for auto parts, competition,
weather, risks associated with the performance of acquired
businesses, our ability to hire and retain qualified employees,
consumer debt levels, our increased debt levels, credit ratings on
public debt, governmental regulations, information security and
cyber-attacks, terrorist activities, war and the threat of war.
Actual results may materially differ from anticipated results
described or implied in these forward-looking statements. Please
refer to the “Risk Factors” section of the annual report on Form
10-K for the year ended December 31, 2019, and subsequent
Securities and Exchange Commission filings for additional factors
that could materially affect the Company’s financial performance.
Forward-looking statements speak only as of the date they were made
and the Company undertakes no obligation to publicly update any
forward-looking statements, whether as a result of new information,
future events or otherwise, except as required by applicable
law.
For further information contact: |
Investor & Media
Contacts |
|
Mark Merz (417) 829-5878 |
|
Eric Bird (417) 868-4259 |
|
|
O’REILLY AUTOMOTIVE, INC. AND
SUBSIDIARIESCONDENSED CONSOLIDATED BALANCE SHEETS(In
thousands, except share data)
|
|
|
|
|
|
|
|
|
|
|
|
September 30, 2020 |
|
September 30, 2019 |
|
December 31, 2019 |
|
|
(Unaudited) |
|
(Unaudited) |
|
(Note) |
Assets |
|
|
|
|
|
|
|
|
|
Current assets: |
|
|
|
|
|
|
|
|
|
Cash and cash equivalents |
|
$ |
1,627,098 |
|
|
$ |
42,804 |
|
|
$ |
40,406 |
|
Accounts receivable, net |
|
|
243,192 |
|
|
|
224,033 |
|
|
|
214,915 |
|
Amounts receivable from suppliers |
|
|
90,341 |
|
|
|
76,107 |
|
|
|
79,492 |
|
Inventory |
|
|
3,527,495 |
|
|
|
3,348,631 |
|
|
|
3,454,092 |
|
Other current assets |
|
|
45,315 |
|
|
|
32,914 |
|
|
|
44,757 |
|
Total current assets |
|
|
5,533,441 |
|
|
|
3,724,489 |
|
|
|
3,833,662 |
|
|
|
|
|
|
|
|
|
|
|
Property and equipment, at
cost |
|
|
6,497,065 |
|
|
|
6,053,306 |
|
|
|
6,191,427 |
|
Less: accumulated depreciation
and amortization |
|
|
2,424,168 |
|
|
|
2,182,599 |
|
|
|
2,243,224 |
|
Net property and equipment |
|
|
4,072,897 |
|
|
|
3,870,707 |
|
|
|
3,948,203 |
|
|
|
|
|
|
|
|
|
|
|
Operating lease, right-of-use
assets |
|
|
1,913,897 |
|
|
|
1,908,931 |
|
|
|
1,928,369 |
|
Goodwill |
|
|
873,717 |
|
|
|
808,259 |
|
|
|
936,814 |
|
Other assets, net |
|
|
109,999 |
|
|
|
60,338 |
|
|
|
70,112 |
|
Total assets |
|
$ |
12,503,951 |
|
|
$ |
10,372,724 |
|
|
$ |
10,717,160 |
|
|
|
|
|
|
|
|
|
|
|
Liabilities and
shareholders’ equity |
|
|
|
|
|
|
|
|
|
Current liabilities: |
|
|
|
|
|
|
|
|
|
Accounts payable |
|
$ |
4,083,805 |
|
|
$ |
3,606,571 |
|
|
$ |
3,604,722 |
|
Self-insurance reserves |
|
|
91,118 |
|
|
|
75,158 |
|
|
|
79,079 |
|
Accrued payroll |
|
|
127,841 |
|
|
|
104,161 |
|
|
|
100,816 |
|
Accrued benefits and withholdings |
|
|
202,198 |
|
|
|
87,386 |
|
|
|
98,539 |
|
Income taxes payable |
|
|
4,553 |
|
|
|
100,472 |
|
|
|
— |
|
Current portion of operating lease liabilities |
|
|
318,533 |
|
|
|
308,726 |
|
|
|
316,061 |
|
Other current liabilities |
|
|
341,553 |
|
|
|
298,380 |
|
|
|
270,210 |
|
Current portion of long-term debt |
|
|
499,783 |
|
|
|
— |
|
|
|
— |
|
Total current liabilities |
|
|
5,669,384 |
|
|
|
4,580,854 |
|
|
|
4,469,427 |
|
|
|
|
|
|
|
|
|
|
|
Long-term debt |
|
|
4,122,424 |
|
|
|
3,703,628 |
|
|
|
3,890,527 |
|
Operating lease liabilities,
less current portion |
|
|
1,640,646 |
|
|
|
1,642,178 |
|
|
|
1,655,297 |
|
Deferred income taxes |
|
|
174,177 |
|
|
|
117,551 |
|
|
|
133,280 |
|
Other liabilities |
|
|
188,095 |
|
|
|
162,294 |
|
|
|
171,289 |
|
|
|
|
|
|
|
|
|
|
|
Shareholders’ equity: |
|
|
|
|
|
|
|
|
|
Common stock, $0.01 par value: |
|
|
|
|
|
|
|
|
|
Authorized shares – 245,000,000 |
|
|
|
|
|
|
|
|
|
Issued and outstanding shares – |
|
|
|
|
|
|
|
|
|
73,272,379 as of September 30, 2020, |
|
|
|
|
|
|
|
|
|
75,727,781 as of September 30, 2019, and |
|
|
|
|
|
|
|
|
|
75,618,659 as of December 31, 2019 |
|
|
733 |
|
|
|
757 |
|
|
|
756 |
|
Additional paid-in capital |
|
|
1,303,699 |
|
|
|
1,259,544 |
|
|
|
1,280,760 |
|
Retained deficit |
|
|
(578,172 |
) |
|
|
(1,094,082 |
) |
|
|
(889,066 |
) |
Accumulated other comprehensive (loss) income |
|
|
(17,035 |
) |
|
|
— |
|
|
|
4,890 |
|
Total shareholders’
equity |
|
|
709,225 |
|
|
|
166,219 |
|
|
|
397,340 |
|
|
|
|
|
|
|
|
|
|
|
Total liabilities and
shareholders’ equity |
|
$ |
12,503,951 |
|
|
$ |
10,372,724 |
|
|
$ |
10,717,160 |
|
Note: The balance sheet at
December 31, 2019, has been derived from the audited
consolidated financial statements at that date but does not include
all of the information and footnotes required by United States
generally accepted accounting principles for complete financial
statements.
O’REILLY AUTOMOTIVE, INC. AND
SUBSIDIARIESCONDENSED CONSOLIDATED STATEMENTS OF INCOME(In
thousands, except per share data)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For the Three Months Ended |
|
For the Nine Months Ended |
|
|
September 30, |
|
September 30, |
|
|
2020 |
|
2019 |
|
2020 |
|
2019 |
Sales |
|
$ |
3,207,638 |
|
|
$ |
2,666,528 |
|
|
$ |
8,775,720 |
|
|
$ |
7,667,010 |
|
Cost of goods sold, including
warehouse and distribution expenses |
|
|
1,527,170 |
|
|
|
1,243,998 |
|
|
|
4,162,166 |
|
|
|
3,596,903 |
|
Gross profit |
|
|
1,680,468 |
|
|
|
1,422,530 |
|
|
|
4,613,554 |
|
|
|
4,070,107 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Selling, general and
administrative expenses |
|
|
955,455 |
|
|
|
886,167 |
|
|
|
2,728,490 |
|
|
|
2,590,884 |
|
Operating income |
|
|
725,013 |
|
|
|
536,363 |
|
|
|
1,885,064 |
|
|
|
1,479,223 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other income (expense): |
|
|
|
|
|
|
|
|
|
|
|
|
Interest expense |
|
|
(41,668 |
) |
|
|
(35,858 |
) |
|
|
(122,777 |
) |
|
|
(104,687 |
) |
Interest income |
|
|
582 |
|
|
|
656 |
|
|
|
1,892 |
|
|
|
1,813 |
|
Other, net |
|
|
2,479 |
|
|
|
732 |
|
|
|
2,297 |
|
|
|
4,667 |
|
Total other expense |
|
|
(38,607 |
) |
|
|
(34,470 |
) |
|
|
(118,588 |
) |
|
|
(98,207 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Income before income
taxes |
|
|
686,406 |
|
|
|
501,893 |
|
|
|
1,766,476 |
|
|
|
1,381,016 |
|
Provision for income
taxes |
|
|
159,154 |
|
|
|
110,600 |
|
|
|
407,119 |
|
|
|
314,890 |
|
Net income |
|
$ |
527,252 |
|
|
$ |
391,293 |
|
|
$ |
1,359,357 |
|
|
$ |
1,066,126 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings per share-basic: |
|
|
|
|
|
|
|
|
|
|
|
|
Earnings per share |
|
$ |
7.13 |
|
|
$ |
5.14 |
|
|
$ |
18.28 |
|
|
$ |
13.77 |
|
Weighted-average common shares
outstanding – basic |
|
|
73,916 |
|
|
|
76,172 |
|
|
|
74,377 |
|
|
|
77,415 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings per share-assuming
dilution: |
|
|
|
|
|
|
|
|
|
|
|
|
Earnings per share |
|
$ |
7.07 |
|
|
$ |
5.08 |
|
|
$ |
18.12 |
|
|
$ |
13.63 |
|
Weighted-average common shares
outstanding – assuming dilution |
|
|
74,586 |
|
|
|
76,969 |
|
|
|
75,026 |
|
|
|
78,220 |
|
O’REILLY AUTOMOTIVE, INC. AND
SUBSIDIARIESCONDENSED CONSOLIDATED STATEMENTS OF CASH
FLOWS (In thousands)
|
|
|
|
|
|
|
|
|
For the Nine Months Ended |
|
|
September 30, |
|
|
2020 |
|
2019 |
Operating
activities: |
|
|
|
|
|
|
Net income |
|
$ |
1,359,357 |
|
|
$ |
1,066,126 |
|
Adjustments to reconcile net
income to net cash provided by operating activities: |
|
|
|
|
|
|
Depreciation and amortization of property, equipment and
intangibles |
|
|
231,510 |
|
|
|
200,382 |
|
Amortization of debt discount and issuance costs |
|
|
3,300 |
|
|
|
2,898 |
|
Deferred income taxes |
|
|
32,249 |
|
|
|
12,383 |
|
Share-based compensation programs |
|
|
17,062 |
|
|
|
16,578 |
|
Other |
|
|
2,576 |
|
|
|
5,830 |
|
Changes in operating assets and liabilities: |
|
|
|
|
|
|
Accounts receivable |
|
|
(34,970 |
) |
|
|
(38,892 |
) |
Inventory |
|
|
(76,239 |
) |
|
|
(154,986 |
) |
Accounts payable |
|
|
481,431 |
|
|
|
228,943 |
|
Income taxes payable |
|
|
123,581 |
|
|
|
90,383 |
|
Other |
|
|
209,272 |
|
|
|
60,031 |
|
Net cash provided by operating activities |
|
|
2,349,129 |
|
|
|
1,489,676 |
|
|
|
|
|
|
|
|
Investing
activities: |
|
|
|
|
|
|
Purchases of property and
equipment |
|
|
(363,425 |
) |
|
|
(481,207 |
) |
Proceeds from sale of property
and equipment |
|
|
11,690 |
|
|
|
5,479 |
|
Investment in tax credit
equity investments |
|
|
(95,292 |
) |
|
|
(17,988 |
) |
Other |
|
|
(312 |
) |
|
|
661 |
|
Net cash used in investing activities |
|
|
(447,339 |
) |
|
|
(493,055 |
) |
|
|
|
|
|
|
|
Financing
activities: |
|
|
|
|
|
|
Proceeds from borrowings on
revolving credit facility |
|
|
1,162,000 |
|
|
|
2,192,000 |
|
Payments on revolving credit
facility |
|
|
(1,423,000 |
) |
|
|
(2,404,000 |
) |
Proceeds from the issuance of
long-term debt |
|
|
997,515 |
|
|
|
499,955 |
|
Payment of debt issuance
costs |
|
|
(7,779 |
) |
|
|
(3,991 |
) |
Repurchases of common
stock |
|
|
(1,094,000 |
) |
|
|
(1,307,983 |
) |
Net proceeds from issuance of
common stock |
|
|
51,174 |
|
|
|
39,077 |
|
Other |
|
|
(253 |
) |
|
|
(190 |
) |
Net cash used in financing activities |
|
|
(314,343 |
) |
|
|
(985,132 |
) |
|
|
|
|
|
|
|
Effect of exchange rate
changes on cash |
|
|
(755 |
) |
|
|
— |
|
Net increase in cash and cash
equivalents |
|
|
1,586,692 |
|
|
|
11,489 |
|
Cash and cash equivalents at
beginning of the period |
|
|
40,406 |
|
|
|
31,315 |
|
Cash and cash equivalents at
end of the period |
|
$ |
1,627,098 |
|
|
$ |
42,804 |
|
|
|
|
|
|
|
|
Supplemental
disclosures of cash flow information: |
|
|
|
|
|
|
Income taxes paid |
|
$ |
250,484 |
|
|
$ |
218,386 |
|
Interest paid, net of
capitalized interest |
|
|
118,397 |
|
|
|
110,014 |
|
O’REILLY AUTOMOTIVE, INC. AND
SUBSIDIARIESSELECTED FINANCIAL INFORMATION (Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
For the Twelve Months Ended |
|
|
September 30, |
Adjusted
Debt to EBITDAR: |
|
2020 |
|
2019 |
(In thousands,
except adjusted debt to EBITDAR ratio) |
|
|
|
|
|
|
|
|
GAAP debt |
|
$ |
4,622,207 |
|
|
$ |
3,703,628 |
|
Add: |
Letters of credit |
|
|
66,527 |
|
|
|
39,104 |
|
|
Discount on senior notes |
|
|
5,352 |
|
|
|
3,723 |
|
|
Debt issuance costs |
|
|
22,441 |
|
|
|
17,649 |
|
|
Six-times rent expense |
|
|
2,093,556 |
|
|
|
2,005,494 |
|
Adjusted debt |
|
$ |
6,810,083 |
|
|
$ |
5,769,598 |
|
|
|
|
|
|
|
|
|
|
GAAP net
income |
|
$ |
1,684,273 |
|
|
$ |
1,366,483 |
|
Add: |
Interest expense |
|
|
158,065 |
|
|
|
136,155 |
|
|
Provision for income
taxes |
|
|
491,516 |
|
|
|
407,690 |
|
|
Depreciation and
amortization |
|
|
302,003 |
|
|
|
266,001 |
|
|
Share-based compensation
expense |
|
|
22,405 |
|
|
|
21,610 |
|
|
Rent expense (i) |
|
|
348,926 |
|
|
|
334,249 |
|
EBITDAR |
|
$ |
3,007,188 |
|
|
$ |
2,532,188 |
|
|
|
|
|
|
|
|
|
|
Adjusted debt to
EBITDAR |
|
|
2.26 |
|
|
|
2.28 |
|
(i) 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 twelve months ended
September 30, 2020 and for the nine and twelve months
ended September 30, 2019 (in thousands):
|
|
|
|
|
|
Total lease cost,
per ASC 842, for the twelve months ended
September 30, 2020 |
|
$ |
413,314 |
|
Less: |
Variable non-contract
operating lease components, related to property taxes and
insurance, for the twelve months ended
September 30, 2020 |
|
|
64,388 |
|
Rent expense for
the twelve months ended September 30, 2020 |
|
$ |
348,926 |
|
|
|
|
|
|
|
Total lease cost,
per ASC 842, for the nine months ended
September 30, 2019 |
|
$ |
298,185 |
|
Less: |
Variable non-contract
operating lease components, related to property taxes and
insurance, for the nine months ended
September 30, 2019 |
|
|
44,531 |
|
Rent expense for
the nine months ended September 30, 2019 |
|
|
253,654 |
|
Add: |
Rent expense for the three
months ended December 31, 2018, as previously reported
prior to the adoption of ASC 842 |
|
|
80,595 |
|
Rent expense for
the twelve months ended September 30, 2019 |
|
$ |
334,249 |
|
|
|
|
|
|
|
|
|
|
|
|
September 30, |
|
|
2020 |
|
2019 |
Selected Balance Sheet
Ratios: |
|
|
|
|
|
|
|
|
Inventory turnover (1) |
|
|
1.5 |
|
|
|
1.4 |
|
Average inventory per store
(in thousands) (2) |
|
$ |
628 |
|
|
$ |
618 |
|
Accounts payable to inventory
(3) |
|
|
115.8 |
% |
|
|
107.7 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For the Three Months Ended |
|
For the Nine Months Ended |
|
|
|
September 30, |
|
September 30, |
|
|
|
2020 |
|
2019 |
|
2020 |
|
2019 |
Reconciliation of Free Cash Flow (in
thousands): |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net cash provided
by operating activities |
|
$ |
790,051 |
|
|
$ |
642,672 |
|
|
$ |
2,349,129 |
|
|
$ |
1,489,676 |
|
Less: |
Capital expenditures |
|
|
118,954 |
|
|
|
185,599 |
|
|
|
363,425 |
|
|
|
481,207 |
|
|
Excess tax benefit from
share-based compensation payments |
|
|
8,326 |
|
|
|
2,337 |
|
|
|
14,786 |
|
|
|
13,059 |
|
|
Investment in tax credit
equity investments |
|
|
— |
|
|
|
16,271 |
|
|
|
95,292 |
|
|
|
17,988 |
|
Free cash
flow |
|
$ |
662,771 |
|
|
$ |
438,465 |
|
|
$ |
1,875,626 |
|
|
$ |
977,422 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For the Three Months Ended |
|
For the Nine Months Ended |
|
For the Twelve Months Ended |
|
|
September 30, |
|
September 30, |
|
September 30, |
|
|
2020 |
|
2019 |
|
2020 |
|
2019 |
|
2020 |
|
2019 |
Store
Count: |
|
|
|
|
|
|
|
|
|
|
|
|
|
Beginning store count |
|
5,562 |
|
|
5,344 |
|
|
5,439 |
|
|
5,219 |
|
|
5,420 |
|
|
5,190 |
|
New stores opened |
|
36 |
|
|
76 |
|
|
162 |
|
|
183 |
|
|
181 |
|
|
212 |
|
Bennett stores acquired, net
of stores merged (4) |
|
— |
|
|
— |
|
|
— |
|
|
20 |
|
|
— |
|
|
20 |
|
Stores closed |
|
(6 |
) |
|
— |
|
|
(9 |
) |
|
(2 |
) |
|
(9 |
) |
|
(2 |
) |
Ending domestic store
count |
|
5,592 |
|
|
5,420 |
|
|
5,592 |
|
|
5,420 |
|
|
5,592 |
|
|
5,420 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Mexico stores (5) |
|
21 |
|
|
— |
|
|
21 |
|
|
— |
|
|
21 |
|
|
— |
|
Ending total store count |
|
5,613 |
|
|
5,420 |
|
|
5,613 |
|
|
5,420 |
|
|
5,613 |
|
|
5,420 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For the Three Months Ended |
|
For the Twelve Months Ended |
|
|
September 30, |
|
September 30, |
|
|
2020 |
|
2019 |
|
2020 |
|
2019 |
Store and Team Member
Information: (6) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total employment |
|
|
76,027 |
|
|
|
82,163 |
|
|
|
|
|
|
|
|
|
Square footage (in
thousands) |
|
|
41,591 |
|
|
|
40,070 |
|
|
|
|
|
|
|
|
|
Sales per weighted-average
square foot (7) |
|
$ |
76.14 |
|
|
$ |
66.73 |
|
|
$ |
271.62 |
|
|
$ |
253.82 |
|
Sales per weighted-average
store (in thousands) (8) |
|
$ |
566 |
|
|
$ |
493 |
|
|
$ |
2,014 |
|
|
$ |
1,871 |
|
(1) Calculated as cost of goods sold for
the last 12 months divided by average inventory. Average inventory
is calculated as the average of inventory for the trailing four
quarters used in determining the denominator.(2) Calculated as
inventory divided by store count at the end of the reported
period.(3) Calculated as accounts payable divided by
inventory.(4) O’Reilly acquired 33 Bennett Auto Supply, Inc.
(“Bennett”) stores after the close of business on December 31,
2018, which were not included in the December 31, 2018, store
count, as they were not operated by the Company for any portion of
2018. During the first quarter ended March 31, 2019, O’Reilly
merged eight of the acquired Bennett stores into existing O’Reilly
locations, and during the second quarter ended June 30, 2019,
O’Reilly merged an additional five acquired Bennett stores into
existing O’Reilly locations.(5) O’Reilly acquired Mayoreo de
Autopartes y Aceites, S.A. de C.V. (“Mayasa”), headquartered in
Guadalajara, Jalisco, Mexico, after the close of business on
November 29, 2019.(6) Represents O’Reilly’s U.S. operations
only.(7) Calculated as sales less jobber sales, divided by
weighted-average square footage. Weighted-average square footage is
determined by weighting store square footage based on the
approximate dates of store openings, acquisitions, expansions or
closures.(8) Calculated as sales less jobber sales, divided by
weighted-average stores. Weighted-average stores is determined by
weighting stores based on their approximate dates of openings,
acquisitions or closures.
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