UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of report (Date of earliest event reported): July 26, 2005
O'REILLY AUTOMOTIVE, INC.
(Exact Name of Registrant as Specified in Its Charter)
Missouri 44-0618012
- --------------------------------------------------------------------------------
(State or Other Jurisdiction (IRS Employer Identification No.)
of Incorporation)
233 S. Patterson
Springfield, Missouri 65802
- --------------------------------------------------------------------------------
(Address of Principal Executive Offices)(Zip Code)
417-862-6708
- --------------------------------------------------------------------------------
(Registrant's Telephone Number, Including Area Code)
(Not Applicable)
- --------------------------------------------------------------------------------
(Former name or former address, if changed since last report.)
Check the appropriate box below if the Form 8-K filing is intended to
simultaneously satisfy the filing obligation of the registrant under any of the
following provisions (see General Instruction A.2):
[_] Written communications pursuant to Rule 425 under the Securities Act (17
CFR 230.425)
[_] Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12)
[_] Pre-commencement communications pursuant to Rule 14d-2(b) under the
Exchange Act (17 CFR 240.14d-d(b))
[_] Pre-commencement communications pursuant to Rule 13e-4(c) under the
Exchange Act (17 CFR 240-13e-4(c))
Section 2 - Financial Information
Item 2.02 Results of Operations and Financial Condition.
On July 26, 2005, O'Reilly Automotive, Inc. issued a press release announcing
second quarter earnings. The text of the press release is attached hereto as
Exhibit 99.1.
Section 7 - Regulation FD
ITEM 7.01. REGULATION FD DISCLOSURE
On July 26, 2005, O'Reilly Automotive, Inc. issued a press release announcing
second quarter earnings. The text of the press release is attached hereto as
Exhibit 99.1.
Section 9 - Financial Statements and Exhibits
Item 9.01 Financial Statements and Exhibits
Exhibit
Number Description
- ------ -----------------------------------------------------------------
99.1 Press Release dated July 26, 2005
The information in this Current Report on Form 8-K, including the exhibit
hereto, shall not be deemed "filed" for the purposes of Section 18 of the
Securities Exchange Act of 1934, as amended, or otherwise subject to the
liabilities of that section, nor shall it be deemed incorporated by reference in
any filing under the Securities Act of 1933, as amended.
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
Date: July 29, 2005
O'REILLY AUTOMOTIVE, INC.
By:/s/ James R. Batten
-------------------------------------------
James R. Batten
Executive Vice President of Finance
Chief Financial Officer and Treasurer
(principal financial officer)
FOR IMMEDIATE RELEASE
For further information contact: Greg Henslee
Jim Batten
(417) 862-3333
________________________________________________________________________________
O'REILLY AUTOMOTIVE, INC. REPORTS RECORD
2005 SECOND QUARTER RESULTS
9.6% INCREASE IN COMPARABLE STORE PRODUCT SALES
26.7% INCREASE IN EARNINGS PER SHARE
________________________________________________________________________________
Springfield, MO, July 26, 2005 -- O'Reilly Automotive, Inc. ("O'Reilly" or "the
Company") (Nasdaq: ORLY) today announced record revenues and earnings for the
second quarter of 2005, representing 47 quarters of record revenues and earnings
for O'Reilly since becoming a public company in April 1993.
Net income, before cumulative effect of accounting change, for the second
quarter ended June 30, 2005, totaled $42.9 million, up 27.3% from $33.7 million
for the same period in 2004. Diluted earnings per common share, before
cumulative effect of accounting change, for the second quarter of 2005 increased
26.7% to $0.38 on 113.1 million shares compared to $0.30 for the second quarter
of 2004 on 111.4 million shares.
Product sales for the three months ended June 30, 2005, totaled $521.2 million,
up 19.8% from $435.2 million for the same period a year ago. Gross profit for
the second quarter of 2005 increased to $229.0 million (or 43.9% of product
sales) from $189.4 million (or 43.5% of product sales) for the second quarter of
2004, representing an increase of 20.9%. Operating, Selling, General and
Administrative ("OSG&A") expenses increased to $160.8 million (or 30.9% of
product sales) for the second quarter of 2005 from $135.2 million (or 31.1% of
product sales) for the second quarter of 2004, representing an increase of
18.9%.
Net income, before cumulative effect of accounting change, for the first six
months of 2005 totaled $76.1 million, up 24.8% from $61.0 million for the same
period a year ago. Diluted earnings per common share, before cumulative effect
of accounting change, for the first six months of 2005 increased 21.8% to $0.67
on 112.8 million shares compared to $0.55 a year ago on 111.1 million shares.
Product sales for the first six months of 2005 totaled $987.4 million, up 17.8%
from $838.5 million for the same period a year ago. Gross profit for the first
six months of 2005 increased to $425.1 million (or 43.1% of product sales) from
$359.0 million (or 42.8% of product sales) for the same period a year ago,
representing an increase of 18.4%. OSG&A expenses increased to $303.4 million
(or 30.7% of product sales) for the first six months of 2005 from $260.8 million
(or 31.1% of product sales) for the same period a year ago, representing an
increase of 16.3%.
Comparable store product sales for stores open at least one year increased 9.6%
and 8.4% for the second quarter and first six months of 2005 respectively.
On June 15, 2005, the Company issued dividend payments for all shareholders as
of record on May 31, 2005, for a two-for-one stock split that was announced on
May 24, 2005.
"We're very proud of Team O'Reilly's outstanding second quarter performance. The
9.6% comparable store product sales increase was the result of the outstanding
efforts of each team member to give every customer the best service in our
business," said Greg Henslee, CEO and Co-President.
"In addition to opening 41 stores during the quarter, we successfully closed our
acquisition of Midwest Auto Parts which included 72 stores and 2 distribution
centers in St. Paul, Minnesota, and Billings, Montana. We look forward to
working with our new team members to grow the business in that region," said Ted
Wise, COO and Co-President.
The Company will host a conference call Wednesday, July 27, 2005, at 10:00 a.m.
central time to discuss its results, as well as future expectations. Interested
parties may listen to the conference call live on the Company's web site,
www.oreillyauto.com, by clicking "News." A replay will also be available on the
web site shortly after the call.
O'Reilly Automotive, Inc. 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 installer
markets. Founded in 1957 by the O'Reilly family, the Company operated 1,399
stores within the states of Alabama, Arkansas, Florida, Georgia, Illinois,
Indiana, Iowa, Kansas, Kentucky, Louisiana, Minnesota, Mississippi, Missouri,
Montana, Nebraska, North Carolina, North Dakota, Oklahoma, South Carolina, South
Dakota, Tennessee, Texas, Virginia, Wisconsin and Wyoming as of June 30, 2005.
The Company claims the protection of the safe-harbor for forward-looking
statements within the meaning of the Private Securities Litigation Reform Act of
1995. These statements can be identified by forward-looking words such as
"expect," "believe," "anticipate," "good," "plan," "intend," "estimate,"
"project," "will" 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 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, competition, product demand, the market for auto
parts, the economy in general, inflation, consumer debt levels, governmental
approvals, our ability to hire and retain qualified employees, risks associated
with the integration of acquired businesses, weather, 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 sections of the Company's Form 10-K for the year ended
December 31, 2004, for more details.
<page>
O'REILLY AUTOMOTIVE, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
<table>
<caption>
June 30, December 31,
2005 2004
------------ ------------
(Unaudited) (Note)
(In thousands, except
share data)
Assets
Current assets:
Cash and cash equivalents $ 36,452 $ 69,028
Accounts receivable, net 75,481 60,928
Amounts receivable from vendors, net 47,304 52,976
Inventory 695,842 625,320
Other current assets 13,093 5,225
------------ ------------
Total current assets 868,172 813,477
Property and equipment, at cost 895,448 791,794
Accumulated depreciation and amortization 248,527 224,301
------------ -------------
Net property and equipment 646,921 567,493
Notes receivable, less current portion 31,290 21,690
Other assets, net 61,726 29,697
------------ ------------
Total assets $ 1,608,109 $ 1,432,357
============ ============
Liabilities and shareholders' equity
Current liabilities:
Income taxes payable $ 29,379 $ 9,736
Accounts payable 272,100 240,548
Accrued payroll 16,884 15,130
Accrued benefits and withholdings 43,596 35,794
Deferred income taxes 5,209 7,198
Other current liabilities 51,946 24,817
Current portion of long-term debt 75,587 592
------------ ------------
Total current liabilities 494,701 333,815
Long-term debt, less current portion 25,471 100,322
Deferred income taxes 31,353 38,440
Other liabilities 12,998 11,963
Shareholders' equity:
Common stock, $0.01 par value:
Authorized shares - 250,000,000
Issued and outstanding shares -
111,816,886 at June 30, 2005,
and 55,377,130 at December 31, 2004 1,118 554
Additional paid-in capital 346,278 326,650
Retained earnings 696,190 620,613
------------ ------------
Total shareholders' equity 1,043,586 947,817
------------ ------------
Total liabilities and shareholders' equity $ 1,608,109 $ 1,432,357
============ ============
</table>
Note: The balance sheet at December 31, 2004, has been derived from the audited
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.
<page>
O'REILLY AUTOMOTIVE, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(Unaudited)
<table>
<caption>
Three Months Ended Six Months Ended
June 30, June 30,
-------------------- --------------------
2005 2004 2005 2004
--------- --------- --------- ---------
(In thousands, except per share data)
Product sales $ 521,209 $ 435,167 $ 987,448 $ 838,461
Cost of goods sold, including warehouse
and distribution expenses 292,239 245,732 562,309 479,433
--------- --------- --------- ---------
Gross profit 228,970 189,435 425,139 359,028
Operating, selling, general and
administrative expenses 160,843 135,193 303,431 260,759
--------- --------- --------- ---------
Operating income 68,127 54,242 121,708 98,269
Other income (expense), net 195 (438) (473) (884)
--------- --------- --------- ---------
Income before income taxes and cumulative
effect of accounting change 68,322 53,804 121,235 97,385
Provision for income taxes 25,399 20,109 45,099 36,405
--------- --------- --------- ---------
Income before cumulative effect
of accounting change 42,923 33,695 76,136 60,980
Cumulative effect of accounting
change, net of tax - - - 21,892
--------- --------- --------- ---------
Net income $ 42,923 $ 33,695 $ 76,136 $ 82,872
========= ========= ========= =========
Net income per common share: (1)
Income before cumulative effect
of accounting change $ 0.39 $ 0.31 $ 0.68 $ 0.56
Cumulative effect of accounting
change, net of tax - - - 0.20
--------- --------- --------- ---------
Net income $ 0.39 $ 0.31 $ 0.68 $ 0.76
========= ========= ========= =========
Net income per common share -
assuming dilution: (1)
Income before cumulative effect
of accounting change $ 0.38 $ 0.30 $ 0.67 $ 0.55
Cumulative effect of accounting
change, net of tax - - - 0.20
--------- --------- --------- ---------
Net income $ 0.38 $ 0.30 $ 0.67 $ 0.75
========= ========= ========= =========
Weighted-average common shares
outstanding - basic (1) 111,448 109,868 111,174 109,627
========= ========= ========= =========
Adjusted weighted-average common shares
outstanding - assuming dilution (1) 113,138 111,441 112,827 111,101
========= ========= ========= =========
<fn>
(1) On June 15, 2005, the Company completed a two-for-one split of its common
stock. All share and per share amounts for the periods presented have been
adjusted to reflect the effect of the stock split.
</fn>
</table>
<page>
O'REILLY AUTOMOTIVE, INC. AND SUBSIDIARIES
SELECTED FINANCIAL INFORMATION
(Unaudited)
<table>
<caption>
June 30,
2005 2004
------- -------
Inventory turnover (1) 1.7 1.7
Inventory turnover, net of payables (2) 2.7 2.5
AP to inventory (3) 39.1% 38.8%
Debt-to-capital (4) 8.8% 10.3%
Return on equity (5) 13.8% 14.4%
Return on assets (6) 9.0% 9.3%
Square footage (in thousands) (7) 8,860 7,768
Store count:
New stores, net (three months ended) (8) 113 38
Total stores 1,399 1,170
Total employment 19,426 17,203
<caption>
Three Months Ended
June 30,
-------------------
2005 2004
-------- --------
Other information (in thousands):
Capital expenditures $ 56,924 $ 41,669
Depreciation & amortization $ 13,768 $ 11,670
Interest expense $ 1,034 $ 975
Lease & rental expense $ 10,615 $ 8,833
Sales per weighted-average square foot (9) $ 58.21 $ 55.98
Sales per weighted-average
store (in thousands) (10) $ 388 $ 371
<fn>
(1) Calculated as cost of sales for the last 12 months divided by average
inventory. Average inventory is calculated as the simple average of
beginning and ending inventory for the same period used in determining the
numerator.
(2) Calculated as cost of sales divided by average inventory less accounts
payable. Average inventory is calculated as the simple average of beginning
and ending inventory for the same period used in determining the numerator.
(3) Accounts payable divided by inventory.
(4) The sum of long-term debt and current portion of long-term debt, divided by
the sum of long-term debt, current portion of long-term debt and total
shareholders' equity.
(5) Last 12 months net income divided by average shareholders' equity. Average
shareholders' equity is calculated by taking a simple average of the
beginning and ending shareholders' equity for the same period used in
determining the numerator.
(6) Last 12 months net income divided by average total assets. Average total
assets is calculated by taking a simple average of the beginning and ending
total assets for the same period used in determining the numerator.
(7) Square footage calculation excludes stores acquired with Midwest Auto
Parts.
(8) Net new stores includes 72 new stores acquired with Midwest Auto Parts.
(9) Total sales less jobber sales, divided by weighted-average square feet.
Weighted-average sales per square foot is weighted to consider the
approximate dates of store openings or expansions. This calculation
excludes stores acquired with Midwest Auto Parts.
(10) Total sales less jobber sales, divided by weighted-average stores.
Weighted-average sales per store is weighted to consider the approximate
dates of store openings or expansions. This calculation excludes stores
acquired with Midwest Auto Parts.
</fn>
</table>