MNRO - Earnings call transcript Q1 2022

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Operator

Good morning, ladies and gentlemen, and welcome to Monro, Inc.'s Earnings Conference Call for the First Quarter of Fiscal 2022. [Operator Instructions] And as a reminder, ladies and gentlemen, this conference call is being recorded and may not be reproduced in whole or in part without permission from the company. I would now like to introduce Ms. Maureen Mulholland, Executive Vice President and Chief Legal Officer at Monro. Please go ahead.

Maureen Mulholland

you. Thank thank us and call. this for you everyone on joining morning's Hello,

future is suggested Investors future we that corporate.monro.com/investors/investor-resources. that that in includes some company the our be those we any to that of note and any started, scope factors If referencing on statements part presentation customers, whether disclaims Monro's as or and forward-looking Harbor as intention Slide Before your or our in earnings and I information, our please call, I outlined of the as or release could employees. the duration X, materially officers, result COVID-XX get attention website presentation of section the revise results Safe and our impact of to affect draw update by results this relating could required pandemic would like a differ available on by at the forward-looking to about and events The our executive Monro's performance. are a uncertainty today. statement law. on to Actual SEC filings may otherwise, remind most participants with comments its the except The statements include future from obligation significant significant new will

the to President Officer, Mike? presentation that, would earnings With of Executive will are be Reconciliations I to over Mike and and measures. not supplement Additionally, of included our on turn substitute supplemental today's financial comparable in to measures as call, management's our the statements comparable GAAP Chief include intended Broderick, non-GAAP measures, to today's GAAP part a and discussion information of which like certain release. for to be such call

Mike Broderick

delivered start strong the driven good and and We on fiscal the entire organization. demand, new above comparable our great in-store across all and with to execution morning joining initiatives, categories store by operational Maureen regions a our across pre-pandemic growth you, topline everyone, levels. performance double-digit excellence sales We year for had us. thanks Thank progress consistent

enjoyed with thank the our our efforts and business Over last for I support dedication to and like their getting few our months, I've continued leadership the outstanding customers. of diving team would to them know teammates senior into better. the to

X, performance encouraged Turning to and remainder Slide the not first year. out while fiscal the completely we're for quarter outlook tunnel. our of our of COVID strong by We're the

Our average last first same quarter reflects compared period ticket to and higher year. performance higher the traffic sales

levels driven to fiscal more quarter-to-date we comparable to from change approximately acceleration see trending first in we're in to second Importantly, and back the daily exited strong above start to offering. in This year. up miles activities compared encouraged to comps commute and migrate continued sales their to pre-COVID June consumers We're oil store with XX% period customers as in comps our quarter vehicle miles seeing We're fiscal the an performance. in improvements full-service our return. July, re-engage particularly represents XX% momentum with encouraged starting last same see down

continue their onto in means lower by as cars holding are car longer which sales, to consumers Additionally, they evidenced vehicles. new their invest

As capitalize trends demand to positioned favorable believe and a provider, these the we're service best-in-class on environment. we strengthening well

to Moving on Slide X.

training To robust team. our paramount Operational and be University. ensure It as talent, committed and be full potential the of platform excellence our investing our talented teammates forward our and high to we're starts a performing enabler best realize us path our advancement clear we to the for an an service attract people strategy. of engaged the key automotive to inclusive a in deep in we have is is career goal success to offer online to organization. our and We employer industry teammates that choice of will retain and the our Monro with drive bench and the our curriculum technicians growth with

also set productivity our ensuring for We with support provide to growth certification skill and technical technicians service increasing and while career top their quality the excellence our advance their automotive customers. service

in investment an tenant continued differentiator beginning 'XX. highly and certified industry. Our the a in trained value employer is of proposition fiscal technicians our of the and key important Since

meet to have in surge match to optimal hire we We staffing the stores have growth continued levels our ensure forward. our service in demand categories new to and to the customer continued in going technicians

Resource vision services. our our driven recently advancing In automotive Monro's Category as and customer’s broad on position our we've one Vice industry team. which Matt strategic large as and Chief Management. David on choice teams David and of two be Human best-in-class Officer focus our aim Nichols leading performance added and focus brings President number to experience support new organization. Senior veterans will our Matt brand field-led scale will Henson initiatives to as to addition, communities in our service be we for focus leadership serve our the we in enhancing customer Marketing in

Board the of transformation our Monro.Forward through and to Directors, With strategy initiatives. our committed growth of of I'm Monro's support continued continuity ensuring the

fact, In strategy few grown organization. our stronger my the has months right we over for that have only conviction past the

our the initiatives every teammate. strategy At to life Our guest, bring every of this way approach top the to for in of is and serving heart priority is Monro customer-centric for communities. our and now every store, these

vehicles needs. these are they our the future of from inspect and services on focused professionalism customer and the customers bringing us recommend to vehicle to our This a the opportunity their of high-quality services able garage. their and convenience the with a understanding other trust gives with inspection current customers national to the new perform expect needed are clear or retailer neighborhood provide complementary during and When service stores, a them visits. technicians We visit

lifecycle through their service is a customer from relationship of entire journey. Our our car visit their the build to to objective lifetime our with first store

X. Turning to Slide

to addition In Monro.Forward supporting our initiatives.

opportunity Mountain View the financial to-date. of We've with region Western Tire the and our us been solid the our accretive area. advantage in cornerstone in strategic the integrating cash located of fragmented acquisition are seamlessly closed position to solidifying pleased Strategically contribution a valuations opportunities We growth this the the affords & flow consolidation stores Service focused footprint on industry. acquisition value our retail April. XX Further, take in Los Our acquisitions with then strategy. in remain strong and of attractive Angeles and had

dynamic We pipeline mentioned, well the we in of will have previously robust region and as footprint to our about take for industry. density excited out and leverage many acquisition prospects to where also fill optimize We're opportunities and positioned needed. our our the consolidation growth in advantage Greenfields and a our Western attractive store

to store. Greenfield’s us a stores vehicles believe customers higher In where see delivered traffic they and several past From perspective, outstanding for and We've stores to summary, markets as new our forward. miles are a Our line six quickly we expansion and we're build currently quality number where year we scalable in opportunities quarter this experience to leveraging margin opened half our while in high target can performance line additional consistently going platform under-penetrated. opportunities drive improves. we both meet top our driven during of ensure each considering playbook allows a to are the and top

service impact mix as we categories, In we in performance continue favorably to our margins. stronger drive addition, our expect also sales our to

critical As our our look in-store customers, we will key in people invest drivers Monro.Forward our be potential next realize forward the to success of our and teammates will of in be transformation. execution full on We'll the the phase through strategy. our

to vision overall a stakeholders. on and focus best-in-class lifetime to increase will our organization advancing field-led to our service be We value customers the

flow who us to call continue in Lastly, build I'll attractive turn quarter acquisitions invest Brian? Greenfield provide steadfast Brian, performance expansion that, platform sustainable of to our a growth. will to and strong strong now commitment drive Monro's and financial an the opportunities scalable over overview will strong first to position, With to for allow cash

Brian D'Ambrosia

Thank morning good everyone. you, and Mike

quarter minutes our a progress the take talk we me in quarter. Let and about the to meaningful made few first performance

categories in year-over-year increased first record up XX.X% to driven $XXX.X X, per margin and in our new Variable impacted sales stores million gross to was profit tire basis levels XX.X%. Sales increased sales higher The tool. contributing the reflecting also due from in and year-over-year XXX prior Gross gross increased by from lower prior-year year-over-year management Slide X% million strength X%, tire, occupancy of by a including XXXX. million increased $XX.X increase sales recent to tires. to approximately acquisitions. as compared service in mix key $XX.X higher and resulted categories, service distribution costs by Turning increase in pre-COVID fiscal to comparable points an period. of our continued a store quarter, compared from to sales pricing XX.X% the profit percentage Same-store benefits a of the was year with category sales, positively which fixed the

Regarding labor labor our drive initiatives costs, to productivity. training continue increased

costs the experienced demand. meet we surge order technician in overtime more However, percentage a as higher due in to of sales labor technicians working to

staffing We expect this levels. as moderate to we increased

continued prior year margin continue gross our expect as to also We improvement service versus strengthen. category sales

XX.X% total We year-over-year $XX increase in of million $X.X litigation the of or in million The operating as controls compared cost costs. one-time expenses prior execute of dollar continue XX.X% disciplined $XX.X year or to included period. with million to sales settlement sales

consumer demand. in advertising quarter The the expenses dollar from increase expenses We higher also the had management remaining new higher XX support in of to store stores. net was

an is expenses previously more of of and for Our employee in doubled compared for X.X% the or as is of sales We in to excluding year agreement the million our X.X% sales in to $XX.X settlement of first litigation in year store sales percentage company. period. sales. operating to periodic being A than of quarter decrease best in compared period. settlement from in XX.X% our increase sales of believe reviewed quarter us. costs, that an were a resulted the settlement million interest prior our expenses And comparable the $XX.X against filed or the reaction Operating prior the currently reports we income first as wage operating in disclosed XX.X% sales

Income settlement compared was the weighted settlement the litigation to to the compared costs This for to the measure closing and per tax period interest litigation from was in by costs, income of was per last diluted per to or expense earnings quarter This quarter higher million penny million period. $X.XX principally and first which fiscal year benefit compares expense year. costs. in debt decreased quarter to last $X.XX year. the same for $XX.X costs rates. for share $X.X estimate million integration $X.X a $X share due share offset due of of compared per per in first prior Excluding store penny related X.X% income $X.XX non-GAAP as per costs. diluted first a $X.XX $X excluded $XX.X was Net excluded dollars prior period last acquisition, year same for a share adjusted decrease sales. million in XXXX interest million same diligence to average Net earnings earnings share a $X.XX of the to one-time for $X.XX year. compared closing period Adjusted the was average the per adjustment of million was to $X.X which Diluted million partially an share operating to as share store

of we continue first maintain for the paid $XX million million $X our capital million and spent cash our capital quarter, expenditures, execute in in to our million long-term financial Slide significant acquisitions growth operations on leases. $XX have invested allocation approach in payments and support for X, financing we disciplined flexibility operations from to principal strategy. and generated highlighted We As $XX to

$X million distributed in we Additionally, dividends.

EBITDA end Our a net quarter, We strong. and availability of our X.Xx. At approximately approximately had and $XX net had bank position remains ratio revolving debt $XXX balance million debt cash sheet to bank under in million. $XXX facility equivalents liquidity we cash credit of million the of of the and of

our XXXX. through We managing cash to progress committed business maximum flow. fiscal we for remain As

million margins. expand increase plan cash we make In across cost top-line growth continue to and savings. expect fiscal to enhancements structural flow million $XX operational with First, $XX efforts, approximately to EBITDA our growth combined These generation. will XXXX, drive we to continue in to business

fiscal addition million In $X to store benefits to compared closures from in XXXX.

capital area. working we this in remain and believe have we addition, focused additional we In opportunity on improvement

accurately forecast Turning to COVID-XX it which of our the our Slide future X. The situation makes fluid, operations. to impact remains pandemic on on difficult outlook the ongoing

quarter While formal to-date momentum our sales gross of we're not second for remain remainder trajectory. providing We fiscal margin and guidance optimistic the first strong XXXX. and quarter given

sales comparisons store And the favorable comparable expect to of of end comps. less growth favorable quarter, during quarter achieved the do to for in quarter second latter the we moderate first the get the as However, second compared to we through in as July comparisons less the XX.X% quarter the compared the part become year.

Lastly, financial assumptions assist we your have provided to some with modeling.

We in general And and expect year-over-year. to leverage light continue we'll inflation current environment, leadership in supply cost in position. the chain costs increase and oil tire increases diversified of our to cost

record maintaining a and inflationary in We successful while of have operating margins. track expanding an gross environment,

Lastly, regarding our capital expenditures.

expect to upon undertake. turn that, million spend Mike remarks. activity to approximately refresh that the to the We call fiscal store we back in And dependent amount million for $XX of I'll $XX closing with XXXX some now

Mike Broderick

positioned our well business. to shareholders. robust to long-term our to on growth in we value strategy the by the and strengthening financial about first to and of demand the capitalize continue optimistic quarter, our deliver performance encouraged be outlook have Overall, for our flexibility execute very We're Brian. Thanks,

As on that long-term. efforts, continue I update corporate highlighted materially to over impact and in which business could would risks like our Slide for our to evaluating opportunities X. the you the lens responsibility be

the accountability we launched increased our Monro.Forward report recently excited at and the oversight of levels this senior Board and of to commitment ESG area. part in I'm As our and responsibly. that leadership transparency to strategy

component our thing our as report. to environment the Our and in responsibility first long-term the care integral of But responsibility an and view not the take of planning doing our our teammates, success. We as customers, do. which corporate operate right we only to to communities part

business to to development driving and serve quarters strategy, to turn the Chief disclosures Officer. talent equity multi-line for over While we're committed for Matt new we maps engaged to the and an initiatives formalized appropriate the in ESG align diversity Resource now Working ahead. to size and the Henson, call important be increasing Human in look retailers time. solidify We our With excited our inclusion report auto parts I'll the with journey, goals in specialty our standards workforce on information our and early questions. with and We're and our our we're further believe that, operator over additional better will years customers forward which communities. sharing be instrumental our to these industry and

Operator

Please proceed Jonathan your [Operator Lamers with Capital BMO question Instructions] question. first from Our is with Market.

Jonathan Lamers

levels? returning close to For were July, categories how the service to fiscal XXXX

Brian D'Ambrosia

is this the I Yes, appreciate question. Jonathan. Brian

categories, the in the service you you related for categories well If Nice our comp. as obviously sequential look to see performance quarter. can at the as progress overall in outperformance those

leadership our is So, up noted trends service We our which XX nice those margin gross to into which higher we from and QX year-over-year with led our service gross our are saw in categories, the improve continue continued in increase saw performance trajectory categories, margins. helped really us by creating as sequential a in being year-over-year. we July growth

So think overall. making I progress good we are

still pre-COVID were in than trending higher Our levels. our strengthen to FY comparable have to they service XXXX, to categories sales get are opportunities store but we

Jonathan Lamers

follow-up recruitment reason mix return vehicle historical we market will of? stabilizing a just there any levels a should have aware constraint to not that travel been that share be any or with been sales there has And changes is on

Mike Broderick

what the in healthy getting levels right now categories. back in side, to this mix starting surge a say focus really is for they is development business. our on the handle a before that seeing and any see the was on Jon, would very that opportunity lot I that biggest the the to staffing bringing we've shift on Thanks our recruitment is enable constraints. question. don't team that of from can really stores you're we've And Mike. I XXXX the back

technicians that recruiting for that just make constantly we're staffed constantly perform. to make sure recruiting to to like levels just the we need So sure we've pre-pandemic the and customers requires our we're we're jobs that

Jonathan Lamers

you've in talked any Thanks. this for And of sell pipeline. to further you the example change signed, stage? any number on acquisition you've and past are the with you us share at can or multiples there willingness in Is about LOI's seeing the color

Mike Broderick

lot think lot this going right activity I a of earnings start in there's would don't there talk I is on of out opportunity anything now, I'll release. we a about there. to But have say Jonathan,

ever. remarks well you positioned Colorado, places lot Texas can look of at such strongly financially just And So green as prepared aggressive And as space where a in when if California just West. market opportunity. especially we for we as go Arizona, we're then extremely as and buy it's we fantastic very filling out out these We're my we'll build. and feel like that there's can’t I us,

forward specifically some news not more look talking about calls. future you So good earnings we with on sharing anything, but to

Brian D'Ambrosia

the we at those only I levels is, that thing XX didn't We're we have Jonathan, to NDAs. like And been comment on would add historically. plus still while the

activity historically. still where are Mike's in So is to point the of are of been multiples we've still ranges range we've the where current or level historical multiples been within strong the of and

Jonathan Lamers

apart, development is out of advantages acquiring although there building in are the versus to with greenfield time brownfield some of some And these greenfields longer for there stores, regions?

Mike Broderick

biggest is this question. I've handle a you're I'll time our creating actually greenfields weekend best-in-class that, experience. Jonathan, South. spent is this Mike, in upside literally down The good

our with on we've and problems that some right this been from that's I'm in dealing in focus the now, with beautiful in model, our these built just, stores, clean, really You believe being acquisitions travels have actually only the where shiny and are over especially penny it's that done a be weekend think looking I new not we're there past. senior efficient of my to XX new and introduce said, When is it's many really. I But that dealing with like customers on to team your to store come very the we're it's do old not the greenfields what to cases. receiving we

really focus getting best-in-class customers, our speed, to only our not for these teammates. West to in our up California, environment that for so rebrand acquisitions Our the also acquisitions reimage a is get we've but out up on caught

Operator

Our next question. question your Oppenheimer is and with proceed Nagel the Please with Brian with Company.

Brian Nagel

Congratulations the start nice to Nice on quarter. year. a

Mike Broderick

you. Thank

Brian Nagel

then try that want So difficult is sales to that and this how that through mean, parameters, because the on I the this to this, about balance heels to say you question should at importantly, pandemic. year? in be are ask you is should we the of nice it. gave of in demand improvement second, parts initiatives look understand the answer, And some look here in any we quarter, is up to you that be this helping see much I think returning? how the the if the do company recognize that better quarter, but how of the But Monro.Forward the at do you question sort you pent we I you is is probably think gauge the as demand sustainability think And perform evidence as of think more the going

Mike Broderick

for shot. thanks take is question. I to me a let that Monro.Forward the This Brian, regards Mike, would with remember. say

touched we Just And technology. product promotion re-brand people re-image so we top to we on of a that remind and everybody lot. touched then

right focus most my not this we how So, bring do only for our is teammates. customers life, of our for really to now

up about of business they team that's I taking was properly our and what up some our culture, that's when about making proud care all what to are truly is So we of like our is the delivered tire in-store customers sure you performance. we're significantly attachment. point would it's tire talked XX%, the over of execution. What about alignments And the to all I'm

sustainable the what our the for very That's seeing our teammates doing believe and they're actually going some customer. right of I thing forward. I'm react model in So business is

Brian Nagel

ask the these mentioned you thoughts what any question second inflation, on pass it forward? along the in just Then have to cost been cost you I extent about prepared and mentioned was want that going to able comments to

Mike Broderick

job I XX Brian's Mike calling done on years that welcome me involved Okay. Monro expenses let over This has context. for years. XX been managing but again, Monro been give also. the comments I've I've just with is excellent an Monro. But

As relate definitely a supplier, can that. I to

you is So repair we've when that. this people on service look look context, at conversation But at properly, you talked that people me labor of the to a you inflation is let are the we to manage of Brian about when people done the with an make categories. is of managing demand. Most the biggest the making and give around prepared the excellent remarks, cost be in lot the sure time not able about because enough order to spending broader job cost inflation, over over scheduled component time the we're have sure

that's our business. half Now

the the is much a Most different of other The now half business tires cost is very tires. that's of story.

our relevant just So it's methodology really that really believe value in category managing it's I company. tire very driving I costs. and our and retail significant see of very management managing is sustainable good-better-best traditional

Brian D'Ambrosia

Yes, X% the would tire. thing only may and category attention profit gross to the that's highlighted the and that tool It - be to our tire category we we exactly us add why I that really in to allowing inflation for navigate management seeing. shows any is that is improvement I managing - year-over-year would that Brian

Operator

Please with is proceed from Bret Jefferies. next from your question. Our Jordan question

Bret Jordan

over rate be hour of at the what maybe inflation X labor could inflation time, on the about labor On a you sort side? talk might regular

Brian D'Ambrosia

this Brian, Yes, Bret. is

incentive the stores. our competitive labor wages productivity and plans sales stated us We rate, are volume to those with rate, any and very based seen programs of our of so so in that and productivity and related really reward and our a be and clock pressure throughput haven't to most reward allows for excess the earning technicians of compensation are technicians know, significant based our as you

labor any inflation other allowed parts retail. mitigate So think has that of out model our there be might I of us in to that

the quarter the really really over driver time for driven So was by differential. that

Bret Jordan

got the thinking infrastructure? investment those to out you've markets about infrastructure West, scale build think in the are in you when distribution enough Southeast guess I or And the in Okay. you distribution

Mike Broderick

We're best lot take let to properly there looking looking say, Thanks care for the is take able are stores to business at Bret, customers. question. that, this that to partnering and with that's their partners Monro enable the to me of do or way of building probably to Mike. is our be a

So here, develop on really a is good of I'm in Monros. the business lot want to do been people trying a or partnerships three to who news four that is Monro. that looking I've with lot there months support to The is, of

find So feel built service if we to that to long-term the partnerships confident a similar enable appropriate to will relationship that can our our grow we will Greenfield I us strategy, but in partner continue business. can

Bret Jordan

And just us then, work? housekeeping, the give Brian, product a monthly could you

Brian D'Ambrosia

May, up Yes, in sure. And We as and that trends XX% prior-year June, XX% in comparable then reflective obviously again in of by July. XX% well. is in XX% trend were April,

Operator

is Stephanie your from proceed with Our Truist. next Moore question with Please question.

Stephanie Moore

up I have labor some side also baked about wanted to to meet second. nice touch a on pretty to for but of just know staffing you step overall talked structural expectations this into having a expenses the SG&A year. savings I for means, cost this

think local align savings maybe of last revenue So color that an course at over levels, kind model would the there of make the the any up exceed some of you changes, here, to target pre-COVID be - get the helpful. Thanks. do and the look called business year you kind you as maybe opportunity structural cost as there is texture to you at that look

Brian D'Ambrosia

Yes. Stephanie. I question. appreciate the

look think the at I legal excluding settlement. our you if

trend on as XX.X% of think in a our sales, percent at G&A look move to we right you If that's internal is where continue that the expect to expectations quarters I forward. right

year in have just expected So did as much advertising lockdowns back an the we But higher seeing much would the which COVID expenses CRM more are did to back added not were prior driving, standpoint the and efficient those itself strategy. demand, pretty the flow-through to the business we're and that as consumer I support advertising are to our appropriate that certainly feel in last entering lend think that leverage levels, with we're levels in emergency completely happy we're we environment with our year from to levels digital we strategy expect, than our marketing, the versus sales

So on demand supportive we're be levels better return current environment. getting our but bringing of still dollar to advertising advertising spent,

the think the G&A through right So look at to for got I and and we've move levels we QX. I structure QX we that continue it where described, we'll want as

Operator

David is Bellinger Wolfe next question with Our Research. Please question. proceed your with from

David Bellinger

taking saw Thanks labor Then credit across quarter? comment that on marketplace. seeing on there got Is tax issues from my normalized before get through worse these recently any in back question. one to for Any constraints another child environment? the the call think labor or impact and long you persist labor the better in more we're inflation effect we how do we

Mike Broderick

the for this labor I'm is David, on with Mike. Thanks the question. start. I'll sure, Brian file will conversation.

labor development, the past everybody what that's can the changing paramount. a about of sure that's just make elevated technicians just invest our back so take goes able is how building we training, develop really to into training pre-COVID people actually lot to with been entering care before technician developing we've even service to car. me are out talked in None their we of Let in continue we training as our of that been organization, take and a skills best-in-class of who the be community, our initiatives

just in -COVID, it's done enhanced what fiscal really been So pre that's before XXXX. we've

the is with what starts we're where have with technicians the incredibly customers under to the a be that around focused investing from hood service every do business there wheel We staffed to where people serve. the offering recruiting spots, training, full we a expect it in be challenge. is and then full can can a because qualified But that out from and communities hotspots, on of provider perspective, is that both that so technicians, bringing our want That do sure I in appreciate early clear. and going that the with one them. building always jobs on team is We've I that's making drive X,XXX hot service we're going. we really all over and Now we're that

Now it's the that Yes. because for do the I our that industry been be in That's challenge first, a our organization. marketplace. that's we for believe technicians on our the will But we've is destination destination best will years. that we're - be something for for goal we the technicians the the challenge? for many focused

David Bellinger

And if moving steel - that. higher Are follow-up, you could? commodities now more building Very you and that up you potentially as mentioned opposed helpful. locations Appreciate any other factoring to all just my of buying. quantification cost

Mike Broderick

back question. Sure, thank more on at please raw look It to the other for of side that's goes you business. comment, materials, the service to back it you goes the when my

So look that's all proper at overtime talked managing Brian about of brakes, a cost. Most you actually it's our that staffing about through smaller we've the labor overtime labor mitigate to of when routers, true levels. component

So productive we very give do come us. stay they when our teammates days to off they work and for

always competitive we've the along manage So commodities then to same now, to able those, at with that those And focus prove obviously and to our that marketplace. continue to is we've regards the to right in expenses pass been to consumer, - extremely we're time competition expenses. staying able the to those the what the

Operator

Thank you.

Nelson from is question proceed question. with from Rick your next Stephens. Please Our

Rick Nelson

quarter growth Like how ask the period? what and in in units about industry think changed to tire those that you was

Brian D'Ambrosia

we category, and of question. in Rick, units We our I'll as of XX% Brian. were in we tire mix. said had, equal was is that that kind parts price really Thanks for take up this the

certainly certainly and about performance And deliver helped as us balance gross per feel so, I I good our that that entered into tire XXXX, slightly we or said U.S. like the has discussed look pandemic. we've been And X% industry unit above the at that that tire our And performance we've we profit think we industry. throughout then there. feel tire at to versus as the the fiscal

from lot So, units, driving the driving continued driving margin, benefits price average good category and there, performance our selling of management. a

Rick Nelson

from are are in margin trading thoughts why fact sales in the you Any on sales tire lagging, category? tire the

Mike Broderick

the as that's our But how and away competitive. take think quarter-over-quarter and love we walk I fact tires. that the should that fact on Mike. significant and love think and the tire not - looked now we profitable that I margin the service also that lagging the would now is seeing sales extremely is getting categories focused selling growth that service We is on are is it. sales our at on service improvement. consistent theme comp that, focused I'll this continue sales, conversation selling Rick, We're it business this it's that just we grow say but from business. are to the the I the service forward We're focus enable I to the focus attention should

Rick Nelson

rebranding Mountain View into you stores? those also stores, to are how expectation So performing the curious changes stores those any those you're putting on stores are relative your

Mike Broderick

This heavy those successful They've contributing are last is Thanks, talk a They're marketplace. there, immediately everybody, But and was in an I call. Rick. quality we business three months. they love just for so in service stores. April great the the take been XX reputation Mike have I I've they I'll out pleased close, I a so the just that was about been extremely just very did people. that. remember us. with that first

stores, sure View Now re-imaging of we're process we Mountain in the Tire are making up now to are snuff. with that those they and Allen

for the get cleaned with year, and those to done back really regards going everything up. stores On we're with we've the, half Monro.Forward that's the of

Operator

is Our Scott with C.L. from next your with Please King & Associates. question. question Stember proceed

Scott Stember

same-store I first the the dig you're guess, is quantify is much again all also that our pre-pandemic hanging bit can maybe I QX. to Brian, generally low two there fruit categories on - board you sales as the more business you time. of other ago this versus how Could the sales we and guess a up years say into and up, versus any want quarter or you did that this Just little levels across basis, back? at expect comes are that

Brian D'Ambrosia

think, were I was up Well I said I total X% the think sales. in what remarks prepared in that

back beyond that we've moving any store and since that From in pandemic. to acceleration. pre-pandemic we're pre-pandemic not we above We've levels. account stores slightly the the above into that that so going I'm accelerate quantify, first take levels July, seen added we're at in standpoint a quarter sales comparable seeing were but slightly So would

acceleration well. margin levels we in seeing back kind and As as the have in as that target described we're to of also getting pre-pandemic of prepared remarks, we a

Scott Stember

there already been seeing really or to could And that just category, that by are is expect area that's in, lagging any we we kick in July?

Brian D'Ambrosia

margin on Well, was service tire paramount in I of tremendous we up and see service our with QX them not line still continuing service say to up we staffed our that held as category to and us is relatively And with in you're around FY yes and as we component much the recover into to It a think Mike's is service just amount talked about categories. tires lagged progress seeing were. we that the what And down to our kind that in comments in July sure last service remember and our for of continue. categories. And question strengthening focus made XXXX that our some the where categories our we of to expect of expect service service will industry It continue. are COVID, double during going and big be category improvement making our continued but to certainly in forward. down to

Operator

I remarks. back call reached We've end to the would closing session. of like the for Broderick the to question-and-answer turn

Mike Broderick

build updated look We've you to exciting I Thank Have to be you for on our great joining is strong part progress. stakeholders. us long-term our foundation today. upon Monro. to forward for time This day. to value a an create keeping of a

Operator

This conference. concludes today's

for your time. participation. at this disconnect you may lines You Thank your

Monro (MNRO) 28 Jul 212022 Q1 Earnings call transcript