AutoZone Q3 Profit Tops View

(RTTNews) - Automotive parts retailer AutoZone Inc. (AZO) Tuesday said its third-quarter profit increased from the prior year, helped by higher sales. While earnings topped wall Street estimates, revenues met expectations.

Bill Rhodes, Chairman, President and CEO, said, "We are pleased to report our thirty-fifth consecutive quarter of double digit earnings per share growth...We continued to diligently work on our inventory availability initiatives, including expanding our multi-deliveries per week to test stores and opening two additional mega hub store locations."

Net income for the quarter increased to $309.07 million or $9.57 per share from $285.16 million or $8.46 per share in the prior year.

On average, 21 analysts polled by Thomson Reuters expected the company to report earnings per share of $9.52 for the quarter. Analysts' estimates typically exclude special items.

Net sales grew 6.5 percent to $2.49 billion from $2.34 billion in the prior year. Analysts expected revenue of $2.50 billion.

Domestic same store sales, or sales for stores open at least one year, increased 2.3 percent for the quarter.

Gross margin improved to 52.3 percent from 52 percent, due to higher merchandise margins.

Inventory increased 10.7 percent, driven by increased product placement, new stores, and the acquisition of Interamerican Motor Corp. or IMC.

During the quarter ended May 9, 2015, AutoZone opened 27 new stores and relocated one store in the U.S. The company opened seven new stores in Mexico, and opened two new stores in Brazil.

The stock closed at $689.18 on Friday. In the pre-market trading today, the stock was gaining 0.04 percent or 27 cents at $689.45.