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Advance Auto Parts 4Q Net Income Jumps
By Michael Felberbaum, AP Business Writer
Manufacturing.Net - February 10, 2011
RICHMOND, Va. (AP) -- Auto parts seller Advance Auto Parts Inc. says its
fourth-quarter net income rose nearly 40 percent on higher sales and the
improved availability and pricing of parts.
The Roanoke-based company said late Wednesday that it earned $48.1
million, or 57 cents per share, in the period ended Jan. 1, compared
with $34.5 million, or 36 cents per share, a year ago.
Advance Auto Parts says revenue rose 11 percent to $1.27 billion.
Analysts polled by FactSet expected the company to earn 54 cents per
share on revenue of $1.25 billion.
The company has seen a net addition of 143 new stores over the past 12
months, but sales also rose in established locations. Sales at stores
open at least a year rose 8.9 percent in the fourth quarter, compared
with a 2.4 percent gain in the year-ago quarter.
"The vital signs of our industry continue to be very favorable," CEO
Darren R. Jackson said in a conference call with investors on Thursday,
adding that he does see potential headwinds like rising gas prices and
the rebounding U.S. auto market.
Jackson said the average age of vehicles on the road is more than 10
years old and the number of miles driven continues to increase modestly.
But he said, "Consumer preference still favors necessity as a result of
the sluggish economy and job market."
Auto parts retailers have boomed in the past two years as
recession-weary Americans fixed up old cars and postponed new-car
purchases. But the parts sellers might be ready to downshift amid
surging car sales and a spreading economic recovery.
Major parts-store chains have posted impressive sales and net income
growth since the economic downturn started in late 2007.
Advance Auto Parts forecast its 2011 full-year earnings in the range of
$4.60 to $4.80 per share. The company expects to open between 120 to 140
new stores and forecasts sales at stores open at least a year will
increase in the low- to mid-single digits. Analysts were expecting
earnings of $4.61 a share.
For 2010, Advance Auto Parts said its net income rose 28 percent to
$346.1 million, or $3.95 per share, compared with $270.4 million, or
$2.83 per share, in the previous year. Revenue grew 9.5 percent to $5.93
billion.
The company, which sells automotive parts, accessories, batteries and
maintenance items, has more than 3,563 stores in 39 states, Puerto Rico
and the Virgin Islands.
In midday trading Thursday, Advance Auto Parts shares were down 77 cents
at $65.23.