Advance Auto Parts announced its financial results for the first quarter ended April 23, 2016. First quarter adjusted earnings per diluted share were $2.51.
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These results exclude $0.11 of amortization of acquired intangible assets and integration and restructuring costs of $0.26, primarily associated with the acquisition of General Parts International.
Total sales decreased 1.9% to $2.98 billion, as compared with total sales during the first quarter of fiscal 2015 of $3.04 billion. The sales decline was driven by the comparable store sales decrease of 1.9% primarily due to availability and service shortfalls.
"Our first quarter results did not meet our expectations," said Tom Greco, Chief Executive Officer.
"We are moving forward with urgency to drive improved performance. Our customers are our top priority and we are elevating our intensity to get the right parts to the right place at the right time as we empower our team members to serve the customer better than anyone else."
The comparable sales cadence experienced a more pronounced decline in the latter portion of the quarter. The Company's comparable store sales were also partially impacted by lower demand due to unfavorable weather during the quarter and benefited from the favorable consolidation impact from Carquest stores.
The Company's Gross Profit rate was 45.3% of sales during the first quarter as compared to 45.9% during the first quarter last year. The 58 basis-point decrease in gross profit rate was primarily the result of supply chain expense deleverage due to the comparable store sales decline.
The Company's Adjusted SG&A rate was 34.7% of sales during the first quarter as compared to 35.7% during the same period last year.
The 100 basis-point decrease was primarily the result of Advance Auto Part' continued cost reduction initiatives and benefits from the cost reduction actions taken in 2015 partially offset by expense deleverage. On a GAAP basis, the company's SG&A rate was 36.2% of sales during the first quarter as compared to 37.2% during the same period last year.
The Company's Adjusted Operating Income was $315.0 million during the first quarter, an increase of 2.2% versus the first quarter of fiscal 2015. As a percentage of sales, Adjusted Operating Income in the first quarter expanded to 10.6% versus 10.1% during the first quarter of fiscal 2015.
On a GAAP basis, Advance Auto Part' operating income during the first quarter of $271.0 million increased 3.2% versus the first quarter of fiscal 2015. On a GAAP basis, the Operating Income rate was 9.1% during the first quarter as compared to 8.6% during the first quarter of fiscal 2015.
Operating cash flow decreased approximately 26.3% to $75.3 million in the first quarter of fiscal 2016 from $102.2 million in the first quarter of fiscal 2015.
Free cash flow was a decrease of $13.8 million in the first quarter of fiscal 2016 compared to an increase of $45.2 million in the first quarter of fiscal 2015. Capital expenditures in the first quarter of fiscal 2016 were $89.1 million as compared to $57.0 million in the first quarter of fiscal 2015. ■