O'Reilly 3Q sales up 68%, post-CSK acquisition

SPRINGFIELD, Mo. O’Reilly Automotive posted sales for the three months ended Sept. 30, of $1.11 billion, up 68% from $0.66 billion for the same period last year. Net income for the third quarter totaled $41.4 million, down 22% from $53.1 million for the same period in 2007. Diluted EPS for the quarter decreased 33% to 31 cents on 133.1 million shares, compared to 46 cents for the third quarter of 2007 on 116.3 million shares. Comparable-store sales for the third quarter increased 1.5%.

The company’s third-quarter results include charges related to the July 11 acquisition of CSK Automotive, including one-time costs for the prepayment and extinguishment of existing O’Reilly debt, commitment fees for an unused interim financing facility, a one-time adjustment to tax liabilities resulting from the acquisition of CSK and a non-cash charge to amortize the value assigned to CSK’s trade names and trademarks, which will be amortized over the next two-and-a-half years, coinciding with the anticipated conversion of CSK store locations. Adjusted diluted EPS, excluding the impact of acquisition-related charges, was 40 cents for the third quarter, reflecting a decrease of 13% from the same period a year ago.

Comparable-store sales for CSK decreased 4.3% for the portion of CSK’s sales in the third quarter since the July 11 acquisition by O’Reilly. Consolidated comparable-store sales decreased 0.8%.

“We enter the fourth quarter focused on the continued execution of our CSK store conversion plan,” said O'Reilly coo and co-president Ted Wise. “During the quarter, we will be converting stores located in markets where we have O’Reilly distribution reach and can effectively execute our dual market strategy ... We continue to be very impressed with the new members of our team and the level of enthusiasm they have shown by embracing the O’Reilly culture.”