AutoZone, Inc. (NYSE: AZO) saw its shares dwindle in price on first-quarter numbers.
The Memphis-based company today reported net sales of $3.2 billion for its first quarter ended November 21, 2020, an increase of 12.9% from the first quarter of fiscal 2020. Domestic same store sales, or sales for stores open at least one year, increased 12.3% for the quarter.
Said CEO Bill Rhodes, "As the COVID-19 global pandemic continues, our primary focus has been and continues to be the health, wellness and safety of our customers and AutoZoners. Last week, we shared with all eligible AutoZoners that we have again made some significant benefit changes to encourage personal responsibility. Most notably, we will offer another week of 'emergency time-off,' and we will allow an extended carryover of paid time off for much of the new calendar year."
For the quarter, gross profit, as a percentage of sales, was 53.1%, a decrease of 62 basis points versus the prior year. The decrease in gross margin was attributable to one-time pandemic related charges, increased loyalty program participation resulting from increased purchase frequency from existing customers, and a shift in mix.
Operating expenses, as a percentage of sales, were 33.6% (versus 35.8% for last year’s quarter), with leverage primarily due to higher sales volumes.
Operating profit increased 23.0% to $615.2 million. Net income for the quarter increased 26.3% over the same period last year to $442.4 million, while diluted earnings per share increased 30.1% to $18.61 per share from $14.30 per share in the year-ago quarter. The increase in net income was driven by strong top-line growth.
AutoZone shares fell 0.5% to close at $1,157.18 on Monday. They opened Tuesday lower by $47.12, or 4.1%, to $1,110.06.
