TBC backs off on acquisitions for now
TBC Corp. doesn´t want "to jump back into the acquisition market too quickly," Larry Day, the company´s CEO and president, told investors this morning.
"We´re only interested in the deepest values" when it comes to buying other companies next year, he says.
"We´re in a position where we can be a little choosy in what we pay" for acquisitions.
TBC will focus on internal improvements during 2005, according to Day.
The Memphis, Tenn.-based company plans to add 20 to 25 new Tire Kingdom Inc. stores, concentrating on the Boston, Mass., Texas and Illinois markets.
It also wants to add 30 to 60 new Big O Tires Inc. franchise outlets in 2005, most of them pre-existing facilities. "We are actively involved in several discussions" with independent tire dealerships who have expressed interest in signing with Big O.
Meanwhile, TBC´s integration of National Tire & Battery (NTB) locations into its system "is right on plan," says Day. And the company´s wholesale operation "is stable."
Overall, TBC wants private brand tires to comprise 50% of the product mix at its retail stores. "For the third quarter, our private label mix was 40%. I believe the 50% goal is very attainable." However, "it doesn´t come overnight and has to be done properly."
TBC posted net income of $10.9 million on net sales of $476.5 million during the third quarter vs. income of $10 million on sales of $362.4 million for the same period last year.
The company released its third quarter financials yesterday.