Monro posts record sales and earnings in 1Q
Monro Muffler Brake Inc. recorded net income of $7 million on sales of $87.3 million for the first quarter ended June 26, 2004. That compares to net income of $5.9 million on sales of $73.6 million for the period 12 months prior.
The earnings and sales totals were company records.
According to Monro, the sales increase was driven by a 6.8% improvement in comparable store sales, up from 5.9% last year. The company's Mr. Tire stores added $12.3 million to the total. (Monro completed its acquisition of 36 Mr. Tire Inc. locations from Mile One Automotive in early March.)
The company also opened three new stores and closed one in BJ's Wholesale Club locations during the quarter.
"Despite a challenging retail and industry environment marked by a consumer spending slowdown in June, we are pleased with our overall performance in the first quarter, during which we continued to expand both our top and bottom lines," says Robert Gross, CEO and president.
"We drove positive comparable store sales through increases in our oil changes and maintenance services." At the same time, Monro achieved lower selling, general and administrative expenses (they decreased from 29.9% of sales to 28.9%), which Gross says allowed the company to maintain its operating margins.
"As we move further into fiscal 2005, we intend to build on the solid results of the first quarter," says Gross. He estimates comparable store sales will increase between 1% and 3% in the second quarter, helped by a 3% price increase instituted earlier this month.
In addition, Monro's expansion strategy "continues to be an important part of our growth, especially in a weak marketplace where the opportunity to acquire businesses at advantageous prices is greater," he adds.
Monro Muffler is the seventh largest independent tire dealership in the United States, according to Modern Tire Dealer's Top 100 Independent Tire Store Chains list.