Autozone Inc 8-K, filed Mar 1, 2022

Autozone Inc (AZO)

8-K 2022-03-01 For: 2022-03-01

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Added on April 07, 2026

About this 8-K

Autozone Inc filed this 8-K on March 1, 2022.

Items reported

Item 2.02: Financial results
Item 9.01: Financial statements and exhibits

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Nevada	1-10714	62-1482048
(State or Other Jurisdiction of Incorporation)	(Commission File Number)	(I.R.S. Employer Identification No.)

☐	Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
☐	Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
☐	Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
☐	Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock, par value $0.01 per share	AZO	New York Stock Exchange

99.1		Press Release dated March 1, 2022
104		Cover Page Interactive Data File (embedded within the Inline XBRL document)

	AUTOZONE, INC.


Date: March 1, 2022	By:	/s/ Jamere Jackson
		Jamere Jackson
		Chief Financial Officer and Executive Vice President - Finance and Store Development

AutoZone's 2nd Quarter Highlights - Fiscal 2022

Condensed Consolidated Statements of Operations
2nd Quarter, FY2022
(in thousands, except per share data)
		GAAP Results
		12 Weeks Ended			12 Weeks Ended
		February 12, 2022			February 13, 2021⁽²⁾

Net sales		$	3,369,750		$	2,910,818
Cost of sales			1,584,524			1,351,435
Gross profit			1,785,226			1,559,383
Operating, SG&A expenses			1,158,466			1,077,616
Operating profit (EBIT)			626,760			481,767
Interest expense, net			42,471			46,012
Income before taxes			584,289			435,755
Income tax expense⁽¹⁾			112,534			89,809
Net income		$	471,755		$	345,946
Net income per share:
	Basic	$	23.00		$	15.27
	Diluted	$	22.30		$	14.93
Weighted average shares outstanding:
	Basic		20,513			22,648
	Diluted		21,158			23,168

⁽¹⁾The twelve weeks ended February 12, 2022 and the comparable prior year period include $23.4M and $11.6M in tax benefits from stock option exercises, respectively

⁽²⁾The twelve weeks ended February 13, 2021 was negatively impacted by pandemic related expenses, including Emergency Time-Off of approximately $40M (pre-tax)


Year-To-Date 2nd Quarter, FY2022
(in thousands, except per share data)
		GAAP Results
		24 Weeks Ended			24 Weeks Ended
		February 12, 2022			February 13, 2021⁽²⁾

Net sales		$	7,038,653		$	6,065,078
Cost of sales			3,328,267			2,830,078
Gross profit			3,710,386			3,235,000
Operating, SG&A expenses			2,329,141			2,138,008
Operating profit (EBIT)			1,381,245			1,096,992
Interest expense, net			85,755			92,191
Income before taxes			1,295,490			1,004,801
Income taxes⁽¹⁾			268,500			216,422
Net income		$	1,026,990		$	788,379
Net income per share:
	Basic	$	49.49		$	34.37
	Diluted	$	48.03		$	33.59
Weighted average shares outstanding:
	Basic		20,750			22,935
	Diluted		21,383			23,473

⁽¹⁾The twenty-four weeks ended February 12, 2022 and the comparable prior year period include $34.7M and $19.2M in tax benefits from stock option exercises, respectively

⁽²⁾The twenty-four weeks ended February 13, 2021 was negatively impacted by pandemic related expenses, including Emergency Time-Off of approximately $45M (pre-tax)


Selected Balance Sheet Information
(in thousands)
		February 12, 2022			February 13, 2021			August 28, 2021

Cash and cash equivalents		$	239,423		$	1,026,164		$	1,171,335
Merchandise inventories			5,031,222			4,736,826			4,639,813
Current assets			5,903,770			6,326,845			6,415,303
Property and equipment, net			4,879,079			4,627,993			4,856,891
Operating lease right-of-use assets			2,743,771			2,660,667			2,718,712
Total assets			14,078,473			14,159,993			14,516,199
Accounts payable			6,378,606			5,351,096			6,013,924
Current liabilities			7,684,645			6,804,271			7,369,754
Operating lease liabilities, less current portion			2,641,555			2,566,974			2,632,842
Total debt			5,840,884			5,516,396			5,269,820
Stockholders' deficit			(3,137,477	)		(1,523,573	)		(1,797,536	)
Working capital			(1,780,875	)		(477,426	)		(954,451	)

AutoZone's 2nd Quarter Highlights - Fiscal 2022

Condensed Consolidated Statements of Operations

Adjusted Debt / EBITDAR
(in thousands, except adjusted debt to EBITDAR ratio)	Trailing 4 Quarters
	February 12, 2022			February 13, 2021
Net income	$	2,408,925		$	1,871,731
Add: Interest expense		188,901			205,278
Income tax expense		630,954			529,701
EBIT		3,228,780			2,606,710

Add: Depreciation and amortization		422,938			401,073
Rent expense⁽¹⁾		354,410			335,969
Share-based expense		62,672			46,906
EBITDAR	$	4,068,800		$	3,390,658

Debt	$	5,840,884		$	5,516,396
Financing lease liabilities		272,719			225,411
Add: Rent x 6⁽¹⁾		2,126,460			2,015,814
Adjusted debt	$	8,240,063		$	7,757,621

Adjusted debt to EBITDAR		2.0			2.3

Adjusted Return on Invested Capital (ROIC)
(in thousands, except ROIC)
	Trailing 4 Quarters
	February 12, 2022			February 13, 2021
Net income	$	2,408,925		$	1,871,731
Adjustments:
Interest expense		188,901			205,278
Rent expense⁽¹⁾		354,410			335,969
Tax effect⁽²⁾		(113,008	)		(119,616	)
Adjusted after-tax return	$	2,839,228		$	2,293,362

Average debt⁽³⁾	$	5,433,252		$	5,482,877
Average stockholders' deficit⁽³⁾		(2,069,346	)		(1,354,477	)
Add: Rent x 6⁽¹⁾		2,126,460			2,015,814
Average financing lease liabilities⁽³⁾		255,497			220,550
Invested capital	$	5,745,863		$	6,364,764

Adjusted After-Tax ROIC		49.4	%		36.0	%

⁽¹⁾The table below outlines the calculation of rent expense and reconciles rent expense to total lease cost, per ASC 842, the most directly comparable GAAP financial measure, for the trailing four quarters ended February 12, 2022 and February 13, 2021



	Trailing 4 Quarters
(in thousands)	February 12, 2022			February 13, 2021
Total lease cost, per ASC 842, for the trailing four quarters	$	442,950		$	418,100
Less: Financing lease interest and amortization		(62,607	)		(55,880	)
Less: Variable operating lease components, related to insurance and common area maintenance		(25,933	)		(26,251	)
		(25,933	)		(26,251	)
Rent expense for the trailing four quarters	$	354,410		$	335,969


⁽²⁾Effective tax rate over trailing four quarters ended February 12, 2022 and February 13, 2021 is 20.8% and 22.1%, respectively
⁽³⁾All averages are computed based on trailing five quarter balances

Other Selected Financial Information
(in thousands)
	February 12, 2022			February 13, 2021
Cumulative share repurchases ($ since fiscal 1998)	$	28,192,426		$	23,932,433
Remaining share repurchase authorization ($)		957,574			717,567

Cumulative share repurchases (shares since fiscal 1998)		151,586			149,033

Shares outstanding, end of quarter		19,967			22,183


	12 Weeks Ended			12 Weeks Ended			24 Weeks Ended		24 Weeks Ended
	February 12, 2022			February 13, 2021			February 12, 2022		February 13, 2021

Depreciation and amortization	$	99,692		$	94,476		$	199,282	$	184,027

Capital spending		105,874			125,608			208,143		238,644

AutoZone's 2nd Quarter Highlights - Fiscal 2022
Selected Operating Highlights
Condensed Consolidated Statements of Operations

Store Count & Square Footage

		12 Weeks Ended				12 Weeks Ended				24 Weeks Ended			24 Weeks Ended
		February 12, 2022				February 13, 2021				February 12, 2022			February 13, 2021
Domestic:
	Beginning stores		6,066				5,924				6,051			5,885
	Stores opened		26				27				41			66
	Stores closed		(1	)			-				(1	)		-
	Ending domestic stores		6,091				5,951				6,091			5,951

	Relocated stores		1				1				4			5

	Stores with commercial programs		5,233				5,088				5,233			5,088

	Square footage (in thousands)		40,037				39,003				40,037			39,003

Mexico:
	Beginning stores		666				621				664			621
	Stores opened		3				7				5			7
	Ending Mexico stores		669				628				669			628

Brazil:
	Beginning stores		53				45				52			43
	Stores opened		2				1				3			3
	Ending Brazil stores		55				46				55			46

Total			6,815				6,625				6,815			6,625

	Square footage (in thousands)		45,433				44,021				45,433			44,021
	Square footage per store		6,667				6,645				6,667			6,645

Sales Statistics
($ in thousands, except sales per average square foot)
		12 Weeks Ended				12 Weeks Ended				Trailing 4 Quarters			Trailing 4 Quarters
Total AutoZone Stores (Domestic, Mexico and Brazil)		February 12, 2022				February 13, 2021				February 12, 2022			February 13, 2021
	Sales per average store	$	486			$	433			$	2,282		$	2,011
	Sales per average square foot	$	73			$	65			$	343		$	303

Total Auto Parts (Domestic, Mexico and Brazil)
	Total auto parts sales	$	3,306,223			$	2,859,698			$	15,332,148		$	13,158,997
	% Increase vs. LY		15.6	%			16.0	%			16.5	%		11.0	%

Domestic Commercial
	Total domestic commercial sales	$	843,889			$	638,912			$	3,755,003		$	2,883,615
	% Increase vs. LY		32.1	%			14.7	%			30.2	%		7.6	%

	Average sales per program per week	$	13.5			$	10.5			$	14.0		$	11.1
	% Increase vs. LY		28.6	%			11.7	%			26.1	%		6.7	%

All Other, including ALLDATA
	All other sales	$	63,527			$	51,120			$	271,012		$	231,348
	% Increase vs. LY		24.3	%			5.0	%			17.1	%		4.7	%


		12 Weeks Ended				12 Weeks Ended				24 Weeks Ended			24 Weeks Ended
		February 12, 2022				February 13, 2021				February 12, 2022			February 13, 2021
Domestic same store sales			13.8	%			15.2	%			13.7	%		13.6	%

Inventory Statistics (Total Stores)
		as of				as of
		February 12, 2022				February 13, 2021
	Accounts payable/inventory		126.8	%			113.0	%

	($ in thousands)
	Inventory	$	5,031,222			$	4,736,826
	Inventory per store		738				715
	Net inventory (net of payables)		(1,347,384	)			(614,270	)
	Net inventory / per store		(198	)			(93	)

		Trailing 5 Quarters
		February 12, 2022				February 13, 2021
	Inventory turns		1.6		x		1.4		x