O'Reilly Automotive Q1 Profit Up 13%, Results Beat View, Lifts Earnings Outlook

(RTTNews) - Auto-parts retailer O'Reilly Automotive Inc. (ORLY) on Wednesday reported a 13 percent increase in profit for the first quarter from last year, boosted by higher sales and margins. Both revenue and earnings per share for the quarter beat analysts' expectations.

Looking ahead, O'Reilly forecast earnings for the second quarter below analysts' estimates. For fiscal 2014, the company raised its outlook for earnings, but below Street consensus, and maintained its forecast for revenue and comparable store sales growth. Shares of the company declined more than 5 percent in extended trades.

The Springfield, Missouri-based company's net income for the first quarter was $173.86 million or $1.61 per share, up from $154.33 million or $1.36 per share in the year-ago period. On average, 23 analysts polled by Thomson Reuters expected the company to report earnings of $1.58 per share for the quarter. Analysts' estimates typically exclude special items.

Sales for the quarter grew 9 percent to $1.73 billion from $1.59 billion in the same period last year. Analysts had a consensus revenue estimate of $1.72 billion for the quarter.

Comparable store sales for the quarter increased 6.3 percent, compared to an increase of 0.6 percent in the same period last year.

Gross margin edged up to 50.8 percent from 50.4 percent in the year-ago period, while operating margin expanded to 16.6 percent from 15.8 percent.

Looking ahead to the second quarter, O'Reilly forecast earnings of $1.79 to $1.83 per share and comparable store sales growth of 2 percent to 4 percent. Analysts currently expect the company to report earnings of $1.85 per share for the quarter.

Greg Henslee, President and CEO of O'Reilly, said, "We have seen the strong sales volumes we experienced in the first quarter continue into the beginning of April; however, we face our most difficult quarterly comparable store sales comparison in the second quarter of 2014 as we anniversary 2013's strong second quarter comparable stores increase of 6.5% and face a headwind from the timing of the Easter holiday, which falls in the second quarter this year versus the first quarter last year."

For fiscal 2014, O'Reilly raised its outlook for earnings to a range of $6.82 to $6.92 per share, from the prior range of $6.74 to $6.84 per share. However, the company maintained its outlook for full-year revenue of $7.0 billion to $7.2 billion, and comparable store sales growth of 3 percent to 5 percent.

Analysts currently expect the company to earn $7.03 per share for the year on revenues of $7.13 billion.

ORLY closed Wednesday's regular trading session at $148.12, up $0.17 or 0.11 percent on a volume of 806,909 shares. However, in after-hours, the stock declined $7.81 or 5.27 percent to $140.31.