Advance Auto Parts, Inc. (AAP) has reported a 32.02 percent plunge in profit for the quarter ended Apr. 22, 2017. The company has earned $107.96 million, or $1.46 a share in the quarter, compared with $158.81 million, or $2.14 a share for the same period last year. On the other hand, adjusted net income for the quarter stood at $118.36 million, or $1.60 a share compared with $186.10 million or $2.51 a share, a year ago.
Revenue during the quarter went down marginally by 2.98 percent to $2,890.84 million from $2,979.78 million in the previous year period. Gross margin for the quarter contracted 135 basis points over the previous year period to 43.96 percent. Total expenses were 93.78 percent of quarterly revenues, up from 90.91 percent for the same period last year. That has resulted in a contraction of 288 basis points in operating margin to 6.22 percent.
Operating income for the quarter was $179.78 million, compared with $271 million in the previous year period.
However, the adjusted operating income for the quarter stood at $204.92 million compared to $315.01 million in the prior year period. At the same time, adjusted operating margin contracted 348 basis points in the quarter to 7.09 percent from 10.57 percent in the last year period.
"Our first quarter comparable store sales declined 2.7%. As expected, comparable store sales were unfavorably impacted by the shift in New Year's Day to the first quarter of 2017 as well as the significant shift of winter related demand into December. These factors pulled sales forward into the fourth quarter of 2016 and reduced comparable store sales in the first quarter. Taking into account these shifts and normalizing for their impact across the 28 week period including the fourth quarter of 2016 and first quarter of 2017, we delivered positive sequential improvement in comparable store sales performance of approximately 70 basis points versus the third quarter of 2016. This steady improvement demonstrates that we are making progress to improve our top line performance by taking decisive and consistent actions across the organization as we refocus the company on the customer," said Tom Greco, president and chief executive officer.
Operating cash flow drops significantly
Advance Auto Parts, Inc. has generated cash of $35.08 million from operating activities during the quarter, down 60.34 percent or $ 53.36 million, when compared with the last year period.
The company has spent $64.14 million cash to meet investing activities during the quarter as against cash outgo of $87.91 million in the last year period. It has incurred net capital expenditure of $64.33 million on net basis during the quarter, down 26.82 percent or $23.58 million from year ago period.
Cash flow from financing activities was $19.87 million for the quarter, up 102.63 percent or $10.06 million, when compared with the last year period.
Cash and cash equivalents stood at $126.09 million as on Apr. 22, 2017, up 21.58 percent or $22.38 million from $103.71 million on Apr. 23, 2016.
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