Monro Muffler Brake, Inc. (MNRO) has reported a 15.33 percent rise in profit for the quarter ended Dec. 24, 2016. The company has earned $17.57 million, or $0.53 a share in the quarter, compared with $15.23 million, or $0.46 a share for the same period last year.
Revenue during the quarter grew 20.65 percent to $288.28 million from $238.94 million in the previous year period. Gross margin for the quarter contracted 244 basis points over the previous year period to 36.63 percent. Total expenses were 88.53 percent of quarterly revenues, down from 88.94 percent for the same period last year. This has led to an improvement of 41 basis points in operating margin to 11.47 percent.
Operating income for the quarter was $33.07 million, compared with $26.43 million in the previous year period.
John Van Heel, president and chief executive officer stated, "Despite a challenging operating environment, the return of winter weather in the quarter, combined with solid operational execution, effective cost control and the solid integration of our recent acquisitions, allowed us to deliver earnings at the midpoint of guidance. The 2.3% increase in comparable store sales was driven by a 2% increase in traffic, reflective of a comparable store sales lift of 11% in December, adjusted for one extra sales day in the month. Importantly, we continued to capitalize on growth opportunities in the market, having opened 67 net new stores through acquisition and greenfield growth fiscal year-to-date, while also signing a definitive agreement to acquire 16 additional stores. Combined, these acquisitions represent approximately $150 million in annualized sales, laying a solid foundation for strong earnings growth for many years to come."
For fiscal year 2017, Monro Muffler Brake, Inc. forecasts revenue to be in the range of $1,032 million to $1,038 million. It expects diluted earnings per share to be in the range of $1.95 to $2 for the same period.
For the fourth-quarter, Monro Muffler Brake, Inc. forecasts revenue to be in the range of $262 million to $268 million. It expects diluted earnings per share to be in the range of $0.39 to $0.44 for the same period.
Working capital drops significantly
Monro Muffler Brake, Inc. has witnessed a decline in the working capital over the last year. It stood at $13.84 million as at Dec. 24, 2016, down 51.40 percent or $14.63 million from $28.47 million on Dec. 26, 2015. Current ratio was at 1.08 as on Dec. 24, 2016, down from 1.18 on Dec. 26, 2015.
Days sales outstanding went down to 1 days for the quarter compared with 2 days for the same period last year.
Days inventory outstanding has decreased to 34 days for the quarter compared with 83 days for the previous year period.
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