Item 6. Selected Financial Data

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Item 6. Selected Financial Data

(in thousands, except per share data, same store sales and selectedFiscal Year Ended August
operating data)20172016201520142013(1)
Income Statement Data
Net sales$10,888,676$10,635,676$10,187,340$9,475,313$9,147,530
Cost of sales, including warehouse and delivery expenses5,149,0565,026,9404,860,3094,540,4064,406,595
Gross profit5,739,6205,608,7365,327,0314,934,9074,740,935
Operating, selling, general and administrative expenses3,659,5513,548,3413,373,9803,104,6842,967,837
Operating profit2,080,0692,060,3951,953,0511,830,2231,773,098
Interest expense, net154,580147,681150,439167,509185,415
Income before income taxes1,925,4891,912,7141,802,6121,662,7141,587,683
Income tax expense(2)644,620671,707642,371592,970571,203
Net income(2)$1,280,869$1,241,007$1,160,241$1,069,744$1,016,480
Diluted earnings per share(2)$44.07$40.70$36.03$31.57$27.79
Weighted average shares for diluted earnings per share(2)29,06530,48832,20633,88236,581
Adjusted diluted earnings per share(2)$43.26$40.70$36.03$31.57$27.79
Same Store Sales
Increase in domestic comparable store net sales(3)0.5%2.4%3.8%2.8%0.0%
Balance Sheet Data
Current assets$4,611,255$4,239,573$3,970,294$3,580,612$3,278,013
Working capital (deficit)(155,046)(450,747)(742,579)(960,482)(891,137)
Total assets9,259,7818,599,7878,102,3497,497,1636,869,167
Current liabilities4,766,3014,690,3204,712,8734,541,0944,169,150
Debt5,081,2384,924,1194,624,8764,323,1064,164,078
Long-term capital leases102,322102,45187,63983,09873,925
Stockholders’ (deficit)(1,428,377)(1,787,538)(1,701,390)(1,621,857)(1,687,319)
Selected Operating Data
Number of locations at beginning of year5,8145,6095,3915,2015,006
Acquired locations(4)——17——
New locations215205202190197
Closed locations——1—2
Net new locations215205201190195
Relocated locations565811
Number of locations at end of year6,0295,8145,6095,3915,201
AutoZone domestic commercial programs4,5924,3904,1413,8453,421
Inventory per location (in thousands)$644$625$610$582$550
Total AutoZone store square footage (in thousands)39,68438,19836,81535,42434,076
Average square footage per AutoZone store6,6116,6006,5876,5716,552
Increase in AutoZone store square footage3.9%3.8%3.9%4.0%4.2%
Average net sales per AutoZone store (in thousands)$1,756$1,773$1,761$1,724$1,736
Net sales per AutoZone store square foot$266$269$268$263$265
Total employees at end of year (in thousands)8784817671
Inventory turnover(5)1.4x1.4x1.4x1.5x1.6x
Accounts payable to inventory ratio107.4%112.8%112.9%114.9%115.6%
After-tax return on invested capital(6)29.9%31.3%31.2%32.1%32.9%
Adjusted debt to EBITDAR(7)2.62.52.52.52.5
Net cash provided by operating activities (in thousands)(2)$1,570,612$1,641,060$1,573,018$1,365,005$1,481,763
Cash flow before share repurchases and changes in debt (in thousands)(8)$1,017,585$1,166,987$1,018,440$924,706$1,007,761
Share repurchases (in thousands)$1,071,649$1,452,462$1,271,416$1,099,212$1,387,315
Number of shares repurchased (in thousands)1,4951,9032,0102,2323,511
(1)The fiscal year ended August 31, 2013 consisted of 53 weeks.
(2)As described in the consolidated financial statements and notes, thereto, we have adopted the provisions of ASU 2016-09, Compensation – Stock Compensation (Topic 718): Improvement to Employee Share-based Payment Accounting, as of August 28, 2016. The ASU simplifies several aspects of accounting for share-based payments transactions, including income tax consequences, classification of awards as either equity or liabilities and classification on the statement of cash flows. We have applied the amendment requiring recognition of excess tax deficiencies and tax benefits in the income statement, prospectively. Prior period income tax expense, net income and diluted earnings per share amounts were not restated. The adoption of
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the new standard increased diluted earnings per share for fiscal 2017 by $0.81, driven by a lower effective tax rate of 162 basis points, partially offset by a change to the dilutive outstanding shares calculation. Excluding the impact of excess tax benefits from option exercises, adjusted diluted earnings per share was $43.26. See Reconciliation of Non-GAAP Financial Measures in Management’s Discussion and Analysis of Financial Condition and Results of Operations. We have applied the amendment relating to the presentation of the excess tax benefits on the Consolidated Statements of Cash Flows retrospectively. Prior period amounts for net cash provided by operating activities for all years presented above were restated to conform to the current period presentation.
(3)The domestic comparable sales increases are based on sales for all AutoZone domestic stores open at least one year. Relocated stores are included in the same store sales computation based on the year the original store was opened. Closed store sales are included in the same store sales computation up to the week it closes, and excluded from the computation for all periods subsequent to closing. All sales through our www.autozone.com website, including consumer direct ship-to-home sales, are also included in the computation.
(4)17 IMC branches acquired on September 27, 2014.
(5)Inventory turnover is calculated as cost of sales divided by the average merchandise inventory balance over the trailing 5 quarters.
(6)After-tax return on invested capital is defined as after-tax operating profit (excluding rent charges) divided by invested capital (which includes a factor to capitalize operating leases). See Reconciliation of Non-GAAP Financial Measures in Management’s Discussion and Analysis of Financial Condition and Results of Operations.
(7)Adjusted debt to EBITDAR is defined as the sum of total debt, capital lease obligations and annual rents times six; divided by net income plus interest, taxes, depreciation, amortization, rent and share-based compensation expense. See Reconciliation of Non-GAAP Financial Measures in Management’s Discussion and Analysis of Financial Condition and Results of Operations.
(8)Cash flow before share repurchases and changes in debt is defined as the change in cash and cash equivalents less the change in debt plus treasury stock purchases. See Reconciliation of Non-GAAP Financial Measures in Management’s Discussion and Analysis of Financial Condition and Results of Operations.

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