A Dark Vector Cognition product

Item 6. Selected Financial Data

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Item 6. Selected Financial Data

(in thousands, except per share data, same store sales and selected operating data)Fiscal Year Ended August
20182017201620152014
Income Statement Data
Net sales$11,221,077$10,888,676$10,635,676$10,187,340$9,475,313
Cost of sales, including warehouse and delivery expenses5,247,3315,149,0565,026,9404,860,3094,540,406
Gross profit5,973,7465,739,6205,608,7365,327,0314,934,907
Operating, selling, general and administrative expenses(1)4,162,8903,659,5513,548,3413,373,9803,104,684
Operating profit(1)1,810,8562,080,0692,060,3951,953,0511,830,223
Interest expense, net174,527154,580147,681150,439167,509
Income before income taxes1,636,3291,925,4891,912,7141,802,6121,662,714
Income tax expense(2)(3)298,793644,620671,707642,371592,970
Net income(2)(3)$1,337,536$1,280,869$1,241,007$1,160,241$1,069,744
Diluted earnings per share(2)$48.77$44.07$40.70$36.03$31.57
Weighted average shares for diluted earnings per share(2)27,42429,06530,48832,20633,882
Same Store Sales
Increase in domestic comparable store net sales(4)1.8%0.5%2.4%3.8%2.8%
Balance Sheet Data
Current assets$4,635,869$4,611,255$4,239,573$3,970,294$3,580,612
Working capital (deficit)(392,812)(155,046)(450,747)(742,579)(960,482)
Total assets9,346,9809,259,7818,599,7878,102,3497,497,163
Current liabilities5,028,6814,766,3014,690,3204,712,8734,541,094
Debt5,005,9305,081,2384,924,1194,624,8764,323,106
Long-term capital leases102,013102,322102,45187,63983,098
Stockholders’ (deficit)(1,520,355)(1,428,377)(1,787,538)(1,701,390)(1,621,857)
Selected Operating Data
Number of locations at beginning of year6,0295,8145,6095,3915,201
Acquired locations(5)———17—
Sold locations(6)26————
New locations201215205202190
Closed locations2——1—
Net new locations199215205201190
Relocated locations75658
Number of locations at end of year6,2026,0295,8145,6095,391
AutoZone domestic commercial programs4,7414,5924,3904,1413,845
Inventory per location (in thousands)$636$644$625$610$582
Total AutoZone store square footage (in thousands)41,06639,68438,19836,81535,424
Average square footage per AutoZone store6,6216,6116,6006,5876,571
Increase in AutoZone store square footage3.5%3.9%3.8%3.9%4.0%
Average net sales per AutoZone store (in thousands)$1,778$1,756$1,773$1,761$1,724
Net sales per AutoZone store square foot$269$266$269$268$263
Total employees at end of year (in thousands)8987848176
Inventory turnover(7)1.3x1.4x1.4x1.4x1.5x
Accounts payable to inventory ratio111.8%107.4%112.8%112.9%114.9%
After-tax return on invested capital(8)32.1%29.9%31.3%31.2%32.1%
Adjusted debt to EBITDAR(9)2.52.62.52.52.5
Net cash provided by operating activities (in thousands)(2)$2,080,292$1,570,612$1,641,060$1,573,018$1,365,005
Cash flow before share repurchases and changes in debt (in thousands)(10)$1,596,367$1,017,585$1,166,987$1,018,440$924,706
Share repurchases (in thousands)$1,592,013$1,071,649$1,452,462$1,271,416$1,099,212
Number of shares repurchased (in thousands)2,3981,4951,9032,0102,232
(1)Fiscal 2018 was negatively impacted by the pension termination charges of $130.3 million (pre-tax) recognized in the fourth quarter and asset impairments of $193.2 million (pre-tax) recognized in the second quarter of fiscal 2018. See “Note M – Sale of Assets” and “Note L – Pension and Savings Plans” of the Notes to Consolidated Financial Statements for more information.
(2)Fiscal 2018 and 2017 include excess tax benefits from stock option exercises of $31.3 million and $31.2 million, respectively, related to the adoption of ASU 2016-09, Compensation – Stock Compensation (Topic 718): Improvement to Employee Share-based Payment Accounting. The Company adopted ASU 2016-09 effective August 28, 2016 and applied the recognition of excess tax deficiencies and tax benefits in the income statement on a prospective basis. Income tax expense, net income and diluted earnings per share amounts presented for prior periods were not restated. The Company applied ASU 2016-09 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.
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(3)Fiscal 2018 includes a benefit to net income related to Tax Reform. See “Note D – Income Taxes” of the Notes to Consolidated Financial Statements for more information.
(4)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.
(5)17 IMC branches acquired on September 27, 2014.
(6)26 IMC branches were sold on April 4, 2018. See “Note M – Sale of Assets” of the Notes to Consolidated Financial Statements for more information.
(7)Inventory turnover is calculated as cost of sales divided by the average merchandise inventory balance over the trailing 5 quarters.
(8)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). For fiscal 2018, after-tax operating profit was adjusted for impairment charges, pension termination charges and the impact of the revaluation of deferred tax liabilities, net of repatriation tax. See Reconciliation of Non-GAAP Financial Measures in Management’s Discussion and Analysis of Financial Condition and Results of Operations.
(9)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. For fiscal 2018, net income was adjusted for impairment charges and pension termination charges before tax impact. See Reconciliation of Non-GAAP Financial Measures in Management’s Discussion and Analysis of Financial Condition and Results of Operations.
(10)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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