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Tractor Supply Company Reports Operating Results (10-Q)

August 06, 2012 | About:
10qk

10qk

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Tractor Supply Company (TSCO) filed Quarterly Report for the period ended 2012-06-30.

Tractor Supply Company has a market cap of $6.52 billion; its shares were traded at around $90.11 with a P/E ratio of 25.6 and P/S ratio of 1.5. The dividend yield of Tractor Supply Company stocks is 0.9%. Tractor Supply Company had an annual average earning growth of 19.9% over the past 10 years. GuruFocus rated Tractor Supply Company the business predictability rank of 5-star.

Highlight of Business Operations:

Gross margin dollars increased 12.2% to $451.5 million for the second quarter of fiscal 2012 from $402.5 million in the second quarter of fiscal 2011. As a percent of sales, gross margin increased 80 basis points to 34.9% for the second quarter of fiscal 2012 compared to 34.1% for the comparable period in fiscal 2011. The increase in gross margin as a percent of sales was primarily driven by the favorable impact of a lower percent of sales mix of low margin, big ticket seasonal and emergency response products. In addition, direct product margin increased as a result of continued efforts in our key margin-driving initiatives of inventory management, strategic sourcing, private branding and pricing.

Net sales increased 14.8% to $2.31 billion for the first six months of fiscal 2012 from $2.01 billion for the first six months of fiscal 2011. Same-store sales for the first six months of fiscal 2012 were $2.18 billion, a 6.7% increase over the first six months of fiscal 2011. This compares to a 7.0% same-store sales increase for the first six months of fiscal 2011. The same-store sales increase was broad-based across all major product categories. Inflation, principally in C.U.E. categories also contributed approximately 340 basis points to the same-store sales increase. In addition to these factors, total net sales benefited from new store growth.

Store growth was approximately 8.8%, a net increase of 92 stores since June 25, 2011. Non-comp sales for the first six months of fiscal 2012 were $136.3 million, a 6.8% increase over total first six months fiscal 2011 net sales. Non-comp sales for the first six months of fiscal 2011 were $113.5 million, a 6.4% increase over total first six months fiscal 2010 net sales.

Gross margin increased 16.0% to $784.3 million for the first six months of fiscal 2012 from $676.1 million in the first six months of fiscal 2011. As a percent of sales, gross margin increased 30 basis points to 33.9% for the first six months of fiscal 2012 compared to 33.6% for the comparable period in fiscal 2011. The increase in gross margin as a percent of sales resulted primarily from improved direct product margin. Direct product margin increased primarily as a result of continued efforts in our key margin-driving initiatives of inventory management, strategic sourcing, private branding and pricing.

As a percent of sales, SG&A expenses, including depreciation and amortization, improved 120 basis points to 23.8% in the first six months of fiscal 2012 from 25.0% in the first six months of fiscal 2011. The SG&A improvement as a percent of sales for the first six months of fiscal 2012 was primarily attributable to strong same-store sales growth as well as expense control with respect to store personnel and other operating costs. Total SG&A expenses increased 9.3% to $550.0 million from $503.1 million in the first six months of fiscal 2011. The increase in SG&A expense primarily reflects new store growth, variable costs associated with our same store sales growth, and operating costs relating to the new Franklin, Kentucky distribution center, which became operational in the fourth quarter of fiscal 2011.

Read the The complete Report

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