Advance Auto Parts announced second-quarter net sales of $2.7 billion, up 0.6% compared to second-quarter 2021.
Comparable-store sales were down 0.6%, while operating income dropped 17.7% to $201.7 million.
Advance CEO Tom Greco acknowledged that it was “a more challenging quarter on the top line than we expected.”
“Our deliberate move to increase owned-brand penetration reduced both net and comp sales by approximately one full point,” Greco said. “Our DIY omnichannel sales were particularly challenged in the quarter and we expect that high inflation and significant year-over-year increases in fuel prices will continue to pressure DIY consumers in the back half of the year. As a result, we are updating our 2022 full-year guidance.”
Advance now expects full-year net sales of $11 billion to $11.2 billion, compared to its previous guidance of $11.2 billion to $11.5 billion.
“While our industry is not immune to the inflationary pressures consumers and broader retail have been experiencing, we believe our industry is well-positioned for the long term within the broader retail space to withstand these headwinds,” Greco said. “In addition, our team continues to make progress on our strategic initiatives to drive long-term shareholder value. We remain relentlessly focused on customer service, parts availability and reliability of delivery. We’re confident this will help enable sustainable sales growth, margin expansion and strong cash returns.”
Greco also highlighted some of the positive from the second quarter, including a 10% increase in diluted earnings per share.
“In Q2 we delivered another quarter of growth in net sales and adjusted operating income, underscored by adjusted operating-income margin expansion,” Greco said. “Our adjusted operating-income margin rate of 11.7% was the highest-level AAP has achieved in seven years. This helped enable a quarterly record for adjusted diluted earnings per share of $3.74, which increased 10% compared with Q2 2021 and 72% compared with Q2 2019. Additionally, we returned $291 million dollars to our shareholders through a combination of share repurchases and our quarterly cash dividend.”
