=Advance Auto (AAP) reported earnings on Tue 15 Aug 17 (b/o)

Advance Auto misses by $0.08, reports revs in-line; provides updated FY17 outlook(109.32 )

• Reports Q2 (Jun) earnings of $1.58 per share, excluding non-recurring items, $0.08 worse than the Capital IQ Consensus of $1.66; revenues rose 0.3% year/year to $2.26 bln vs the $2.26 bln Capital IQ Consensus.
• Comparable store sales for the quarter were flat.
• The Company's Gross Profit margin decreased 91 basis points year over year to 43.9%. The decline was primarily driven by the non-cash accounting impact of the planned inventory reduction as well as the increase in supply chain costs, unfavorable mix and commodity headwinds. These factors were partially offset by the Company's efforts to drive favorable material cost performance. The non-cash accounting impact of the year over year inventory reduction was 26 basis points in Q2. Excluding the non-cash accounting impact of the inventory reduction, the Company's Gross Profit margin decreased 65 basis points year over year.
• The Company provided the following update to its full fiscal year 2017 guidance:
  • New Stores 60-65 new stores
  • Comparable Store Sales -3% to -1%
  • Adjusted Operating Income Rate 200 to 300 basis points year over year reduction
• "Our revised guidance for the year incorporates the impact of industry headwinds in the first half, which we expect to continue in the second half of the year and we are taking the appropriate actions to adapt to this environment."