Advance Auto Parts 4Q profit jumps on higher sales, but results miss Wall Street estimates

IndustriesAssociated Press

Advance Auto Parts Inc. said Thursday that its fourth-quarter profit jumped more than 70 percent as it benefited from the addition of sales from a car parts supplier it bought last year.

The Roanoke, Virginia, seller of windshield wipers, batteries and other auto parts reported earnings of $84.4 million, or $1.15 per share, up from $49.3 million, or 67 cents per share, a year ago.

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On an adjusted basis, Advance Auto said it earned $1.37 per share, missing Wall Street expectations of $1.48 per share, according to Zacks Investment Research.

Revenue climbed nearly 59 percent to $2.24 billion in the fourth quarter. Analysts expected $2.28 billion. Same store sales, a key gauge for retailers that excludes recently opened or closed locations, rose 1 percent.

Last year, Advance Auto completed a $2.04 billion deal for privately held distributor and supplier General Parts International Inc., which the companies said would create the biggest automotive replacement parts provider in North America. It also had acquired privately held Northeast car parts supplier B.W.P. Distributors Inc. in late 2012.

Advance Auto now operates more than 5,370 stores in North America, Puerto Rico and the Virgin Islands. That's compared with about 4,050 stores a year ago.

When vehicle sales tumbled a few years ago, auto parts retailers such as Advance Auto Parts got a sales boost, as more Americans kept their vehicles longer and invested more in keeping them running.

But improved consumer confidence and cheap gas are likely to push new car sales to their highest level in a decade this year.

Analysts expect sales to reach 17 million for the first time since 2005. That's close to the record of 17.3 million set in 2000.

For all of 2014, sales were up 6 percent to 16.5 million vehicles, according to Autodata Corp. That was the biggest year for the industry since 2006.

For the full year, Advance Auto said its profit rose 26 percent to $493.8 million. Revenue increased 51 percent to $9.84 billion. It expects full-year earnings for 2015 in the range of $8.35 to $8.55 per share.

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Michael Felberbaum can be reached at http://www.twitter.com/MLFelberbaum.