Brentwood Home Page news reports
Brentwood-based Tractor Supply Company, the largest retail farm and ranch store chain in the United States, on Wednesday announced financial results for its third fiscal quarter which ended Sept. 24.

Net sales increased 17.9% to $977.8 million from $829.1 million in the prior year's third quarter. Same-store sales increased 11.5% compared to a 5.0% increase in the prior-year period.

"During the third quarter, we generated double-digit increases in both sales and earnings on top of last year's record results while improving gross margin and leveraging SG&A costs,” Jim Wright, chairman and CEO, stated.

“This strong performance, which also included positive ticket and traffic, reflects the impact of our strategic initiatives and our ability to respond to our customers' everyday rural lifestyle needs. Additionally, we executed exceptionally well and successfully managed through the inflationary environment. We are delighted that we continue to experience broad-based strength across the business."

The same-store sales increase was driven by continued strong results in core consumable, usable and edible products, principally animal- and pet-related merchandise; seasonal heating products and emergency response merchandise related to Hurricane Irene. Additionally, same-store sales were favorably impacted by higher selling prices due to inflation in key C.U.E. categories.

Gross margin increased 18.8% to $327.6 million, or 33.5% of sales, compared to $275.7 million, or 33.2% of sales, in the prior year's third quarter. The increase in gross margin reflects improved direct product margin, partially offset by increased transportation costs and product mix. Direct product margin increased as a result of improved inventory management, strategic sourcing, private branding and pricing.

Net income for the quarter was $42.7 million, or $0.58 per diluted share, compared to net income of $29.9 million, or $0.40 per diluted share, in the third quarter of the prior year.

The Company opened 12 stores, relocated one store and closed one store compared to opening nine stores in the prior year's third quarter.

Based on strong performance in the third quarter, the Company raised its financial expectations for fiscal 2011.

"Our track record of consistently generating strong results demonstrates that we are benefiting from our strategic initiatives which, collectively, have strengthened the structural foundation of the Tractor Supply Company business and brand,” Wright said. “As we look ahead, we are well-prepared for the upcoming fall, winter and holiday selling season and believe that our merchandising and marketing initiatives will allow us to gain market share. With the right strategies, capital structure and team in place, we are confident in our outlook for 2011 and our ability to continue to build on our momentum for the long-term."