MEMPHIS, Tenn. (Oct. 24, 2002)—TBC Corp. reported record sales and earnings in the third quarter as the company benefited from an expanded retail store network and improved same-store sales.
The firm's unit tire sales were unchanged from a year earlier, vs. an industry-wide shipments decline.
Net income in the quarter ended Sept. 30 increased 27.5 percent to $7.6 million, while sales rose 5.9 percent to $295.5 million. Same store sales for the Tire Kingdom and Big O retail stores increased 3 percent in the quarter.
“The execution of our multi-channel marketing strategy enabled us to again outpace the industry in the third quarter,” said Larry Day, president and CEO. “Same store sales comparisons for the third quarter and year-to-date were driven in part by increased mechanical service revenues, as we attracted customers to the broad range of products and services offered by our Tire Kingdom and Big O stores.”
From January through September of this year, TBC added 67 retail stores, including 16 in the third quarter, bringing to 753 the number of stores in operation. The retail segment now represents nearly half of TBC's total revenues and more than half of its pre-tax earnings
“In addition to driving our top line, the expansion of our retail store base gives us the opportunity to capitalize on our wholesale sourcing strength and better leverage our distribution and administrative costs,” Mr. Day said.
Net income for the nine months increased 25.5 percent to $19.3 million, as sales rose 9.2 percent to $831.9 million. Same-store sales rose 5.2 percent in the period, and unit tire sales grew 5.3 percent compared with an industry decline, TBC said.
The company also said it is confident it can generate earnings growth next year of 10 to 15 percent over 2002.