ITASCA, Ill. (Oct. 25, 2007) — Midas Inc.'s operating profit in the fiscal third quarter managed to stay relatively flat at $7.5 million vs. the prior year period despite a 3.2-percent decline in comparable shop sales in the U.S., management said.
However, profit improvements and cost reductions among other factors helped the Itasca-based automotive service chain record a 25-percent gain in net income to $3 million from $2.4 million a year ago. Total sales rose only 1.8 percent to $46.1 million.
“Third quarter retail sales trends for the Midas system were similar to many retailers in North America,” said Alan Feldman, chairman and CEO. “Also, our September results were comparing to a very strong month last year when U.S. comparable shops sales were up 5 percent, led by an 8-percent increase in brakes.”
Midas did not have as much difficulty selling tires. Comparable sales of tires in its U.S. shops rose 9 percent and oil changes 11 percent. Those gains, however, were offset by a 7-percent drop in brakes and an 11-percent decline in exhaust work.
“In July, we began a heavy schedule of advertising, which runs through mid-November, for the $29.95 Midas Touch Maintenance Package including oil and filter replacement, tire inspection and rotation and a multi-point vehicle inspection,” Mr. Feldman said.
For the first nine months of Midas' fiscal year, sales were basically flat at $133.1 million as net income fell slightly to $8.2 million from $8.8 million.
Midas ended the third quarter with 80 company-owned shops. The remainder of its approximately 2,500 shops are franchises or licensees.