RTS) | Seeking Alpha
]TORRANCE, Calif., Aug. 5, 2021 /PRNewswire/ -- CarParts.com, Inc. (NASDAQ:PRTS), one of the leading e-commerce providers of automotive parts and accessories, is reporting results for the second quarter ended July 3, 2021.
Second Quarter 2021 Summary vs. Year-Ago Quarter
- Net sales increased 32% year over year to $157.5 million.
- Gross profit increased 31% to $53.3 million, with gross margin down 40 basis points to 33.9% driven in part to continued pressure from inbound and outbound freight as well as a shift in mix in branded products, which typically carry a higher selling price but lower gross margin percentage.
- Net income was $2.1 million or $0.04 per diluted share, compared to net income of $1.6 million or $0.03 per diluted share.
- Record Adjusted EBITDA of $8.3 million vs. $5.6 million.
- Announced $30 million in stock repurchase plan.
- Management reiterates long term targets of 20-25% compounded revenue growth and 8-10% EBITDA margin.
"We saw another record-breaking quarter with revenues of $157.5 million," said Lev Peker, CEO of CarParts.com. "We also achieved a record breaking $8.3 million of Adjusted EBITDA."
"A large contributor to our revenue growth was due to an increase in DC capacity since Grand Prairie was fully operational. I'm proud to announce that we are expanding the space there by 156k square feet and we have also signed a lease to open a new 180k square foot Jacksonville, Florida distribution center. Once these two facilities are added to our network, our total DC square footage will exceed 1.2 million square feet."
"We are also announcing a share repurchase program of up to $30 million. The program gives us a flexible way to return value to our shareholders when we see unwarranted volatility in our stock and we intend to be opportunistic with repurchases. An important driver of our decision making will of course be the potential ROI of any dollar spent; whether it's an investment into our shares, inventory, supply chain or technology."
Second Quarter 2021 Financial Results
Net sales in the second quarter of 2021 were $157.5 million compared to $118.9 million in the year-ago quarter. The increase was primarily driven by the expanded capacity coming from our Grand Prairie distribution center and the additional product offering of branded inventory from our partner network.
Gross profit in the second quarter increased 31% to $53.3 million compared to $40.8 million in the second quarter last year, with gross margin down 40 bps to 33.9% compared to 34.3%. The decrease in gross margin was in part due to continued pressure from inbound and outbound freight as well as a shift in mix in branded products, which typically carry a higher selling price but lower gross margin percentage.
Total operating expenses in the second quarter were $51.0 million compared to $38.7 million in the second quarter last year in line with our growth in sales.
Net income in the second quarter increased to $2.1 million compared to $1.6 million in the second quarter last year. The increase was driven by the significant sales growth.
Adjusted EBITDA in the second quarter increased to $8.3 million compared to $5.6 million in the year-ago quarter. The increase was driven by the significant sales growth.
On July 3, 2021, the Company had no revolver debt, no outstanding trade letters of credit ("LCs") and a cash balance of $33.1 million, compared to no revolver debt, no outstanding trade LCs and a $35.8 million cash balance at prior fiscal year-end January 2, 2021.
On July 27, 2021, the Company's Board of Directors authorized a new stock repurchase program under which the Company may purchase up to $30 million of the Company's common stock from time to time. The repurchases of common stock may be executed through open market purchases, block trades, the implementation of a 10b5-1 plan, and/or any other available methods. The amount and timing of repurchases will depend upon market conditions and other corporate considerations. The share repurchase program does not obligate the Company to acquire any particular amount of stock, and it may be terminated, modified, or suspended at any time at the Company's discretion.
Conference Call
CarParts.com CEO Lev Peker and CFO/COO David Meniane will host a conference call today via an audio webcast on the Company's website per the link below, followed by a question and answer period.
Date: Thursday, August 5, 2021
Time: 5:00 p.m. Eastern time (2:00 p.m. Pacific time)
Webcast: www.carparts.com/investor/news-events
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