ROCHESTER, N.Y. - Monro, Inc. (NASDAQ: NASDAQ:MNRO), a leader in automotive undercar repair and tire services, announced its fourth-quarter financial results, revealing earnings and revenue that fell short of Wall Street expectations.
The company reported adjusted earnings per share (EPS) of $0.21 for the quarter, which was below the analyst consensus estimate of $0.30. Revenue for the quarter was $310.08 million, also missing the analyst projection of $320.43 million.
In comparison to the same quarter last year, Monro's fourth-quarter sales saw a slight decrease of 0.2% from $310.8 million. The company experienced a marginal increase in comparable store sales of 0.1% on a reported basis, but when adjusted for days, there was a 7.2% decrease.
This decline was attributed to a strained low-to-middle income consumer base that opted for lower-margin tires due to an industry-wide oversupply. Despite these challenges, Monro achieved a gross margin expansion of 210 basis points over the prior year period, largely due to reduced technician labor costs, including a 15% reduction in overtime hours, and lower material costs as a percentage of sales.
President and Chief Executive Officer Mike Broderick commented on the company's performance, stating, "We expanded gross margins, both in the fourth quarter and for the full fiscal year. We continued to mitigate a challenged topline with actions to reduce non-productive labor costs, including overtime hours in our stores." Broderick also noted that while the tire market's weakness has persisted longer than expected, Monro has navigated the situation effectively through strategic actions and initiatives.
For the full fiscal year 2024, Monro reported a sales decrease of 3.7% to $1.277 billion from $1.325 billion in fiscal 2023, with a reported 2.0% decrease in comparable store sales and a 3.9% decrease when adjusted for days. The company's adjusted diluted EPS for fiscal 2024 was $1.33, slightly down from $1.36 in the previous year.
Monro closed 8 stores during the fourth quarter, ending with 1,288 company-operated stores and 51 franchised locations. The company did not provide specific financial guidance for fiscal 2025 but generated operating cash flow of $125 million in fiscal 2024 and reported total liquidity of $475 million as of March 30, 2024.
The Board of Directors approved a cash dividend for the first quarter of fiscal year 2025 of $0.28 per share, payable on June 18, 2024, to shareholders of record as of June 4, 2024. Monro did not repurchase any shares under its current authorization during the fourth quarter but repurchased 1.5 million shares at an average price of $28.50 for $44 million during fiscal 2024.
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