Advance Auto Parts 2012 Annual Report Download - page 29

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22
Fiscal 2012 Highlights
A high-level summary of our financial results and other highlights from our Fiscal 2012 include:
Financial
• Total sales during Fiscal 2012 increased 0.6% to $6,205.0 million as compared to Fiscal 2011, primarily driven by the
addition of 132 net new stores partially offset by a 0.8% decrease in comparable store sales.
• Our operating income for Fiscal 2012 was $657.3 million, a decrease of $7.3 million from the comparable period in
Fiscal 2011. As a percentage of total sales, operating income was 10.6%, a decrease of 18 basis points, due to the
deleverage of our SG&A rate partially offset by a slightly higher gross profit rate.
• Our inventory balance as of December 29, 2012 increased $265.5 million, or 13.0%, over the prior year driven
primarily by our inventory availability initiatives, including store upgrades, the opening of our new distribution center,
continued expansion of our HUB network and new store growth.
• We generated operating cash flow of $685.3 million during Fiscal 2012, a decrease of 17.3% compared to Fiscal 2011,
with the largest portion of the decrease consisting of an increase in accounts receivable resulting from the in-sourcing
of our Commercial credit program.
Other
• In January 2012 we issued $300 million of senior unsecured notes, due in 2022, with an interest rate of 4.50%.
• We opened our tenth distribution center in Remington, IN which will provide needed warehouse capacity and
upgraded supply chain technology.
• We in-sourced our Commercial credit function and rolled out our MotoLogic® diagnostic and repair resource to
support the continued investment in our Commercial business.
Subsequent to Fiscal 2012, we completed the acquisition of B.W.P. Distributors, Inc., a leading Commercial provider in the
Northeast.
Refer to the "Results of Operations" and "Liquidity" sections for further details of our income statement and cash flow results,
respectively.
Business Update
Our two key strategies, Superior Availability and Service Leadership, remained unchanged in Fiscal 2012 and continue to
serve as the foundation for all of the initiatives we undertake. Superior Availability is focused on consistently improving
product availability and maximizing the speed, reliability and efficiency of our local market availability. Service Leadership
relies on Superior Availability and a more consistent execution of serving our DIY and Commercial customers' needs whether
in our stores or online. Through these two key strategies, we believe we can continue to build on the initiatives discussed below
and produce favorable financial results over the long term. Sales to Commercial customers remain the biggest opportunity for
us to increase our overall market share in the automotive aftermarket industry. Our Commercial sales, as a percentage of total
sales, increased to 38% in Fiscal 2012 compared to 37% in Fiscal 2011.