Napa Auto Parts 2010 Annual Report Download - page 18

Table of Contents
relatively in-line with our sales increase in the fourth quarter of the year and inventory was up slightly, including acquisitions. Accounts
payable increased $281 million or 26% from the prior year, due primarily to improved payment terms with certain suppliers and other
ongoing payables initiatives such as a procurement card program. Total debt outstanding at December 31, 2010 was unchanged from
$500 million at December 31, 2009.
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Our results of operations are summarized below for the three years ended December 31, 2010, 2009 and 2008.
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  

Net Sales  $10,057,512 $11,015,263
Gross Profit  3,009,762 3,272,490
Net Income  399,575 475,417
Diluted Earnings Per Share  2.50 2.92
Net Sales
Consolidated net sales for the year ended December 31, 2010 totaled $11.2 billion, an 11% increase from 2009 driven by sales
growth in all four of our business segments. The Industrial and Electrical business segments experienced the greatest percentage increases
for the year, as the manufacturing sector of the economy was much stronger in 2010 relative to 2009. These businesses also benefited
from acquisitions in 2010. Sales for the Automotive business segment were much improved in 2010 as well, primarily due to the benefits
of well executed internal initiatives and the overall improvement in the economy. Cumulatively, prices in 2010 were up approximately 1%
in the Automotive segment, up approximately 3% in the Industrial segment, up approximately 4% in the Electrical segment and
approximately flat in the Office segment.
Consolidated net sales for the year ended December 31, 2009 totaled $10.1 billion, a 9% decrease from 2008. Each of our four
businesses experienced sales decreases, with the Industrial and Electrical business segments showing the most significant declines, as the
manufacturing sector of the economy was severely impacted by the weak economic conditions, which we began to experience in the latter
part of 2008. The general weakness in demand resulting from lower consumer spending and industrial production and higher
unemployment appeared to stabilize over the last half of 2009. Among the four quarters in 2009, the fourth quarter was the strongest
period for sales in each business segment. Cumulatively, prices in 2009 were down approximately 3% in the Automotive segment,
approximately flat in the Industrial segment and up approximately 4% in the Office segment and 2% in the Electrical segment.
Automotive Group
Net sales for the Automotive Group (“Automotive”) were $5.6 billion in 2010, an increase of 7% from 2009. Sales improved in
2010 due to the successful execution of our sales initiatives and the stronger economy, which drove increased demand for automotive
maintenance and supply items. Automotive revenues were up 6% in the first quarter, followed by 7% increases in the second and third
quarters, and a 9% increase in the fourth quarter. Other factors impacting our Automotive sales for the year include the effect of currency,
which positively impacted sales by approximately 2%.
Automotive sales were $5.2 billion in 2009, a decrease of 2% from 2008. Sales were impacted by the soft economy in 2009, which
reduced the overall level of consumer spending and, specifically, the demand for automotive maintenance and supply items. The first half
of the year proved to be the most challenging, with Automotive sales down 7% and 5% in the first and second quarters, respectively.
Sales were down 1% in the third quarter followed by a 6% increase in the fourth quarter. Other factors impacting our Automotive sales for
the year include acquisitions, which had an approximately 1% positive effect on sales, and the effect of currency, which negatively
impacted sales by approximately 2%.
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