01—Abstract
Summary
Summary of the 10-K filed February 28, 2023. Cited figures are marked; the original filing is the authoritative source.
O'Reilly Automotive, Inc. (ORLY) reported strong performance in its 2022 fiscal year, demonstrating resilience and continued growth within the automotive aftermarket sector.
The company expanded its store footprint, opening 187 net new domestic stores and 17 new stores in Mexico, bringing the total to 5,971 locations. Sales saw an 8%a increase year-over-year, driven by a 6.4% rise in comparable store sales, which benefited from increased average ticket values for both professional and DIY customers. Despite some inflationary pressures impacting SG&A expenses, O'Reilly managed to maintain its operating income margin.
The company also continued its share repurchase program, demonstrating a commitment to returning value to shareholders. The report highlights the company's dual-market strategy, strong customer service, and efficient distribution network as key competitive advantages.
02—Key points
Key Highlights
- O'Reilly Automotive reported an 8% increase in sales for the year ended December 31, 2022, reaching $14.41 billion.
- Comparable store sales increased by 6.4%, indicating continued demand and market penetration.
- The company continued its aggressive store expansion, opening 187 net new domestic stores and 17 new stores in Mexico.
- Operating income saw a slight increase of 1% to $2.95 billion, with operating income as a percentage of sales at 20.5%.
- Selling, general, and administrative (SG&A) expenses increased by 8% but as a percentage of sales, they slightly decreased to 30.7% due to leverage from strong sales.
- Diluted earnings per share (EPS) increased by 8% to $33.44.
- O'Reilly actively repurchased shares, with $3.28 billion spent on repurchases during the year, and $1.7 billion remaining on its authorization at year-end.
03—One dollar
Follow one dollar
Of each $1.00 of revenue in FY2022, O Reilly Automotive Inc kept $0.15.
- Revenue$14.41B100.0%
- Cost of revenue−$7.03B48.8%
- Gross profit$7.38B51.2%
- Operating costs−$4.43B30.7%
- Operating income$2.95B20.5%
- Interest, other & tax−$781.8M5.4%
- Net income$2.17B15.1%
Where FY2022 revenue went
$14.41B- Cost of revenue: $7.03B, 49% of revenue
- SG&A: $4.43B, 31% of revenue
- Net income: $2.17B, 15% of revenue
- Interest, other & tax: $781.8M, 5.4% of revenue
Kept 15% as net income
Full revenue history →04—Financials
Financial Highlights
Figures from 10-KFY2022filed February 28, 2023Financial Statements
FY2022 against FY2021
| Line item | FY2022FY2021 | Change |
|---|---|---|
| Revenue | $14.41B$13.33B | +8.1% |
| Cost of Revenue | $7.03B$6.31B | +11.4% |
| Gross Profit | $7.38B$7.02B | +5.2% |
| SG&A Expenses | $4.43B$4.10B | +7.9% |
| Operating Income | $2.95B$2.92B | +1.3% |
| Interest Expense | $157.72M$144.77M | +8.9% |
| Net Income | $2.17B$2.16B | +0.4% |
| EPS (Basic) | $2.25$2.09 | +7.5% |
| EPS (Diluted) | $2.23$2.07 | +7.5% |
| Shares Outstanding (Basic) | 965.58M1.03B | −6.7% |
| Shares Outstanding (Diluted) | 974.43M1.04B | −6.7% |
05—Questions
Frequently Asked Questions
What was O'Reilly's sales performance in 2022?
O'Reilly Automotive reported a robust increase in sales for the year ended December 31, 2022, with total sales reaching $14.41 billion, an 8% increase compared to $13.33 billion in 2021. This growth was supported by a 6.4% increase in comparable store sales.
How did the company manage its expenses in 2022?
Selling, general, and administrative (SG&A) expenses increased by 8% year-over-year, primarily due to investments in Team Members, facilities, and inflationary pressures. However, as a percentage of sales, SG&A slightly decreased from 30.8% in 2021 to 30.7% in 2022, demonstrating efficient cost management relative to sales growth.
What is O'Reilly's strategy for future growth?
O'Reilly's growth strategy remains focused on aggressively opening new stores, with plans to open 180 to 190 net new stores in 2023. They also aim to grow sales in existing stores through superior customer service and product availability, and selectively pursue strategic acquisitions to further consolidate the fragmented automotive aftermarket industry.
How does O'Reilly return value to shareholders?
O'Reilly demonstrates a strong commitment to shareholder returns primarily through its share repurchase program. In 2022, the company repurchased $3.28 billion of its common stock. While the company does not currently pay dividends, its active share repurchases aim to enhance shareholder value.
06—Continue