Record
Quarterly Sales of $166.1 million, up 15%
9th Consecutive Quarter of Year over Year Sales Growth
Record Adjusted EBITDA of $9.4 million
TORRANCE, Calif., May 3, 2022 /PRNewswire/ --
CarParts.com, Inc. (NASDAQ: PRTS), one of the leading
e-commerce providers of automotive parts and accessories, is
reporting results for the first quarter ended April
2, 2022.
First Quarter 2022 Summary vs. Year-Ago Quarter
- Net sales increased 15% year over year to $166.1 million and increased 80% on a two-year
stack.
- Gross profit increased 24% to $61.2
million, with gross margin increasing 280 basis points to
36.8%.
- Net income was $2.1 million or
$0.04 per diluted share, compared to
net loss of ($2.7) million or
($0.06) per diluted share.
- Adjusted EBITDA increased to $9.4
million vs. $3.6 million.
- Grew inventory to record $157.9
million.
Management Commentary
"Our company is on solid ground both operationally and
financially," said David Meniane, CEO of CarParts.com. "Once again,
we achieved a record-breaking sales quarter as well as a
record-breaking Adjusted EBITDA quarter."
"When I look at the business going forward, there are 4 areas of
focus for us to continue to strive for perfection: outstanding
customer service, operational excellence, financial discipline, and
innovation. Combining these focus areas with disciplined profitable
growth, will be our core strategy going forward."
First Quarter 2022 Financial Results
Net sales in the first quarter of 2022 were $166.1 million compared to $144.8 million in the year-ago
quarter. The increase was primarily driven by continued
strong demand and the expanded capacity from
our Grand Prairie distribution center.
Gross profit in the first quarter increased 24% to
$61.2 million compared to
$49.2 million in the first
quarter last year, with gross margin increasing 280 basis points
to 36.8%.
Total operating expenses in the first quarter were $58.8 million compared to $51.7 million in the first quarter last year due
to an increase in sales and investments in the business.
Net income in the first quarter was $2.1 million
compared to a net loss of ($2.7)
million in the first quarter last year.
Adjusted EBITDA in the first quarter increased to $9.4 million compared to $3.6 million in the year-ago quarter.
On April 2, 2022, the Company had
a cash balance of $25.0 million,
$5.0 million of revolver debt and no
outstanding trade letters of credit ("LCs"), compared to no
revolver debt, no outstanding trade LCs and a $18.1 million cash
balance at prior fiscal year-end January 1, 2022. The revolver debt was primarily
used to increase our inventory position in support of our
Grand Prairie, Texas distribution
center expansion and the upcoming second quarter opening of our new
Jacksonville, Florida distribution
center.
Conference Call
CarParts.com CEO David Meniane
and CFO Ryan Lockwood 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: Tuesday, May 3, 2022
Time: 5:00 p.m. Eastern time
(2:00 p.m. Pacific time)
Webcast: www.carparts.com/investor/news-events
To listen to the live call, please click the link above to
access the webcast at least 5-10 minutes prior to the start time to
register your name and organization. The audio webcast will be
archived on the Company's website at
www.carparts.com/investor.
If you are unable to join via the webcast, you may dial in to
the call at 833-649-1138 (domestic) or 918-922-3112 (international)
using access code 1791764. A telephone replay will also be
available on the same day through May 10,
2022 at 855-859-2056 (domestic) or 404-537-3406
(international) using access code 1791764.
About CarParts.com, Inc.
With over 25 years of experience, and more than 50 million parts
delivered, we've streamlined our website and sourcing network to
better serve the way drivers get the parts they need. Utilizing the
latest technologies and design principles, we've created an
easy-to-use, mobile-friendly shopping experience that, alongside
our own nationwide distribution network, cuts out the
brick-and-mortar supply chain costs and provides quality parts at a
budget-friendly price.
CarParts.com is headquartered in Torrance, California.
Non-GAAP Financial Measures
Regulation G, and other provisions of the Securities Exchange
Act of 1934, as amended, define and prescribe the conditions for
use of certain non-GAAP financial information. We provide "Adjusted
EBITDA," which is a non-GAAP financial measure. Adjusted EBITDA
consists of net income (loss) before (a) interest expense,
net; (b) income tax provision; (c) depreciation and
amortization expense; (d) amortization of intangible
assets; and (e) share-based compensation expense. A
reconciliation of Adjusted EBITDA to net income (loss) is provided
below.
The Company believes that this non-GAAP financial measure
provides important supplemental information to management and
investors. This non-GAAP financial measure reflects an additional
way of viewing aspects of the Company's operations that, when
viewed with the GAAP results and the accompanying reconciliation to
corresponding GAAP financial measures, provides a more complete
understanding of factors and trends affecting the Company's
business and results of operations.
Management uses Adjusted EBITDA as one measure of the Company's
operating performance because it assists in comparing the Company's
operating performance on a consistent basis by removing the impact
of stock compensation expense as well as other items that we do not
believe are representative of our ongoing operating performance.
Internally, this non-GAAP measure is also used by management for
planning purposes, including the preparation of internal budgets;
for allocating resources to enhance financial performance; and for
evaluating the effectiveness of operational strategies. The Company
also believes that analysts and investors use Adjusted EBITDA as a
supplemental measure to evaluate the ongoing operations of
companies in our industry.
This non-GAAP financial measure is used in addition to and in
conjunction with results presented in accordance with GAAP and
should not be relied upon to the exclusion of GAAP financial
measures. Management strongly encourages investors to review the
Company's consolidated financial statements in their entirety and
to not rely on any single financial measure. Because non-GAAP
financial measures are not standardized, it may not be possible to
compare these financial measures with other companies' non-GAAP
financial measures having the same or similar names. In addition,
the Company expects to continue to incur expenses similar to the
non-GAAP adjustments described above, and exclusion of these items
from the Company's non-GAAP measures should not be construed as an
inference that these costs are all unusual, infrequent or
non-recurring.
Safe Harbor Statement
This press release contains statements which are based
on management's current expectations, estimates and projections
about the Company's business and its industry, as well as certain
assumptions made by the Company. These statements are forward
looking statements for the purposes of the safe harbor provided by
Section 21E of the Securities Exchange Act of 1934, as amended
and Section 27A of the Securities Act of 1933, as amended.
Words such as "anticipates," "could," "expects," "intends,"
"plans," "potential," "believes," "predicts," "projects," "seeks,"
"estimates," "may," "will," "would," "will likely continue" and
variations of these words or similar expressions are intended to
identify forward-looking statements. These statements include,
but are not limited to, statements regarding our
future operating results and financial condition, our
potential growth, our ability to innovate, our ability to gain
market share, and our ability to expand and improve our product
offerings. We undertake no obligation to revise or update publicly
any forward-looking statements for any reason. These statements are
not guarantees of future performance and are subject to certain
risks, uncertainties and assumptions that are difficult to
predict. Therefore, our actual results could differ materially
and adversely from those expressed in any forward-looking
statements as a result of various factors.
Important factors that may cause such a difference include,
but are not limited to, competitive pressures, our dependence on
search engines to attract customers, demand for the Company's
products, the online market and channel mix for aftermarket auto
parts, the economy in general, increases in commodity and component
pricing that would increase the Company's product costs, the
operating restrictions in its credit agreement, the weather and any
other factors discussed in the Company's filings with the
Securities and Exchange Commission (the "SEC"), including the Risk
Factors contained in the Company's Annual Report on Form 10‑K
and Quarterly Reports on Form 10‑Q, which are available
at www.carparts.com/investor and the SEC's website
at www.sec.gov. You are urged to consider these factors
carefully in evaluating the forward-looking statements in this
release and are cautioned not to place undue reliance on such
forward-looking statements, which are qualified in their entirety
by this cautionary statement. Unless otherwise required by
law, the Company expressly disclaims any obligation to update
publicly any forward-looking statements, whether as result of new
information, future events or otherwise.
Investor Relations:
Ryan Lockwood, CFA
IR@carparts.com
Summarized information for the periods presented is as follows
(in millions):
|
|
Thirteen Weeks
Ended
|
|
Thirteen Weeks
Ended
|
|
|
|
April 2, 2022
|
|
April 3, 2021
|
|
Net sales
|
|
$
|
166.05
|
|
$
|
144.80
|
|
Gross profit
|
|
$
|
61.16
|
|
$
|
49.17
|
|
|
|
|
36.8
|
%
|
|
34.0
|
%
|
Operating
expense
|
|
$
|
58.77
|
|
$
|
51.67
|
|
|
|
|
35.4
|
%
|
|
35.7
|
%
|
Net income
(loss)
|
|
$
|
2.10
|
|
$
|
(2.72)
|
|
|
|
|
1.3
|
%
|
|
(1.9)
|
%
|
Adjusted
EBITDA
|
|
$
|
9.42
|
|
$
|
3.56
|
|
|
|
|
5.7
|
%
|
|
2.5
|
%
|
The table below reconciles net income (loss) to Adjusted EBITDA
for the periods presented (in thousands):
|
|
|
|
|
|
|
|
|
Thirteen Weeks Ended
|
|
Thirteen Weeks Ended
|
|
|
April 2, 2022
|
|
April 3, 2021
|
Net income
(loss)
|
|
$
|
2,103
|
|
$
|
(2,722)
|
Depreciation &
amortization
|
|
|
2,957
|
|
|
2,379
|
Amortization of
intangible assets
|
|
|
28
|
|
|
28
|
Interest expense,
net
|
|
|
291
|
|
|
249
|
Taxes
|
|
|
52
|
|
|
55
|
EBITDA
|
|
$
|
5,431
|
|
$
|
(11)
|
Stock compensation
expense
|
|
$
|
3,992
|
|
$
|
3,573
|
Adjusted
EBITDA
|
|
$
|
9,423
|
|
$
|
3,562
|
CARPARTS.COM, INC. AND
SUBSIDIARIES
CONSOLIDATED
STATEMENTS OF OPERATIONS AND COMPREHENSIVE
OPERATIONS
(Unaudited, in
Thousands, Except Per Share Data)
|
|
|
|
Thirteen Weeks Ended
|
|
|
April 2,
|
|
April 3,
|
|
|
2022
|
|
2021
|
Net sales
|
|
$
|
166,053
|
|
$
|
144,802
|
Cost of sales
(1)
|
|
|
104,891
|
|
|
95,628
|
Gross profit
|
|
|
61,162
|
|
|
49,174
|
Operating
expense
|
|
|
58,771
|
|
|
51,672
|
Income (loss) from
operations
|
|
|
2,391
|
|
|
(2,498)
|
Other income
(expense):
|
|
|
|
|
|
|
Other, net
|
|
|
56
|
|
|
81
|
Interest
expense
|
|
|
(292)
|
|
|
(250)
|
Total
other expense, net
|
|
|
(236)
|
|
|
(169)
|
Income (loss) before
income taxes
|
|
|
2,155
|
|
|
(2,667)
|
Income tax
provision
|
|
|
52
|
|
|
55
|
Net income
(loss)
|
|
|
2,103
|
|
|
(2,722)
|
Other comprehensive
gain (loss):
|
|
|
|
|
|
|
Foreign currency
translation adjustments
|
|
|
20
|
|
|
14
|
Unrealized (loss) gain
on deferred compensation trust assets
|
|
|
(34)
|
|
|
35
|
Total
other comprehensive (loss) gain
|
|
|
(14)
|
|
|
49
|
Comprehensive income
(loss)
|
|
$
|
2,089
|
|
$
|
(2,673)
|
Net income (loss) per
share:
|
|
|
|
|
|
|
Basic net income (loss)
per share
|
|
$
|
0.04
|
|
$
|
(0.06)
|
Diluted net income
(loss) per share
|
|
$
|
0.04
|
|
$
|
(0.06)
|
Weighted-average common
shares outstanding:
|
|
|
|
|
|
|
Shares used in
computation of basic net income (loss) per share
|
|
|
53,251
|
|
|
48,760
|
Shares used in
computation of diluted net income (loss) per share
|
|
|
57,172
|
|
|
48,760
|
____________________
|
(1) Excludes
depreciation and amortization expense which is included in
operating expense.
|
CARPARTS.COM, INC. AND
SUBSIDIARIES
CONSOLIDATED BALANCE
SHEETS
(Unaudited, In
Thousands, Except Par Value Data)
|
|
|
|
April 2,
|
|
January 1,
|
|
|
2022
|
|
2022
|
ASSETS
|
|
|
|
|
|
|
Current
assets:
|
|
|
|
|
|
|
Cash and cash
equivalents
|
|
$
|
25,035
|
|
$
|
18,144
|
Accounts receivable,
net
|
|
|
6,461
|
|
|
5,015
|
Inventory,
net
|
|
|
157,937
|
|
|
138,851
|
Other current
assets
|
|
|
7,585
|
|
|
6,592
|
Total
current assets
|
|
|
197,018
|
|
|
168,602
|
Property and equipment,
net
|
|
|
22,587
|
|
|
20,736
|
Right-of-use - assets -
operating leases, net
|
|
|
27,428
|
|
|
28,680
|
Right-of-use - assets -
finance leases, net
|
|
|
17,424
|
|
|
15,130
|
Other non-current
assets
|
|
|
2,626
|
|
|
2,188
|
Total
assets
|
|
$
|
267,083
|
|
$
|
235,336
|
LIABILITIES AND STOCKHOLDERS'
EQUITY
|
|
|
|
|
|
|
Current
liabilities:
|
|
|
|
|
|
|
Accounts
payable
|
|
$
|
80,486
|
|
$
|
67,372
|
Accrued
expenses
|
|
|
22,521
|
|
|
17,517
|
Revolving loan
payable
|
|
|
5,000
|
|
|
—
|
Customer
deposits
|
|
|
404
|
|
|
826
|
Right-of-use -
obligation - operating, current
|
|
|
4,323
|
|
|
4,201
|
Right-of-use -
obligation - finance, current
|
|
|
3,671
|
|
|
2,953
|
Other current
liabilities
|
|
|
4,211
|
|
|
3,925
|
Total
current liabilities
|
|
|
120,616
|
|
|
96,794
|
Right-of-use -
obligation - operating, non-current
|
|
|
25,116
|
|
|
26,367
|
Right-of-use -
obligation - finance, non-current
|
|
|
14,512
|
|
|
12,868
|
Other non-current
liabilities
|
|
|
3,624
|
|
|
3,739
|
Total
liabilities
|
|
|
163,868
|
|
|
139,768
|
Commitments and
contingencies
|
|
|
|
|
|
|
Stockholders'
equity:
|
|
|
|
|
|
|
Common stock, $0.001
par value; 100,000 shares authorized; 54,070 and 52,960 shares
issued
and outstanding as of
April 2, 2022 and January 1, 2022 (of which 2,565
are treasury stock)
|
|
|
57
|
|
|
56
|
Treasury
stock
|
|
|
(7,625)
|
|
|
(7,625)
|
Additional paid-in
capital
|
|
|
288,220
|
|
|
282,663
|
Accumulated other
comprehensive gain
|
|
|
260
|
|
|
274
|
Accumulated
deficit
|
|
|
(177,697)
|
|
|
(179,800)
|
Total
stockholders' equity
|
|
|
103,215
|
|
|
95,568
|
Total
liabilities and stockholders' equity
|
|
$
|
267,083
|
|
$
|
235,336
|
CARPARTS.COM, INC. AND
SUBSIDIARIES
CONSOLIDATED
STATEMENTS OF CASH FLOWS
(Unaudited, In
Thousands)
|
|
|
|
Thirteen Weeks Ended
|
|
|
April 2,
|
|
April 3,
|
|
|
2022
|
|
2021
|
Operating activities
|
|
|
|
|
|
|
Net income
(loss)
|
|
$
|
2,103
|
|
$
|
(2,722)
|
Adjustments to
reconcile net income (loss) to net cash provided by operating
activities:
|
|
|
|
|
|
|
Depreciation and
amortization expense
|
|
|
2,957
|
|
|
2,379
|
Amortization of
intangible assets
|
|
|
28
|
|
|
28
|
Share-based
compensation expense
|
|
|
3,992
|
|
|
3,573
|
Stock awards issued for
non-employee director service
|
|
|
6
|
|
|
6
|
Stock awards related to
officers and directors stock purchase plan from payroll
deferral
|
|
|
23
|
|
|
—
|
Amortization of
deferred financing costs
|
|
|
4
|
|
|
5
|
Changes in operating
assets and liabilities:
|
|
|
|
|
|
|
Accounts
receivable
|
|
|
(1,445)
|
|
|
(3,417)
|
Inventory
|
|
|
(19,087)
|
|
|
(8,627)
|
Other current
assets
|
|
|
(998)
|
|
|
(1,903)
|
Other non-current
assets
|
|
|
(503)
|
|
|
554
|
Accounts payable and
accrued expenses
|
|
|
18,296
|
|
|
21,265
|
Other current
liabilities
|
|
|
(136)
|
|
|
2,364
|
Right-of-use obligation
- operating leases - current
|
|
|
125
|
|
|
(72)
|
Right-of-use obligation
- operating leases - long-term
|
|
|
(1)
|
|
|
(44)
|
Other non-current
liabilities
|
|
|
(98)
|
|
|
(338)
|
Net cash provided by
operating activities
|
|
|
5,266
|
|
|
13,051
|
Investing activities
|
|
|
|
|
|
|
Additions to property
and equipment
|
|
|
(3,760)
|
|
|
(2,630)
|
Net cash used in
investing activities
|
|
|
(3,760)
|
|
|
(2,630)
|
Financing activities
|
|
|
|
|
|
|
Borrowings from
revolving loan payable
|
|
|
5,032
|
|
|
69
|
Payments made on
revolving loan payable
|
|
|
(32)
|
|
|
(69)
|
Payments on finance
leases
|
|
|
(844)
|
|
|
(476)
|
Net proceeds from
issuance of common stock for ESPP
|
|
|
431
|
|
|
—
|
Statutory tax
withholding payment for share-based compensation
|
|
|
—
|
|
|
(3)
|
Proceeds from exercise
of stock options
|
|
|
792
|
|
|
163
|
Net cash provided by
(used in) financing activities
|
|
|
5,379
|
|
|
(316)
|
Effect of exchange rate
changes on cash
|
|
|
6
|
|
|
(11)
|
Net change in cash and
cash equivalents
|
|
|
6,891
|
|
|
10,094
|
Cash and cash
equivalents, beginning of period
|
|
|
18,144
|
|
|
35,802
|
Cash and cash
equivalents, end of period
|
|
$
|
25,035
|
|
$
|
45,896
|
Supplemental disclosure
of non-cash investing and financing activities:
|
|
|
|
|
|
|
Right-of-use operating
asset acquired
|
|
$
|
—
|
|
$
|
17
|
Right-of-use finance
asset acquired
|
|
$
|
3,206
|
|
$
|
1,936
|
Accrued asset
purchases
|
|
$
|
1,560
|
|
$
|
1,877
|
Share-based
compensation expense capitalized in property and
equipment
|
|
$
|
314
|
|
$
|
507
|
Stock issued for
services
|
|
$
|
81
|
|
$
|
—
|
Supplemental disclosure
of cash flow information:
|
|
|
|
|
|
|
Cash paid (received)
during the period for income taxes
|
|
$
|
15
|
|
$
|
(135)
|
Cash paid during the
period for interest
|
|
$
|
306
|
|
$
|
287
|
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SOURCE CarParts.com, Inc.