Consumables driving growth at Tractor Supply
A few weeks after opening its 1,700th store, Tractor Supply Co.'s latest quarterly results show that the retailer is on a path to sustainable long-term growth.
The largest rural lifestyle retail store chain in the United States posted a same store sales increase of 3.7% for the first quarter ended March 31. Net sales increased 7.6%.
“For the first quarter, we are pleased with our overall performance and how effectively we managed our business. We generated solid increases in both comparable store sales and gross margin, despite a delay in the spring selling season in many of our markets. As we enter the second quarter, we believe we are well-positioned to capitalize on the spring selling season. Looking to the balance of 2018, we remain excited about the opportunities ahead of us as we continue to execute our ONETractor strategy, which we believe will contribute to sustainable long-term growth for our shareholders,” said Greg Sandfort, Tractor Supply’s Chief Executive Officer.
The retailer said the same store sales growth in the quarter was broad based across all geographic regions. The increase in comps was primarily driven by strength in everyday merchandise, including consumables, usable and edible products, along with strong demand for winter seasonal categories. These increases were offset by lower sales of spring and summer seasonal products.
Net income increased 18.4% to $71.4 million in the first quarter of 2018 from $60.3 million in the prior year’s first quarter and diluted earnings per share increased 24.0% to $0.57 from $0.46 in the first quarter of 2017.
The company opened 15 new Tractor Supply stores and four Petsense stores in the first quarter of 2018 compared to 24 new Tractor Supply store openings and nine Petsense store openings (including the conversion of the two Hometown Pet stores) in the prior year’s first quarter.
Tractor Supply Co. operates more than 1,700 stores in 49 states and an e-commerce website. The company also owns and operates Petsense, a small-box pet specialty supply retailer focused on meeting the needs of pet owners, primarily in small and mid-size communities, and offering a variety of pet products and services. The company operated 172 Petsense stores in 27 states.