O'Reilly announces Hinojosa purchase, 3rd-quarter results

O'Reilly Automotive, a local, publicly held company, announced Oct. 27 that it has entered a definitive agreement to purchase the assets of Hinojosa Auto Parts, a Brownsville, Texas-based automotive business, according to a release from the company.

O'Reilly will purchase the inventory, fixtures, certain real estate and other assets of Hinojosa for approximately $6 million in cash.

Under the terms of the agreement, O'Reilly will not assume any liabilities of Hinojosa, the release states.

Hinojosa operates 10 stores and a 48,000-square-foot distribution center in the Rio Grande Valley along the Texas/Mexico border. The company has been in business for 31 years and is family-owned and -operated, the release said.

O'Reilly also released its earnings for the third quarter and first nine months of 1998. According to a release from the company, this represents the 22nd consecutive quarter of record revenues and earnings for O'Reilly since becoming a public company in April 1993.

Included in the first nine months of 1998 are eight months of operation for Hi-Lo Automotive, which was acquired by O'Reilly effective Jan. 31, 1998.

For the three months ended Sept. 30, net income totaled $8.4 million, up 26.3 percent from $6.6 million one year ago. Earnings per common share (diluted) for the quarter increased 22.6 percent to 38 cents on 21.9 million shares vs. 31 cents a year ago on 21.3 million shares.

Product sales for the third quarter increased to $172.8 million from $87.5 million for the same period in the prior year, representing an increase of 97.4 percent. Gross profit for the third quarter of 1998 increased to $69.3 million from $36.5 million for the third quarter of 1997, representing an increase of 89.8 percent, the release said.

Net income for the first nine months totaled $21.9 million, up 23.4 percent from $17.7 million for the same period a year ago.

Comparable store product sales for the O'Reilly stores for the third quarter of 1998 and the first nine months of 1998 increased by 9.3 percent and 7.3 percent, respectively. The Hi/Lo stores' comparable store product sales increased by 2.2 percent and 1.6 percent for the third quarter of 1998 and the first nine months of 1998, respectively.

This resulted in a total comparable store product sales increase of 6.1 percent for the three months ended Sept. 30 and 4.9 percent for the first nine months of 1998. Comparable store product sales are calculated based on the change in product sales of only those O'Reilly and Hi/Lo stores open during both full periods being compared, the release said.

In addition to the acquisition of the Hi/Lo stores, O'Reilly opened 35 new stores in the first nine months of 1998, which includes 14 net new stores in the three months ended Sept. 30.

O'Reilly plans to open 15 additional stores in 1998 and 80 stores in 1999, the release said. O'Reilly also plans to open its distribution center in Des Moines, Iowa, March 1, 1999.

O'Reilly is a leading specialty retailer and supplier of automotive aftermarket parts, tools, supplies, equipment and accessories to both do-it-yourself customers and professional mechanics and service technicians.

Founded in 1957 by the O'Reilly family, the company operates stores in the states of Missouri, Texas, Arkansas, Kansas, Oklahoma, Nebraska, Iowa, Louisiana and Illinois.

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