Net sales of Tractor Supply Company (TSCO) for the third quarter rose 9.3% to $1.88 billion from $1.72 billion a year ago, with comparable store sales rising 5.1%. Gross profit jumped 8.8% to $653.1 million. Net income soared 27.1% to $116.8 million, while diluted earnings rose 31.9% to $0.95 a share.
At quarter end, $398.4 million of capital was returned to shareholders since the year began. The company benefited from comp store sales rising due to increases in comparable average ticket of 3.6% and comparable transaction count of 1.4%, driven by broad-based strength in everyday merchandise, along with robust growth across spring and summer seasonal categories.
All merchandise categories delivered higher comparable store sales, as did all geographic regions. The Gross profit jump of 8.8% was, however, diminished by gross margin falling 16 basis points to 34.7%, due to an increase in freight expense on higher carrier rates and increased diesel fuel prices. Tractor Supply opened 23 new Tractor Supply stores and seven new Petsense stores in the third quarter of 2018.
Outlook
The company updated its guidance for fiscal 2018, on better-than-expected results for the first 9 months.
Net sales is now expected to be between $7.84 billion and $7.87 billion generating net income of $522-528 million on comparable store sales growth between 4% and 4.5%. Earnings for the fiscal year is now seen at $4.23-4.27 per diluted share.