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Advance Auto Profit Falls, Yet Tops Estimate; Stock Up - Update

Advance Auto Parts Inc. (AAP), Thursday reported a lower fourth-quarter profit, as the automotive parts retailer incurred higher selling and interest expenses that offset a slight improvement in revenues. Nonetheless, quarterly earnings topped Street estimates, sending the company's shares up nearly 7 percent in morning trade on the New York Stock Exchange.

The Roanoke, Virginia-based company reported fourth-quarter net income of $65 million or $0.88 per share, compared with $66 million or $0.90 per share last year.

On average, 20 analysts polled by Thomson Reuters estimated earnings of $0.76 per share for the quarter. Analysts' estimates typically exclude one-time items.

Revenue for the period totaled $1.329 billion, compared with $1.327 billion a year ago. Analysts on consensus estimated revenues of $1.33 billion for the quarter.

On a same-store basis, sales were negative at 1.9 percent, compared with a growth of 2.9 percent a year ago.

Results were impacted with selling, general and administrative expenses increasing to $550 million from $539 million in the prior year. Interest expense rose to $8 million from $5 million a year ago.

Gross margin for the quarter rose 9 basis points to 49.9 percent, reflecting improvements in shrink and supply chain efficiencies.

The company declared a dividend of $0.06 per share, payable April 5 to stockholders of record as of March 22.

For fiscal year 2013, the company expects net earnings of $5.30 to $5.45 per share, including BWP one-time integration costs. Operating earnings are forecast in the range of $5.45 to $5.60 per share.

Analysts currently estimate earnings of $5.58 per share for 2013.

The company expects to open 170 to 190 new stores during the year.

The company's stock is trading at $77.66, up 6.53%, on a volume of 2.6 million shares.

by RTT Staff Writer

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