Tractor Supply releases Q3 2024 results
Tractor Supply Company has reported its financial results for the quarter ended September 28, 2024. The highlights include:
- Net sales increased 1.6 percent to $3.47 billion.
- Comparable store sales experienced a slight decrease of 0.2 percent.
- The company is raising the lower end of annual guidance for sales and earnings.
- The company opened 16 new stores in the third quarter of 2024.
- It reached a definitive agreement to acquire Allivet, an online pet pharmacy.
“We delivered on our expectations for the third quarter amid a tepid retail sales environment ... The fundamentals of our business remain strong with ongoing market share gains. With nearly 50 percent of our stores in Project Fusion layout and more than 550 garden centers, we continue to invest in our stores, supply chain and capabilities that build customer loyalty and elevate the standard for our sector,” said Hal Lawton, president and CEO of Tractor Supply.
"We remain very excited about the future for Tractor Supply to better serve our customers, capture market share, generate consistent, profitable growth and create ongoing long-term value for our shareholders. Today’s announcement of our acquisition of Allivet, a leading online pet pharmacy, is a great example of unlocking new opportunities for growth. We look forward to bringing pet Rx to our 37 million Neighbor’s Club members.”
Tractor Supply's Q3 2024 results, highlights
Net sales for the third quarter of 2024 increased 1.6 percent to $3.47 billion from $3.41 billion in the third quarter of 2023. The increase in net sales, per the company, was driven by new store openings.
Comparable store sales declined 0.2 percent, compared to the third quarter of 2023, driven by a comparable average transaction count increase of 0.3 percent and offset by a comparable average ticket decrease of 0.5 percent. Comparable store sales results reflect continued strength in big ticket categories, according to Tractor Supply, partially offset by declines in year-round discretionary categories. Consumable, usable and edible products were modestly negative with positive unit growth offset by average unit price pressure.
Gross profit increased 3.2 percent to $1.29 billion from $1.25 billion in the prior year’s third quarter, and gross margin increased 56 basis points to 37.2 percent from 36.7 percent in the prior year’s third quarter. The gross margin rate increase was primarily attributable to ongoing lower transportation costs along with disciplined product cost management and the continued execution of an everyday low price strategy. These improvements in gross margin rate were partially offset by growth in big ticket categories, which have below chain-average margins.
Net income decreased 5.3 percent to $241.5 million from $255.0 million.
Selling, general and administrative (SG&A) expenses, including depreciation and amortization, increased 6.2 percent to $965.8 million from $909.6 million in the prior year’s third quarter. As a percentage of net sales, SG&A expenses increased 119 basis points to 27.8 percent from 26.7 percent in the third quarter of 2023. The increase in SG&A as a percent of net sales was primarily attributable to planned growth investments, including the onboarding of a new distribution center.
Operating income was $324.6 million in the third quarter of 2024 compared to $340.9 million in the third quarter of 2023.
The effective income tax rate was 22.3 percent compared to 23 percent in the third quarter of 2023.
The company repurchased approximately 0.6 million shares of its common stock for $149.8 million and paid quarterly cash dividends totaling $117.8 million, returning a total of $267.6 million of capital to shareholders in the third quarter of 2024.
The company opened 16 new Tractor Supply stores in the third quarter of 2024.
Read TSC's full results for Q3 2024 here.
