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Mar 28, 2020
CarParts.com Q1 2020 Earnings Report
U.S. Auto Parts reported record sales, with significant growth in private label sales and improved profitability.
Key Takeaways
U.S. Auto Parts reported record net sales for Q1 2020, driven by a substantial increase in private label sales. The company's gross profit and adjusted EBITDA also saw significant improvements compared to the year-ago quarter, despite a net loss.
Net sales increased by 18% to a record $87.8 million.
Private label sales increased by 42%.
Gross profit increased by 48% to $29.8 million, with gross margin up to 33.9%.
Net loss improved to $(1.0) million or $(0.03) per share.
CarParts.com
CarParts.com
Forward Guidance
The company is on pace to generate strong sales and adjusted EBITDA growth in the second quarter.
Positive Outlook
- Net sales are up more than 40% through the first five weeks of Q2.
- Higher-margin e-commerce business is significantly outpacing marketplace business.
- Company is well-positioned to operate in the new environment.
- Turnaround strategy is working.
- Actions taken last year to create a lean and efficient operating model have dramatically improved profitability.
Challenges Ahead
- Miles driven are down 50% across the nation.
- COVID-19 environment introduces uncertainty.
- Increase in operating expenses due to marketing spend.
- Increase in operating expenses due to expenses from the new Las Vegas distribution center.
- Net loss of $(1.0) million for the quarter.