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Friday, October 31, 2008

Advance Auto sees consumers struggle

Sales to do-it-yourselfers continue "to remain in crisis mode," according to one company official.

An Advance Auto Parts executive said Thursday that the Roanoke company sees evidence the national slowdown in retail spending is affecting the company. "Consumers are struggling," Elwyn Murray, executive vice president, said in a conference call with industry analysts.

Advance Auto's DIY business -- sales to do-it-yourselfers -- "continues to remain in crisis mode," he said.

Comparable store sales dropped 0.1 percent in the latest three-month period from a year earlier, the company said in its third-quarter earnings report.

The nation's second largest auto parts retailer posted third-quarter profit of $56.2 million, or 59 cents a share.

Murray said there is room to improve. While five out of 10 customers find and buy everything they need, two out of 10 get only some of what they need and three out of 10 leave empty-handed, he said.

He said the company believes it knows what to do to bring that up, with improved parts availability and other steps.

Executives said it is too soon to know how falling gasoline prices will affect the business, but they might know more when fourth-quarter and year-end results are released in February.

Shares of Advance Auto Parts rose more than 6 percent Thursday to close at $27.07, up $1.57 a share.

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