TRACTOR SUPPLY CO /DE/false000091636500009163652024-10-242024-10-24

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

FORM 8-K

CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

 Date of Report (Date of Earliest Event Reported): October 24, 2024

TSC_primary logo_2023.jpg  
TRACTOR SUPPLY COMPANY
__________________________________________
(Exact name of registrant as specified in its charter)
  
Delaware000-2331413-3139732
(State or other jurisdiction of incorporation)(Commission File Number)(I.R.S. Employer Identification No.)

  5401 Virginia Way, Brentwood, Tennessee 37027
(Address of principal executive offices) (Zip Code)

Registrant's telephone number, including area code: (615) 440-4000
Not Applicable
(Former name or former address, if changed since last report.)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions: 
 
[☐] Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
[☐] Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
[☐] Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
[☐] Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:
Title of each classTrading Symbol(s)Name of each exchange on which registered
Common Stock, $0.008 par valueTSCONASDAQ Global Select Market

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 ((§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company [☐]

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. [☐] 






Item 2.02 Results of Operations and Financial Condition.
 
On October 24, 2024, Tractor Supply Company (the "Company") issued a press release reporting its results of operations for the third quarter ended September 28, 2024. Additionally, the Company updated guidance for the results of operations expected for the full fiscal year ending December 28, 2024.

A copy of the press release is furnished herewith as Exhibit 99.1.

Item 9.01 Financial Statements and Exhibits.
 
(d) Exhibits:

Exhibit No. Description
99.1 
104The cover page from this Current Report on Form 8-K, formatted in Inline XBRL.


 

 
 
 


SIGNATURES
 
 
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
 
    
  Tractor Supply Company
    
October 24, 2024 By:/s/ Kurt D. Barton
    
   Name: Kurt D. Barton
   Title: Executive Vice President - Chief Financial Officer and Treasurer
 

 
 
 
 
 



    
imagea.jpg
TRACTOR SUPPLY COMPANY REPORTS THIRD QUARTER 2024 FINANCIAL RESULTS; UPDATES FISCAL 2024 FINANCIAL OUTLOOK

Brentwood, Tenn., October 24, 2024 - Tractor Supply Company (NASDAQ: TSCO), the largest rural lifestyle retailer in the United States (the “Company”), today reported financial results for its third quarter ended September 28, 2024.

l
Net Sales Increased 1.6% to $3.47 Billion
l
Comparable Store Sales Experienced a Slight Decrease of 0.2%
l
Diluted Earnings per Share (“EPS”) of $2.24
lCompany Raises Lower End of Annual Guidance for Sales and Earnings
lDefinitive Agreement Reached to Acquire Allivet, a leading online pet pharmacy

“We delivered on our expectations for the third quarter amid a tepid retail sales environment while advancing our Life Out Here strategy. The fundamentals of our business remain strong with ongoing market share gains. With nearly 50% 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. My thanks and appreciation go out to the entire Tractor Supply team for their engagement and commitment to serving Life Out Here, especially during this challenging hurricane season,” said Hal Lawton, President and Chief Executive Officer 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. As we look towards the back half of the decade, the team is energized to continue to capitalize on the many significant opportunities within our Life Out Here strategy and we look forward to sharing more details in the coming months.”

Third Quarter 2024 Results
Net sales for the third quarter of 2024 increased 1.6% to $3.47 billion from $3.41 billion in the third quarter of 2023. The increase in net sales was driven by new store openings. Comparable store sales declined 0.2%, as compared to the third quarter of 2023, driven by a comparable average transaction count increase of 0.3%, offset by a comparable average ticket decrease of 0.5%. Comparable store sales results reflect continued strength in big ticket categories, partially offset by declines in year-round discretionary categories. As expected, consumable, usable and edible products were modestly negative with positive unit growth offset by average unit price pressure.

Gross profit increased 3.2% 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% from 36.7% 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.

Selling, general and administrative (“SG&A”) expenses, including depreciation and amortization, increased 6.2% 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% from 26.7% 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, lapping a one-time depreciation expense benefit in the prior year of $11 million or approximately 35 basis points and modest deleverage of the Company’s fixed costs given the slight decline in comparable store sales. These factors were partially offset by a disciplined focus on productivity, cost control and modest benefits from the Company’s sale-leaseback strategy.

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% compared to 23.0% in the third quarter of 2023.

Net income decreased 5.3% to $241.5 million from $255.0 million. Diluted EPS decreased 3.9% to $2.24 compared to $2.33 in the third quarter of 2023. The above-mentioned one-time depreciation expense adjustment benefited the prior year’s diluted EPS by $0.08.

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.

Fiscal Year 2024 Financial Outlook
Based on year-to-date performance and its outlook, Tractor Supply is updating its financial guidance. For fiscal year 2024, the Company now expects the following:

UpdatedPrevious
Net Sales $14.85 billion to $15.0 billion $14.8 billion to $15.0 billion
Comparable Store Sales     0.0% to +1.0%(0.5%) to +1.0%
Operating Margin Rate     9.8% to 10.1%  9.8% to 10.1%
Net Income   $1.09 billion to $1.12 billion$1.08 billion to $1.12 billion
Earnings per Diluted Share   $10.10 to $10.40$10.00 to $10.40

Conference Call Information
Tractor Supply Company will hold a conference call today, Thursday, October 24, 2024 at 10 a.m. ET. The call will be webcast live at IR.TractorSupply.com. An investor presentation will be available on the investor relations section of the Company’s website at least 15 minutes prior to the conference call.

Please allow extra time prior to the call to visit the site and download the streaming media software required to listen to the webcast.

A replay of the webcast will also be available at IR.TractorSupply.com shortly after the conference call concludes.







About Tractor Supply Company
For more than 85 years, Tractor Supply Company (NASDAQ: TSCO) has been passionate about serving the needs of recreational farmers, ranchers, homeowners, gardeners, pet enthusiasts and all those who enjoy living Life Out Here. Tractor Supply is the largest rural lifestyle retailer in the U.S., ranking 293 on the Fortune 500. The Company’s more than 50,000 Team Members are known for delivering legendary service and helping customers pursue their passions, whether that means being closer to the land, taking care of animals or living a hands-on, DIY lifestyle. In store and online, Tractor Supply provides what customers need – anytime, anywhere, any way they choose at the low prices they deserve.

As of September 28, 2024, the Company operated 2,270 Tractor Supply stores in 49 states. For more information on Tractor Supply, visit www.tractorsupply.com.

Tractor Supply Company also owns and operates Petsense by Tractor Supply, a small-box pet specialty supply retailer providing products and services for pet owners. As of September 28, 2024, the Company operated 205 Petsense by Tractor Supply stores in 23 states. For more information on Petsense by Tractor Supply, visit www.Petsense.com.


###

Contacts:
Investors
Mary Winn Pilkington (615) 440-4212
Joseph Underwood (615) 440-4658
investorrelations@tractorsupply.com

Media
Tricia Whittemore (615) 440-4410
corporatecommunications@tractorsupply.com


Forward-Looking Statements
This press release contains certain forward-looking statements, including statements regarding market share gains, value creation, customer trends, new stores and distribution centers, property development plans, return of capital, and financial guidance for 2024, including net sales, comparable store sales, operating margin rates, net income, earnings per diluted share, capital expenditures and plans, share repurchase, and sale-leaseback transactions. All forward-looking statements are subject to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995, are subject to the finalization of the Company’s quarterly financial and accounting procedures, and may be affected by certain risks and uncertainties, any one, or a combination, of which could materially affect the results of the Company’s operations. Forward-looking statements are usually identified by or are associated with such words as “will,” “would,” “intend,” “expect,” “continue,” “believe,” “anticipate,” “optimistic,” “forecasted” and similar terminology. Actual results could vary materially from the expectations reflected in these statements. As with any business, all phases of our operations are subject to facts outside of our control. These factors include, without limitation, those factors discussed in the “Risk Factors” section of the Company’s Annual Reports or Form 10-K and other filings with the Securities and Exchange Commission, including our Quarterly Report on Form 10-Q for the quarter ended June 29, 2024, which describes additional risks relating to the scrutiny of our social and environmental strategies, initiatives and targets and our policies related thereto, which could adversely affect public perception of our business, employee morale, customer or stockholder support and have a material adverse effect on our business, liquidity, financial condition, and/or results of operations. Forward-looking statements made by or on behalf of the Company are based on knowledge of its business and the environment in which it operates, but because of the factors listed above, actual results could differ materially from those reflected by any forward-looking statements. Consequently, all of the forward-looking statements made are qualified by these cautionary statements and those contained in the Company’s Annual Report on Form 10-K, quarterly reports on Form 10-Q, and other filings with the Securities and Exchange Commission. There can be no assurance that the results or developments anticipated by the Company will be realized or, even if substantially realized, that they will have the expected consequences to or effects on the Company or its business and operations. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date hereof. The Company does not undertake any obligation to release publicly any revisions to these forward-looking statements to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events, except as required by law.





























(Financial tables to follow)


Consolidated Statements of Income
(Unaudited)
(in thousands, except per share and percentage data)

Three Months EndedNine Months Ended
September 28,
2024		September 30,
2023		September 28,
2024		September 30,
2023
% of% of% of% of
NetNetNetNet
SalesSalesSalesSales
Net sales$3,468,245 100.00%$3,411,980 100.00%$11,109,700 100.00%$10,895,900 100.00%
Cost of merchandise sold2,177,797 62.792,161,501 63.357,042,773 63.396,960,744 63.88
Gross profit1,290,448 37.211,250,479 36.654,066,927 36.613,935,156 36.12
Selling, general and administrative expenses852,299 24.57819,311 24.012,590,637 23.322,500,704 22.95
Depreciation and amortization113,550 3.2790,263 2.65327,107 2.94289,775 2.66
Operating income324,599 9.36340,905 9.991,149,183 10.341,144,677 10.51
Interest expense, net13,875 0.409,539 0.2837,389 0.3434,562 0.32
Income before income taxes310,724 8.96331,366 9.711,111,794 10.011,110,115 10.19
Income tax expense69,254 2.0076,365 2.24246,960 2.22250,792 2.30
Net income$241,470 6.96%$255,001 7.47%$864,834 7.78%$859,323 7.89%
Net income per share:
Basic$2.25 $2.34 $8.04 $7.85 
Diluted$2.24 $2.33 $8.00 $7.81 
Weighted average shares outstanding:
Basic107,167 108,774 107,614 109,415 
Diluted107,678 109,342 108,147 110,055 
Dividends declared per common share outstanding$1.10 $1.03 $3.30 $3.09 

Note: Percent of net sales amounts may not sum to totals due to rounding.











Consolidated Statements of Comprehensive Income
(Unaudited)
(in thousands)

 Three Months EndedNine Months Ended
 September 28,
2024		September 30,
2023		September 28,
2024		September 30,
2023
Net income$241,470 $255,001 $864,834 $859,323 
Other comprehensive (loss) / income:
Change in fair value of interest rate swaps, net of taxes(2,130)(924)(4,243)(1,983)
Total other comprehensive (loss) / income(2,130)(924)(4,243)(1,983)
Total comprehensive income$239,340 $254,077 $860,591 $857,340 



Consolidated Balance Sheets
(Unaudited)
(in thousands)

September 28,
2024		September 30,
2023
ASSETS
Current assets:
Cash and cash equivalents$186,294 $421,693 
Inventories3,082,519 2,834,247 
Prepaid expenses and other current assets199,967 278,174 
Income taxes receivable14,381 — 
Total current assets3,483,161 3,534,114 
Property and equipment, net2,632,895 2,273,646 
Operating lease right-of-use assets3,295,678 3,084,947 
Goodwill and other intangible assets269,520 267,329 
Other assets86,643 44,978 
Total assets$9,767,897 $9,205,014 
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable$1,349,817 $1,412,186 
Accrued employee compensation53,065 49,957 
Other accrued expenses551,847 454,513 
Current portion of finance lease liabilities3,402 3,304 
Current portion of operating lease liabilities387,578 365,189 
Income taxes payable— 33,647 
Total current liabilities2,345,709 2,318,796 
Long-term debt1,831,218 1,728,255 
Finance lease liabilities, less current portion28,831 32,156 
Operating lease liabilities, less current portion3,082,653 2,848,385 
Deferred income taxes48,800 30,006 
Other long-term liabilities141,926 136,285 
Total liabilities7,479,137 7,093,883 
Stockholders’ equity:
Common stock1,423 1,418 
Additional paid-in capital1,362,463 1,302,268 
Treasury stock(5,869,286)(5,347,302)
Accumulated other comprehensive income2,550 9,292 
Retained earnings6,791,610 6,145,455 
Total stockholders’ equity2,288,760 2,111,131 
Total liabilities and stockholders’ equity$9,767,897 $9,205,014 
    



Consolidated Statements of Cash Flows
(Unaudited)
(in thousands)
Nine Months Ended
September 28,
2024		September 30,
2023
Cash flows from operating activities:
Net income$864,834 $859,323 
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization327,107 289,775 
(Gain)/loss on disposition of property and equipment(38,751)(27,460)
Share-based compensation expense35,124 45,150 
Deferred income taxes(21,212)8,082 
Change in assets and liabilities:
Inventories(436,665)(147,521)
Prepaid expenses and other current assets9,092 (28,647)
Accounts payable170,014 13,554 
Accrued employee compensation(38,413)(73,019)
Other accrued expenses(227)(53,795)
Income taxes(11,920)24,176 
Other44,627 28,308 
Net cash provided by operating activities903,610 937,926 
Cash flows from investing activities:
Capital expenditures(538,018)(526,723)
Proceeds from sale of property and equipment77,895 57,801 
Proceeds from Orscheln acquisition net working capital settlement— 4,310 
Proceeds from sale of Orscheln corporate headquarters and distribution center— 10,000 
Net cash used in investing activities(460,123)(454,612)
Cash flows from financing activities:
Borrowings under debt facilities585,000 1,767,000 
Repayments under debt facilities(485,000)(1,195,000)
Debt discounts and issuance costs— (9,729)
Principal payments under finance lease liabilities(1,317)(3,606)
Repurchase of shares to satisfy tax obligations(23,618)(24,015)
Repurchase of common stock(406,663)(480,407)
Net proceeds from issuance of common stock32,516 19,853 
Cash dividends paid to stockholders(355,182)(338,219)
Net cash used in financing activities(654,264)(264,123)
Net (decrease)/increase in cash and cash equivalents(210,777)219,191 
Cash and cash equivalents at beginning of period397,071 202,502 
Cash and cash equivalents at end of period$186,294 $421,693 
Supplemental disclosures of cash flow information:
Cash paid during the period for:
Interest, net of amounts capitalized$36,433 $29,011 
Income taxes cash paid278,273 215,637 
Supplemental disclosures of non-cash activities:
Non-cash accruals for property and equipment$75,332 $20,359 
Increase of operating lease assets and liabilities from new or modified leases442,399 481,177 
Increase of finance lease assets and liabilities from new or modified leases— 450 


Selected Financial and Operating Information
(Unaudited)

Three Months EndedNine Months Ended
September 28,
2024		September 30,
2023		September 28,
2024		September 30,
2023
Sales Information:
Comparable store sales increase (decrease)(0.2)%(0.4)%— %1.5 %
New store sales (% of total sales)2.0 %4.6 %2.0 %4.6 %
Average transaction value$58.87$59.26$60.48$60.74
Comparable store average transaction value (decrease)/increase (a)
(0.5)%(0.3)%(0.2)%1.0 %
Comparable store average transaction count increase0.3 %— %0.3 %0.4 %
Total selling square footage (000’s)38,66838,13238,66838,132
Exclusive brands (% of total sales)29.1 %29.3 %28.8 %29.5 %
Imports (% of total sales)10.4 %11.1 %10.8 %11.3 %
Store Count Information:
Tractor Supply
Beginning of period 2,2542,1812,216 2,147 
New stores opened161754 51 
Stores closed——— — 
End of period2,2702,1982,270 2,198 
Petsense by Tractor Supply
Beginning of period 205192198 186 
New stores opened—47 10 
Stores closed—(1)— (1)
End of period205195205 195 
Consolidated end of period2,4752,3932,475 2,393 
Pre-opening costs (000’s)$2,240$2,743$6,853$10,685
Balance Sheet Information:
Average inventory per store (000’s) (b)
$1,161.6$1,114.2$1,161.6$1,114.2
Inventory turns (annualized)3.033.343.283.48
Share repurchase program:
Cost (000’s) (c)
$151,342$136,778$410,431$491,394
Average purchase price per share$267.13$214.45$259.22$222.20

(a) Comparable store average transaction value changes include the impact of transaction value changes achieved on the current period change in transaction count.
(b) Assumes average inventory cost, excluding inventory in transit.
(c) Effective January 1, 2023, the Company’s share repurchases are subject to a 1% excise tax as a result of the Inflation Reduction Act of 2022. Excise taxes incurred on share repurchases represent direct costs of the repurchase and are recorded as a part of the cost basis of the shares within treasury stock.
Note: Comparable store metrics percentages may not sum to total due to rounding.


Three Months EndedNine Months Ended
September 28, 2024September 30, 2023September 28, 2024September 30, 2023
Capital Expenditures (millions):
Existing stores$75.6 $84.1 $209.8 $246.2 
New stores, relocated stores and stores not yet opened59.110.8178.872.3
Information technology35.735.395.886.4
Distribution center capacity and improvements13.0 46.7 45.2 120.4 
Corporate and other4.80.28.41.4
Total$188.2 $177.1 $538.0 $526.7 

v3.24.3
Cover Document
Oct. 24, 2024
Cover [Abstract]  
Document Type 8-K
Document Period End Date Oct. 24, 2024
Entity Incorporation, State or Country Code DE
Entity File Number 000-23314
Entity Tax Identification Number 13-3139732
Entity Address, Street Name 5401 Virginia Way
Entity Address, City Brentwood
Entity Address, State TN
Entity Address, Postal Zip Code 37027
City Area Code 615
Local Phone Number 440-4000
Written Communications false
Soliciting Material false
Pre-commencement Tender Offer false
Pre-commencement Issuer Tender Offer false
Title of each class Common Stock, $0.008 par value
Trading Symbol TSCO
Name of each exchange on which registered NASDAQ
Entity Emerging Growth Company false
Entity Registrant Name TRACTOR SUPPLY CO /DE/
Amendment Flag false
Entity Central Index Key 0000916365
Tractor Supply (NASDAQ:TSCO)
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