Monro Muffler (NASDAQ: MNRO) reported Q4 EPS of $0.29, in-line with the analyst estimate of $0.29. Revenue for the quarter came in at $252 million versus the consensus estimate of $254.96 million.

• Fiscal 2017 Sales Increase 8% to a Record $1.022 Billion
• Fiscal 2017 Acquisitions Represent $150 Million of Annualized Sales or 16% Annualized Sales Growth ~
• Fiscal 2018 Sales Guidance of $1.125 to $1.155 Billion, an Increase of 10% to 13%
• Fiscal 2018 Diluted Earnings Guidance of $2.10 to $2.30 per share, an Increase of 14% to 24%
• Increases Quarterly Cash Dividend by 6% to $.18 per share

GUIDANCE:

Monro Muffler sees FY2018 EPS of $1.13-$1.16, versus the consensus of $1.15. Monro Muffler sees FY2018 revenue of $2.1-2.3 million, versus the consensus of $2.18 million.

Company Outlook

Based on current visibility, business and economic trends, and recently completed acquisitions, the Company anticipates fiscal 2018 sales to be in the range of $1.125 billion to $1.155 billion, an increase of 10% to 13% over fiscal 2017 sales. Fiscal 2018 sales guidance assumes a comparable store sales increase of 2% to 4% on a 52-week basis (4% to 6% including an extra week in the fourth quarter).

Fiscal 2018 diluted earnings per share are expected to be in the range of $2.10 to $2.30, which represents an increase of 14% to 24% over fiscal 2017. This estimate is based on 33.4 million diluted weighted average shares outstanding. At the midpoint, this guidance represents an increase in operating margin of 70 basis points. The guidance includes approximately $.10 of contribution from the 53rd week and $.15 to $.19 in accretion from recent acquisitions. This guidance also reflects the estimated impact of higher tire selling prices related to expected tire cost increases.

For the first quarter of fiscal 2018, the Company anticipates sales to be in the range of $270.0 million to $275.0 million and comparable store sales to increase 2.0% to 3.0%, as compared to a 6.9% decline in the prior fiscal year period. The Company expects diluted earnings per share for the first quarter to be in the range of $.52 to $.56, as compared to $.50 in the first quarter of fiscal 2017.

Mr. Van Heel concluded, “Following a year of significant acquisitions, we are entering fiscal 2018 well positioned to benefit from these recent transactions and improving sales trends, which we expect to be driven in part by higher tire average ticket. Looking ahead, we are optimistic about the opportunities we see to complete additional acquisitions, continue our greenfield expansion and benefit over the next several years from the growth in the number of vehicles six years old and older, which represent our core customer. The increase in our cash dividend announced today, the twelfth increase in 12 years, reflects the Board's continued confidence in Monro’s long-term strategic plan and commitment to increasing shareholder returns.”

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