Advance Auto Parts is trading lower after-hours

Advance Auto Parts Inc (NYSE: AAP) said its profit and revenue topped Wall Street expectations in the fiscal third quarter. Shares of the company still tanked about 2.0% in after-hours trading on Monday.

Q3 financial performance

Advance Auto Parts reported $169.8 million in net income that translates to $2.70 per share. In the same quarter last year, its net income was capped at $147.4 million or $2.14 per share. On an adjusted basis, the automotive aftermarket parts provider earned $3.21 per share.

The U.S. firm generated $2.60 billion in net sales that represents an annualised growth of 3.1%. In comparison, analysts had called for $2.78 of adjusted EPS on $2.56 billion in sales.

Future outlook and dividend

For the full financial year, the North Carolina-based company now forecasts $10.9 billion to $10.95 billion in revenue, on an up to 10% increase in comparable sales. Last week, Advance Auto Parts declared a quarterly cash dividend of $1.0 per share.

Other notable figures in the earnings report include adjusted gross margin that jumped 246 basis points in the recent quarter to 46.2%.

CEO Tom Greco’s remarks

Commenting on the earnings report, CEO Tom Greco said:

Free cash flow was up 19% from last year and 36% on a year-over-two-year basis. Advance Auto Parts returned $291.2 million to shareholders in Q3 via dividends and share repurchase.