Advance Auto Parts

Advance Auto Parts Appoints Three New Independent Directors 03/11/2024 Enters into Cooperation Agreement with Third Point LLC and Saddle Point Management L.P. RALEIGH, N.C.--(BUSINESS WIRE)-- Advance Auto Parts, Inc. (NYSE: AAP), a leading automotive aftermarket parts provider in North America that serves both professional installer and do-it-yourself customers, today announced that it has appointed A. Brent Windom, Gregory L. Smith and Thomas W. Seboldt as independent directors to the Advance Auto Parts board, effective immediately. In connection with these appointments, the company has entered into a cooperation agreement with Third Point LLC (together with its affiliates, “Third Point”) and Saddle Point Management, L.P. (together with its affiliates, “Saddle Point”). “We are pleased to welcome Brent, Greg and Tom to the Advance Auto Parts board,” said Gene Lee, independent chair of the board of directors. “These directors’ automotive industry and supply chain experience will help us progress in our plan to return the company to profitable growth. With new management in place, important strategic actions underway, and an enhanced board, we are confident that Advance is on the right path to create significant long-term value for shareholders.” “At Advance, our board prioritizes ongoing refreshment to help ensure we have the right expertise and experience to oversee our strategy while profitably growing our business,” said Shane O'Kelly, president and chief executive officer. “As we continue our operational initiatives focusing on the fundamentals, improving our competitive position, and serving our customers better than anyone else, including through the consolidation of our supply chain to a single unified network, we look forward to benefiting from our new directors’ extensive industry relationships and experience.” “These three directors bring essential operational experience and industry expertise to support Shane as he executes on an ambitious agenda,” said Daniel S. Loeb, chief executive officer of Third Point. “With fresh perspectives in the C-suite and board room and a long runway for growth, we believe Advance is well positioned to create meaningful value for shareholders.” “Advance has enormous potential to deliver better results for customers, suppliers, team members, and shareholders. The company's collaborative and focused approach is a key enabling factor for success," said Roy J. Katzovicz, chief executive officer of Saddle Point Management, L.P. The full cooperation agreement, which contains customary standstill, voting and other provisions, will be filed by the company with the U.S. Securities and Exchange Commission as an exhibit to a Current Report on Form 8-K. Additionally, Legion Partners Holdings, LLC (together with its affiliates, “Legion”), another Advance Auto Parts shareholder, has indicated its support for the additions of Mr. Windom, Mr. Smith and Mr. Seboldt to the company’s board of directors. With the appointments announced today, the company’s board will temporarily expand to 12 directors. At the 2024 annual meeting scheduled for May 22, 2024, 11 director nominees are expected to stand for election to the Advance Auto Parts board, including the three newly appointed directors. Advisors Centerview Partners LLC is acting as financial advisor to Advance Auto Parts and Hogan Lovells US LLP is acting as legal counsel. Willkie Farr & Gallagher LLP is acting as legal counsel to Third Point and Saddle Point, and Proskauer Rose LLP is acting as legal counsel to Saddle Point. About A. Brent Windom Brent Windom, 63, is an experienced automotive industry executive, having spent nearly four decades working in roles across the sector. Most recently, Mr. Windom served as President and Chief Executive Officer of Uni-Select Inc., a leading automotive refinish, industrial coatings and automotive aftermarket parts distributor. Previously, Mr. Windom was President and COO of Canadian Automotive Group from July 2017 to May 2019, as well as president and Chief Executive Officer of Auto Plus ǀ Pep Boys, which was formed following Icahn Enterprises L.P.’s acquisition of Uni-Select USA, Inc. and Beck/Arnley Worldparts, Inc. Prior to joining IEH Auto Parts, Mr. Windom spent 10 years with Uni-Select, where he held positions of increasing responsibility including President and Chief Operating Officer, Uni-Select USA. About Gregory L. Smith Gregory L. Smith, 60, is a proven supply chain expert with nearly 30 years of experience across a variety of industries. Mr. Smith currently serves as Executive Vice President, Global Operation and Supply Chain of Medtronic plc. Prior to joining Medtronic in 2021, Mr. Smith was Executive Vice President, Supply Chain of Walmart Inc. from 2017 to 2021 and Senior Vice President, Global Operations of The Goodyear Tire and Rubber Company from 2011 to 2016. Earlier in his career, Mr. Smith spent a decade with Conagra Foods, Inc., where he served in several leadership positions, including Executive Vice President, Supply Chain. He previously held roles with United Signature Foods LLC and Aurora Foods Inc. About Thomas W. Seboldt Thomas W. Seboldt, 57, is a seasoned automotive executive with over three decades of industry experience. Mr. Seboldt spent the vast majority of his career with O’Reilly Automotive, Inc., where he held several titles of increasing responsibility, including Vice President, Merchandising. Mr. Seboldt has also served on the Board of prominent industry associations including the California Automotive Wholesalers' Association (“CAWA”) and the Auto Care Association. During his tenure on the CAWA Board, Mr. Seboldt has served in a variety of positions, including as President, Vice President, Executive Committee member and Treasurer. About Advance Auto Parts Advance Auto Parts, Inc. is a leading automotive aftermarket parts provider that serves both professional installer and do-it-yourself customers. As of December 30, 2023, Advance operated 4,786 stores and 321 Worldpac branches primarily within the United States, with additional locations in Canada, Puerto Rico and the U.S. Virgin Islands. The company also served 1,245 independently owned Carquest branded stores across these locations in addition to Mexico and various Caribbean islands. Additional information about Advance, including employment opportunities, customer services, and online shopping for parts, accessories and other offerings can be found at www.AdvanceAutoParts.com. Forward-Looking Statements Certain statements herein are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are usually identifiable by words such as “anticipate,” “believe,” “could,” “estimate,” “expect,” “forecast,” “guidance,” “intend,” “likely,” “may,” “plan,” “position,” “possible,” “potential,” “probable,” “project,” “should,” “strategy,” “will,” or similar language. All statements other than statements of historical fact are forward-looking statements, including, but not limited to, statements about our strategic initiatives, operational plans and objectives, corporate governance, board performance, director nominees at the 2024 annual meeting of stockholders, expectations for economic conditions, future business results and future financial performance, as well as statements regarding underlying assumptions related thereto. Forward-looking statements reflect our views based on historical results, current information and assumptions related to future developments. Except as may be required by law, the company undertakes no obligation to update any forward-looking statements made herein. Forward-looking statements are subject to a number of risks and uncertainties that could cause actual results to differ materially from those projected or implied by the forward-looking statements. They include, among others, factors related to the company’s leadership transition, the timing and implementation of our initiatives, our potential divestiture of Worldpac and the company's Canada business, our ability to hire, train and retain qualified employees, deterioration of general macroeconomic conditions, the highly competitive nature of our industry, demand for our products and services, complexities in our inventory and supply chain and challenges with transforming and growing our business. Please refer to “Item 1A. Risk Factors” of our most recent Annual Report on Form 10-K filed with the Securities and Exchange Commission (“SEC”), as updated by our subsequent filings with the SEC, for a description of these and other risks and uncertainties that could cause actual results to differ materially from those projected or implied by the forward-looking statements. View the full article

Advance Auto Parts Reports Fourth Quarter and Full Year 2023 Results 02/28/2024 RALEIGH, N.C.--(BUSINESS WIRE)-- Advance Auto Parts, Inc. (NYSE: AAP), a leading automotive aftermarket parts provider in North America, that serves both professional installer and do-it-yourself customers, announced its financial results for the fourth quarter and full year ended December 30, 2023. “As we closed out 2023, we continued to act with a sense of urgency to stabilize the business and position the company to return to profitable growth,” said Shane O'Kelly, president and chief executive officer. “Our full year results are well below our expectations, and we are focused on instilling greater discipline and accountability both in the fundamental business and in how the organization executes across the board. In addition to the operational improvements we are implementing, we are strengthening internal controls and enhancing the quality of our accounting information to help better inform how we drive the business forward. “We continue to advance our ongoing operational and strategic review of the business, including the separate sales processes for Worldpac and our Canadian business. We have streamlined and reorganized the company’s leadership structure and have made several important new hires, including the appointments of Ryan Grimsland as Chief Financial Officer and Elizabeth Dreyer as Chief Accounting Officer. Building on the $150 million in annualized SG&A reductions our team executed in the fourth quarter, we recently launched an initiative to eliminate costs related to our indirect spend by an additional $50 million on an annualized basis. We are also moving forward with the consolidation of our supply chain to a single, unified network to create efficiencies and better serve customers. Looking ahead, we are committed to driving enhanced value for shareholders by executing on the fundamentals of our business – focusing on the customer, investing in our frontline and strengthening our competitive position.” Fourth Quarter and Full Year 2023 Results (1) Fourth quarter 2023 Net sales totaled $2.5 billion, a 0.4% decrease compared with the prior year. Comparable store sales for the fourth quarter 2023 decreased 1.4%. For full year 2023, Net sales of $11.3 billion increased 1.2% from 2022. Comparable store sales for the full year decreased 0.3%. The company's Gross profit decreased 11.9% from the fourth quarter of the prior year to $950.8 million or 38.6% of Net sales compared with 43.6% in the prior year quarter. This result reflects both business performance and atypical drivers, primarily attributable to a change in inventory related items and elevated supply chain costs. The company's full year Gross profit was $4.5 billion, or 40.1% of Net sales, representing a 414 basis points decrease from the prior year primarily driven by inventory related items and costs not fully covered by pricing actions. The company's SG&A was $999.4 million in the fourth quarter, or 40.6% of Net sales compared with 38.8% for the prior year quarter. This was primarily driven by a year over year increase in occupancy costs and store labor. The company's full year SG&A was $4.4 billion, or 39.1% of Net sales compared with 38.2% in the prior year. The company's fourth quarter Operating loss was $48.6 million, or (2.0)% of Net sales compared with the fourth quarter of the prior year Operating income of $119.3 million or 4.8% of Net sales. The company's full year Operating income was $114.4 million, or 1.0% of Net sales, compared with $670.3 million, or 6.0% of Net sales, in the prior year. The company's effective tax rate in the fourth quarter of 2023 was 42.3%. The company's Diluted loss per share was $0.59 compared with Diluted earnings per share of $1.39 in the fourth quarter of the prior year. The company's effective tax rate for full year 2023 was 6.6%. The company's 2023 Diluted earnings per share was $0.50 compared with $7.65 in the prior year. Net cash provided by operating activities was $0.3 billion for the full year 2023 versus $0.7 billion for the prior year. The decrease was primarily driven by lower Net income and working capital. Free cash flow for the full year 2023 was $43.7 million, compared with $312.5 million for the prior year. During management’s review, the company identified issues with certain previously reported financials. All comparisons are based on the corrected historical results as depicted in the financial tables herein, which include the correction of non-material errors in previously reported results. The company filed a Form 12b-25 with the Securities and Exchange Commission and disclosed that it expects to file its Form 10-K prior to the expiration of the extension period. (1) All comparisons are based on the same time period in the prior year. Comparable store sales include locations open for 13 complete accounting periods and excludes sales to independently owned Carquest locations. Capital Allocation On February 13, 2024, the company declared a regular cash dividend of $0.25 per share to be paid on April 26, 2024 to all common stockholders of record as of April 12, 2024. Subsequent Events On February 26, 2024, the company entered into an amendment to its revolving credit facility to enable certain addbacks to financial covenants for specific write-downs of inventory and vendor receivables. As of December 30, 2023, considering the amendment, the company was in compliance with the credit facility’s financial covenants. Full Year 2024 Guidance (1) "In 2024, we are refining our operational improvement plans and building on the decisive actions we have taken to turn around the company’s performance. We are committed to improving overall productivity and taking a disciplined approach to reducing expenses, which will support our focus on investing in our team members. Our 2024 full year guidance is reflective of the steps we must take to reset the business and solidify our foundation for the long term," said Ryan Grimsland, executive vice president and chief financial officer. View the full article

Advance Auto Parts Announces Date for Its Fourth Quarter and Full Year 2023 Earnings Release and Conference Call 02/14/2024 RALEIGH, N.C.--(BUSINESS WIRE)-- Advance Auto Parts, Inc. (NYSE: AAP), a leading automotive aftermarket parts provider in North America that serves both professional installer and do-it-yourself customers, will report its fourth quarter and full year 2023 results before the market opens on Wednesday, February 28, 2024. Interested parties can listen to the event via a webcast scheduled to begin at 8:00 a.m. Eastern Time on Wednesday, February 28, 2024. The webcast will be accessible via the company’s Investor Relations website (ir.AdvanceAutoParts.com). To join by phone, please pre-register online for dial-in and passcode information. Upon registering, participants will receive a confirmation with call details and a registrant ID. While registration is open through the live call, the company suggests registering a day in advance or at minimum 10 minutes before the start of the call. A replay of the conference call will be available on the company’s Investor Relations website for one year. About Advance Auto Parts Advance Auto Parts, Inc. is a leading automotive aftermarket parts provider that serves both professional installer and do-it-yourself customers. As of October 7, 2023 Advance operated 4,785 stores and 320 Worldpac branches primarily within the United States, with additional locations in Canada, Puerto Rico and the U.S. Virgin Islands. The company also served 1,307 independently owned Carquest branded stores across these locations in addition to Mexico and various Caribbean islands. Additional information about Advance, including employment opportunities, customer services, and online shopping for parts, accessories and other offerings can be found at www.AdvanceAutoParts.com. View source version on businesswire.com: https://www.businesswire.com/news/home/20240214110163/en/ Investor Relations Contact: Elisabeth Eisleben T: (919) 227-5466 E: [email protected] Media Contact: Darryl Carr T: (984) 389-7207 E: [email protected] Source: Advance Auto Parts, Inc. View the full article

Advance Auto Parts Puts a Charge in American Motorists on National Battery Day With Free DieHard® Auto Batteries Giveaway and Complimentary Battery Testing Nationwide Feb. 18 02/14/2024 New survey reveals 91 percent of motorists have experienced a dead battery, but nearly two-thirds admit they don’t think about having their car battery checked until it’s too late RALEIGH, N.C.--(BUSINESS WIRE)-- Advance Auto Parts (NYSE: AAP), a leading automotive aftermarket parts provider, is jump-starting motorists’ attention to the safety and reliability of their automobiles by giving away free DieHard® batteries on National Battery Day, Sunday, Feb. 18. This press release features multimedia. View the full release here: https://www.businesswire.com/news/home/20240214445947/en/ Customers who visit their local Advance Auto Parts store on National Battery Day, Sunday, February 18, may be randomly selected to receive a free DieHard auto battery. (Photo: Business Wire) A new national survey by Atomik Research reveals 91 percent of American motorists say they have experienced a dead battery, but nearly two-thirds (65 percent) of motorists admit they don’t think about having their car battery checked until it’s too late. On National Battery Day, Sunday, Feb. 18, Advance will surprise randomly selected customers with a free DieHard® battery, including those getting their current battery tested, at participating stores nationwide. As part of National Battery Day, Advance is partnering with pro football star quarterback Baker Mayfield to encourage motorists to get their car batteries tested. “Our team of automotive experts are committed to customer care and advancing the needs of today’s motorists, such as offering complimentary curbside battery testing and installation every day, including on National Battery Day, Sunday Feb. 18,” said Junior Word, Advance’s executive vice president, U.S. stores. “Checking the performance of your car battery can prevent unfortunate and even unsafe events caused by dead batteries.” Additional data from the national Atomik survey commissioned by Advance in January further validates the need to remind motorists to get their car batteries checked: 65 percent of motorists say they have missed or been late to something due to a dead car battery, including nearly 10 percent say they missed or were late to an important life event – such as a wedding, funeral or birth of a child Only 2 percent of motorists indicate they have had their car battery checked before a cross‑country road trip Only 5 percent of motorists report having ever checked their car battery when there is a drop in temperature To learn more about Advance’s car care offerings, including DieHard®, or find a store location, visit www.AdvanceAutoParts.com. DieHard® is America’s most trusted auto battery* and part of Advance’s portfolio of owned brands. About Advance Auto Parts Advance Auto Parts, Inc. is a leading automotive aftermarket parts provider that serves both professional installer and do-it-yourself customers. As of October 7, 2023, Advance operated 4,785 stores and 320 Worldpac branches primarily within the United States, with additional locations in Canada, Puerto Rico and the U.S. Virgin Islands. The company also served 1,307 independently owned Carquest branded stores across these locations in addition to Mexico and various Caribbean islands. Additional information about Advance, including employment opportunities, customer services, and online shopping for parts, accessories and other offerings can be found at www.AdvanceAutoParts.com. Fleishman-Hillard, Inc. and Advance Auto Parts commissioned Atomik Research to conduct an online survey of 1,004 drivers throughout the United States. The sample consists of adults who own or regularly operate a gasoline-powered vehicle — hybrid and EV drivers were excluded from the sample. The margin of error is +/- 3 percentage points with a confidence level of 95 percent. Fieldwork took place between January 9 and January 11, 2024. * Based on 2021 independent survey of nationally representative sample of 1,200+ drivers. View the full article

Advance Auto Parts Foundation Announces $1.75 Million In Gifts to Aid Military Veterans 02/05/2024 RALEIGH, N.C.--(BUSINESS WIRE)-- Nonprofit organizations providing employment support for women veterans, custom designed homes for injured veterans and frontline support for veterans at risk for suicide are among the recent recipients of gifts announced by the Advance Auto Parts Foundation (AAPF). Totaling $1.75 million, the gifts were made possible by donations to the foundation by more than 100 Advance Auto Parts supplier partners. This is the second year AAPF has made gifts to Hire Heroes USA of Alpharetta, Ga., Building Homes for Heroes of Island Park, N.Y. and Stop Soldier Suicide based in Durham, N.C., totaling $3.75 million during that time. “The military veteran community is one of the Advance Auto Parts Foundation’s three focus areas, and we are proud to partner with our suppliers to support critical needs within that community,” said Elisabeth Eisleben, president, Advance Auto Parts Foundation. “Our veterans have earned the opportunity for meaningful employment, appropriate housing and mental health care, all of which are fundamental to their wellbeing.” A previous gift from AAPF established Hire Heroes USA’s Women Veterans Program, and the latest gift will actively support its ongoing operations. The program features transition specialists and support staff offering career services accommodating the unique needs of women veterans and helped more than 2,000 women veterans find employment last year. Building Homes for Heroes, a longtime partner of Advance Auto Parts and its supplier partners, will use its gift to fund the Advance Auto Parts Foundation Rapid Response Program which provides financial support to veterans in need, including emergency and time-sensitive situations. AAPF provided funding for the program last year when it aided 130 veterans and their families. Stop Soldier Suicide will use its latest gift to maintain the 2023 wellness team expansion that was funded by an earlier AAPF gift. The added capacity served more than 300 veterans with zero-cost, personalized, suicide-specific care thus empowering them to move forward. “Each of these gifts will provide life-changing support to deserving veterans across the U.S.,” said Eisleben. “Our foundation’s leadership was pleased by what was accomplished by our gifts to these organizations last year – literally thousands of veterans were helped – and we look forward to additional support of veterans and their families as AAPF remains focused on veteran needs.” About Advance Auto Parts Foundation Advance Auto Parts Foundation is the charitable arm of Advance Auto Parts, Inc. Its primary areas of funding are community health, veterans’ needs and career training programs at community colleges. About Advance Auto Parts Advance Auto Parts, Inc. is a leading automotive aftermarket parts provider that serves both professional installer and do-it-yourself customers. As of October 7, 2023, Advance operated 4,785 stores and 320 Worldpac branches primarily within the United States, with additional locations in Canada, Puerto Rico and the U.S. Virgin Islands. The company also served 1,307 independently owned Carquest branded stores across these locations in addition to Mexico and various Caribbean islands. Additional information about Advance, including employment opportunities, customer services, and online shopping for parts, accessories and other offerings can be found at www.AdvanceAutoParts.com. View the full article

Advance Auto Parts Names Elizabeth Dreyer Chief Accounting Officer 01/05/2024 RALEIGH, N.C.--(BUSINESS WIRE)-- Advance Auto Parts, Inc. (NYSE: AAP), a leading automotive aftermarket parts provider in North America that serves both professional installer and do-it-yourself customers, today announced that it has appointed Elizabeth Dreyer as senior vice president, controller and chief accounting officer, effective January 9, 2024. In this role, Dreyer will be responsible for enterprise-wide accounting operations, tax, external financial reporting and all related compliance. “I’m excited to welcome Elizabeth to the Advance family as our new chief accounting officer,” said Ryan Grimsland, executive vice president and chief financial officer. “Elizabeth’s breadth of experience in financial management will greatly strengthen our finance organization and help us to further build a best in class accounting function. I look forward to working with her closely as we begin this next chapter for Advance.” Ms. Dreyer, 61, brings 30 years of accounting and finance experience to Advance. Most recently, she served as chief accounting officer and controller at Amyris, Inc., a public biotechnology company creating clean beauty consumer products and ingredients, since October 2022. Prior to Amyris, Dreyer served as senior vice president and chief accounting officer at Travel + Leisure Co., a public vacation ownership and exchange company, from 2018-2022; vice president, controller and chief accounting officer, for Edgewood Personal Care, formerly Energizer Holdings, the global manufacturer of batteries and consumer products, from 2015-2018; and vice president, controller and chief accounting officer, for Hillenbrand, Inc., a global industrial manufacturer of process equipment and death care products, from 2010-2015. Prior to Hillenbrand, Dreyer served in a variety of financial roles with several different companies in the healthcare and automotive industries, including Createc Corporation, a foam manufacturer for automotive and consumer goods industries, and ADESA, Inc., an automobile auction and floor plan financing company. Dreyer earned her bachelor’s degree in business from Indiana University in Bloomington, Ind., and is a Certified Public Accountant. About Advance Auto Parts Advance Auto Parts, Inc. is a leading automotive aftermarket parts provider that serves both professional installer and do-it-yourself customers. As of October 7, 2023, Advance operated 4,785 stores and 320 Worldpac branches primarily within the United States, with additional locations in Canada, Puerto Rico and the U.S. Virgin Islands. The company also served 1,307 independently owned Carquest branded stores across these locations in addition to Mexico and various Caribbean islands. Additional information about Advance, including employment opportunities, customer services, and online shopping for parts, accessories and other offerings can be found at www.AdvanceAutoParts.com. View the full article

Advance Auto Parts Appoints Ryan Grimsland as Executive Vice President and Chief Financial Officer 11/15/2023 RALEIGH, N.C.--(BUSINESS WIRE)-- Advance Auto Parts, Inc. (NYSE: AAP), a leading automotive aftermarket parts provider in North America that serves both professional installer and do-it-yourself customers, today announced that it has appointed Ryan Grimsland as executive vice president and chief financial officer, effective November 27, 2023. Tony Iskander, who has served as interim chief financial officer since August 2023 will continue in his role as senior vice president, finance and treasurer. “I am excited to welcome Ryan to the Advance family and look forward to partnering with him as we begin a new chapter in the company’s 90-year history,” said Shane O’Kelly, president and CEO. “Following a robust search, we are confident that Ryan’s deep finance, retail, strategy development and transformation experience will be invaluable as we execute on our comprehensive business review and work to realize Advance’s full potential. We thank Tony for his dedication and outstanding contributions while serving in the interim role. As we look ahead, our entire team is focused on building on the progress we are already making to reposition the company for long-term success and value creation.” Mr. Grimsland, 46, brings more than 20 years of corporate finance, treasury, financial planning, and retail strategy and transformation experience. Most recently, Mr. Grimsland served as senior vice president, strategy and transformation at Lowe’s Companies, Inc. During his 17-year tenure at Lowe’s he held leadership roles across all aspects of the finance organization, including senior vice president, corporate finance and treasurer; vice president, corporate financial planning and analysis; and vice president, stores finance. Prior to joining Lowe’s, he held positions in operations and finance at Haverty’s Furniture and UBS. Mr. Grimsland earned an MBA in accounting from Benedictine University and a bachelor’s degree in business administration from High Point University. Mr. Grimsland said, “I am thrilled to join Advance and honored to serve as the company’s chief financial officer. I look forward to working with Shane, the board of directors and leadership team, and the nearly 70,000 dedicated team members across the organization to deliver operational improvements, execute on the company’s repositioning, and deliver long-term, sustainable shareholder value.” The company also announced that it is eliminating the position of executive vice president, merchandising, marketing and e-commerce, currently held by Jason McDonell, as part of its efforts to streamline the organizational structure. As a result, Mr. McDonell will depart from the company effective December 1, 2023. Mr. McDonell’s responsibilities will be assumed by other members of the Advance leadership team. Mr. O’Kelly added, “On behalf of the entire Advance team, I thank Jason for his leadership and contributions over the past four years. Jason helped develop our enterprise marketing and e-commerce functions and launched Advance SameDay™ delivery as well as our DieHard® brand, which has enabled accelerated battery sales growth and share gains. We wish Jason all the best in the future.” About Advance Auto Parts Advance Auto Parts, Inc. is a leading automotive aftermarket parts provider that serves both professional installer and do-it-yourself customers. As of October 7, 2023 Advance operated 4,785 stores and 320 Worldpac branches primarily within the United States, with additional locations in Canada, Puerto Rico and the U.S. Virgin Islands. The company also served 1,307 independently owned Carquest branded stores across these locations in addition to Mexico and various Caribbean islands. Additional information about Advance, including employment opportunities, customer services, and online shopping for parts, accessories and other offerings can be found at www.AdvanceAutoParts.com. Forward-Looking Statements Certain statements herein are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are usually identifiable by words such as “anticipate,” “believe,” “could,” “estimate,” “expect,” “forecast,” “guidance,” “intend,” “likely,” “may,” “plan,” “position,” “possible,” “potential,” “probable,” “project,” “should,” “strategy,” “will,” or similar language. All statements other than statements of historical fact are forward-looking statements, including, but not limited to, statements about leadership transitions, strategic initiatives, operational plans and objectives, our strategic and operational review and expectations for economic conditions, future business results and future financial performance, as well as statements regarding underlying assumptions related thereto. Forward-looking statements reflect our views based on historical results, current information and assumptions related to future developments. Except as may be required by law, we undertake no obligation to update any forward-looking statements made herein. Forward-looking statements are subject to a number of risks and uncertainties that could cause actual results to differ materially from those projected or implied by the forward-looking statements. They include, among others, factors related to the company’s leadership transition, the timing and implementation of strategic initiatives, our ability to hire, train and retain qualified employees, deterioration of general macroeconomic conditions, the highly competitive nature of our industry, demand for our products and services, complexities in our inventory and supply chain and challenges with transforming and growing our business. Please refer to “Item 1A. Risk Factors” of our most recent Annual Report on Form 10-K filed with the Securities and Exchange Commission (“SEC”), as updated by our subsequent filings with the SEC, for a description of these and other risks and uncertainties that could cause actual results to differ materially from those projected or implied by the forward-looking statements. View the full article

Advance Auto Parts Reports Third Quarter 2023 Results and Provides Updates on Strategic and Operational Review 11/15/2023 Q3 Net Sales Increased 2.9% to $2.7 Billion; Comparable Store Sales Increased 1.2% Executing on New $150 Million Cost Reduction Program Initiates Sale Processes for Worldpac and Canadian Business RALEIGH, N.C.--(BUSINESS WIRE)-- Advance Auto Parts, Inc. (NYSE: AAP), a leading automotive aftermarket parts provider in North America, that serves both professional installer and do-it-yourself customers, announced its financial results for the third quarter ended October 7, 2023. “Since joining Advance, I have partnered with the board and management team to move with speed in conducting a comprehensive review of the business,” said Shane O'Kelly, president and chief executive officer. “We are taking decisive actions to position Advance for long-term success and create meaningful value for our shareholders. Today we are announcing initial actions from our review process that will allow us to capitalize on significant opportunities ahead. First, we are launching a new cost reduction program that we expect will generate at least $150 million in savings on an annualized basis. We expect to reinvest up to $50 million of these savings in our team members with a clear focus on improving the retention of our frontline team members. At the same time, we have made a strategic decision to focus on our blended box business model and are therefore initiating separate sale processes for Worldpac as well as our Canadian business. “We are committed to stabilizing the company and returning Advance to profitable growth, and our frontline team’s passion and extensive knowledge is integral to how we succeed. Seeing our frontline team members in action delivering for customers, coupled with robust industry fundamentals and strong vendor relationships, has reaffirmed my optimism that by making rigorous strategic and operational decisions now, Advance will be well positioned to capitalize on the opportunities ahead and deliver value for shareholders.” Third Quarter 2023 Results (1) Third quarter 2023 Net sales totaled $2.7 billion, a 2.9% increase compared with the third quarter of the prior year. Comparable store sales increased to 1.2%. Gross profit decreased 16.3% to $1.0 billion. Gross profit margin was 36.3% of Net sales compared with 44.6% of Net sales in the third quarter of the prior year. This was primarily driven by a change in estimate for inventory reserves that resulted in a one-time impact of approximately $119 million. In addition, the company incurred higher product costs that were not fully covered by pricing actions and elevated supply chain costs. This was partially offset by a reduction in LIFO-related expenses. SG&A expenses were $1.0 billion, which were 37.9% of Net sales compared with 38.2% in the third quarter of the prior year. The company's Operating loss was $43.7 million, or (1.6)% of Net sales, compared with 6.5% in the third quarter of the prior year. The company's effective tax rate was 24.4%, compared with 24.7% in the third quarter of the prior year. The company's Diluted loss per share was $(0.82), compared with Diluted earnings per share of $1.92 in the third quarter of the prior year. Net cash provided by operating activities was $30.4 million through the third quarter of 2023 versus $483.1 million in the same period of the prior year. This was primarily driven by lower Net income and an increase in cash used in working capital. Through the third quarter of 2023, Free cash flow was an outflow of $156.8 million compared with an inflow of $149.5 million in the same period of the prior year. All comparisons are based on the corrected results of the same time period in the prior year as depicted in the financial tables herein, which include the correction of non-material errors the company discovered in previously reported results. Strategic Review Update The company has initiated separate sale processes for the potential divestiture of Worldpac and the company’s Canada business. Worldpac, a leading automotive wholesale distributor of original equipment and aftermarket parts for all makes/all models, is highly recognized for its world class technology, catalog, product brand assortment and training. The company's Canadian business, which predominantly serves commercial customers, goes to market under the Carquest banner. The company has engaged Centerview Partners to assist in the sale processes. The company has not set a timetable for the conclusion of the sale processes and does not intend to comment on or provide updates regarding these matters unless and until the processes are concluded or it determines that further disclosure is appropriate or required. (1) Comparable store sales include locations open for 13 complete accounting periods and excludes sales to independently owned Carquest locations. Capital Allocation On October 31, 2023, the company declared a regular cash dividend of $0.25 per share to be paid on January 26, 2024 to all common stockholders of record as of January 12, 2024. Full Year 2023 Guidance Tony Iskander, interim chief financial officer, said, “Based on our year-to-date results and current business trends, we are adjusting our previously provided full year outlook ranges. Our updates include the impact of non-recurring expenses in Q3 as well as continued pressure in Q4 from higher product costs that we do not expect to offset with price. We are taking significant steps to improve our cost structure and remain focused on returning the business to profitable growth.” View the full article

Advance Auto Parts Announces Date for Its Third Quarter 2023 Earnings Release and Conference Call 10/25/2023 RALEIGH, N.C.--(BUSINESS WIRE)-- Advance Auto Parts, Inc. (NYSE: AAP), a leading automotive aftermarket parts provider in North America that serves both professional installer and do-it-yourself customers, will report its third quarter 2023 results before the market opens on Wednesday, November 15, 2023. Interested parties can listen to the event via a webcast scheduled to begin at 8:00 a.m. Eastern Time on Wednesday, November 15, 2023. The webcast will be accessible via the company’s Investor Relations website (ir.AdvanceAutoParts.com). To join by phone, please pre-register online for dial-in and passcode information. Upon registering, participants will receive a confirmation with call details and a registrant ID. While registration is open through the live call, the company suggests registering a day in advance or at minimum 10 minutes before the start of the call. A replay of the conference call will be available on the company’s Investor Relations website for one year. About Advance Auto Parts Advance Auto Parts, Inc. is a leading automotive aftermarket parts provider that serves both professional installer and do-it-yourself customers. As of July 15, 2023, Advance operated 4,790 stores and 319 Worldpac branches primarily within the United States, with additional locations in Canada, Puerto Rico and the U.S. Virgin Islands. The company also served 1,307 independently owned Carquest branded stores across these locations in addition to Mexico and various Caribbean islands. Additional information about Advance, including employment opportunities, customer services, and online shopping for parts, accessories and other offerings can be found at www.AdvanceAutoParts.com. View the full article

ADVANCE AUTO PARTS REPORTS SECOND QUARTER 2023 RESULTS Q2 Net Sales Increased 0.8% to $2.7 Billion; Comparable Store Sales Decreased 0.6% Operating Income of $134.4 Million; Operating Income Margin of 5.0% Separately Announces Leadership Appointments Initiated Comprehensive Operational and Strategic Review RALEIGH, N.C.--(BUSINESS WIRE)-- Advance Auto Parts, Inc. (NYSE: AAP), a leading automotive aftermarket parts provider in North America, that serves both professional installer and do-it-yourself customers, announced its financial results for the second quarter ended July 15, 2023. The company also announced that it has initiated a comprehensive operational and strategic review. Tom Greco, president and chief executive officer, said, “I want to thank the entire Advance family for their dedication and focus on serving our customers in the second quarter while we continued to execute against our priorities to improve operational performance. Profitability in the quarter was below expectations, primarily related to our inability to price to cover inflation. However, we began to see early signs that the strategic investments we are making are beginning to drive an improvement in topline sales and transactions. This is evidenced by positive comparable store sales growth in the final four weeks of the second quarter, which has continued into the third quarter.” Gene Lee, interim executive chair, continued, “Since expanding my role to serve as interim executive chair and partnering more closely with Tom and the leadership team, I have taken a deeper dive into the business and our strategy. As we look to the balance of 2023, we are updating our full-year guidance. We recognize that there is significant work to be done to improve execution across the business and are conducting a comprehensive operational and strategic review to position Advance for long-term success and increase shareholder value. Importantly, as announced separately today, we have identified Advance’s next CEO and look forward to welcoming Shane O’Kelly, an accomplished executive with extensive operational and supply chain experience. The board will work with Shane and the management team to ensure Advance is taking the right steps to build a stronger, more resilient business for the benefit of all stakeholders.” Second Quarter 2023 Results (1) Second quarter of 2023 Net sales totaled $2.7 billion, a 0.8% increase compared with the second quarter of the prior year, primarily driven by new store openings. This was partially offset by a decline of comparable store sales of 0.6%. Gross profit decreased 3.2% to $1.1 billion. Gross profit margin was 42.7% of Net sales compared with 44.5% of Net sales in the second quarter of the prior year. This was primarily driven by higher product costs and supply chain deleverage that were not fully covered by pricing actions, partially offset by a reduction in LIFO-related expenses. SG&A expenses were $1.0 billion, which were 37.7% of Net sales compared with 36.9% in the second quarter of the prior year. This was primarily driven by inflation within labor and benefit-related expenses. The company's Operating income was $134.4 million, or 5.0% of Net sales, compared with 7.6% in the second quarter of the prior year. The company's effective tax rate was 25.9%, compared with 24.3% in the second quarter of the prior year. The company's Diluted EPS was $1.43, compared with $2.38 in the second quarter of the prior year. Net cash used in operating activities was $164.6 million through the second quarter of 2023 versus $308.5 million provided by operating activities in the same period of the prior year. The decrease was primarily driven by lower Net income and an increase in cash used in working capital, primarily in Accounts payable. Free cash flow through the second quarter of 2023 was an outflow of $309.4 million compared with an inflow of $97.3 million in the same period of the prior year. (1) All comparisons are based on the same time period in the prior year. Comparable store sales include locations open for 13 complete accounting periods and excludes sales to independently owned Carquest locations. Capital Allocation On August 7, 2023, the company declared a regular cash dividend of $0.25 per share to be paid on October 27, 2023 to all common stockholders of record as of October 13, 2023. Full Year 2023 Guidance Tony Iskander, interim chief financial officer, said, “We are updating our full-year guidance, which considers a modest step up in net and comparable store sales growth driven by strengthening of our professional business. However, we are reducing our outlook for operating income margin rate, diluted earnings per share and free cash flow. This reflects additional headwinds anticipated in the back half of the year driven by our ongoing commitment to maintain competitive price targets, impacts from a shift in channel mix and investments in our team to help retain top talent.” Prior FY 2023 Outlook Updated FY 2023 Outlook As of May 31, 2023 As of August 23, 2023 ($ in millions, except per share data) Low High Low High Net sales $ 11,200 $ 11,300 $ 11,250 $ 11,350 Comparable store sales (1) (1.0 )% — % (0.5 )% 0.5 % Operating income margin 5.0 % 5.3 % 4.0 % 4.3 % Income tax rate 24.0 % 25.0 % 25.0 % 25.0 % Diluted EPS $ 6.00 $ 6.50 $ 4.50 $ 5.10 Capital expenditures $ 250 $ 300 $ 200 $ 250 Free cash flow (2) $ 200 $ 300 $ 150 $ 250 New store and branch openings 40 60 40 60 (1) Comparable store sales include locations open for 13 complete accounting periods and excludes sales to independently owned Carquest locations. (2) Free cash flow is a non-GAAP measure. For a better understanding of the company's non-GAAP adjustments, refer to the reconciliation of non-GAAP financial measures in the accompanying financial tables included herein. Investor Conference Call The company will detail its results for the second quarter ended July 15, 2023 via a webcast scheduled to begin at 8 a.m. Eastern Time on Wednesday, August 23, 2023. The webcast will be accessible via the Investor Relations page of the company's website (ir.AdvanceAutoParts.com). To join by phone, please pre-register online for dial-in and passcode information. Upon registering, participants will receive a confirmation with call details and a registrant ID. While registration is open through the live call, the company suggests registering a day in advance or at minimum 10 minutes before the start of the call. A replay of the conference call will be available on the company's Investor Relations website for one year. About Advance Auto Parts Advance Auto Parts, Inc. is a leading automotive aftermarket parts provider that serves both professional installer and do-it-yourself customers. As of July 15, 2023 Advance operated 4,790 stores and 319 Worldpac branches primarily within the United States, with additional locations in Canada, Puerto Rico and the U.S. Virgin Islands. The company also served 1,307 independently owned Carquest branded stores across these locations in addition to Mexico and various Caribbean islands. Additional information about Advance, including employment opportunities, customer services, and online shopping for parts, accessories and other offerings can be found at www.AdvanceAutoParts.com. Forward-Looking Statements Certain statements herein are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are usually identifiable by words such as “anticipate,” “believe,” “could,” “estimate,” “expect,” “forecast,” “guidance,” “intend,” “likely,” “may,” “plan,” “position,” “possible,” “potential,” “probable,” “project,” “should,” “strategy,” “will,” or similar language. All statements other than statements of historical fact are forward-looking statements, including, but not limited to, statements about our leadership transition, strategic initiatives, operational plans and objectives, our planned strategic and operational review and expectations for economic conditions, future business results and future financial performance, as well as statements regarding underlying assumptions related thereto. Forward-looking statements reflect our views based on historical results, current information and assumptions related to future developments. Except as may be required by law, we undertake no obligation to update any forward-looking statements made herein. Forward-looking statements are subject to a number of risks and uncertainties that could cause actual results to differ materially from those projected or implied by the forward-looking statements. They include, among others, factors related to the company’s leadership transition, the timing and implementation of strategic initiatives, our ability to hire, train and retain qualified employees, deterioration of general macroeconomic conditions, the highly competitive nature of our industry, demand for our products and services, complexities in our inventory and supply chain and challenges with transforming and growing our business. Please refer to “Item 1A. Risk Factors” of our most recent Annual Report on Form 10-K filed with the Securities and Exchange Commission (“SEC”), as updated by our subsequent filings with the SEC, for a description of these and other risks and uncertainties that could cause actual results to differ materially from those projected or implied by the forward-looking statements. Advance Auto Parts, Inc. and Subsidiaries Condensed Consolidated Balance Sheets (In thousands) (unaudited) July 15, 2023 (1) December 31, 2022 (2) Assets Current assets: Cash and cash equivalents $ 277,064 $ 269,282 Receivables, net 793,772 698,613 Inventories, net 5,067,467 4,915,262 Other current assets 188,169 163,695 Total current assets 6,326,472 6,046,852 Property and equipment, net 1,688,891 1,690,139 Operating lease right-of-use assets 2,618,822 2,607,690 Goodwill 991,871 990,471 Other intangible assets, net 606,450 620,901 Other assets 71,870 62,429 Total assets $ 12,304,376 $ 12,018,482 Liabilities and Stockholders' Equity Current liabilities: Accounts payable $ 3,780,215 $ 4,123,462 Accrued expenses 685,191 634,447 Current portion of long-term debt 95,000 185,000 Other current liabilities 465,972 427,480 Total current liabilities 5,026,378 5,370,389 Long-term debt 1,785,074 1,188,283 Noncurrent operating lease liabilities 2,249,994 2,278,318 Deferred income taxes 432,680 415,997 Other long-term liabilities 87,063 87,214 Total stockholders' equity 2,723,187 2,678,281 Total liabilities and stockholders’ equity $ 12,304,376 $ 12,018,482 (1) This preliminary condensed consolidated balance sheet has been prepared on a basis consistent with the company's previously prepared consolidated balance sheets filed with the Securities and Exchange Commission (“SEC”), but does not include the footnotes required by accounting principles generally accepted in the United States of America (“GAAP”). (2) The balance sheet at December 31, 2022 has been derived from the audited consolidated financial statements at that date, but does not include the footnotes required by GAAP. Advance Auto Parts, Inc. and Subsidiaries Condensed Consolidated Statements of Operations (In thousands, except per share data) (unaudited) Twelve Weeks Ended Twenty-Eight Weeks Ended July 15, 2023 (1) July 16, 2022 (1) July 15, 2023 (1) July 16, 2022 (1) Net sales $ 2,686,066 $ 2,665,426 $ 6,103,659 $ 6,039,636 Cost of sales, including purchasing and warehousing costs 1,537,997 1,479,707 3,484,927 3,347,397 Gross profit 1,148,069 1,185,719 2,618,732 2,692,239 Selling, general and administrative expenses (2) 1,013,701 984,037 2,394,365 2,287,287 Operating income 134,368 201,682 224,367 404,952 Other, net: Interest expense (20,869 ) (10,207 ) (50,587 ) (23,075 ) Loss on early redemption of senior unsecured notes — — — (7,408 ) Other income (expense), net 1,684 (711 ) 1,009 (575 ) Total other, net (19,185 ) (10,918 ) (49,578 ) (31,058 ) Income before provision for income taxes 115,183 190,764 174,789 373,894 Provision for income taxes 29,821 46,362 46,776 89,701 Net income $ 85,362 $ 144,402 $ 128,013 $ 284,193 Basic earnings per common share $ 1.44 $ 2.39 $ 2.16 $ 4.67 Weighted-average common shares outstanding 59,451 60,452 59,384 60,914 Diluted earnings per common share $ 1.43 $ 2.38 $ 2.15 $ 4.63 Weighted-average common shares outstanding 59,604 60,782 59,570 61,328 (1) These preliminary condensed consolidated statements of operations have been prepared on a basis consistent with the company's previously prepared consolidated statements of operations filed with the SEC, but do not include the footnotes required by GAAP. (2) The twenty-eight weeks ended July 15, 2023 included an out-of-period charge of approximately $17 million related to costs incurred in prior years but not expensed in the corresponding periods. The company determined the cumulative impact was not material to the current period or any previously issued financial statements. Advance Auto Parts, Inc. and Subsidiaries Condensed Consolidated Statements of Cash Flows (In thousands) (unaudited) Twenty-Eight Weeks Ended July 15, 2023 (1) July 16, 2022 (1) Cash flows from operating activities: Net income $ 128,013 $ 284,193 Adjustments to reconcile net income to net cash used in operating activities: Depreciation and amortization 162,974 148,691 Share-based compensation 26,791 29,345 Loss and impairment on property and equipment, net 859 2,970 Loss on early redemption of senior unsecured notes — 7,408 Provision for deferred income taxes 16,249 8,779 Other, net 1,170 1,575 Net change in: Receivables, net (93,539 ) (149,255 ) Inventories, net (145,148 ) (176,300 ) Accounts payable (346,808 ) 168,219 Accrued expenses 120,888 (46,887 ) Other assets and liabilities, net (36,008 ) 29,805 Net cash (used in) provided by operating activities (164,559 ) 308,543 Cash flows from investing activities: Purchases of property and equipment (144,874 ) (211,212 ) Proceeds from sales of property and equipment 1,532 830 Net cash used in investing activities (143,342 ) (210,382 ) Cash flows from financing activities: Borrowings under credit facilities 4,327,000 743,000 Payments on credit facilities (4,417,000 ) (643,000 ) Borrowings on senior unsecured notes 599,571 348,618 Payments on senior unsecured notes — (201,081 ) Dividends paid (179,347 ) (245,599 ) Repurchases of common stock (13,808 ) (466,169 ) Other, net (2,013 ) (1,329 ) Net cash provided by (used in) financing activities 314,403 (465,560 ) Effect of exchange rate changes on cash 1,280 6,522 Net increase (decrease) in cash and cash equivalents 7,782 (360,877 ) Cash and cash equivalents, beginning of period 269,282 601,428 Cash and cash equivalents, end of period $ 277,064 $ 240,551 (1) These preliminary condensed consolidated statements of cash flows have been prepared on a consistent basis with the company's previously prepared statements of cash flows filed with the SEC, but do not include the footnotes required by GAAP. Reconciliation of Non-GAAP Financial Measure The company's financial results include certain financial measures not derived in accordance with accounting principles generally accepted in the United States of America (“GAAP”). Management uses Free cash flow as a measure of its liquidity and believes it is a useful indicator to investors or potential investors of the company's ability to implement growth strategies and service debt. Free cash flow is a non-GAAP measure and should be considered in addition to, but not as a substitute for, information contained in the company's condensed consolidated statement of cash flows as a measure of liquidity. Reconciliation of Free Cash Flow: Twenty-Eight Weeks Ended (in thousands) July 15, 2023 July 16, 2022 Cash flows (used in) provided by operating activities $ (164,559 ) $ 308,543 Purchases of property and equipment (144,874 ) (211,212 ) Free cash flow $ (309,433 ) $ 97,331 Adjusted Debt to Adjusted EBITDAR: (1) Four Quarters Ended (In thousands, except adjusted debt to adjusted EBITDAR ratio) July 15, 2023 December 31, 2022 Total GAAP debt $ 1,880,074 $ 1,373,283 Add: Operating lease liabilities 2,705,388 2,692,861 Adjusted debt $ 4,585,462 $ 4,066,144 GAAP Net income $ 345,692 $ 501,872 Depreciation and amortization 298,083 283,800 Interest expense 78,572 51,060 Other expense, net 5,412 6,996 Provision for income taxes 103,890 146,815 Rent expense 596,537 594,838 Share-based compensation 48,424 50,978 Other non-cash charges 17,725 — Adjusted EBITDAR $ 1,494,335 $ 1,636,359 Adjusted Debt to Adjusted EBITDAR 3.1 2.5 (1) Beginning in first quarter 2023, the company no longer excludes transformation-related activities in non-GAAP measures. Prior period has been recast to conform to current year presentation. NOTE: Management believes its Adjusted Debt to Adjusted EBITDAR ratio (“leverage ratio”) is a key financial metric for debt securities, as reviewed by rating agencies, and believes its debt levels are best analyzed using this measure. The company’s goal is to maintain an investment grade rating. The company's credit rating directly impacts the interest rates on borrowings under its existing credit facility and could impact the company's ability to obtain additional funding. If the company was unable to maintain its investment grade rating this could negatively impact future performance and limit growth opportunities. Similar measures are utilized in the calculation of the financial covenants and ratios contained in the company's financing arrangements. The leverage ratio calculated by the company is a non-GAAP measure and should not be considered a substitute for debt to net earnings, net earnings or debt as determined in accordance with GAAP. The company adjusts the calculation to remove rent expense and to add back the company’s existing operating lease liabilities related to their right-of-use assets to provide a more meaningful comparison with the company’s peers and to account for differences in debt structures and leasing arrangements. The company’s calculation of its leverage ratio might not be calculated in the same manner as, and thus might not be comparable to, similarly titled measures by other companies. Store Information During the twenty-eight weeks ended July 15, 2023, 39 stores and branches were opened and 16 were closed or consolidated, resulting in a total of 5,109 stores and branches as of July 15, 2023, compared with a total of 5,086 stores and branches as of December 31, 2022. The below table summarizes the changes in the number of company-operated store and branch locations during the twelve and twenty-eight weeks ended July 15, 2023: Twelve Weeks Ended AAP CARQUEST WORLDPAC (1) Total April 22, 2023 4,456 322 318 5,096 New 17 — 1 18 Closed (2) (3) — (5) July 15, 2023 4,471 319 319 5,109 Twenty-Eight Weeks Ended AAP CARQUEST WORLDPAC (1) Total December 31, 2022 4,440 330 316 5,086 New 36 — 3 39 Closed (5) (11) — (16) July 15, 2023 4,471 319 319 5,109 There were no consolidated, converted or relocated stores during the twelve and twenty-eight weeks ended July 15, 2023. (1) Certain converted Autopart International ("AI") locations will remain branded as AI going forward. View source version on businesswire.com: https://www.businesswire.com/news/home/20230822858609/en/ Investor Relations Contact: Elisabeth Eisleben T: (919) 227-5466 E: [email protected] Media Contact: Darryl Carr T: (984) 389-7207 E: [email protected] Source: Advance Auto Parts, Inc. View the full article

ADVANCE AUTO PARTS ANNOUNCES EXECUTIVE LEADERSHIP CHANGES Appoints Shane O’Kelly as President and Chief Executive Officer Names Tony Iskander as Interim Chief Financial Officer RALEIGH, N.C.--(BUSINESS WIRE)-- Advance Auto Parts, Inc. (NYSE: AAP), a leading automotive aftermarket parts provider in North America that serves both professional installer and do-it-yourself customers, today announced that its board of directors has appointed Shane O’Kelly as president and chief executive officer, effective September 11, 2023. Mr. O’Kelly will succeed Tom Greco, who has served as president and CEO since April 2016. Mr. Greco announced his planned retirement in February 2023 and will stay on as an advisor to ensure a seamless transition. Mr. O’Kelly has also been appointed to the Advance Auto Parts board of directors, effective September 11, 2023. Gene Lee, interim executive chair of the board of directors, will continue in his interim role through the end of the year. Mr. O’Kelly, 54, brings more than 30 years of operational, strategic development, integration and supply chain experience, including a proven track record of developing high-performing teams and cultures to drive results. Most recently, Mr. O’Kelly served as CEO of HD Supply, a wholly owned subsidiary of The Home Depot, Inc. Prior to joining Home Depot, Mr. O’Kelly was the CEO of PetroChoice, the nation's largest distributor of lubricants and lubrication solutions. Prior to that, he was CEO of AH Harris, a specialty construction supply distributor. Earlier in his career, he worked at The Home Depot and McKinsey and Company. Mr. O’Kelly served as a captain in the US Army and earned an MBA from Harvard Business School and a bachelor’s degree from The United States Military Academy at West Point. Gene Lee, interim executive chair, said, “On behalf of the entire Advance Auto Parts board, I am delighted to welcome Shane to the Advance family. Following an extensive search over the past several months, we are confident that Shane’s robust operational background leading complex supply chain organizations makes him the ideal next leader for Advance. His proven leadership, commitment to serving customers, and strong track record of disciplined execution across multi-unit businesses will enable him to lead Advance in the next chapter and help drive long-term value for our shareholders.” Mr. O’Kelly said, “I am honored to be joining Advance at such an important inflection point for the company. I have great respect for the talented team members at Advance and all that has been accomplished, including the team’s relentless focus on delivering for customers while navigating the challenging competitive and macroeconomic environment. As we undertake an operational and strategic review of the business, I look forward to working alongside the entire Advance team and our board of directors to drive growth, operational excellence and value for all stakeholders.” The company also announced today that Tony Iskander has been named interim chief financial officer, effective August 18, 2023. Mr. Iskander succeeds Jeff Shepherd, who departed from Advance, effective August 18, 2023. Mr. Iskander has more than 25 years of finance and accounting experience and served as the company’s senior vice president, finance and treasurer since 2020. Prior to joining Advance in 2017, he spent more than a decade at Hillrom, where he held various finance roles of increasing responsibility. A search is being initiated, with the assistance of a leading executive search firm, to identify the company’s next chief financial officer. Mr. Lee said, “We thank Jeff for his contributions and wish him the best in his future endeavors. Advance is fortunate to have a seasoned executive in Tony to assume the CFO role on an interim basis. I am very confident that Tony will lead the finance team through a seamless transition and work closely with Advance’s new CEO when Shane officially joins in September.” About Advance Auto Parts Advance Auto Parts, Inc. is a leading automotive aftermarket parts provider that serves both professional installer and do-it-yourself customers. As of July 15, 2023, Advance operated 4,790 stores and 319 Worldpac branches primarily within the United States, with additional locations in Canada, Puerto Rico and the U.S. Virgin Islands. The company also served 1,307 independently owned Carquest branded stores across these locations in addition to Mexico and various Caribbean islands. Additional information about Advance, including employment opportunities, customer services, and online shopping for parts, accessories and other offerings can be found at www.AdvanceAutoParts.com. Forward-Looking Statements Certain statements herein are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are usually identifiable by words such as “anticipate,” “believe,” “could,” “estimate,” “expect,” “forecast,” “guidance,” “intend,” “likely,” “may,” “plan,” “position,” “possible,” “potential,” “probable,” “project,” “should,” “strategy,” “will,” or similar language. All statements other than statements of historical fact are forward-looking statements, including, but not limited to, statements about our leadership transition, strategic initiatives, operational plans and objectives, our planned strategic and operational review and expectations for economic conditions, future business results and future financial performance, as well as statements regarding underlying assumptions related thereto. Forward-looking statements reflect our views based on historical results, current information and assumptions related to future developments. Except as may be required by law, we undertake no obligation to update any forward-looking statements made herein. Forward-looking statements are subject to a number of risks and uncertainties that could cause actual results to differ materially from those projected or implied by the forward-looking statements. They include, among others, factors related to the company’s leadership transition, the timing and implementation of strategic initiatives, our ability to hire, train and retain qualified employees, deterioration of general macroeconomic conditions, the highly competitive nature of our industry, demand for our products and services, complexities in our inventory and supply chain and challenges with transforming and growing our business. Please refer to “Item 1A. Risk Factors” of our most recent Annual Report on Form 10-K filed with the Securities and Exchange Commission (“SEC”), as updated by our subsequent filings with the SEC, for a description of these and other risks and uncertainties that could cause actual results to differ materially from those projected or implied by the forward-looking statements. View source version on businesswire.com: https://www.businesswire.com/news/home/20230822500765/en/ Investor Relations Contact: Elisabeth Eisleben T: (919) 227-5466 E: [email protected] Media Contact: Darryl Carr T: (984) 389-7207 E: [email protected] Source: Advance Auto Parts, Inc. View the full article

ADVANCE AUTO PARTS OFFERING STUDENTS A CHANCE TO WIN A ‘FUEL RIDE TO COLLEGE’ AND FREE ‘OFF-TO-CAMPUS’ IN-STORE SERVICES Incoming college freshmen can enter to win a “fuel ride” – four years of free gasoline – after new national survey reveals gas is a significant financial strain for majority of students RALEIGH, N.C.--(BUSINESS WIRE)-- Advance Auto Parts (NYSE: AAP), a leading automotive aftermarket parts provider, announced today that it will help advance the education of incoming college freshmen, and ease their financial burden, by awarding 10 “fuel rides” in the form of four years of free gasoline to 10 lucky winners of the “Fuel Ride to College” sweepstakes.* This press release features multimedia. View the full release here: https://www.businesswire.com/news/home/20230807678901/en/ Along with providing four years of free gas to 10 college students, Advance Auto Parts is offering free in-store services, including free battery testing and installation, wiper blade installation and check engine light scanning. (Photo: Business Wire) Advance’s “Fuel Ride to College” sweepstakes arrives right on time as prices at the pump tick up. New data from Atomik Research reveals that 67% of college students cite gasoline for their automobile as being an expense that puts the most financial strain on their wallet**, while 76% of parents of incoming freshmen say they are worried about their student’s ability to afford gas.*** Parents also have significant anxiety regarding the safety of their college students when it comes to the automobiles they operate, according to Atomik Research surveys commissioned by Advance. Nearly two-thirds (63%) of parents of incoming college freshmen feel very or extremely anxious about their student’s safety when it comes to maintaining their cars and about three-fourths (73%) of parents have more anxiety about the car safety of their incoming college freshman than they did during the child’s senior year in high school. Parents’ anxiety is warranted as more than half of college students admit to having ignored dashboard alerts and notifications, including “check engine” and “low battery warning,” according to the survey. To help ease this anxiety, Advance and its team of friendly automotive experts are offering students and their parents free “off-to-campus” in-store services at Advance stores nationwide, including free battery testing and installation, wiper blade installation and check engine light scanning. In addition to awarding 10 four-year “Fuel Rides to College,” Advance will also award 20 additional winners a $100 Advance gift card to stock up on essentials to help keep their automobiles in reliable shape this school year. If interested in learning more, visit AAPFuelRide.com through Aug. 18 to review eligibility requirements to enter for a chance to win and to review the sweepstakes rules. “Starting college is exciting for incoming freshmen, but that excitement is accompanied by anxiety and worry for both students and their parents, especially regarding finances and safety,” said Samantha Avivi, Advance’s chief marketing officer. “Through our ‘Fuel Ride to College’ program and complimentary curbside services for motorists, we want to put the brakes on fuel-filled worries for both students and parents, especially when it comes to having a reliable and safe automobile on the road to college, around campus, back home and everywhere in between.” Additional data from the Atomik surveys validate the value of a “Fuel Ride to College:” One-third (33%) of students cite that a lack of gas money or the cost of gas has deterred them from going to class, the library or study groups, while 60% of incoming college students’ parents express this exact worry: that the cost of gas will deter their child from going to class or education-related activities. Many college students choose between fueling their body and their automobile: more than one-third (36%) say they have compromised or cut back on groceries to fit gas money into their budget. One-quarter (25%) of college students say they’ve had to cut back or compromise school supplies to fuel their automobiles. Advance has also partnered with auto racing driver and television personality Arie Luyendyk Jr. to encourage incoming freshmen to enter for a chance to win a “Fuel Ride to College” and spread the word about Advance’s commitment to providing parents peace of mind via complimentary in-store services. Check out advanceautoparts.com or visit an Advance Auto Parts retail location to shop for auto parts and products needed to get vehicles in shape for the school year or to receive a free off-to-campus vehicle checkup. About Advance Auto Parts Advance Auto Parts, Inc. is a leading automotive aftermarket parts provider that serves both professional installer and do-it-yourself customers. As of April 22, 2023, Advance operated 4,778 stores and 318 Worldpac branches primarily within the United States, with additional locations in Canada, Puerto Rico and the U.S. Virgin Islands. The company also served 1,315 independently owned Carquest branded stores across these locations in addition to Mexico and various Caribbean islands. Additional information about Advance, including employment opportunities, customer services, and online shopping for parts, accessories and other offerings can be found at www.AdvanceAutoParts.com. * NO PURCHASE NECESSARY TO ENTER OR WIN. A PURCHASE WILL NOT INCREASE YOUR CHANCES OF WINNING. Open only to legal residents of the 50 United States (D.C.), 17 to 20 years of age. Void where prohibited by law. Sweepstakes begins at 8:00 am ET on 8/7/23 and ends at 11:59 pm ET on 8/18/23. Subject to full Official Rules including prizes and odds, https://AAPFuelRide.com/rules . Sponsor: Advance Stores Company, Incorporated, 4200 Six Forks Road, Raleigh, NC 27609. ** Atomik Research conducted an online survey of 1,003 college students across the United States between July 10 and 12, 2023. Qualified respondents are students currently enrolled or planning to be enrolled at a college, university, community college or trade school this fall and who own and/or regularly operate a car. The age of participants ranges between 18 and 24. Margin of error of the sample is +/- 3 percentage points with a confidence level of 95%. *** Atomik Research conducted an online survey of 504 parents of incoming college freshmen across the United States between July 10 and 18, 2023. Qualified respondents are parents of incoming freshmen, who own or regularly operate a car, and are planning to be enrolled at a college, university, community college or trade school this fall. Margin of error of the sample is +/- 4 percentage points with a confidence level of 95%. View source version on businesswire.com: https://www.businesswire.com/news/home/20230807678901/en/ Advance Auto Parts Contacts: Investor Relations: Elisabeth Eisleben T: (919) 227-5466 E: [email protected] Media Relations: Darryl Carr T: (984) 389-7207 E: [email protected] Source: Advance Auto Parts View the full article

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Q1 Net Sales Increased 1.3% to $3.4 Billion; Comparable Store Sales Decreased 0.4% Operating Income of $90.0 Million; Operating Income Margin of 2.6% RALEIGH, N.C.--(BUSINESS WIRE)-- Advance Auto Parts, Inc. (NYSE: AAP), a leading automotive aftermarket parts provider in North America, that serves both professional installer and do-it-yourself customers, announced its financial results for the first quarter ended April 22, 2023. Tom Greco, president and chief executive officer, said, “I want to thank our Advance team members and independent partners for their continued hard work and focus on serving our customers. While we anticipated the first quarter would be challenging, our results were below our expectations. Net sales grew 1.3% in the quarter. Our operating margin rate of 2.6% in the quarter was well below expectations due to higher than planned investments to narrow competitive price gaps in the professional sales channel as well as unfavorable product mix.” Mr. Greco continued, “We remain focused on improving inventory availability while sustaining competitive price targets to improve topline sales. We expect the competitive dynamics we faced in the first quarter to continue, resulting in a shortfall to our 2023 expectations. We have reduced our full-year guidance and our board of directors made the difficult decision to reduce our quarterly dividend. In addition, in connection with my pending retirement, our board’s independent chair, Gene Lee, has assumed an expanded role as interim executive chair. Gene will be providing additional operational oversight and support to our management team to enable a seamless CEO transition. He has helped me immensely during my time as CEO and I look forward to working with him to improve the trajectory of our business in the months ahead.” First Quarter 2023 Results ( 1) First quarter of 2023 Net sales totaled $3.4 billion, a 1.3% increase compared with the first quarter of the prior year, primarily driven by new store openings. This was partially offset by a decline of comparable store sales of 0.4%. Gross profit decreased 2.4% to $1.5 billion. Gross profit margin of 43.0% of Net sales decreased 162 basis points compared with the first quarter of the prior year. This was primarily driven by inflationary product costs that were not fully covered by pricing actions. In addition, unfavorable product mix and supply chain headwinds also contributed to gross margin deleverage in the quarter. SG&A expenses were $1.4 billion, which was 40.4% of Net sales compared with 38.6% in the first quarter of 2022. This was primarily driven by inflation in labor and benefit-related expenses as well as costs associated with new store openings. This was partially offset by a decrease in startup costs related to the company's California expansion. The company's Operating income was $90.0 million or 2.6% of Net sales, compared with 6.0% in the first quarter of 2022. The company's effective tax rate was 28.4%, compared with 23.7% in the first quarter of 2022. The higher effective income tax rate reflects the impact associated with share based compensation. The company's Diluted EPS was $0.72, compared with $2.26 in the first quarter of 2022. Net cash used in operating activities was $378.9 million through the first quarter of 2023 versus $54.9 million used in operating activities in the same period of the prior year. The increase was primarily driven by lower Net income and an increase in cash used in working capital, primarily in accounts payable. Free cash flow through the first quarter of 2023 was an outflow of $468.9 million compared with an outflow of $169.8 million in the same period of the prior year. _______________________ (1) All comparisons are based on the same time period in the prior year. Comparable store sales include locations open for 13 complete accounting periods and excludes sales to independently owned Carquest locations. Capital Allocation On May 30, 2023, the company declared a cash dividend of $0.25 per share to be paid on July 28, 2023 to all common stockholders of record as of July 14, 2023. Full Year 2023 Guidance Jeff Shepherd, executive vice president and chief financial officer, commented, “Given the shortfall experienced this quarter, along with our revised outlook for the balance of the year, we are reducing our full-year 2023 guidance. In addition, our board of directors made the decision to reduce our quarterly cash dividend to provide enhanced financial flexibility. We are committed to improving our operational performance and driving increased profitability." Prior FY 2023 Outlook Updated FY 2023 Outlook As of February 28, 2023 As of May 31, 2023 ($ in millions, except per share data) Low High Low High Net sales $ 11,400 $ 11,600 $ 11,200 $ 11,300 Comparable store sales (1) 1.0 % 3.0 % (1.0 )% 0.0 % Operating income margin 7.8 % 8.2 % 5.0 % 5.3 % Income tax rate 24.0 % 25.0 % 24.0 % 25.0 % Diluted EPS $ 10.20 $ 11.20 $ 6.00 $ 6.50 Capital expenditures $ 300 $ 350 $ 250 $ 300 Free cash flow (2) Minimum $400 $ 200 $ 300 New store and branch openings 60 80 40 60 (1) Comparable store sales include locations open for 13 complete accounting periods and excludes sales to independently owned Carquest locations. (2) Free cash flow is a non-GAAP measure. For a better understanding of the company's non-GAAP adjustments, refer to the reconciliation of non-GAAP financial measures in the accompanying financial tables included herein. Investor Conference Call The company will detail its results for the first quarter ended April 22, 2023 via a webcast scheduled to begin at 8 a.m. Eastern Time on Wednesday, May 31, 2023. The webcast will be accessible via the Investor Relations page of the company's website (ir.AdvanceAutoParts.com). To join by phone, please pre-register online for dial-in and passcode information. Upon registering, participants will receive a confirmation with call details and a registrant ID. While registration is open through the live call, the company suggests registering a day in advance or at minimum 10 minutes before the start of the call. A replay of the conference call will be available on the company's Investor Relations website for one year. About Advance Auto Parts Advance Auto Parts, Inc. is a leading automotive aftermarket parts provider that serves both professional installer and do-it-yourself customers. As of April 22, 2023 Advance operated 4,778 stores and 318 Worldpac branches primarily within the United States, with additional locations in Canada, Puerto Rico and the U.S. Virgin Islands. The company also served 1,315 independently owned Carquest branded stores across these locations in addition to Mexico and various Caribbean islands. Additional information about Advance, including employment opportunities, customer services, and online shopping for parts, accessories and other offerings can be found at www.AdvanceAutoParts.com. Forward-Looking Statements Certain statements herein are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are usually identifiable by words such as “anticipate,” “believe,” “could,” “estimate,” “expect,” “forecast,” “guidance,” “intend,” “likely,” “may,” “plan,” “position,” “possible,” “potential,” “probable,” “project,” “should,” “strategy,” “will,” or similar language. All statements other than statements of historical fact are forward-looking statements, including, but not limited to, statements about our strategic initiatives, operational plans and objectives, expectations for economic conditions and recovery and future business and financial performance, as well as statements regarding underlying assumptions related thereto. Forward-looking statements reflect our views based on historical results, current information and assumptions related to future developments. Except as may be required by law, we undertake no obligation to update any forward-looking statements made herein. Forward-looking statements are subject to a number of risks and uncertainties that could cause actual results to differ materially from those projected or implied by the forward-looking statements. They include, among others, factors related to the company’s leadership transition, the timing and implementation of strategic initiatives, including with respect to labor shortages or disruptions and the impact on our ability to complete store openings, deterioration of general macroeconomic conditions, the highly competitive nature of our industry, demand for our products and services, complexities in our inventory and supply chain and challenges with transforming and growing our business. Please refer to “Item 1A. Risk Factors” of our most recent Annual Report on Form 10-K filed with the Securities and Exchange Commission (“SEC”), as updated by our subsequent filings with the SEC, for a description of these and other risks and uncertainties that could cause actual results to differ materially from those projected or implied by the forward-looking statements. Advance Auto Parts, Inc. and Subsidiaries Condensed Consolidated Balance Sheets (In thousands) (unaudited) April 22, 2023(1) December 31, 2022(2) Assets Current assets: Cash and cash equivalents $ 226,499 $ 269,282 Receivables, net 782,093 698,613 Inventories, net 5,015,973 4,915,262 Other current assets 177,127 163,695 Total current assets 6,201,692 6,046,852 Property and equipment, net 1,694,337 1,690,139 Operating lease right-of-use assets 2,628,899 2,607,690 Goodwill 990,573 990,471 Other intangible assets, net 612,104 620,901 Other assets 54,633 62,429 Total assets $ 12,182,238 $ 12,018,482 Liabilities and Stockholders' Equity Current liabilities: Accounts payable $ 3,682,749 $ 4,123,462 Accrued expenses 718,290 634,447 Current portion of long-term debt 116,000 185,000 Other current liabilities 466,416 427,480 Total current liabilities 4,983,455 5,370,389 Long-term debt 1,784,596 1,188,283 Noncurrent operating lease liabilities 2,269,280 2,278,318 Deferred income taxes 422,984 415,997 Other long-term liabilities 85,762 87,214 Total stockholders' equity 2,636,161 2,678,281 Total liabilities and stockholders’ equity $ 12,182,238 $ 12,018,482 (1) This preliminary condensed consolidated balance sheet has been prepared on a basis consistent with the company's previously prepared consolidated balance sheets filed with the Securities and Exchange Commission (“SEC”), but does not include the footnotes required by accounting principles generally accepted in the United States of America (“GAAP”). (2) The balance sheet at December 31, 2022 has been derived from the audited consolidated financial statements at that date, but does not include the footnotes required by GAAP. Advance Auto Parts, Inc. and Subsidiaries Condensed Consolidated Statements of Operations (In thousands, except per share data) (unaudited) Sixteen Weeks Ended April 22, 2023(1) April 23, 2022(1) Net sales $ 3,417,594 $ 3,374,210 Cost of sales, including purchasing and warehousing costs 1,946,931 1,867,690 Gross profit 1,470,663 1,506,520 Selling, general and administrative expenses (2) 1,380,664 1,303,250 Operating income 89,999 203,270 Other, net: Interest expense (29,718 ) (12,868 ) Loss on early redemptions of senior unsecured notes — (7,408 ) Other (expense) income, net (674 ) 136 Total other, net (30,392 ) (20,140 ) Income before provision for income taxes 59,607 183,130 Provision for income taxes 16,956 43,339 Net income $ 42,651 $ 139,791 Basic earnings per common share $ 0.72 $ 2.28 Weighted-average common shares outstanding 59,334 61,261 Diluted earnings per common share $ 0.72 $ 2.26 Weighted-average common shares outstanding 59,544 61,732 (1) These preliminary condensed consolidated statements of operations have been prepared on a basis consistent with the company's previously prepared consolidated statements of operations filed with the SEC, but do not include the footnotes required by GAAP. (2) The sixteen weeks ended April 22, 2023 included an out-of-period charge of approximately $17 million related to costs incurred in prior years but not expensed in the corresponding periods. The company determined the cumulative impact was not material to the current period or any previously issued financial statements. Advance Auto Parts, Inc. and Subsidiaries Condensed Consolidated Statements of Cash Flows (In thousands) (unaudited) Sixteen Weeks Ended April 22, 2023(1) April 23, 2022(1) Cash flows from operating activities: Net income $ 42,651 $ 139,791 Adjustments to reconcile net income to net cash used in operating activities: Depreciation and amortization 92,554 85,581 Share-based compensation 16,524 16,978 Loss on property and equipment, net 90 1,237 Loss on early redemptions of senior unsecured notes — 7,408 Provision for deferred income taxes 6,899 9,681 Other, net 391 1,020 Net change in: Receivables, net (83,370 ) (174,895 ) Inventories, net (100,178 ) (119,550 ) Accounts payable (440,995 ) 20,225 Accrued expenses 85,035 (98,978 ) Other assets and liabilities, net 1,534 56,562 Net cash used in operating activities (378,865 ) (54,940 ) Cash flows from investing activities: Purchases of property and equipment (89,996 ) (114,854 ) Proceeds from sales of property and equipment 325 828 Net cash used in investing activities (89,671 ) (114,026 ) Cash flows from financing activities: Borrowings under credit facilities 2,886,000 275,000 Payments on credit facilities (2,955,000 ) (275,000 ) Borrowings on senior unsecured notes 599,571 348,618 Payments on senior unsecured notes — (201,081 ) Dividends paid (89,487 ) (154,796 ) Repurchases of common stock (12,605 ) (264,469 ) Other, net (2,819 ) (2,007 ) Net cash provided by (used in) financing activities 425,660 (273,735 ) Effect of exchange rate changes on cash 93 (19,994 ) Net decrease in cash and cash equivalents (42,783 ) (462,695 ) Cash and cash equivalents, beginning of period 269,282 601,428 Cash and cash equivalents, end of period $ 226,499 $ 138,733 (1) These preliminary condensed consolidated statements of cash flows have been prepared on a consistent basis with the company's previously prepared statements of cash flows filed with the SEC, but do not include the footnotes required by GAAP. Reconciliation of Non-GAAP Financial Measure The company's financial results include certain financial measures not derived in accordance with accounting principles generally accepted in the United States of America (“GAAP”). Management uses Free cash flow as a measure of its liquidity and believes it is a useful indicator to investors or potential investors of the company's ability to implement growth strategies and service debt. Free cash flow is a non-GAAP measure and should be considered in addition to, but not as a substitute for, information contained in the company's condensed consolidated statement of cash flows as a measure of liquidity. Reconciliation of Free Cash Flow: Sixteen Weeks Ended (in thousands) April 22, 2023 April 23, 2022 Cash flows used in operating activities $ (378,865 ) $ (54,940 ) Purchases of property and equipment (89,996 ) (114,854 ) Free cash flow $ (468,861 ) $ (169,794 ) Adjusted Debt to EBITDAR: (1) Four Quarters Ended (In thousands, except adjusted debt to EBITDAR ratio) April 22, 2023 December 31, 2022 Total GAAP debt $ 1,900,596 $ 1,373,283 Add: Operating lease liabilities 2,726,880 2,692,861 Adjusted debt $ 4,627,476 $ 4,066,144 GAAP Net income $ 404,732 $ 501,872 Depreciation and amortization 291,032 283,800 Provision for income taxes 120,432 146,815 Interest expense 67,910 51,060 Share-based compensation 50,524 50,978 Other expense, net 7,806 6,996 Rent expense 595,208 594,838 EBITDAR $ 1,537,644 $ 1,636,359 Adjusted Debt to EBITDAR 3.0 2.5 (1) Beginning in first quarter 2023, the company no longer excludes transformation-related activities in non-GAAP measures. Prior period has been recast to conform to current year presentation. NOTE: Management believes its Adjusted Debt to EBITDAR ratio (“leverage ratio”) is a key financial metric for debt securities, as reviewed by rating agencies, and believes its debt levels are best analyzed using this measure. The company’s goal is to maintain an investment grade rating. The company's credit rating directly impacts the interest rates on borrowings under its existing credit facility and could impact the company's ability to obtain additional funding. If the company was unable to maintain its investment grade rating this could negatively impact future performance and limit growth opportunities. Similar measures are utilized in the calculation of the financial covenants and ratios contained in the company's financing arrangements. The leverage ratio calculated by the company is a non-GAAP measure and should not be considered a substitute for debt to net earnings, net earnings or debt as determined in accordance with GAAP. The company adjusts the calculation to remove rent expense and to add back the company’s existing operating lease liabilities related to their right-of-use assets to provide a more meaningful comparison with the company’s peers and to account for differences in debt structures and leasing arrangements. The company’s calculation of its leverage ratio might not be calculated in the same manner as, and thus might not be comparable to, similarly titled measures by other companies. Store Information During the sixteen weeks ended April 22, 2023, 21 stores and branches were opened and 11 were closed or consolidated, resulting in a total of 5,096 stores and branches as of April 22, 2023, compared with a total of 5,086 stores and branches as of December 31, 2022. The below table summarizes the changes in the number of company-operated store and branch locations during the sixteen weeks ended April 22, 2023: AAP CARQUEST WORLDPAC (1) Total December 31, 2022 4,440 330 316 5,086 New 19 — 2 21 Closed (3 ) (8 ) — (11 ) Consolidated — — — — Converted — — — — Relocated — — — — April 22, 2023 4,456 322 318 5,096 (1) Certain converted Autopart International ("AI") locations will remain branded as AI going forward. View source version on businesswire.com: https://www.businesswire.com/news/home/20230530005726/en/ Investor Relations Contact: Elisabeth Eisleben T: (919) 227-5466 E: [email protected] Media Contact: Darryl Carr T: (984) 389-7207 E: [email protected] Source: Advance Auto Parts, Inc. View the full article

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