Tractor Supply Company today announced financial results for its fourth quarter and fiscal year ended December 27, 2014. Additionally, the Company provided its initial outlook for fiscal 2015.

Fourth Quarter 2014 Results

Net sales increased 12.0% to $1.58 billion from $1.42 billion in the fourth quarter of 2013. Comparable store sales increased 5.3% versus a 3.5% increase in the prior year's fourth quarter. The increase in comparable store sales was broad based and driven by increases in both traffic and ticket. Comparable store transaction count increased 3.0% and average ticket increased 2.3%. The increase in comparable store sales was driven by a strong winter seasonal business, solid performance in consumable, usable and edible (C.U.E.) products and an increase in sales of big ticket items. In addition, hardline products such as fencing, truck accessories and tools also performed well.

Gross profit increased 12.5% to $539.6 million from $479.7 million in the prior year's fourth quarter and gross margin rate increased 10 basis points to 34.0% from 33.9% in the prior-year period. The improvement in gross margin rate resulted primarily from price management as the favorable, colder weather early in the quarter created strong demand for winter goods, resulting in fewer seasonal markdowns. This was partially offset by higher transportation costs primarily due to our continued western store expansion.

Selling, general and administrative (SG&A) expenses, including depreciation and amortization, increased 8.8% to $361.9 million. As a percent of sales, SG&A expenses improved 70 basis points to 22.8% from 23.5% in the fourth quarter last year. The improvement as a percent of sales was primarily attributable to the leverage of store operating costs provided by the strong comparable store sales growth and lower year-over-year incentive compensation expense.

Net income increased 16.9% to $112.1 million from $95.9 million and diluted earnings per share increased 19.1% to $0.81 from $0.68 in the fourth quarter of the prior year.

The Company opened 22 new stores and closed one store in the fourth quarter of 2014 compared to 31 new store openings and no store closures in the prior year's fourth quarter.

Greg Sandfort, President and Chief Executive Officer, stated, "Across the board, we had a strong fourth quarter and are pleased with our results. Sales growth was broad-based across all of our major product categories and geographic regions and was well balanced between both traffic and ticket. The fourth quarter was our 27th consecutive quarter of positive comparable store transaction counts. The team did an excellent job of managing product assortments, inventory, and pricing levels to capitalize on early consumer buying trends and drove both sales and margin growth in the quarter. It is my belief that our fourth quarter and full year results reflect our ability to effectively manage seasonal inventory investments, pricing and sell-through during seasonal changes and weather variations."

Full Year Results

Net sales increased 10.6% to $5.71 billion from $5.16 billion in fiscal 2013. Comparable store sales increased 3.8% versus a 4.8% increase in fiscal 2013. Gross profit increased 11.2% to $1.95 billion from $1.75 billion and gross margin increased 10 basis points to 34.1% of sales from 34.0% of sales in fiscal 2013.

Selling, general and administrative expenses, including depreciation and amortization, increased 9.8% to $1.36 billion, and improved as a percent of sales to 23.8% compared to 24.0% for fiscal 2013.

Net income increased 13.0% to $370.9 million from $328.2 million and net income per diluted share increased 14.7% to $2.66 from $2.32 for fiscal 2013.

The Company opened 107 new stores and closed one store during fiscal 2014 compared to 102 new store openings and two store closures during fiscal 2013.

Company Outlook

The Company anticipates net sales for fiscal 2015 will range between $6.2 billion and $6.3 billion, with comparable store sales expected to increase 2.5% to 4.0%. The Company projects fiscal 2015 full year net income to range from $2.95 to $3.05 per diluted share. For the full year, the Company expects capital expenditures to range between $240 million and $250 million, including spending to support 110 to 115 new store openings and construction of a new Southwest distribution center in Casa Grande, Arizona to open in fiscal 2015.

For full financial results, including financial tables, click here.