____________
FORM 10-K
[ ] Transition report pursuant to section 13 or 15(d) of the Securities Exchange Act of 1934 For the transition period from to .
AUTOZONE, INC.
(Exact name of registrant as specified in its charter)
|
|
|
|
|
|
|
123 South Front Street, Memphis, Tennessee 38103
(Address of principal executive offices) (Zip Code)
(901) 495-6500
Registrant's telephone number, including area code
Securities registered pursuant to Section 12(b) of the Act:
|
|
on which registered |
|
($.01 par value) |
|
Securities registered pursuant to Section 12(g) of the Act: None
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes [X] No [ ]
Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K § 229.405 of this chapter) is not contained herein, and will not be contained, to the best of registrant's knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. [X]
The aggregate market value of the 70,984,627 shares of voting stock
of the registrant held by non-affiliates of the registrant (excluding,
for this purpose, shares held by officers, directors, or 10% stockholders)
was $4,026,957,889 based on the last sales price of the Common Stock on
October 15, 2001, as reported on the New York Stock Exchange. The number
of shares of Common Stock outstanding as of October 15, 2001, was 107,807,339.
Documents Incorporated By Reference
Portions of the definitive Proxy Statement dated November 7, 2001, for the Annual Meeting of Stockholders to be held December 13, 2001, are incorporated by reference into Part III.
Portions of the Annual Report to Stockholders for the year ended August
25, 2001, are incorporated by reference into Parts I and II.
TABLE OF CONTENTS
PART I
Item 1. Business
Introduction
Marketing and Merchandising Strategy
Store Operations
Store Development
Purchasing and Supply Chain
Competition
Trademarks and Patents
Employees
Executive Officers of the Registrant
Risk Factors
Item 2. Properties
Item 3. Legal Proceedings
PART II
Item 5. Market for Registrant's Common Stock and Related
Stockholder Matters
Item 6. Selected Financial Data
Item 7. Management's Discussion and Analysis of Financial
Condition and Results of Operations
Item 7A. Quantitative and Qualitative Disclosures About
Market Risk
Item 8. Financial Statements and Supplementary Data
Item 9. Changes In and Disagreements with Accountants
on Accounting and Financial Disclosure
PART III
Item 10. Directors and Officers of the Registrant
Item 11. Executive Compensation
Item 12. Security Ownership of Certain Beneficial Owners
and Management
Item 13. Certain Relationships and Related Transactions
PART IV
Item 14. Exhibits, Financial Statement Schedules, and
Reports On Form 8-K
Forward-Looking Statements
Certain statements contained in this Annual Report on Form 10-K are forward-looking statements. These statements discuss, among other things, expected growth, domestic and international development and expansion strategy, business strategies, and future performance. These forward-looking statements are subject to risks, uncertainties, and assumptions, including without limitation, competition, product demand, domestic and international economies, the ability to hire and retain qualified employees, consumer debt levels, inflation, war and the prospect of war, including terrorist activity, and availability of commercial transportation. Actual results may materially differ from anticipated results. Please refer to the Risk Factors section of this Form 10-K for more details.
We are the nation's leading specialty retailer of automotive parts and accessories, with most of our sales to do-it-yourself ("DIY") customers. We began operations in 1979 and at August 25, 2001, operated 3,019 auto parts stores in the United States and 21 in Mexico. Each auto parts store carries an extensive product line for cars, vans, and light trucks, including new and re-manufactured automotive hard parts, maintenance items, and accessories. We also have a commercial sales program in the United States that provides commercial credit and prompt delivery of parts and other products to local repair garages, dealers, and service stations. We do not sell tires nor do we perform automotive repair or installation.
In addition, we sell automotive diagnostic and repair information software through our ALLDATA subsidiary and diagnostic and repair information through alldatadiy.com.
At August 25, 2001, our auto
parts stores were in the following states:
| Alabama
Arizona Arkansas California Colorado Connecticut Delaware Florida Georgia Illinois Indiana Iowa Kansas Kentucky Louisiana |
83
75 48 393 39 22 8 148 101 134 102 31 43 57 89 |
Maine
Maryland Massachusetts Michigan Mississippi Missouri Nebraska Nevada New Hampshire New Jersey New Mexico New York North Carolina Ohio Oklahoma |
5
26 53 117 67 84 9 31 11 12 29 88 101 184 63 |
Oregon
Pennsylvania Rhode Island South Carolina Tennessee Texas Utah Vermont Virginia Washington, DC West Virginia Wisconsin Wyoming Mexico TOTAL |
14
76 14 52 112 352 24 1 55 6 16 39 5 21 3,040 |
Marketing and Merchandising Strategy
We are dedicated to providing customers with superior service, value, and quality automotive parts and products at conveniently located, well-designed stores. Key elements of this strategy are:
Customer Service
We believe that our customers value customer service; therefore, customer service is the most important element in our marketing and merchandising strategy. We emphasize that our AutoZoners (employees) should always put customers first. Our electronic parts catalogs assist in the selection of parts; we offer free testing of starters, alternators, batteries, sensors, and actuators; and we were among the first auto parts companies to offer lifetime warranties on many of the parts we sell. Our satellite system in our auto parts stores helps us to speed up credit card and check approval processes and locate parts at neighboring AutoZone stores.
Our stores generally open at 8 a.m. and close between 8 and 10 p.m. (with some open 24 hours) Monday through Saturday and typically open at 9 a.m. and close between 6 and 8 p.m. on Sunday.
AutoZone also provides specialty tools in our loan-a-tool program. Customers can borrow a specialty tool, such as a steering wheel puller, that a do-it-yourself customer or a small repair shop would have no use for other than for a single job.
Products
This table shows the types
of products we sell in our auto parts stores:
| Hard Parts | Maintenance Items | Accessories | Miscellany |
| Alternators
Batteries Brake Drums, Rotors Shoes, and Pads Carburetors Clutches Engines Mufflers Shock Absorbers Spark Plugs Starters Struts Water Pumps |
Antifreeze
Brake Fluid Oil Oil and Fuel Additives Oil, Air, and Fuel Filters Power Steering Fluid Transmission Fluid Wash and Wax Chemicals Windshield Wipers |
Floor Mats
Lights Mirrors Stereos |
Air Fresheners
Cell Phone Accessories Decorative Lighting Dent Filler Hand Cleaner Paint Repair Manuals Sunglasses Tools |
We believe that the satisfaction of DIY and professional technician customers often is impacted by our ability to provide specific automotive products as requested. Our auto parts stores generally offer between 19,000 and 22,000 stock keeping units ("SKUs") covering a broad range of vehicle types. Each auto parts store carries the same basic product line with some regional differences based on climate, demographics, and age and type of vehicle registration. Our "flexogram" program enables us to tailor our parts inventory to the makes and models of the automobiles in each store's trade area. We also offer a range of lower turnover products through overnight delivery to our auto parts stores and at hub stores that carry a larger range of products.
Pricing
We employ an everyday low price strategy and want to be perceived by our customers as the value leader in our industry by consistently providing quality merchandise at a good price, with a good warranty and backed by outstanding customer service. Our prices are generally structured to meet the lowest price offered by a competitor for a product and we believe that our prices overall compare favorably to those of our competitors.
Commercial Sales Program
Our commercial sales program provides credit and prompt delivery of parts and other products to local repair garages, dealers, and service stations. The program operated out of 1,638 stores as of August 25, 2001. In addition, we have opened 39 hub stores that offer a greater range of parts and products desired by commercial customers and that can be used as additive inventory for local stores.
Store Design and Visual Merchandising
We design and build stores
for a high visual impact. The typical AutoZone store has an industrial
"high tech" appearance by utilizing colorful exterior signage, exposed
beams and ductwork, and brightly lighted interiors. Maintenance products,
accessories, and miscellaneous items are attractively displayed for easy
browsing by customers. In-store signage and special displays promote products
in floor displays, endcaps, and on the shelf. Store managers are able to
customize areas of the store to prominently display products that are in
demand in the local community.
Store Formats
As of August 25, 2001, we
had domestic auto parts stores in the following square footage ranges:
| Square Footage |
|
| Less than 4,000 |
294
|
| 4,000 to 7,000 |
1,565
|
| More than 7,000 |
1,160
|
Substantially all AutoZone stores are based on standard store formats resulting in generally consistent appearance, merchandising, and product mix. Approximately 85% to 90% of each store's square footage is selling space, of which approximately 40% to 45% is dedicated to hard parts inventory. The hard parts inventory area is fronted by a counter that generally runs the depth or length of the store, dividing the hard parts area from the remainder of the store. The remaining selling space contains displays of accessories and maintenance items.
We have knowledgeable AutoZoners (employees) available to assist customers with their parts needs utilizing our proprietary electronic parts catalog with a video screen which is visible to both the AutoZoner and the customer. The parts catalog will suggest additional items that a customer should purchase in order to properly install the part being purchased.
We believe that our stores are "destination stores," generating their own traffic rather than relying on traffic created by the presence of other stores in the immediate vicinity. Therefore, we situate most stores on major thoroughfares with easy access and good parking. Approximately 2,300 of our auto parts stores are freestanding, with the balance principally located within strip shopping centers. Freestanding large format stores typically have parking for approximately 40 to 45 cars on a lot of approximately 3/4 to one acre. Our smaller auto parts stores typically have parking for approximately 25 to 35 cars and are usually located on a lot of approximately 1/2 to 3/4 acre.
Store Personnel and Training
Each auto parts store typically employs from six to eighteen AutoZoners, including a manager and an assistant manager. AutoZoners typically have prior automotive experience. All AutoZoners are encouraged to complete courses resulting in certification by the National Institute for Automotive Service Excellence ("ASE"), which is broadly recognized for training certification in the automotive industry. Although we rely primarily on on-the-job training, we also provide formal training programs, including regular store meetings on specific sales and product issues, standardized training manuals, and a specialist program where AutoZoners can obtain certification in several areas of technical expertise from both the company and from independent certification agencies. Training is supplemented with frequent store visits by management.
Store managers get financial incentives through performance-based bonuses and grants of stock options. In addition, our growth has provided opportunities for the promotion of qualified AutoZoners. We believe these opportunities are important to attract, motivate, and retain quality AutoZoners.
Our domestic auto parts stores are primarily supervised through district managers who oversee approximately six to ten stores each and who report to regional managers. Regional managers with approximately fifty-five to sixty-five stores each, in turn, report to five Vice Presidents-Store Operations. Purchasing, merchandising, advertising, accounting, cash management, store development, systems technology and support, and other store support functions are centralized in our store support center in Memphis, Tennessee. We believe that this centralization enhances consistent execution of our merchandising and marketing strategy at the store level, and reduces expenses and cost of goods.
Store Automation
All auto parts stores have proprietary electronic parts catalogs that provide parts information based on the make, model, and year of an automobile. The catalog display screens are placed on the hard parts counter where both AutoZoners and customers can view the screen. In addition, our satellite system enables the auto parts stores to speed up credit card and check approval processes and locate parts at neighboring AutoZone stores.
Our domestic auto parts stores utilize our computerized Store Management System, which includes bar code scanning and point-of-sale data collection terminals. The Store Management System provides administrative assistance and improved personnel scheduling at the store level, as well as enhanced merchandising information and improved inventory control. We believe the Store Management System also enhances customer service through faster processing of transactions and simplified warranty and product return procedures.
This table shows the domestic
auto parts store development during the past five fiscal years:
|
|
|||||
|
1997
|
1998
|
1999
|
2000
|
2001
|
|
| Beginning Stores |
1,423
|
1,728
|
2,657
|
2,711
|
2,915
|
| New Stores1 |
308
|
952
|
245
|
208
|
107
|
| Replaced Stores2 |
17
|
12
|
59
|
30
|
16
|
| Closed Stores2 |
(20)
|
(35)
|
(250)
|
(34)
|
(19)
|
| Ending Stores |
1,728
|
2,657
|
2,711
|
2,915
|
3,019
|
1Includes
stores obtained in Chief and Auto Palace acquisitions in 1998, and store
real estate acquired from Pep Boys in fiscal year 1999.
2Closed
stores include replaced stores.
We believe that expansion opportunities exist both in markets that we do not currently serve, and in markets where we can achieve a larger presence. We attempt to obtain high visibility sites in high traffic locations and undertake substantial research prior to entering new markets. The most important criteria for opening a new store is its projected future profitability. Key factors in selecting new site and market locations include population, demographics, vehicle profile, number and strength of competitors' stores, and the cost of real estate. We generally seek to open new stores within or contiguous to existing market areas and attempt to cluster development in new urban markets in a relatively short period of time in order to achieve economies of scale in advertising and distribution costs. In addition to continuing to construct our own stores, we occasionally evaluate potential acquisition candidates in new as well as in existing markets.
Merchandise is selected and purchased for all stores at our store support center in Memphis. No one class of product accounts for as much as ten percent of our total sales. In fiscal 2001, no single supplier accounted for more than seven percent of our total purchases, and our ten largest suppliers accounted for approximately 32 percent of our purchases. We generally have few long-term contracts for the purchase of merchandise. We believe that we have excellent relationships with suppliers. We also believe that alternative sources of supply exist, at similar cost, for substantially all types of product sold.
Our vendors ship substantially all of our merchandise to our distribution centers. Stores typically place orders on a weekly basis with merchandise shipped from the warehouse in our trucks on the following day.
We want to have the right merchandise in our stores at the right time. In the past two fiscal years, we have improved our supply chain by eliminating excess inventory and increasing our purchasing terms while increasing sales. This has resulted in increases in inventory turns and substantial increases in net inventory turns.
AutoZone competes in both the DIY and professional technician auto parts markets. Primary competitors include national and regional auto parts chains, independently owned parts stores, wholesalers and jobbers, and auto dealers. Although auto parts stores are the most important retail outlets for DIY customers, some aftermarket vehicle supplies, chemicals, accessories, and tools are also available at discount and department stores, hardware stores, supermarkets, drug stores, and home stores. Auto parts retailers have remained competitive in the DIY aftermarket by offering superior product knowledge and an extensive number of products in stock. AutoZone competes on the basis of customer service, including the knowledge and expertise of our AutoZoners, merchandise selection and availability, price, product warranty, store layout, and location.
We have registered several service marks and trademarks in the United States Patent and Trademark office, including our service mark "AutoZone" and trademarks "AutoZone," "Duralast," and "ALLDATA." We believe that the "AutoZone" service mark and trademarks are important components in our merchandising and marketing strategy.
As of August 25, 2001, we employed approximately 44,600 persons, approximately 29,000 of whom were employed full-time. Approximately 90 percent of our AutoZoners were employed in stores or in direct field supervision, approximately seven percent in distribution centers, and approximately three percent in store support functions.
We have never experienced any material labor disruption, and believe that our labor relations are generally good.
Executive Officers of the Registrant
The following table lists our executive officers. The title of each executive officer includes the words "Customer Satisfaction" which reflects our commitment to customer service as part of our marketing and merchandising strategy. Officers are elected by and serve at the discretion of the Board of Directors.
Steve Odland, 43---Chairman, President, Chief Executive Officer,
and Director
Steve Odland was elected
Chairman, Chief Executive Officer, and a Director in January 2001 and was
elected President in May 2001. From June 2000, he was Chief Operating Officer
for Ahold USA. From 1998, he was President and CEO of Tops Markets, an
Ahold subsidiary. Previously, Mr. Odland was President of the Foodservice
Division of Sara Lee Bakery from 1997 to 1998. Before Sara Lee, Mr. Odland
was employed by The Quaker Oats Company for over 16 years in various executive
positions.
Robert J. Hunt, 52---Executive Vice President and Chief Financial
Officer
Robert J. Hunt has been
Executive Vice President and Chief Financial Officer since 1994, and was
a member of the Board of Directors from 1997 until May 2001. He has announced
his intention to retire as Executive Vice President and Chief Financial
Officer upon appointment of his successor. From 1984 to 1991, Mr. Hunt
was employed by Malone & Hyde, AutoZone's former parent company, where
he was Executive Vice President and Chief Financial Officer from 1988 to
1991.
Bruce G. Clark, 56---Senior Vice President and Chief Information
Officer
Bruce G. Clark has been
Senior Vice President and Chief Information Officer since January 1999.
Previously Mr. Clark was Senior Vice President--MIS/Telemarketing of Brylane
and its predecessors since 1988, and had been employed by Brylane, at that
time a division of The Limited, since 1983.
Brett D. Easley, 42---Senior Vice President--Merchandising
Brett D. Easley was named
Senior Vice President--Merchandising in 2000. He was President of ALLDATA
from 1998 to 2000 and Senior Vice President--E-Commerce from 1999 to 2000.
Prior to that, he was Vice President--Information and Training since 1997
and Vice President--Merchandising Systems since 1994. Mr. Easley has been
employed by AutoZone or Malone & Hyde since 1984.
Harry L. Goldsmith, 50---Senior Vice President, Secretary, and General
Counsel
Harry L. Goldsmith was elected
Senior Vice President, Secretary, and General Counsel in 1996. Previously
he was Vice President, General Counsel, and Secretary from 1993 to 1996.
Lisa R. Kranc, 48---Senior Vice President--Marketing
Lisa R. Kranc joined AutoZone
as Senior Vice President--Marketing in August 2001. Previously, she was
Vice President--Marketing for Hannaford Bros. Co., a Maine-based grocery
chain, since 1997 and was Senior Vice President--Marketing for Bruno's,
Inc., from 1996 to 1997.
Michael E. Longo, 40---Senior Vice President--Store Operations
Michael E. Longo has been
Senior Vice President--Store Operations since February 2001. Previously
he was Senior Vice President--Supply Chain since 1998 and Vice President--Distribution
since 1996. Mr. Longo has been employed by AutoZone since 1992.
Robert D. Olsen, 49---Senior Vice President--Mexico, ALLDATA, and
Store Development
Robert D. Olsen was elected
Senior Vice President in 2000. Currently Mr. Olsen is President of ALLDATA
and also has primary responsibility for store development and our Mexico
operations. From 1993 to 2000, Mr. Olsen was Executive Vice President and
Chief Financial Officer of Leslie's Poolmart. From 1985 to 1989, Mr. Olsen
held several positions with AutoZone, including Controller, Vice President--Finance,
and Senior Vice President and Chief Financial Officer.
William C. Rhodes, III, 36---Senior Vice President--Supply Chain
William C. Rhodes, III,
has been Senior Vice President--Supply Chain since February 2001. Prior
to that time, he has served in various capacities with AutoZone, including
Vice-President--Mid-South Stores in 2000, Senior Vice President--Finance
and Vice President--Finance in 1999, Vice President--Operations Analysis
and Support from 1997 to 1999. He has been employed by AutoZone since 1994.
Daisy L. Vanderlinde, 51---Senior Vice President--Human Resources
Daisy L. Vanderlinde joined
AutoZone as Senior Vice President--Human Resources in March 2001. Previously,
she was Vice President--Human Resources for Tractor Supply Company since
1996 and Vice President--Human Resources for Marshalls, Inc., from 1990.
Tricia K. Greenberger, 33---Vice President and Controller
Tricia K. Greenberger has
been Vice President and Controller since April 2000. Prior to that, she
was Vice President-Financial Planning and Control since 1998. Previously,
she was Director of Process Improvement since 1996.
We may not be able to increase sales by the same historic growth rates.
We have significantly increased our domestic store count in the past five fiscal years, growing from 1,143 stores at August 25, 1996, to 3,019 stores at August 25, 2001, an average store count increase per year of 16%. We do not plan to continue our store count growth rate at the historic pace. In addition, a portion of our total sales increases each year results from increases in sales at existing stores. We cannot provide any assurance that we can continue to increase same store sales as our stores mature in their markets.
We have an ever-increasing need for qualified employees.
In fiscal year 2001, our consolidated employee count increased from approximately 43,200 at the beginning of the year to about 44,600, a 3% increase in the year. We do not know if we can continue to hire and retain qualified employees at current wage rates.
If demand for our products slows, then our business may be materially affected.
Demand for products sold by our stores depends on many factors. In the short term, it may depend upon:
If we cannot profitably increase market share in the commercial auto parts business, our sales growth may be limited.
Although we are one of the five largest sellers of auto parts in the commercial "do-it-for-me" market, to increase commercial sales we must compete against automotive aftermarket jobbers and warehouse distributors, in addition to other auto parts retailers that have recently entered the commercial business. Some of these jobbers and warehouse distributors have been in business for substantially longer periods of time than we have, have developed long-term customer relationships, and have larger available inventories. We can make no assurance that we can profitably develop new commercial customers or make available inventories required by commercial customers.
If we cannot profitably open and operate stores in international markets, our sales growth may be limited.
We opened our first auto parts stores in Mexico during fiscal year 1999. Although we believe that great potential exists for auto parts stores in the fragmented international auto parts market, we have little experience opening or operating stores outside of the United States, and no assurances can be made that we can open additional stores in Mexico or stores in any other country in a timely or profitable manner.
In addition, products sold in Mexico must be properly labeled for sale in accordance with Mexican law. If AutoZone cannot source products in Mexico, it must obtain products elsewhere and have them appropriately labeled for sale in Mexico. We can make no assurances that we can purchase goods of appropriate quality or in sufficient quantities in Mexico to sell in our stores, nor can we make any assurances that we can profitably obtain products outside of Mexico and have them relabeled in accordance with Mexican law.
If our vendors continue to consolidate, we may pay higher prices for our merchandise.
Recently, several of our vendors have merged and others have announced plans to merge. Further vendor consolidation could limit the number of vendors from which we may purchase products and could materially affect the prices we pay for these products.
Consolidation among our competitors may negatively impact our business.
Recently, several large auto parts chains have announced plans to merge. We do not know what impact these mergers will have upon competition in the retail automotive aftermarket. If our merging competitors are able to achieve efficiencies in their mergers, then there may be greater competitive pressures in the markets in which they are strongest.
War, acts of terrorism, or the threat of either may negatively impact availability of merchandise and adversely impact our sales.
In the event of war, acts of terrorism, or either are threatened, it may have a negative impact on our ability to obtain merchandise available for sale in our stores. Some of our merchandise is imported from other countries. If imported goods become difficult or impossible to bring into the United States, and if we cannot obtain such merchandise from other sources at similar costs, our sales and profit margins may be negatively affected. In addition, a significant amount of the merchandise sold in our Mexico stores is exported from the United States. If we cannot export this merchandise in a timely manner, sales in our Mexico stores may be adversely affected.
In the event that commercial
transportation is curtailed or substantially delayed, our business may
be adversely impacted, as we may have difficulty shipping merchandise to
our distribution centers and stores.
This table shows the square
footage and number of leased and owned properties for our domestic auto
parts stores:
|
|
|
|
| Leased |
1,238
|
7,323,497
|
| Owned |
1,781
|
12,053,970
|
| Total |
3,019
|
19,377,467
|
We have 2,998,834 square feet in our distribution centers servicing our auto parts stores, all of which is owned, except for 998,237 square feet, which is leased. The distribution centers are located in Arizona, California, Georgia, Illinois, Louisiana, Ohio, Tennessee, and Texas.
Our store support center, which we own, is located in Memphis, Tennessee, and consists of 260,000 square feet.
We also own and lease other
properties that are not material in the aggregate.
AutoZone, Inc., was a defendant in a class action lawsuit entitled "Melvin Quinnie on behalf of all others similarly situated v. AutoZone, Inc., and DOES 1 through 100, inclusive" filed in the Superior Court of California, County of Los Angeles, in November 1998. The plaintiff claimed that the defendants failed to pay overtime to store managers as required by California law and failed to pay terminated managers in a timely manner as required by California law. The plaintiff was seeking injunctive relief, restitution, statutory penalties, prejudgment interest, and reasonable attorneys' fees, expenses, and costs. The parties have settled the lawsuit and the settlement has received court approval. The terms of the settlement were not material to AutoZone's operations or consolidated financial position.
AutoZone, Inc., is a defendant in a lawsuit entitled "Coalition for a Level Playing Field, L.L.C., et al., v. AutoZone, Inc., et al.," filed in the U.S. District Court for the Eastern District of New York in February 2000. The case was filed by over 100 plaintiffs, principally automotive aftermarket warehouse distributors and jobbers, against eight defendants, principally automotive aftermarket parts retailers. The plaintiffs claim that the defendants have knowingly received volume discounts, rebates, slotting and other allowances, fees, free inventory, sham advertising and promotional payments, a share in the manufacturers' profits, and excessive payments for services purportedly performed for the manufacturers in violation of the Robinson-Patman Act. Plaintiffs seek approximately $1 billion in damages (including statutory trebling) and a permanent injunction prohibiting defendants from committing further violations of the Robinson-Patman Act and from opening any further stores to compete with plaintiffs as long as defendants continue to violate the Act. We and the other defendants filed a motion to dismiss this action in the fiscal fourth quarter. Subsequently, on October 23, 2001, the court overruled a substantial portion of the defendants' motion. We believe this suit is without merit and will vigorously defend against it.
We are also involved in various
other legal proceedings incidental to the conduct of our business. Although
the amount of liability that may result from these other proceedings cannot
be ascertained, we do not currently believe that, in the aggregate, they
will result in liabilities material to our financial condition or results
of operations.
Item 4. Submission of Matters to a Vote of Security Holders
None.
Item 5. Market for Registrant's Common Stock and Related Stockholder Matters
Common Stock Market Prices for our common stock as traded on the New York Stock Exchange as shown in the section labeled "Quarterly Summary" of the Annual Report to Stockholders for the fiscal year ended August 25, 2001, are incorporated herein by reference.
At October 15, 2001, we had
3,550 stockholders of record, which does not include the number of beneficial
owners whose shares were represented by security position listings.
Item 6. Selected Financial Data
Selected financial data contained
in the section entitled "Ten-Year Review" of the Annual Report to Stockholders
for the fiscal year ended August 25, 2001, are incorporated herein by reference.
Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations
The section entitled "Financial
Review" of the Annual Report to Stockholders for the fiscal year ended
August 25, 2001, is incorporated herein by reference.
Item 7A. Quantitative and Qualitative Disclosures About Market Risk
The subsection entitled "Financial
Market Risk" of the section entitled "Financial Review" of the Annual Report
to Stockholders for the fiscal year ended August 25, 2001, is incorporated
herein by reference.
Item 8. Financial Statements and Supplementary Data
The financial statements
and related notes and the section entitled "Quarterly Summary" of the Annual
Report to Stockholders for the fiscal year ended August 25, 2001, are incorporated
herein by reference.
Item 9. Changes In and Disagreements with Accountants on Accounting and Financial Disclosure
None.
Item 10. Directors and Officers of the Registrant
The information required
by this item is incorporated by reference to Part I of this document and
to the definitive Proxy Statement dated November 7, 2001, filed pursuant
to Regulation 14A under the Securities Exchange Act of 1934 in connection
with the annual meeting of stockholders to be held December 13, 2001.
Item 11. Executive Compensation
The information required
by this item is incorporated by reference to the definitive Proxy Statement
dated November 7, 2001, filed pursuant to Regulation 14A under the Securities
Exchange Act of 1934 in connection with the annual meeting of stockholders
to be held December 13, 2001.
Item 12. Security Ownership of Certain Beneficial Owners and Management
The information required
by this item is incorporated by reference to the definitive Proxy Statement
dated November 7, 2001, filed pursuant to Regulation 14A under the Securities
Exchange Act of 1934 in connection with the annual meeting of stockholders
to be held December 13, 2001.
Item 13. Certain Relationships and Related Transactions
The information required
by this item is incorporated by reference to the definitive Proxy Statement
dated November 7, 2001, filed pursuant to Regulation 14A under the Securities
Exchange Act of 1934 in connection with the annual meeting of stockholders
to be held December 13, 2001.
Item 14. Exhibits, Financial Statement Schedules, and Reports On Form 8-K
(a) 1. Financial Statements
The following financial statements included in the Annual Report to Stockholders for the fiscal year ended August 25, 2001, are incorporated herein by reference to Item 8:
Consolidated Statements of Income for the fiscal years ended August 25, 2001, August 26, 2000, and August 28, 1999
Consolidated Balance Sheets as of August 25, 2001, and August 26, 2000
Consolidated Statements of Stockholders' Equity for the fiscal years ended August 25, 2001, August 26, 2000, and August 28, 1999
Consolidated Statements of Cash Flows for the fiscal years ended August 25, 2001, August 26, 2000, and August 28, 1999
Notes to Consolidated Financial Statements
All other schedules are omitted because the information is not required or because the information required is included in the financial statements or notes thereto.
3. The following exhibits
are filed as a part of this report:
|
3.1
|
|
|
3.2
|
|
|
4.1
|
|
|
4.2
|
|
|
4.3
|
|
|
*10.1
|
|
|
*10.2
|
|
|
*10.3
|
|
|
10.4
|
|
|
*10.5
|
|
|
*10.6
|
|
|
*10.7
|
|
|
*10.8
|
|
|
*10.9
|
|
|
*10.10
|
|
|
*10.11
|
|
|
*10.12
|
|
|
*10.13
|
|
|
*10.14
|
|
|
*10.15
|
|
|
*10.16
|
|
|
*10.17
|
|
|
10.18
|
|
|
10.19
|
|
|
10.20
|
|
|
19.1
|
|
|
21.1
|
|
|
23.1
|
|
(b) Reports on Form 8-K.
The Company filed a Current Report on Form 8-K dated May 23, 2001, that contained a press release announcing the Company's financial results for the quarter ended May 5, 2001.
The Company filed a Current Report on Form 8-K dated June 8, 2001, that contained a press release announcing that the Company would take a nonrecurring charge in the fourth quarter of the 2001 fiscal year.
The Company filed a Current Report on Form 8-K dated July 10, 2001, that contained a press release announcing that the Company: had retained an advisor for the sale of its TruckPro, Inc., subsidiary, had hired Lisa Kranc as senior vice president of marketing, had increased its share repurchase authorization, and had updated sales trends for the fiscal quarter.
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, the Registrant has duly caused this report to be
signed on its behalf by the undersigned, thereunto duly authorized.
AUTOZONE, INC.
By: /s/ Steve Odland
Steve Odland
Chairman, President, and
Chief Executive Officer
(Principal Executive Officer)
Dated: November 16, 2001
Pursuant to the requirement
of the Securities Exchange Act of 1934, this report has been signed below
by the following persons in the capacities and on the dates indicated:
| SIGNATURE
|
TITLE | DATE |
| /s/ Steve Odland_________
Steve Odland |
Chairman, President, Chief Executive Officer,
& Director
(Principal Executive Officer) |
November 16, 2001 |
| /s/ Robert J. Hunt________
Robert J. Hunt
|
Executive Vice President & Chief Financial
Officer
(Principal Financial Officer) |
November 16, 2001 |
| /s/ Tricia K. Greenberger__
Tricia K. Greenberger |
Vice President & Controller
(Principal Accounting Officer) |
November 16, 2001 |
| /s/ Andrew M. Clarkson___
Andrew M. Clarkson |
Director | November 16, 2001 |
| /s/ Charles M. Elson______
Charles M. Elson |
Director | November 16, 2001 |
| /s/ N. Gerry House________
N. Gerry House |
Director | November 16, 2001 |
| /s/ J. R. Hyde, III_________
J.R. Hyde, III |
Director | November 16, 2001 |
| /s/ James F. Keegan___
James F. Keegan |
Director | November 16, 2001
|
| /s/ Edward S. Lampert_____
Edward S. Lampert |
Director | November 16, 2001 |
| /s/ W. Andrew McKenna___
W. Andrew McKenna |
Director | November 16, 2001 |
| /s/ Michael W. Michelson__
Michael W. Michelson |
Director | November 16, 2001 |
SCHEDULE II -- VALUATION AND QUALIFYING ACCOUNTS
AUTOZONE, INC.
(In thousands)
|
|
|
|
|
|
|||||
|
|
|||||||||
|
|
Beginning of Period |
And Expenses |
|
|
End of Period |
||||
| YEAR ENDED AUGUST 28, 1999: | |||||||||
|
|
|||||||||
|
|
$20,786
|
$90,310
|
$3,473
|
|
$81,619
|
|
$32,950
|
||
|
|
14,296
|
94,640
|
|
||||||
| YEAR ENDED AUGUST 26, 2000: | |||||||||
|
|
|||||||||
|
|
32,950
|
100,381
|
83,317
|
|
50,014
|
||||
|
|
94,640
|
57,585
|
|
||||||
| YEAR ENDED AUGUST 25, 2001: | |||||||||
|
|
|||||||||
|
|
50,014
|
101,318
|
87,865
|
|
63,467
|
||||
|
|
57,585
|
98,689
|
|
||||||
|
(1)
|
Cost of product for warranty replacements, net of salvage and amounts collected from customers. | ||||||||
|
(2)
|
Purchase accounting adjustments related to acquisition of Chief Auto Parts Inc. | ||||||||
|
(3)
|
Amount includes items classified in other accrued expenses and other long-term liabilities. | ||||||||
|
3.1
|
|
|
3.2
|
|
|
4.1
|
|
|
4.2
|
|
|
4.3
|
|
|
*10.1
|
|
|
*10.2
|
|
|
*10.3
|
|
|
10.4
|
|
|
*10.5
|
|
|
*10.6
|
|
|
*10.7
|
|
|
*10.8
|
|
|
*10.9
|
|
|
*10.10
|
|
|
*10.11
|
|
|
*10.12
|
|
|
*10.13
|
|
|
*10.14
|
|
|
*10.15
|
|
|
*10.16
|
|
|
*10.17
|
|
|
10.18
|
|
|
10.19
|
|
|
10.20
|
|
|
19.1
|
|
|
21.1
|
|
|
23.1
|
|
*Management contract or compensatory plan or arrangement.