American Tire Distributors Holdings (Huntersville, NC) was able to turn a $10.60-million net loss from a year ago into $1.22 million in net income in the third quarter of 2013. Net sales increased $72.55 million, or 7.9 percent, to $987.89 million.
The increase in net sales was primarily driven by the combined results of new distribution centers, as well as the acquisitions of TriCan Tire Distributors, Regional Tire Distributors and TDI (see below). These growth initiatives added $108.80 million in incremental sales in the third quarter of 2013. This increase was partially offset by roughly $27.90 million in lower net tire pricing, primarily driven by manufacturer price repositioning and an overall softer sales unit environment.
For the three months ended Sept. 28, 2013, ATD’s revenues were primarily generated from sales of passenger car and light-truck tires, which represent 80.1 percent of our net sales. This was followed by other tire sales (17.4 percent); custom wheels (1.8 percent); and tire supplies, tools and other products (0.7 percent).
ATD bills itself as the leading replacement tire distributor in North America. The company has a network of 131 distribution centers in the United States and Canada, servicing approximately 72,000 tire retailers (roughly 62,000 in the United States and 10,000 in Canada). ATD estimates its share of the U.S. replacement passenger and light-truck tire market to be 10 percent. Its estimated share of the Canadian replacement passenger and light-truck tire market is 9 percent.
In related news, on Aug. 30, ATD acquired Tire Distributors Inc. (TDI), a distributor serving more than 1,700 customers in Maryland and northeastern Virginia.
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