Tractor Supply Company (NASDAQ:TSCO) Q4 2014 Earnings Conference Call - Final Transcript

Jan 28, 2015 • 05:00 pm ET


Tractor Supply Company (NASDAQ:TSCO) Q4 2014 Earnings Conference Call - Final Transcript


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Good afternoon, ladies and gentlemen, and welcome to the Tractor Supply Company's Conference Call to discuss Fourth Quarter and Full Year 2014 Results. At this time, all participants are in a listen-only mode. Later, we will conduct a question-and-answer session and instructions will follow at that time. Please note that each participant will be permitted to ask one question with one follow-up. Please be advised that reproduction of this call, in whole or in part, is not permitted without written authorization of Tractor Supply Company. As a reminder, this call is being recorded.

I would now like to introduce your host for today's call, Ms. Christine Skold of Tractor Supply Company. Christine, please go ahead.

Christine Skold

Thank you, operator. Good afternoon, and thank you for joining us for Tractor Supply Company's quarterly earnings conference call.

(Cautionary Forward-Looking Statements) I'm now pleased to introduce Greg Sandfort, Tractor Supply Company's President and Chief Executive Officer. Greg, please go ahead.

Gregory A. Sandfort

Good afternoon, everyone, and thank you for joining us. On the call with me today are Tony Crudele, our EVP and CFO; Steve Barbarick, our EVP of Merchandising and Marketing; and Lee Downing, our EVP of Store Operations and Real Estate. We are pleased with our performance in the fourth quarter and our full year results. Comp store sales for the quarter increased 5.3% versus an increase of 3.5% in last year's fourth quarter. The comp increase was driven by increases in both traffic and ticket, and we continued to see strength across all our major merchandize categories and geographic regions.

The fourth quarter was our 21st consecutive quarter of positive comp store sales and our 27th consecutive quarter of positive comp transaction counts. For the fourth quarter, we made early strategic investments in a number of key categories such as heating, cold weather apparel and footwear and outdoor power equipment anticipating that the customer would purchase earlier than the year before.

Gregory A. Sandfort

These investments positioned us well to capitalize on early consumer buying trends, driven by colder weather early in the quarter. We also strengthened our commitment to seasonal C.U.E. items and achieved a solid performance within this group of products, which also added to our comparable sales for the quarter.In the quarter, we started the rollout of our new demand planning system to the first few departments, and as we methodically rolled the system out across all our merchandize categories, this system will more accurately forecast the sales and seasonality of products that we carry within our assortments. During the fourth quarter, we also opened our first Tractor Supply store in Utah, which was the 49th state for Tractor Supply.

We also converted our first Del's store over to the Tractor Supply format and nameplate in the state of Washington.We are excited about the opportunity to grow our market share in Washington as we continue to convert the remaining Del's stores to new TSC stores in that market. We continue to develop our omni-channel with improvements to content and product availability online as well