Tractor Supply net sales up by 7.2 per cent

Tractor Supply Company, the largest rural lifestyle retailer in the United States, has reported financial results for its second quarter, which ended on 1 July 2023. Net sales increased by 7.2 per cent to USD 4.18 bn from USD 3.90 bn in the second quarter of 2022. The report indicates that the increase in net sales was driven by contributions from the acquisition of Orscheln Farm and Home, new store openings and growth in comparable store sales. Comparable store sales increased by 2.5 per cent, as compared to an increase of 5.5 per cent in the prior year's second quarter.

"As has been well documented, U.S. consumer spending on goods is moderating. Additionally, our business was further impacted by seasonal under-performance, particularly in June. Consequently, our second-quarter results, while solid, were below our expectations," said Hal Lawton, president and CEO of Tractor Supply. "My thanks and appreciation go out to our 52,000 Tractor Supply team members. Through their efforts, we delivered record customer service scores and positive comparable transaction growth in the quarter. Given our first-half performance and our view that our customers will continue to be discerning in their spending for the remainder of the year, we are adjusting our full-year outlook."

Comparable store sales were driven by a comparable average transaction count increase of 1.8 per cent and comparable average ticket growth of 0.6 per cent. Gross profit increased by 9.3 per cent to USD 1.51 bn from USD 1.39 bn in the prior year's second quarter, and gross margin increased by 69 basis points to 36.2 per cent from 35.5 per cent in the prior year's second quarter.

The company opened 17 new Tractor Supply stores and three new Petsense by Tractor Supply stores in the second quarter of 2023. It is also establishing a new target of 3,000 Tractor Supply stores in the U.S., an increase of 200 from its prior guidance. Additionally, the company anticipates accelerating its annual new store growth to approximately 90 stores per year beginning in 2025, with a step up to 80 new stores in 2024.