Monro, Inc. Files 2024 10-K Report

TL;DR

Monro Inc. 2024 10-K filed. Financials look solid, check for growth drivers.

AI Summary

Monro, Inc. filed its 2024 10-K report for the fiscal year ending March 30, 2024. The company, headquartered in Rochester, NY, operates in the automotive repair services sector. The filing details its financial performance and business operations over the past fiscal year, providing a comprehensive overview for investors and stakeholders.

Why It Matters

This 10-K filing provides crucial financial and operational details for Monro, Inc., allowing investors to assess the company's performance and make informed investment decisions.

Risk Assessment

Risk Level: medium — The filing is a standard annual report and does not inherently indicate new or elevated risks.

Key Numbers

• 0330 — Fiscal Year End (Indicates the end of the reporting period for financial statements.)
• 000-19357 — SEC File Number (Unique identifier for Monro, Inc.'s filings with the SEC.)

Key Players & Entities

• MONRO, INC. (company) — Filer of the 10-K report
• 20240330 (date) — Conformed period of report
• 20240528 (date) — Filed as of date
• Rochester, NY (location) — Company headquarters and business address
• 7500 (number) — Standard Industrial Classification code for automotive repair

FAQ

Key Financial Figures

• $0.01 — 45 shares of registrant's common stock, $0.01 par value per share, were outstanding.
• $224 million — adding 156 locations and approximately $224 million in annualized revenue. Additionally, du

Filing Documents

• mnro-20240330x10k.htm (10-K) — 5759KB
• mnro-20240330xex4_01.htm (EX-4.01) — 20KB
• mnro-20240330xex10_72b.htm (EX-10.72B) — 111KB
• mnro-20240330xex21_01.htm (EX-21.01) — 9KB
• mnro-20240330xex23_01.htm (EX-23.01) — 4KB
• mnro-20240330xex24_01.htm (EX-24.01) — 17KB
• mnro-20240330xex31_1.htm (EX-31.1) — 12KB
• mnro-20240330xex31_2.htm (EX-31.2) — 12KB
• mnro-20240330xex32_1.htm (EX-32.1) — 13KB
• mnro-20240330xex97_01.htm (EX-97.01) — 74KB
• mnro-20240330x10kg001.jpg (GRAPHIC) — 2KB
• mnro-20240330x10kg002.jpg (GRAPHIC) — 66KB
• 0001562762-24-000155.txt ( ) — 18998KB
• mnro-20240330.xsd (EX-101.SCH) — 69KB
• mnro-20240330_cal.xml (EX-101.CAL) — 109KB
• mnro-20240330_def.xml (EX-101.DEF) — 188KB
• mnro-20240330_lab.xml (EX-101.LAB) — 598KB
• mnro-20240330_pre.xml (EX-101.PRE) — 513KB
• mnro-20240330x10k_htm.xml (XML) — 4249KB

Business

Business 5 Item 1A.

Risk Factors

Risk Factors 10 Item 1B. Unresolved Staff Comments 18 Item 1C. Cybersecurity 18 Item 2.

Properties

Properties 21 Item 3.

Legal Proceedings

Legal Proceedings 22 Item 4. Mine Safety Disclosures 22 PART II Item 5. Market for the Company's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities 23 Item 6. [Reserved] 24 Item 7.

Management's Discussion and Analysis of Financial Condition and Results of Operations

Management's Discussion and Analysis of Financial Condition and Results of Operations 25 Item 7A.

Quantitative and Qualitative Disclosures about Market Risk

Quantitative and Qualitative Disclosures about Market Risk 34 Item 8.

Financial Statements and Supplementary Data

Financial Statements and Supplementary Data 35 Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure 62 Item 9A.

Controls and Procedures

Controls and Procedures 62 Item 9B. Other Information 62 Item 9C. Disclosure Regarding Foreign Jurisdictions that Prevent Inspections 63 PART III Item 10. Directors, Executive Officers and Corporate Governance 64 Item 11.

Executive Compensation

Executive Compensation 64 Item 12.

Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters

Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters 64 Item 13. Certain Relationships and Related Transactions, and Director Independence 64 Item 14. Principal Accountant Fees and Services 64 PART IV Item 15. Exhibits and Financial Statement Schedules 65 Item 16. Form 10-K Summary 68

Signatures

Signatures 69 Monro, Inc. 2024 Form 10-K 2 Table of Contents PA RT I Cautionary Note Regarding Forward-Looking Statements This Annual Report on Form 10-K contains "forward-looking statements" as that term is used in the Private Securities Litigation Reform Act of 1995. Forward-looking statements can be identified by the fact that they address future events, developments, and results and do not relate strictly to historical facts. Any statements contained herein that are not statements of historical fact may be deemed to be forward-looking statements. Forward-looking statements include, without limitation, statements preceded by, followed by, or including words such as "anticipate," "believe," "can," "could," "design," "estimate," "expect," "forecast," "intend," "invest," "may," "outlook," "plan," "potential," "seek," "should," "strategy," "strive," "vision," "will," "would," and variations thereof and similar expressions. Forward-looking statements are subject to risks, uncertainties, and other important factors that could cause actual results to differ materially from those expressed. For example, our forward-looking statements include, without limitation, statements regarding: the impact of competitive services and pricing; the effect of economic conditions and geopolitical uncertainty, seasonality, and the impact of weather conditions and natural disasters on customer demand; advances in automotive technologies including adoption of electronic vehicle technology; our dependence on third-party vendors for certain inventory; the risks associated with vendor relationships and international trade, particularly imported goods such as those sourced from China; the impact of changes in U.S. trade relations and the ongoing trade dispute between the United States and China, and other potential impediments to imports; our ability to service our debt obligations, including our expected annual interest expense, and to comply with the debt covenant

Business

Item 1. Business General We are a leading nation-wide operator of retail tire and automotive repair stores in the United States. We offer to our customers, referred to as "guests", replacement tires and tire related services, automotive undercar repair services, and a broad range of routine maintenance services, primarily on passenger cars, light trucks, and vans. We also provide other products and services for brakes; mufflers and exhaust systems; and steering, drive train, suspension, and wheel alignment. We believe the convenience and value we offer are key factors in serving and growing our base of customers. At March 30, 2024, we operated 1,288 retail tire and automotive repair stores and serviced approximately 4.7 million vehicles in fiscal 2024. Our retail tire and automotive repair stores operate primarily under the brands "Monro Auto Service and Tire Centers," "Tire Choice Auto Service Centers," "Mr. Tire Auto Service Centers," "Car-X Tire & Auto," "Tire Warehouse Tires for Less," "Ken Towery's Tire & Auto Care," "Mountain View Tire & Auto Service," and "Tire Barn Warehouse". Company-operated Store Brands as of March 30, 2024 Stores Monro Auto Service and Tire Centers 360 Tire Choice Auto Service Centers 349 Mr. Tire Auto Service Centers 317 Car-X Tire & Auto 72 Tire Warehouse Tires For Less 55 Ken Towery's Tire & Auto Care 34 Mountain View Tire & Auto Service 30 Tire Barn Warehouse 27 Other (a) 44 Total 1,288 (a) Includes recently acquired stores to be converted to certain brands named above. The typical format for a Monro store is a free-standing building consisting of a sales area, fully equipped service bays and a parts/tires storage area. Most service bays are equipped with above-ground electric vehicle lifts. Generally, each store is located within 25 miles of a "key" store which carries approximately double the inventory of a typical store and serves as a mini-distribution point for slower mo vi

BUSINESS

BUSINESS Business Strategy Our vision is to be America's leading auto and tire service center, trusted by consumers as the best place in their neighborhoods for quality automotive service and tires. We believe that success in this vision will position Monro to deliver consistent and sustainable organic growth as well as lead to strong, long-term financial performance. Specifically, we are committed to seeing this vision executed across all aspects of the business, through the following actions: Exceed guest expectations. We will continue to invest in and execute strategic initiatives to improve our guests' in-store experience. This includes leveraging our scale and the strength of our financial position to make critical investments in our business, our technicians and technology, allowing us to further execute on our operational excellence initiatives in 2024. Provide consistent value . We intend to be able to offer better value than new car dealers to more price-sensitive consumers. Vehicles generally need more service and repairs as they advance in age. However, as consumers' vehicles age, the consumers' willingness to pay higher prices decreases. Monro's service menu is focused on items that are purchased frequently, like oil changes and other scheduled services, along with higher value services like tires, brakes, and other undercar services. We have rolled out several enhanced offerings, including a walk-in oil service option to provide hassle-free service, which is in addition to our existing online appointment system, and Good, Better, Best oil service package updates to give guests competitively priced options to meet their budgets. We also offer combined tire and related service packages, including installation, alignment, and brake service packages, to better connect tire sales to service categories. Additionally, our tire pricing and category management system allows us to dynamically track demand trends and make rapid adjustments to optimize our

BUSINESS

BUSINESS Purchasing and Distribution We believe that our substantial economies of scale and our flexibility in making sourcing decisions contributes to our successful purchasing strategy. We also believe our ability to negotiate with our vendor partners allows us to ensure we are receiving competitive pricing and terms as well as minimize the margin impact of economic pressures such as tariffs, inflation, and supply chain disruptions. We purchase most of the tires we sell to our guests through a distribution agreement under which ATD supplies and sells certain tires to our retail locations. ATD also provides tire category management, ordering and inventory management services to us. We also select and purchase parts (including oil) and supplies for all Company-operated stores on a centralized basis through an automatic replenishment system based on operational data we collect from stores daily which allows us to control store inventory on a near real-time basis. National vendors ship most of our parts supply directly to our stores. Additionally, each store has access to the inventory carried by up to the 14 stores nearest to it. Management believes that this feature improves customer satisfaction and store productivity by reducing the time required to locate out-of-stock parts and tires. It also improves profitability because it reduces the amount of inventory which must be purchased outside Monro from local vendors. Local vendor purchases are made when needed at the store level and accounted for approximately 29 percent of all parts and tires purchased in 2024. Our ten largest vendors accounted for approximately 95 percent of our total stocking purchases, with the largest vendor accounting for approximately 38 percent of total stocking purchases in 2024. We purchase parts (including oil) and tires from approximately 56 vendors. Management believes that our relationships with vendors are excellent and that alternative sources of supply exist, at comparable c

BUSINESS

BUSINESS New technician development has been an area of particular focus for Monro to increase productivity and retention and make it easier for technicians to overcome barriers of joining the industry. One way we do this is by offering a tool purchase program through which trainee technicians can acquire their own set of tools. We also provide Automotive Service Excellence ("ASE") certification in eight different categories as technicians advance in their careers. Store and operations managers also have courses available through Monro University that are supplemented with live and on-line vendor training courses. Management training covers topics including safety, customer service, human resources, leadership, and scheduling and is delivered on a regular basis. We believe that involving operations management in the development and delivery of these sessions results in more relevant and actionable training for store managers, helping improve staff retention as well as overall performance. Monro University also provides targeted training for corporate management and staff, including diversity training, harassment prevention training, and people manager training. We also foster development through annual reviews at which time employees can discuss with their manager goals for aligning their own development with our business objectives. We believe our teammates are compensated in a fair manner which increases along with productivity. Our store compensation plan also streamlines bonus programs, creating consistency and increasing human capital productivity across our stores. In addition to providing ongoing learning and development opportunities, ensuring our teammates feel supported is also important in teammate retention. Besides standard employee benefits we offer a confidential Employee Assistance Program with 24/7 support, financial counseling, estate planning, and online resources for parents whose children struggle with developmental disabilities, as well

View Full Filing

View this 10-K filing on SEC EDGAR