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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
__________________________________________
FORM 10-Q
________________________________________________________________
☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended October 5, 2024
☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from ________ to ________.
Commission file number 001-16797
_______________________________
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ADVANCE AUTO PARTS, INC.
(Exact name of registrant as specified in its charter)
_________________________
Delaware54-2049910
(State or other jurisdiction of incorporation or organization)(I.R.S. Employer Identification No.)
4200 Six Forks Road, Raleigh, North Carolina 27609
(Address of principal executive offices) (Zip Code)
(540) 362-4911
(Registrant’s telephone number, including area code)
Securities Registered Pursuant to Section 12(b) of the Act:
Title of each classTrading symbolName of each exchange on which registered
Common Stock, $0.0001 par valueAAPNew York Stock Exchange
Not Applicable
(Former name, former address and former fiscal year, if changed since last report).
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 ☒ No ☐
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Registration S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
Large accelerated filer☒Accelerated filer☐
Non-accelerated filer☐Smaller reporting company☐
Emerging growth company☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒
As of November 11, 2024, the number of shares of the registrant’s common stock outstanding was 59,734,513 shares.
TABLE OF CONTENTS
   
 Page
 
  
  
  
  
 
 
 
 
 

FORWARD-LOOKING STATEMENTS

Certain statements herein are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are usually identifiable by words such as “anticipate,” “believe,” “could,” “estimate,” “expect,” “forecast, “guidance,” “intend,” “likely,” “may,” “plan,” “position,” “possible,” “potential,” “probable,” “project,” “should,” “strategy,” “target,” “will,” or similar language. All statements other than statements of historical fact are forward-looking statements, including, but not limited to, statements about the Company’s strategic initiatives, restructuring and asset optimization plans, and the estimated amounts and types of costs the company will incur in connection with such plans, financial objectives, operational plans and objectives, statements about the sale of the Company’s Worldpac business, including statements regarding the benefits of the sale and use of proceeds therefrom, statements regarding expectations for economic conditions, future business and financial performance, as well as statements regarding underlying assumptions related thereto. Forward-looking statements reflect the Company’s views based on historical results, current information and assumptions related to future developments. Except as may be required by law, the Company undertakes no obligation to update any forward-looking statements made herein. Forward-looking statements are subject to a number of risks and uncertainties that could cause actual results to differ materially from those projected or implied by the forward-looking statements. They include, among others, the Company’s ability to hire, train and retain qualified employees, the timing and implementation of strategic initiatives, risks associated with the Company’s restructuring and asset optimization plans, deterioration of general macroeconomic conditions, geopolitical factors, the highly competitive nature of the industry, demand for the Company’s products and services, ongoing risks associated with the disposition of Worldpac, the Company’s ability to maintain credit ratings, risks relating to the impairment of assets, including intangible assets such as goodwill, access to financing on favorable terms, complexities in the Company’s inventory and supply chain and challenges with transforming and growing its business. Please refer to “Item 1A. Risk Factors” of the Company’s most recent Annual Report on Form 10-K filed with the Securities and Exchange Commission (“SEC”), as updated by the Company’s subsequent filings with the SEC, for a description of these and other risks and uncertainties that could cause actual results to differ materially from those projected or implied by the forward-looking statements.
1
PART I. FINANCIAL INFORMATION
ITEM 1.CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
Advance Auto Parts, Inc. and Subsidiaries
Condensed Consolidated Balance Sheets
(in thousands, except per share data) (Unaudited)
AssetsOctober 5, 2024December 30, 2023
Current assets:  
Cash and cash equivalents$464,492 $488,049 
Receivables, net668,937 609,528 
Inventories, net4,042,200 3,893,569 
Other current assets180,448 180,402 
Current assets held for sale2,137,690 1,205,473 
Total current assets7,493,767 6,377,021 
Property and equipment, net of accumulated depreciation of $2,913,816 and $2,729,208
1,479,738 1,555,985 
Operating lease right-of-use assets2,399,630 2,347,073 
Goodwill600,182 601,159 
Other intangible assets, net409,501 419,161 
Other noncurrent assets85,366 85,988 
Noncurrent assets held for sale— 889,939 
Total assets$12,468,184 $12,276,326 
Liabilities and Stockholders’ Equity  
Current liabilities:  
Accounts payable$3,498,460 $3,526,079 
Accrued expenses641,914 616,067 
Other current liabilities458,343 396,408 
Current liabilities held for sale994,824 768,851 
Total current liabilities5,593,541 5,307,405 
Long-term debt1,788,513 1,786,361 
Noncurrent operating lease liabilities2,018,383 2,039,908 
Deferred income taxes380,118 355,635 
Other long-term liabilities89,949 83,538 
Noncurrent liabilities held for sale— 183,751 
Total liabilities9,870,504 9,756,598 
Commitments and contingencies
Stockholders’ equity:  
Preferred stock, nonvoting, $0.0001 par value
— — 
Common stock, voting, $0.0001 par value
8 8 
Additional paid-in capital987,657 946,099 
Treasury stock, at cost(2,938,887)(2,933,286)
Accumulated other comprehensive loss(43,514)(52,232)
Retained earnings4,592,416 4,559,139 
Total stockholders’ equity2,597,680 2,519,728 
Total liabilities and stockholders’ equity$12,468,184 $12,276,326 

The accompanying notes to the condensed consolidated financial statements are an integral part of these statements.
2
Advance Auto Parts, Inc. and Subsidiaries
Condensed Consolidated Statements of Operations
(in thousands, except per share data) (Unaudited)
 Twelve Weeks EndedForty Weeks Ended
October 5, 2024October 7, 2023October 5, 2024October 7, 2023
Net sales$2,147,991 $2,218,205 $7,098,302 $7,194,670 
Cost of sales, including purchasing and warehousing costs
1,240,093 1,400,638 4,036,898 4,154,190 
Gross profit907,898 817,567 3,061,404 3,040,480 
Selling, general and administrative expenses907,495 896,145 2,954,707 2,959,238 
Operating income (loss)403 (78,578)106,697 81,242 
Other, net:
Interest expense(18,805)(19,375)(62,127)(69,948)
Other income (expense), net2,393 (305)12,769 232 
Total other, net(16,412)(19,680)(49,358)(69,716)
(Loss) income before provision for income taxes(16,009)(98,258)57,339 11,526 
Provision for income taxes9,354 (24,072)34,763 6,360 
Net (loss) income from continuing operations(25,363)(74,186)22,576 5,166 
Net income from discontinued operations19,349 12,149 56,413 59,696 
Net (loss) income$(6,014)$(62,037)$78,989 $64,862 
Basic (loss) earnings per common share from continuing operations$(0.42)$(1.25)$0.38 $0.09 
Basic earnings per common share from discontinued operations0.32 0.20 0.95 1.00 
Basic (loss) earnings per common share
$(0.10)$(1.05)$1.33 $1.09 
Basic weighted-average common shares outstanding
59,684 59,474 59,618 59,411 
Diluted (loss) earnings per common share from continuing operations$(0.42)$(1.24)$0.38 $0.09 
Diluted earnings per common share from discontinued operations0.32 0.20 0.94 1.00 
Diluted (loss) earnings per common share
$(0.10)$(1.04)$1.32 $1.09 
Diluted weighted-average common shares outstanding
59,902 59,630 59,878 59,588 

The accompanying notes to the condensed consolidated financial statements are an integral part of these statements.

3
Condensed Consolidated Statements of Comprehensive Income (Loss)
(in thousands) (Unaudited)
 Twelve Weeks EndedForty Weeks Ended
October 5, 2024October 7, 2023October 5, 2024October 7, 2023
Net (loss) income
$(6,014)$(62,037)$78,989 $64,862 
Other comprehensive (loss) income:
Changes in net unrecognized other postretirement benefits, net of tax (benefit) expense of $(11), $(13), $(42) and $43
(31)(38)(119)121 
Currency translation adjustments1,048 (10,280)8,837 (2,451)
Total other comprehensive (loss) income 1,017 (10,318)8,718 (2,330)
Comprehensive (loss) income
$(4,997)$(72,355)$87,707 $62,532 


The accompanying notes to the condensed consolidated financial statements are an integral part of these statements.
4
Advance Auto Parts, Inc. and Subsidiaries
Condensed Consolidated Statements of Changes in Stockholders’ Equity
(in thousands, except per share data) (Unaudited)
Twelve Weeks Ended October 5, 2024
Common StockAdditional
Paid-in Capital		Treasury Stock, at CostAccumulated Other
Comprehensive Loss		Retained EarningsTotal
Stockholders’ Equity
SharesAmount
Balance at July 13, 202459,675 $8 $975,540 $(2,937,903)$(44,531)$4,613,638 $2,606,752 
Net income— — — — — (6,014)(6,014)
Total other comprehensive income
— — — — 1,017 — 1,017 
Restricted stock units and deferred stock units vested51 — 312 — — — 312 
Share-based compensation— — 10,910 — — — 10,910 
Stock issued under employee stock purchase plan26 — 895 — — — 895 
Repurchases of common stock(21)— — (984)— — (984)
Cash dividends declared ($0.25 per common share)
— — — — — (15,208)(15,208)
Balance at October 5, 202459,731 $8 $987,657 $(2,938,887)$(43,514)$4,592,416 $2,597,680 
Twelve Weeks Ended October 7, 2023
Common StockAdditional
Paid-in Capital		Treasury Stock, at CostAccumulated Other
Comprehensive Loss		Retained EarningsTotal
Stockholders’ Equity
SharesAmount
Balance at July 15, 202359,457 $8 $925,411 $(2,932,576)$(36,707)$4,686,518 $2,642,654 
Net loss— — — — — (62,037)(62,037)
Total other comprehensive loss— — — — (10,318)— (10,318)
Restricted stock units and deferred stock units vested18 — — — — — — 
Share-based compensation— — 10,582 — — — 10,582 
Stock issued under employee stock purchase plan14 — 1,047 — — — 1,047 
Repurchases of common stock(7)— — (429)— — (429)
Cash dividends declared ($0.25 per common share)
— — — — — (15,163)(15,163)
Balance at October 7, 202359,482 $8 $937,040 $(2,933,005)$(47,025)$4,609,318 $2,566,336 


The accompanying notes to the condensed consolidated financial statements are an integral part of these statements.
5
Advance Auto Parts, Inc. and Subsidiaries
Condensed Consolidated Statements of Changes in Stockholders’ Equity
(in thousands, except per share data) (Unaudited)
Forty Weeks Ended October 5, 2024
Common StockAdditional
Paid-in Capital		Treasury Stock, at CostAccumulated Other
Comprehensive Loss		Retained EarningsTotal
Stockholders’ Equity
SharesAmount
Balance at December 30, 202359,512 $8 $946,099 $(2,933,286)$(52,232)$4,559,139 $2,519,728 
Net income — — — — — 78,989 78,989 
Total other comprehensive income
— — — — 8,718 — 8,718 
Restricted stock units and deferred stock units vested238 — 312 — — — 312 
Share-based compensation— — 38,563 — — — 38,563 
Stock issued under employee stock purchase plan69 — 2,683 — — — 2,683 
Repurchases of common stock(88)— — (5,601)— — (5,601)
Cash dividends declared ($0.75 per common share)
— — — — — (45,712)(45,712)
Balance at October 5, 202459,731 $8 $987,657 $(2,938,887)$(43,514)$4,592,416 $2,597,680 
Forty Weeks Ended October 7, 2023
Common StockAdditional
Paid-in Capital		Treasury Stock, at CostAccumulated Other
Comprehensive Loss		Retained EarningsTotal
Stockholders’ Equity
SharesAmount
Balance at December 31, 202259,264 $8 $897,560 $(2,918,768)$(44,695)$4,665,087 $2,599,192 
Net income— — — — — 64,862 64,862 
Total other comprehensive income (loss)— — — — (2,330)— (2,330)
Restricted stock units and deferred stock units vested294 — — — — — — 
Share-based compensation— — 37,435 — — — 37,435 
Stock issued under employee stock purchase plan32 — 3,045 — — — 3,045 
Repurchases of common stock(108)— — (14,237)— — (14,237)
Cash dividends declared ($2.00 per common share)
— — — — — (120,631)(120,631)
Other— — (1,000)— — — (1,000)
Balance at October 7, 202359,482 $8 $937,040 $(2,933,005)$(47,025)$4,609,318 $2,566,336 


The accompanying notes to the condensed consolidated financial statements are an integral part of these statements.
6
Advance Auto Parts, Inc. and Subsidiaries
Condensed Consolidated Statements of Cash Flows
(in thousands) (Unaudited)
 Forty Weeks Ended
October 5, 2024October 7, 2023
Cash flows from operating activities:  
Net income$78,989 $64,862 
Net income from discontinued operations56,413 59,696 
Net income from continuing operations22,576 5,166 
Adjustments to reconcile net income to net cash used in operating activities:
Depreciation and amortization217,197 206,658 
Share-based compensation33,810 33,777 
(Gain) Loss on sale and impairment of long-lived assets
(14,273)1,886 
Provision for deferred income taxes24,289 (27,811)
Other, net2,986 2,436 
Net change in:
Receivables, net(60,383)(161,629)
Inventories, net(152,229)(110,871)
Accounts payable(25,225)(77,336)
Accrued expenses30,794 171,117 
Other assets and liabilities, net1,477 (71,707)
Net cash provided by (used in) operating activities of continuing operations81,019 (28,314)
Net cash provided by operating activities of discontinued operations
76,917 57,148 
Net cash provided by operating activities157,936 28,834 
Cash flows from investing activities:  
Purchases of property and equipment(129,714)(174,186)
Proceeds from sales of property and equipment13,232 2,001 
Net cash used in investing activities of continuing operations
(116,482)(172,185)
Net cash used in investing activities of discontinued operations
(7,988)(13,015)
Net cash used in investing activities (124,470)(185,200)
Cash flows from financing activities:  
Borrowings under credit facilities— 4,805,000 
Payments on credit facilities— (4,990,000)
Borrowings on senior unsecured notes— 599,571 
Dividends paid(44,882)(194,322)
Purchase of noncontrolling interest(9,101)— 
Proceeds from the issuance of common stock
2,995 3,045 
Repurchases of common stock(5,601)(14,237)
Other, net
(1,143)(5,010)
Net cash (used in) provided by financing activities(57,732)204,047 
Effect of exchange rate changes on cash11,766 (1,932)
Net (decrease) increase in cash and cash equivalents(12,500)45,749 
Cash and cash equivalents, beginning of period
503,471 270,805 
7
 Forty Weeks Ended
October 5, 2024October 7, 2023
Cash and cash equivalents, end of period
$490,971 $316,554 
Non-cash transactions of continuing operations:
Accrued purchases of property and equipment$9,276 $9,434 
Transfers of property and equipment from (to) assets related to discontinued operations to (from) continuing operations
$7,262 $(105)
Summary of cash and cash equivalents:
Cash and cash equivalents of continuing operations, end of period
464,492 308,804 
Cash and cash equivalents of discontinued operations, end of period
26,479 7,750 
Cash and cash equivalents, end of period
$490,971 $316,554 


The accompanying notes to the condensed consolidated financial statements are an integral part of these statements.
8
Advance Auto Parts, Inc. and Subsidiaries
Notes to the Condensed Consolidated Financial Statements
(Amounts presented in thousands, except per share data, unless otherwise stated)
(Unaudited)

1.    Nature of Operations and Basis of Presentation

Description of Business

Advance Auto Parts, Inc. and subsidiaries is a leading automotive aftermarket parts provider in North America, serving both professional installers (“professional”) and “do-it-yourself” (“DIY”) customers. The accompanying condensed consolidated financial statements include the accounts of Advance Auto Parts, Inc., its wholly owned subsidiaries, Advance Stores Company, Incorporated (“Advance Stores”) and Neuse River Insurance Company, Inc., and their subsidiaries (collectively referred to as “the Company”).

As discussed in Note 3. “Discontinued Operations,” on August 22, 2024, the Company entered into a definitive purchase agreement to sell its Worldpac, Inc. business (“Worldpac”), which reflects a strategic shift in its business. The sale was completed on November 1, 2024. As a result of the Company’s entry into the purchase agreement, Worldpac is presented as discontinued operations beginning in the third quarter of 2024. The Company has reclassified the financial results of Worldpac to discontinued operations, net of tax, in the Condensed Consolidated Statements of Operations for all periods presented. The Company also reclassified the related assets and liabilities as assets and liabilities held for sale on the accompanying Condensed Consolidated Balance Sheets as of October 5, 2024 and December 30, 2023. Cash flows from the Company’s discontinued operations are presented as such in the Condensed Consolidated Statements of Cash Flows for all periods presented. Refer to Note 15. Subsequent Events for additional information about the sale of Worldpac in November 2024.

As of October 5, 2024, the Company operated a total of 4,781 stores primarily within the United States, with additional locations in Canada, Puerto Rico and the U.S. Virgin Islands. In addition, as of October 5, 2024, the Company served 1,125 independently owned Carquest branded stores across the same geographic locations served by the Company’s stores in addition to Mexico and various Caribbean islands. The Company’s stores operate primarily under the trade names “Advance Auto Parts” and “Carquest”.

The Company has one reportable segment and three operating segments. The operating segments are aggregated primarily due to the economic and operational similarities of each operating segment as the stores and branches have similar characteristics, including the nature of the products and services offered, customer base and the methods used to distribute products and provide services to its customers. Worldpac was one of the Company’s operating segments. As noted in Note 15. Subsequent Events, the sale of Worldpac was completed November 1, 2024, resulting in the Company having two operating segments, “Advance Auto Parts/Carquest U.S.” and “Carquest Canada.”

Basis of Presentation

The accounting policies followed in the presentation of interim financial results are consistent with those followed on an annual basis. Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”), have been condensed or omitted based upon the Securities and Exchange Commission (“SEC”) interim reporting principles. These condensed consolidated financial statements should be read in conjunction with the financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for 2023 as filed with the SEC on March 12, 2024, and the amended Annual Report on Form 10-K/A filed with the SEC on May 30, 2024 (collectively the “2023 Form 10-K”).

The accompanying condensed consolidated financial statements reflect all normal recurring adjustments that are necessary to present fairly the results for the interim periods presented. The results of operations for the interim
1
Advance Auto Parts, Inc. and Subsidiaries
Notes to the Condensed Consolidated Financial Statements
(Amounts presented in thousands, except per share data, unless otherwise stated)
(Unaudited)
periods are not necessarily indicative of the operating results to be expected for the full year. The Company’s first quarter of the year contains sixteen weeks. The Company’s remaining three quarters each consist of twelve weeks.

Revision of Previously Issued Financial Statements for Correction of Immaterial Errors

During the year ended December 30, 2023, the Company identified errors in its consolidated results impacting cost of sales, selling, general and administrative expenses (“SG&A”) and other income (expense), net, of $62.9 million, $36.6 million and $1.7 million incurred in prior years but not previously recognized. These charges primarily related to product costs and vendor credits. Management assessed the materiality of the errors, including the presentation on prior period consolidated financial statements, on a qualitative and quantitative basis in accordance with SEC Staff Accounting Bulletin No. 99, Materiality, codified in Accounting Standards Codification Topic 250, Accounting Changes and Error Corrections. The Company concluded that these errors and the related impacts did not result in a material misstatement of its previously issued consolidated financial statements as of and for the years ended December 31, 2022 and January 1, 2022 and its previously issued unaudited condensed consolidated interim financial statements as of and for the sixteen weeks ended April 22, 2023; the twelve and twenty-eight weeks ended July 15, 2023; and the twelve and forty weeks ended October 7, 2023. Correcting the cumulative effect of these errors in the fifty-two weeks ended December 30, 2023 would have had a significant effect on the results of operations for such period.

The Company has corrected the relevant prior periods of its consolidated financial statements and related footnotes for these and other immaterial corrections for comparative purposes, as previously disclosed in Note 18. Immaterial Restatement of Prior Period Financial Statements of the Company’s 2023 Form 10-K. The Company will also adjust previously reported financial information for such immaterial errors in future filings, as applicable. A summary of the corrections to the impacted financial statement line items from our previously issued financial statements are presented in Note 13. Immaterial Misstatement of Prior Period Financial Statements.

2.    Significant Accounting Policies

Revenues

The following table summarizes disaggregated revenue from contracts with customers by product group from continuing operations:
Twelve Weeks EndedForty Weeks Ended
October 5, 2024October 7, 2023October 5, 2024October 7, 2023
Percentage of Sales:
Parts and Batteries64 %64 %63 %63 %
Accessories and Chemicals21 21 22 22 
Engine Maintenance14 14 14 14 
Other1 1 1 1 
Total100 %100 %100 %100 %

2
Advance Auto Parts, Inc. and Subsidiaries
Notes to the Condensed Consolidated Financial Statements
(Amounts presented in thousands, except per share data, unless otherwise stated)
(Unaudited)
Recently Issued Accounting Pronouncements - Not Yet Adopted

Disclosure Improvements

In October 2023, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2023-06, Disclosure Improvements (“ASU 2023-06”), which defines when companies will be required to improve and clarify disclosure and presentation requirements. This ASU should be applied prospectively, and the effective date will be determined for each individual disclosure based on the effective date of the SEC’s removal of the related disclosure. If the applicable requirements have not been removed by the SEC by June 30, 2027, this ASU will not become effective. Early adoption is prohibited. The Company is currently evaluating the impact of adopting ASU 2023-06 on the consolidated financial statements and related disclosures, and does not believe it will have a material impact on the consolidated financial statements.

Improvements to Reportable Segment Disclosures

In November 2023, the FASB issued ASU 2023-07, Improvements to Reportable Segment Disclosures (“ASU 2023-07”), which requires a company to disclose additional, more detailed information about a reportable segment’s significant expenses, even if there is one reportable segment, and is intended to improve the disclosures about a public entity’s reportable segments. The ASU is effective for fiscal years beginning after December 15, 2023, and for interim periods beginning after December 15, 2024, with early adoption permitted. The Company is currently evaluating the impact of the adoption of ASU 2023-07 and believes that the adoption will result in additional disclosures, but will not have any other impact on its consolidated financial statements and segment reporting.

Income Tax Disclosure Improvements

In December 2023, the FASB issued ASU 2023-09, Income Taxes (“ASU 2023-09”), which requires a company to enhance its income tax disclosures. In each annual reporting period, the company should disclose the specific categories used in the rate reconciliation and additional information for reconciling items that meet a quantitative threshold, including disaggregation of taxes paid by jurisdiction. The related disclosures are effective for the fiscal year beginning after December 15, 2024. The Company is currently evaluating the impact of adopting ASU 2023-09 on our consolidated financial statements and related disclosures and believes that the adoption will result in additional disclosures, but will not have any other impact on its consolidated financial statements.

Climate Disclosure Requirements

In March 2024, the SEC issued its final climate disclosure rules, which require the disclosure of climate-related information in annual reports and registration statements. The rules require disclosure in the audited financial statements of certain effects of severe weather events and other natural conditions and greenhouse gas emissions above certain financial thresholds, as well as amounts related to carbon offsets and renewable energy credits or certificates, if material. Additionally, the rule established disclosure requirements regarding material climate-related risks, descriptions of board oversight and risk management activities, the material impacts of these risks on a registrants' strategy, business model and outlook and any material climate-related targets or goals. On April 4, 2024, the SEC determined to voluntarily stay the final rules pending certain legal challenges. Prior to the stay in the new rules, disclosures would have been effective for annual periods beginning January 1, 2025, except for the greenhouse gas emissions disclosure which would have been effective for annual periods beginning January 1, 2026. The Company is currently evaluating the impact of the new rules on the consolidated financial statements and related disclosures.

3
Advance Auto Parts, Inc. and Subsidiaries
Notes to the Condensed Consolidated Financial Statements
(Amounts presented in thousands, except per share data, unless otherwise stated)
(Unaudited)
Disaggregation of Income Statement Expenses

In November 2024, the FASB issued ASU 2024-03, Income Statement-Reporting Comprehensive Income-Expense Disaggregation (“ASU 2024-03”), which requires public entities to disclose more detailed information about certain costs and expenses presented in the income statement, including inventory purchases, employee compensation, selling expenses and depreciation. ASU 2024-03 is effective for fiscal years beginning after December 15, 2026, and for interim periods beginning after December 15, 2027, with early adoption permitted. The Company is currently evaluating the impact of adopting ASU 2024-03 on the consolidated financial statements and related disclosures.

3. Discontinued Operations

On August 22, 2024, the Company entered into a definitive purchase agreement to sell Worldpac for $1.5 billion, with customary purchase price adjustments for working capital and other items. The Company’s sale of Worldpac was progress towards the changing landscape of the business with increased focus on the Advance blended-box model. The transaction closed on November 1, 2024. As a result, the Company has classified the results of operations and cash flows of Worldpac as discontinued operations in its Condensed Consolidated Statements of Operations and Condensed Consolidated Statements of Cash Flows for all periods presented. The related assets and liabilities associated with the discontinued operations are classified as held for sale in the Condensed Consolidated Balance Sheets. Additionally, beginning August 22, 2024, in accordance with ASC 360, Property, Plant and Equipment, the Company ceased recording depreciation and amortization for Worldpac’s finite-lived intangible assets and operating lease right-of-use assets.

In connection with the Worldpac divestiture, the Company agreed to provide letters of credit in the aggregate amount of up to $200 million, issued under its unsecured revolving credit facility, for up to 12 months after closing of the transaction as credit support for Worldpac’s new supply chain financing program, which letter of credit exposure will reduce to zero no later than 24 months after closing. Worldpac will remain a parts supplier for the Company following the close of the sale. Worldpac has entered into an agreement to supply, sell and deliver to the Company. Under this agreement, the Company intends to purchase at least $145 million of Worldpac’s products during the period beginning on January 1, 2024 and ending on December 31, 2024. If the purchase minimum is met, the agreement automatically renews for one-year terms up to three years. Historically, the Company has made sales to Worldpac but there is no obligation to continue to do so as part of the purchase agreement.

Additionally, the Company and Worldpac entered into a Transition Services Agreement and Reverse Transition Services Agreement, pursuant to which the two entities will provide certain services to each other during the post-closing period. The minimum terms of the agreements are for twelve months, which may be extended by the Company and Worldpac for up to two three-month extension periods.

4
Advance Auto Parts, Inc. and Subsidiaries
Notes to the Condensed Consolidated Financial Statements
(Amounts presented in thousands, except per share data, unless otherwise stated)
(Unaudited)
The following table represents the major classes of assets and liabilities of discontinued operations classified as held for sale in the Condensed Consolidated Balance Sheets as of October 5, 2024 and December 30, 2023:

October 5, 2024December 30, 2023
Carrying amounts of the major classes of assets included in discontinued operations1:
Cash$26,479 $15,422 
Receivables, net208,942 190,613 
Inventories, net987,687 964,133 
Other current assets33,403 35,305 
Property and equipment, net of accumulated depreciation82,480 92,561 
Operating lease right-of-use assets243,763 231,703 
Other intangible assets, net163,408 174,180 
Goodwill390,256 390,584 
Other noncurrent assets
1,272 911 
Total assets of held for sale$2,137,690 $2,095,412 
Carrying amounts of the major classes of liabilities included in discontinued operations1:
Accounts payable$686,249 $651,895 
Accrued expenses58,020 55,170 
Other current liabilities70,935 61,786 
Noncurrent operating lease liabilities171,093 175,858 
Deferred income taxes6,618 6,907 
Other noncurrent liabilities
1,909 986 
Total liabilities held for sale$994,824 $952,602 
1 Assets and liabilities of discontinued operations as of October 5, 2024 are classified as current on the consolidated balance sheet as the Company expects to close within twelve months of the balance sheet date.

5
Advance Auto Parts, Inc. and Subsidiaries
Notes to the Condensed Consolidated Financial Statements
(Amounts presented in thousands, except per share data, unless otherwise stated)
(Unaudited)
The following table presents the major components of discontinued operations, net of income taxes, in the Company's Condensed Consolidated Statements of Operations:

Twelve Weeks EndedForty Weeks Ended
October 5, 2024October 7, 2023October 5, 2024October 7, 2023
Major classes of line items constituting income of discontinued operations before provision for income taxes:
 
Net Sales$496,749 $500,874 $1,635,745 $1,628,068 
Cost of sales, including purchasing and warehousing costs
329,532 348,161 1,078,651 1,095,887 
Selling, general and administrative expenses137,779 135,088 476,177 450,479 
Interest expense
(149)(32)(370)(46)
Other income (expense), net
329 (911)(2,327)(437)
Income from discontinued operations related to major classes before provision for income taxes
29,618 16,682 78,220 81,219 
Provision for income taxes10,269 4,533 21,807 21,523 
Net income from discontinued operations
$19,349 $12,149 $56,413 $59,696 


4.    Inventories, net

The Company used the last in, first out (“LIFO”) method of accounting for approximately 92.3% of inventories as of October 5, 2024 and 92.8% as of December 30, 2023. As a result, the Company recorded a reduction to cost of sales of $34.7 million and $51.3 million for the twelve weeks ended October 5, 2024 and October 7, 2023 to state inventories at LIFO. For the forty weeks ended October 5, 2024 and October 7, 2023, the Company recorded a reduction to cost of sales of $69.1 million and $106.5 million to state inventories at LIFO.

Purchasing and warehousing costs included in inventories as of October 5, 2024 and December 30, 2023 were $429.7 million and $454.0 million.

An actual valuation of inventory under the LIFO method is performed at the end of each fiscal year based on inventory levels and carrying costs at that time. Accordingly, interim LIFO calculations are based on the Company’s estimates of expected inventory levels and costs at the end of the year.

Inventory balances were as follows:
October 5, 2024December 30, 2023
Inventories at first in, first out (“FIFO”)$4,076,359 $3,996,877 
Adjustments to state inventories at LIFO(34,159)(103,308)
Inventories at LIFO$4,042,200 $3,893,569 

6
Advance Auto Parts, Inc. and Subsidiaries
Notes to the Condensed Consolidated Financial Statements
(Amounts presented in thousands, except per share data, unless otherwise stated)
(Unaudited)
5.    Intangible Assets

The Company’s definite-lived intangible assets include customer relationships and non-compete agreements. Amortization expense was $2.6 million and $2.9 million for the twelve weeks ended October 5, 2024 and October 7, 2023, and $9.4 million and $10.2 million for the forty weeks ended October 5, 2024 and October 7, 2023.

6.    Receivables, net

Receivables, net, consisted of the following:
October 5, 2024December 30, 2023
Trade$466,805 $421,293 
Vendor217,221 199,580 
Other17,593 12,271 
Total receivables701,619 633,144 
Less: allowance for credit losses(32,682)(23,616)
Receivables, net$668,937 $609,528 

7.    Long-term Debt and Fair Value of Financial Instruments

Long-term debt consisted of the following:
October 5, 2024December 30, 2023
5.90% Senior Unsecured Notes due March 9, 2026
$298,939 $298,369 
1.75% Senior Unsecured Notes due October 1, 2027
347,952 347,514 
5.95% Senior Unsecured Notes due March 9, 2028
298,466 298,116 
3.90% Senior Unsecured Notes due April 15, 2030
496,603 496,149 
3.50% Senior Unsecured Notes due March 15, 2032
346,553 346,213 
Total long-term debt1,788,513 1,786,361 
Less: Current portion of long-term debt— — 
Long-term debt, excluding the current portion$1,788,513 $1,786,361 
Fair value of long-term debt$1,643,832 $1,641,409 

Fair Value of Financial Assets and Liabilities

The fair value of the Company’s senior unsecured notes was determined using Level 2 inputs based on quoted market prices. The carrying amounts of the Company’s cash and cash equivalents, receivables, net, accounts payable and accrued expenses approximate their fair values due to the relatively short-term nature of these instruments.
7
Advance Auto Parts, Inc. and Subsidiaries
Notes to the Condensed Consolidated Financial Statements
(Amounts presented in thousands, except per share data, unless otherwise stated)
(Unaudited)

Bank Debt

On February 26, 2024, the Company entered into Amendment No. 4 (“Amendment No. 4”) to the Company’s unsecured revolving credit facility (“2021 Credit Agreement”) to enable certain addbacks to the definition of Consolidated Earnings Before Interest, Taxes, Depreciation and Amortization (“EBITDA”) contained therein for specific write-downs of inventory and vendor receivables. Amendment No. 4 also updated certain limitations on future incurrences of other indebtedness and liens, replacing the cap thereon of 10% of consolidated net tangible assets with $400 million, and eliminated the $250 million basket for accounts receivable securitization transactions. Amendment No. 4 made no other material changes to the terms of the 2021 Credit Agreement. See Note 15. Subsequent Events for changes to the Company’s 2021 Credit Agreement as defined in Amendment No. 5.

The 2021 Credit Agreement contains customary covenants restricting the ability of: (a) Advance Auto Parts, Inc. and its subsidiaries to, among other things, (i) create, incur or assume additional debt (only with respect to subsidiaries of Advance Auto Parts, Inc.), (ii) incur liens, (iii) guarantee obligations, and (iv) change the nature of their business; (b) Advance Auto Parts, Inc., Advance Stores and their subsidiaries to, among other things (i) enter into certain hedging arrangements, (ii) enter into restrictive agreements limiting their ability to incur liens on any of their property or assets, pay distributions, repay loans, or guarantee indebtedness of their subsidiaries; and (c) Advance Auto Parts, Inc., among other things, to change its holding company status. The Company is also required to comply with financial covenants with respect to a maximum leverage ratio and a minimum coverage ratio. The 2021 Credit Agreement also provides for customary events of default, including non-payment defaults, covenant defaults and cross-defaults of Advance’s other material indebtedness. The Company was in compliance with the financial covenants with respect to the 2021 Credit Agreement as of October 5, 2024. See Note 15. Subsequent Events for changes to the Company’s 2021 Credit Agreement as defined in Amendment No. 5.

As of October 5, 2024 and December 30, 2023, the Company had no outstanding borrowings, $1.2 billion of borrowing availability and no letters of credit outstanding under the 2021 Credit Agreement.

As of October 5, 2024 and December 30, 2023, the Company had $90.8 million and $91.2 million of bilateral letters of credit issued separately from the 2021 Credit Agreement, none of which were drawn upon. These bilateral letters of credit generally have a term of one year or less and primarily serve as collateral for the Company’s self-insurance policies.

Senior Unsecured Notes

The Company’s 3.90% senior unsecured notes due April 15, 2030 (the “Original Notes”) were issued April 16, 2020, at 99.65% of the principal amount of $500.0 million, and were not registered under the Securities Act of 1933, as amended (the “Securities Act”). The Original Notes bear interest, payable semi-annually in arrears on April 15 and October 15, at a rate of 3.90% per year. On July 28, 2020, the Company completed an exchange offer whereby the Original Notes in the aggregate principal amount of $500.0 million were exchanged for a like principal amount (the “Exchange Notes” or “2030 Notes”), and which have been registered under the Securities Act. The Original Notes were substantially identical to the Exchange Notes, except the Exchange Notes are registered under the Securities Act and are not subject to the transfer restrictions and certain registration rights agreement provisions applicable to the Original Notes.

The Company’s 1.75% senior unsecured notes due October 1, 2027 (the “2027 Notes”) were issued September 29, 2020, at 99.67% of the principal amount of $350.0 million. The 2027 Notes bear interest, payable semi-annually in arrears on April 1 and October 1, at a rate of 1.75% per year. In connection with the 2027 Notes offering, the Company incurred $2.9 million of debt issuance costs.

8
Advance Auto Parts, Inc. and Subsidiaries
Notes to the Condensed Consolidated Financial Statements
(Amounts presented in thousands, except per share data, unless otherwise stated)
(Unaudited)
The Company’s 3.50% senior unsecured notes due 2032 (the “2032 Notes”) were issued March 4, 2022, at 99.61% of the principal amount of $350.0 million. The 2032 Notes bear interest, payable semi-annually in arrears on March 15 and September 15, at a rate of 3.50% per year. In connection with the 2032 Notes offering, the Company incurred $3.2 million of debt issuance costs.

The Company’s 5.90% senior unsecured notes due March 9, 2026 (the “2026 Notes”) were issued March 9, 2023, at 99.94% of the principal amount of $300.0 million. The 2026 Notes bear interest, payable semi-annually in arrears on March 9 and September 9, at a rate of 5.90% per year. In connection with the 2026 Notes offering, the Company incurred $1.6 million of debt issuance costs.

The Company’s 5.95% senior unsecured notes due March 9, 2028 (the “2028 Notes”) were issued March 9, 2023, at 99.92% of the principal amount of $300.0 million. The 2028 Notes bear interest, payable semi-annually in arrears on March 9 and September 9, at a rate of 5.95% per year. In connection with the 2028 Notes offering, the Company incurred $1.9 million of debt issuance costs.

The Company may redeem some or all of the 2026 Notes and 2028 Notes (the “Notes”) at any time, or from time to time, prior to March 9, 2026 in the case of the 2026 Notes, or February 9, 2028 in the case of the 2028 Notes, at the redemption price described in the related indenture for the Notes (the “Indenture”). In the event of a change of control triggering event, as defined in the Indenture, the Company will be required to offer the repurchase of the Notes at a price equal to 101% of the principal amount thereof, plus accrued and unpaid interest to the repurchase date. Currently, the Notes are fully and unconditionally guaranteed, jointly and severally, on an unsubordinated unsecured basis by guarantor and subsidiary guarantees, as defined by the Indenture.

Debt Guarantees

The Company is a guarantor of loans made by banks to various independently owned Carquest-branded stores that are customers of the Company. These loans totaled $102.4 million and $106.9 million as of October 5, 2024 and December 30, 2023 and are collateralized by security agreements on merchandise inventory and other assets of the borrowers. The approximate value of the inventory collateralized by these agreements was $183.6 million and $221.2 million as of October 5, 2024 and December 30, 2023. The Company believes that the likelihood of performance under these guarantees is remote.

8.    Leases

Substantially all of the Company’s leases are for facilities, vehicles and equipment. The initial term for facilities is typically five to ten years, with renewal options typically at five-year intervals, with the exercise of lease renewal options at the Company’s sole discretion. The Company’s vehicle and equipment lease terms are typically three to six years. The Company’s lease agreements do not contain any material residual value guarantees or material restrictive covenants.

9
Advance Auto Parts, Inc. and Subsidiaries
Notes to the Condensed Consolidated Financial Statements
(Amounts presented in thousands, except per share data, unless otherwise stated)
(Unaudited)
Total lease cost is included in cost of sales and SG&A in the accompanying condensed consolidated statements of operations and is recorded net of immaterial sublease income. Total lease costs comprised of the following:
Twelve Weeks EndedForty Weeks Ended
October 5, 2024October 7, 2023October 5, 2024October 7, 2023
Operating lease cost$121,322 $116,082 $396,333 $381,326 
Variable lease cost33,888 33,666 119,237 108,896 
Total lease cost$155,210 $149,748 $515,570 $490,222 

Other information relating to the Company’s lease liabilities was as follows:
Forty Weeks Ended
October 5, 2024October 7, 2023
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases$400,551 $386,668 
Right-of-use assets obtained in exchange for lease obligations:
Operating leases$387,266 $312,808 

During first quarter of 2024, the Company entered into a sale-leaseback transaction where the Company sold a building and land and entered into a three-year lease of the property upon the sale. This transaction resulted in a gain of $22.3 million and is included in selling, general and administrative expenses on the condensed consolidated statement of operations.
9.    Share Repurchase Program

The Company’s Board of Directors had previously authorized $2.7 billion to its share repurchase program. The share repurchase program permits the repurchase of the Company’s common stock on the open market and in privately negotiated transactions from time to time. Amendment No. 5 to the Company’s 2021 Credit Agreement generally prohibits open market share repurchases.

During the twelve and forty weeks ended October 5, 2024 and October 7, 2023, the Company did not purchase any shares of the Company’s common stock under the share repurchase program. The Company had $947.3 million remaining under the share repurchase program as of October 5, 2024.

10
Advance Auto Parts, Inc. and Subsidiaries
Notes to the Condensed Consolidated Financial Statements
(Amounts presented in thousands, except per share data, unless otherwise stated)
(Unaudited)
10.    Earnings per Share

The computations of basic and diluted earnings per share were as follows:
 Twelve Weeks Ended
Forty Weeks Ended
October 5, 2024October 7, 2023October 5, 2024October 7, 2023
Numerator
(Loss) income from continuing operations$(25,363)$(74,186)$22,576 $5,166 
Income from discontinued operations19,349 12,149 56,413 59,696 
Net (loss) income applicable to common shares
$(6,014)$(62,037)$78,989 $64,862 
Denominator
Basic weighted-average common shares59,684 59,474 59,618 59,411 
Dilutive impact of share-based awards218 156 260 177 
Diluted weighted-average common shares(1)
59,902 59,630 59,878 59,588 
Basic (loss) earnings per common share from continuing operations$(0.42)$(1.25)$0.38 $0.09 
Basic earnings per common share from discontinued operations0.32 0.20 0.95 1.00 
Basic (loss) earnings per common share
$(0.10)$(1.05)$1.33 $1.09 
Diluted (loss) earnings per common share from continuing operations$(0.42)$(1.24)$0.38 $0.09 
Diluted earnings per common share from discontinued operations0.32 0.20 0.94 1.00 
Diluted (loss) earnings per common share
$(0.10)$(1.04)$1.32 $1.09 
(1) For the twelve weeks ended October 5, 2024 and October 7, 2023, 570 thousand and 515 thousand restricted stock units (“RSUs”) were excluded from the diluted calculation as their inclusion would have been anti-dilutive. For the forty weeks ended October 5, 2024 and October 7, 2023, 536 thousand and 299 thousand RSUs were excluded from the diluted calculation as their inclusion would have been anti-dilutive.


11.    Share-Based Compensation

The Company grants time based RSUs, market based RSUs and options to purchase common stock to certain employees under the Company’s 2023 Omnibus Incentive Compensation Plan. The general terms of the time-based and market-based RSUs and stock options are similar to awards previously granted by the Company. The Company records compensation expense for the grant date fair value of the option awards evenly over the vesting period.

During the twelve and forty weeks ended October 5, 2024, the Company granted the following time-based and market-based RSUs:

11
Advance Auto Parts, Inc. and Subsidiaries
Notes to the Condensed Consolidated Financial Statements
(Amounts presented in thousands, except per share data, unless otherwise stated)
(Unaudited)
Twelve Weeks EndedForty Weeks Ended
Time-based RSUs
Number of awards
16.7 499.1 
Weighted-average fair value
$49.11 $76.84 
Market-based RSUs
Number of awards
— 143.9 
Weighted-average fair value
$— $113.31 

For time-based RSUs, the fair value of each award was determined based on the market price of the Company’s stock on the date of grant adjusted for expected dividends during the vesting period, as applicable. The fair value of each market-based RSU was determined using a Monte Carlo simulation model.

During the twelve and forty weeks ended October 5, 2024, the Company granted the following stock options:

Twelve Weeks EndedForty Weeks Ended
Number of awards— 195.4 
Weighted-average fair value$— $31.86 

The fair value of each option was estimated on the date of grant by applying the Black-Scholes option-pricing valuation model.
Twelve Weeks EndedForty Weeks Ended
Risk-free interest rate (1)
— %4.1 -4.2 %
Expected term (2)
— 6 years
Expected volatility (3)
— %41.6 -42.6 %
Expected dividend yield (4)
— %1.4 -1.5 %
(1) The risk-free interest rate is based on the yield in effect at grant for zero-coupon U.S. Treasury notes with maturities equivalent to the expected term of the stock options.
(2) The expected term represents the period of time options granted are expected to be outstanding. As the Company does not have sufficient historical data, the Company utilized the simplified method provided by the SEC to calculate the expected term as the average of the contractual term and vesting period.
(3) Expected volatility is the measure of the amount by which the stock price has fluctuated or is expected to fluctuate. The Company utilized historical trends and the implied volatility of the Company’s publicly traded financial instruments in developing the volatility estimate for its stock options.
(4) The expected dividend yield is calculated based on our expected quarterly dividend and the three month average stock price as of the grant date.

The total income tax benefit related to share-based compensation expense for the twelve and forty weeks ended October 5, 2024 was $2.4 million and $8.4 million. As of October 5, 2024, there was $85.4 million of unrecognized compensation expense related to all share-based awards that is expected to be recognized over a weighted-average period of 1.6 years.

12
Advance Auto Parts, Inc. and Subsidiaries
Notes to the Condensed Consolidated Financial Statements
(Amounts presented in thousands, except per share data, unless otherwise stated)
(Unaudited)
12. Supplier Finance Programs

The Company maintains supply chain financing agreements with third-party financial institutions to provide the Company’s suppliers with enhanced receivables options. Through these agreements, the Company’s suppliers, at their sole discretion, may elect to sell their receivables due from the Company to the third-party financial institution at terms negotiated between the supplier and the third-party financial institution. The Company does not provide any guarantees to any third party in connection with these financing arrangements. The Company’s obligations to suppliers, including amounts due and scheduled payment terms, are not impacted, and no assets are pledged under the agreements. All outstanding amounts due to third-party financial institutions related to suppliers participating in such financing arrangements are recorded within accounts payable and represent obligations outstanding under these supplier finance programs for invoices that were confirmed as valid and owed to the third-party financial institutions in the Company’s Condensed Consolidated Balance Sheets. As of October 5, 2024, and December 30, 2023, $3.26 billion and $3.36 billion of the Company’s accounts payable were to suppliers participating in these financing arrangements.

13. Immaterial Restatement of Prior Period Financial Statements

As discussed in Note 1. Basis of Presentation, the Company made corrections to the consolidated financial statements for periods ended December 31, 2022, January 1, 2022, and the quarterly periods of 2023. A summary of the corrections related to prior periods presented are as follows (tables may not foot or cross foot due to rounding):
Condensed Consolidated Statement of Operations
October 7, 2023
Twelve Weeks Ended
As
Previously
Reported		AdjustmentsAs
Corrected		Discontinued OperationsAs Corrected, after Discontinued Operations
Cost of sales$1,732,420 $16,379 $1,748,799 $348,161 $1,400,638 
Gross profit986,659 (16,379)970,280 152,713 817,567 
Selling, general and administrative expenses1,030,355 878 1,031,233 135,088 896,145 
Operating (loss) income
(43,696)(17,257)(60,953)17,625 (78,578)
(Loss) Income before provision for income taxes
(64,319)(17,257)(81,576)16,682 (98,258)
Provision for income taxes(15,686)(3,853)(19,539)4,533 (24,072)
Net (loss) income
$(48,633)$(13,404)$(62,037)$12,149 $(74,186)
Basic (loss) earnings per share
$(0.82)$(0.23)$(1.05)$0.20 $(1.25)
Diluted (loss) earnings per common share
$(0.82)$(0.22)$(1.04)$0.20 $(1.24)

13
Advance Auto Parts, Inc. and Subsidiaries
Notes to the Condensed Consolidated Financial Statements
(Amounts presented in thousands, except per share data, unless otherwise stated)
(Unaudited)
Condensed Consolidated Statement of Operations
October 7, 2023
Forty Weeks Ended
As
Previously
Reported		AdjustmentsAs
Corrected		Discontinued OperationsAs Corrected, after Discontinued Operations
Cost of sales$5,220,200 $29,877 $5,250,077 $1,095,887 $4,154,190 
Gross profit3,602,538 (29,877)3,572,661 532,181 3,040,480 
Selling, general and administrative expenses3,407,445 2,272 3,409,717 450,479 2,959,238 
Operating income (loss)
195,093 (32,149)162,944 81,702 81,242 
Income (loss) before provision for income taxes
124,894 (32,149)92,745 81,219 11,526 
Provision for income taxes34,649 (6,766)27,883 21,523 6,360 
Net income (loss)
$90,245 $(25,383)$64,862 $59,696 $5,166 
Basic earnings (loss) per share
$1.52 $(0.43)$1.09 $1.00 $0.09 
Diluted earnings (loss) per common share
$1.51 $(0.42)$1.09 $1.00 $0.09 

Condensed Consolidated Statement of Comprehensive Income
October 7, 2023
Twelve Weeks Ended
As
Previously
Reported		AdjustmentsAs
Corrected
Net (loss) income
$(48,633)$(13,404)$(62,037)
Currency translation adjustments(10,737)457 (10,280)
Total other comprehensive loss(10,775)457 (10,318)
Comprehensive (loss) income
$(59,408)$(12,947)$(72,355)

Condensed Consolidated Statement of Comprehensive Income
October 7, 2023
Forty Weeks Ended
As
Previously
Reported		AdjustmentsAs
Corrected
Net income$90,245 $(25,383)$64,862 
Currency translation adjustments(2,577)126 (2,451)
Total other comprehensive loss(2,456)126 (2,330)
Comprehensive income$87,789 $(25,257)$62,532 

14
Advance Auto Parts, Inc. and Subsidiaries
Notes to the Condensed Consolidated Financial Statements
(Amounts presented in thousands, except per share data, unless otherwise stated)
(Unaudited)
Condensed Consolidated Statements of Changes in Stockholders’ Equity
Twelve Weeks Ended October 7, 2023
Accumulated Other
Comprehensive Loss		Retained
Earnings		Total Stockholders' Equity
Twelve Weeks Ended As Previously Reported
Balance at July 15, 2023$(36,824)$4,767,168 $2,723,187 
Net loss — (48,633)(48,633)
Total other comprehensive loss(10,775)— (10,775)
Balance at October 7, 2023$(47,599)$4,690,424 $2,646,868 
Adjustments
Balance at July 15, 2023$117 $(80,650)$(80,533)
Net loss(1)
— (13,404)(13,404)
Total other comprehensive income457 — 457 
Balance at October 7, 2023$574 $(81,106)$(80,532)
As Corrected
Balance at July 15, 2023$(36,707)$4,686,518 $2,642,654 
Net loss— (62,037)(62,037)
Total other comprehensive loss(10,318)— (10,318)
Balance at October 7, 2023$(47,025)$4,609,318 $2,566,336 
(1) Adjustments to retained earnings does not foot due to the previous adjustments made in third quarter 2023.
Condensed Consolidated Statements of Changes in Stockholders’ Equity
Forty Weeks Ended October 7, 2023
Accumulated Other
Comprehensive Loss		Retained
Earnings		Total Stockholders' Equity
Forty Weeks Ended As Previously Reported
Balance at December 31, 2022$(45,143)$4,744,624 $2,678,281 
Net income— 90,245 90,245 
Total other comprehensive loss(2,456)— (2,456)
Balance at October 7, 2023$(47,599)$4,690,424 $2,646,868 
Adjustments
Balance at December 31, 2022$448 $(79,537)$(79,089)
Net loss(1)
— (25,383)(25,383)
Total other comprehensive income126 — 126 
Balance at October 7, 2023$574 $(81,106)$(80,532)
As Corrected
Balance at December 31, 2022$(44,695)$4,665,087 $2,599,192 
Net income— 64,862 64,862 
Total other comprehensive loss(2,330)— (2,330)
Balance at October 7, 2023$(47,025)$4,609,318 $2,566,336 
(1) Adjustments to retained earnings does not foot due to the previous adjustments made in third quarter 2023.
15
Advance Auto Parts, Inc. and Subsidiaries
Notes to the Condensed Consolidated Financial Statements
(Amounts presented in thousands, except per share data, unless otherwise stated)
(Unaudited)
Condensed Consolidated Statement of Cash Flows
Forty Weeks Ended October 7, 2023
As
Previously
Reported		AdjustmentsAs
Corrected		Discontinued
Operations		As Corrected, after Discontinued Operations
Net income$90,245 $(25,383)$64,862 $59,696 $5,166 
Provision for deferred income taxes(33,059)5,248 (27,811)— (27,811)
Other, net1,499 937 2,436 — 2,436 
Net change in:
Receivables, net(170,371)(9,519)(179,890)(18,261)(161,629)
Inventories, net(41,025)15,442 (25,583)85,288 (110,871)
Accounts payable(191,871)28,500 (163,371)(86,035)(77,336)
Accrued expenses