MNRO earnings analysis
What we found in MNRO's 10-Q: the parts that mattered, the offsets in the same document, and what the company said about what comes next.
Our reading of the filing · Free to read, no account needed
Monro reported fiscal Q1 2027 revenue of $287.1 million, down 4.6% year over year and modestly above the fiscal Q4 2026 level of $274 million, while comparable-store sales fell 1.7%. GAAP results improved materially, with operating income of $3.7 million versus a $6.1 million loss a year earlier and diluted loss narrowing to $0.08 from $0.28; however, adjusted EPS deteriorated to a $0.09 loss from $0.22 of profit. Liquidity remains supported by $261.5 million of revolver availability, but negative $37.9 million estimated free cash flow and a $48.4 million sequential increase in credit-facility debt are key near-term concerns.
The parts that mattered.
Pulled out of the filing itself, with the figures the company reported.
- GAAP operating profit turned positive
- GAAP operating income improved to $3.7 million from a $6.1 million operating loss in the prior-year quarter, as OSG&A declined $16.3 million, or 14.4%, to $96.7 million.
- Gross margin improved sequentially
- Gross margin was 35.0%, down 50 bps year over year but up 110 bps from 33.9% in fiscal Q4 2026. Lower technician labor costs from productivity and efficiency partially offset a 90-bp occupancy-cost headwind.
- Working-capital deficit narrowed
- Working-capital deficit narrowed by $40.1 million to $241.1 million at June 27, 2026, from a $281.2 million deficit at March 28, 2026.
- Credit-facility liquidity remains available
- The company had $261.5 million available under its credit facility, alongside $9.5 million of cash and equivalents, and stated these sources provide adequate liquidity for the next 12 months and long term.
And the other side of it.
The offsets in the same document — the things a summary that only listed the good news would have left out.
- Sales and comparable-store sales declined
- Sales fell $13.9 million, or 4.6%, to $287.1 million: closed stores reduced sales by 2.9 percentage points and comparable-store sales declined 1.7%. Maintenance-service comparable sales declined 5%, while tires and brakes each declined 1%.
- Adjusted earnings deteriorated sharply
- Adjusted diluted loss was $0.09 per share versus adjusted EPS of $0.22 in the prior-year quarter, a $0.31 per-share deterioration. The reported $0.08 loss also missed the $0.03 consensus estimate by $0.11 per share.
- Cash flow weakened materially
- Operating cash flow was negative $30.4 million versus negative $1.9 million a year earlier; after $7.5 million of capex, estimated free cash flow was negative $37.9 million. Accounts payable and accrued expenses consumed $43.2 million of cash due to payment timing.
- Borrowings and floating-rate exposure increased
- Credit-facility borrowings rose to $108.4 million at June 27, 2026 from $60.0 million at March 28, 2026. A 100-bp SOFR increase would raise annual interest expense by about $1.1 million based on quarter-end debt.
- Substantial lease obligations remain
- No updated Item 1A risk factors were included in this 10-Q. However, the filing identifies $430.2 million of lease payments through October 2040, including $92.4 million due within one year, as a material fixed-commitment consideration.
What they reported.
What the company itself reported, taken out of the document.
- Earnings per share
- $-0.08
- Gross margin
- 35.0%
- Operating margin
- 1.3%
What they said about what is next.
The company is not providing fiscal 2027 financial guidance. Its quantitative capital-spending outlook is fiscal-2027 capex of $25 million to $35 million, and management expects to continue generating positive operating cash flow over the full year.
The filing reads worse than the one before it.
What came before.
- 10-K · May 27, 2026
- Monro, Inc. faced a challenging year, reporting a 3.2% decline in sales to $1.16 billion and a diluted EPS of $0.03, rebounding from a loss of $0.22 in the previous year. While comparable store sales grew by 1.4%,…
- 10-Q · January 28, 2026
- Monro reported Q3 (three months ended December 27, 2025) sales of $293,387,000 and diluted EPS of $0.35. Gross margin held near 34.9% and operating margin expanded to 6.3% as operating income rose to $18,570,000.…
- 10-Q · October 29, 2025
- Monro reported quarterly sales of $288,914,000 and diluted EPS of $0.18 for the three months ended September 27, 2025. Revenue declined versus the prior-year quarter and the company remains margin-positive (gross margin…
- 10-Q · January 29, 2025
- Monro reported quarterly sales of $305,769,000, down from $317,653,000 a year earlier, with gross margin compressing to 34.3% and operating income halving to $9,963,000. Diluted EPS fell to $0.15 from $0.38 a year ago.…
This is our reading of a public filing, not the filing. Read the original on SEC.gov · Educational only. Nothing here is investment advice.
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