SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 11 - K
(Mark One) ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE
(X) SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended December 31, 1999
OR
( ) TRANSITION REPORT PURSUANT TO SECTION 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the transition period from to
Commission file number: 0-21318
A. Full title of the plan and the address of the plan, if different from that
of the Issuer named below.
O'Reilly Automotive, Inc.
Profit Sharing and Savings Plan
B. Name of issuer of the securities held pursuant to the plan and the address
of its principal executive office:
O'Reilly Automotive, Inc.
233 South Patterson
Springfield, Missouri 65802
<PAGE>
Securities and Exchange Commission
Washington, D.C. 20549
FORM 11-K
REQUIRED INFORMATION
(a) Financial Statements. Filed as part of this Report on Form 11-K are the
financial statements and the schedules thereto of the O'Reilly Automotive,
Inc. Profit Sharing and Savings Plan as required by Form 11-K, together
with the report thereon of Ernst & Young LLP, independent auditors, dated
May 18, 2000.
(b) Exhibits. A consent of Ernst & Young LLP is being filed as Exhibit 23 to
this Report.
<PAGE>
Financial Statements and Schedules
(Modified Cash Basis)
O'Reilly Automotive, Inc.
Profit Sharing and Savings Plan
December 31, 1999 and 1998, and the year ended
December 31, 1999
with Report of Independent Auditors
<PAGE>
Report of Independent Auditors
The Plan Administrators and Participants
O'Reilly Automotive, Inc.
Profit Sharing and Savings Plan
We have audited the accompanying statements of net assets available for plan
benefits (modified cash basis) of the O'Reilly Automotive, Inc. Profit Sharing
and Savings Plan (the Plan) as of December 31, 1999 and 1998, and the related
statements of changes in net assets available for plan benefits (modified cash
basis) for the years then ended. These financial statements are the
responsibility of the Plan's management. Our responsibility is to express an
opinion on these financial statements based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.
As described in Note 1, these financial statements have been prepared on the
modified cash basis, which is a comprehensive basis of accounting other than
generally accepted accounting principles.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the Plan's net assets available for plan benefits
(modified cash basis) at December 31, 1999 and 1998, and changes in its net
assets available for plan benefits (modified cash basis) for the years then
ended on the basis of accounting described in Note 1.
Our audits were performed for the purpose of forming an opinion on the basic
financial statements taken as a whole. The accompanying supplemental schedules
(modified cash basis) of assets held for investment purposes as of December 31,
1998 and reportable transactions for the year then ended are presented for
purposes of additional analysis and are not a required part of the financial
statements, but are supplementary information required by the Department of
Labor's Rules and Regulations for Reporting and Disclosure under the Employee
Retirement Income Security Act of 1974. These supplemental schedules are the
responsibility of the Plan's management. The fund information in the statements
of changes in net assets available for plan benefits is presented for purposes
of additional analysis rather than to present the changes in net assets
available for benefits of each fund. The supplemental schedules (modified cash
basis) and fund information have been subjected to the auditing procedures
applied in our audits of the basic financial statements and, in our opinion, are
fairly stated, in all material respects, in relation to the basic financial
statements taken as a whole.
Ernst & Young LLP
Kansas City, Missouri
June 30, 2000
<PAGE>
O'Reilly Automotive, Inc.
Profit Sharing and Savings Plan
(Modified Cash Basis)
Financial Statements
and Schedules
December 31, 1999 and 1998, and the year ended
December 31, 1999
Contents
Report of Independent Auditors ...............................................1
Audited Financial Statements (Modified Cash Basis)
Statements of Net Assets Available for Plan Benefits..........................3
Statement of Changes in Net Assets Available for Plan Benefits................4
Notes to Financial Statements.................................................5
Supplemental Schedules (Modified Cash Basis)
Schedule H, Line 4i - Schedule of Assets Held for Investment Purposes........12
Schedule H, Line 4j - Schedule of Reportable Transactions....................13
<PAGE>
O'Reilly Automotive, Inc.
Profit Sharing and Savings Plan
Statements of Net Assets Available for Plan Benefits
(Modified Cash Basis)
<TABLE>
<CAPTION>
December 31,
1999 1998
------ ------
<S> <C> <C>
Assets
Investments, at fair value (Note 3) $38,885,736 $36,342,012
Net assets available for benefits $38,885,736 $36,342,012
</TABLE>
See accompanying notes.
<PAGE>
O'Reilly Automotive, Inc.
Profit Sharing and Savings Plan
Statement of Changes in Net Assets Available for Plan Benefits
(Modified Cash Basis)
Year ended December 31, 1999
<TABLE>
<S> <C>
Additions:
Investment income:
Net realized and unrealized depreciation in
fair value of investments (Note 3) $ (527,214)
Dividend and interest income 463,091
Contributions:
Employer 2,122,039
Employee 2,502,151
-----------------------
4,624,190
-----------------------
Total additions 4,560,067
Deductions:
Distributions to participants (2,016,343)
-----------------------
Net increase 2,543,724
Net assets available for benefits, at beginning of year 36,342,012
-----------------------
Net assets available for benefits, at end of year $38,885,736
-----------------------
</TABLE>
See accompanying notes.
<PAGE>
O'Reilly Automotive, Inc.
Profit Sharing and Savings Plan
(Modified Cash Basis)
Notes to Financial Statements
December 31, 1999
1. Summary of Significant Accounting Policies
The following is a summary of the significant accounting policies of the
O'Reilly Automotive, Inc. (the "Company") Profit Sharing and Savings Plan (the
"Plan"):
Basis of Presentation
The accompanying financial statements have been prepared on the modified cash
basis of accounting, which is a comprehensive basis of accounting other than
generally accepted accounting principles. Under this basis, contributions are
recorded when received rather than in the period to which they relate, and
expenses are recorded when paid rather than when incurred.
Valuation of Investments
The value of investments in common collective trusts, registered investment
company funds and in the O'Reilly Automotive, Inc. Stock Fund is based on quoted
market values received from SunTrust Bank, Central Florida, N.A. (SunTrust) on
the last business day of the plan year.
Use of Estimates
The preparation of financial statements requires management to make estimates
and assumptions that affect the amounts reported in the financial statements and
accompanying notes. Actual results could differ from those estimates.
Reclassification
Certain amounts in the 1998 financial statements have been reclassified to
conform to the 1999 presentation.
<PAGE>
O'Reilly Automotive, Inc.
Profit Sharing and Savings Plan
(Modified Cash Basis)
Notes to Financial Statements (Continued)
2. Description of the Plan
The following description of the Plan is provided for general information only.
Participants should refer to the plan agreement for a more complete description
of the Plan's provisions.
The Plan is a defined contribution pension plan providing retirement benefits to
substantially all employees of the Company who have attained age 21 and
completed six months and at least 1,000 hours of service in a
12-consecutive-month period of employment. The Plan is sponsored by the Company
and is subject to the provisions of the Employee Retirement Income Security Act
of 1974 (ERISA).
The Plan allows participants to contribute up to 15% of their annual
compensation to the Plan. At its discretion, the Company has elected to
contribute 50% of each employee's voluntary contribution up to 2% of the
employee's compensation and 25% of the next 2% of each employee's voluntary
contribution. Additionally, the Company may make voluntary contributions to the
Plan annually, as determined by its Board of Directors, up to a maximum
aggregate company contribution of 15% of participants' annual compensation. All
employer contributions are invested in the O'Reilly Automotive, Inc. Stock Fund.
During the year ended December 31, 1999, the Plan received discretionary
contributions from the Company amounting to $1,300,000, not including matching
contributions.
Each participant's account is credited with the participant's contribution and
an allocation of the Company's contribution and plan earnings. Allocations of
company contributions are based on participant earnings. Allocations of plan
earnings are based on participants' account balances. Forfeitures of terminated
participants' non-vested accounts are taken against the plan's administrative
costs and the company contributions.
Participants are immediately vested with respect to their voluntary
contributions. With respect to employer contributions, participants become 20%
vested after three years of service with the Company. Vesting increases in 20%
increments annually to 100% after seven years.
Participating employees are entitled to borrow from the Plan the lesser of
$50,000 or 50% of the employee's vested account balance at a rate equal to one
percentage point above the prime interest rate in effect as reported in the Wall
Street Journal on the last business day of the month prior to the date the loan
is made. Loans are repaid by payroll deductions over a period no longer than ten
years.
<PAGE>
O'Reilly Automotive, Inc.
Profit Sharing and Savings Plan
(Modified Cash Basis)
Notes to Financial Statements (Continued)
2. Description of the Plan (continued)
Although it has not expressed any intent to do so, the Company has the right
under the Plan to discontinue its contributions at any time and to terminate the
Plan subject to the provisions of ERISA. In the event of plan termination,
participants will become 100% vested in their accounts.
Benefit distributions are payable in monthly installments to the beneficiary or
in a lump sum, as elected by the participant. At December 31, 1999 and 1998,
terminated employees had approximately $259,000 and $669,000, respectively,
included in net assets available for plan benefits which were to be paid in 2000
and 1999, respectively. The Company currently pays 100% of the administrative
expenses associated with the Plan.
<PAGE>
O'Reilly Automotive, Inc.
Profit Sharing and Savings Plan
(Modified Cash Basis)
Notes to Financial Statements (Continued)
3. Investments
At December 31, 1999, the Plan's investments are held by SunTrust, in a bank-
administered trust fund. At December 31, 1998, the Plan's investments were held
by Bankers Trust, in a bank-administered trust fund. The trustee has full
discretionary authority for the purchase and sale of investments, subject to
certain restrictions as specified in the trust agreement and in ERISA.
The fair value of individual investments that represent 5% or more of the Plan's
net assets are as follows:
<TABLE>
<CAPTION>
1999 1998
---------------------------------------
<S> <C> <C>
SunTrust common collective trusts:
Classic Balanced Fund $ 3,504,817 $ --
Stable Asset Fund 4,652,091 --
Registered investment company fund:
Vanguard 500 Index Fund 5,685,920 --
Bankers Trust common collective trusts:
Stable Value Government -- 4,983,719
Intermediate & Long Term Bond Fund -- 1,301,474
Asset Management Fund -- 3,604,702
Equity Index Fund -- 4,937,181
O'Reilly Automotive, Inc. Stock Fund-
Particpant Directed 8,376,525 7,385,258
O'Reilly Automotive, Inc. Stock Fund-
Nonparticipant Directed 11,686,247 11,910,557
</TABLE>
<PAGE>
O'Reilly Automotive, Inc.
Profit Sharing and Savings Plan
(Modified Cash Basis)
Notes to Financial Statements (Continued)
3. Investments (Continued)
During 1999, the Plan's investments (including investments purchased, sold, as
well as held, during the year) appreciated (depreciated) in fair value as
follows:
<TABLE>
<CAPTION>
Net Appreciation
(Depreciation) in
Fair Value of
Investments
---------------------------
<S> <C>
Year ended December 31, 1999
Fair value as determined by quoted market
prices of the underlying securities:
Stable Asset Fund $ 102,720
Classic Investment Grade Bond Fund (83,922)
Classic Balanced Fund 76,022
Classic Capital Appreciation Fund (703)
Vanguard 500 Index Fund 929,106
Fidelity Advisor Growth Opportunities Fund (70,579)
Janus Worldwide Fund 284,604
Classic Small Cap Fund (2,615)
American Century Value Advisor Fund (9,112)
O'Reilly Automotive, Inc. Stock Fund (1,752,735)
---------------------------
$ (527,214)
===========================
</TABLE>
<PAGE>
O'Reilly Automotive, Inc.
Profit Sharing and Savings Plan
(Modified Cash Basis)
Notes to Financial Statements (Continued)
4. Nonparticipant-Directed Investments
Information about the net assets and the significant components of the changes
in net assets relating to the nonparticipant-directed investments is as follows:
<TABLE>
<CAPTION>
December 31,
1999 1998
-------------------------------
<S> <C> <C>
Net assets:
O'Reilly Automotive, Inc. Stock Fund $ 11,686,247 $ 11,910,557
-------------------------------
$ 11,686,247 $ 11,910,557
===============================
</TABLE>
<TABLE>
<CAPTION>
Year Ended
December 31, 1999
---------------------
<S> <C>
Changes in net assets:
Contributions $ 2,043,675
Net depreciation in fair value (1,101,303)
Distributions to participants (1,166,682)
---------------------
$ (224,310)
=====================
</TABLE>
5. Income Tax Status
The Plan has received a determination letter from the Internal Revenue Service
dated February 7, 1995, stating that the Plan is qualified under Section 401(a)
of the Internal Revenue Code (the "Code") and, therefore, the related trust is
exempt from taxation. Once qualified, the Plan is required to operate in
conformity with the Code to maintain its qualification. The Plan has been
amended since receiving the latest tax determination letter. The Plan
Administrator believes the Plan is being operated in compliance with the
applicable requirements of the Code and the related trust is tax exempt.
6. Subsequent Events
The market price of the O'Reilly Automotive, Inc. common stock has declined from
$21.50 per share at December 31, 1999 to $15.00 per share at May 18, 2000. This
decline has caused the fair value of the O'Reilly Automotive, Inc. Stock Fund to
decrease approximately $5.8 million in fair value.
<PAGE>
Supplemental Schedules
<PAGE>
O'Reilly Automotive, Inc.
Profit Sharing and Savings Plan
EIN#-44-00618012 Plan#-002
Schedule H, Line 4i
Schedule of Assets Held for Investment Purposes
December 31, 1999
<TABLE>
<CAPTION>
Number of
Identify of Issue Shares Cost Fair Value
-------------------------------------------------------------------------------
<S> <C> <C> <C>
SunTrust common collective trusts*:
Stable Asset Fund $ 1,420,511 $ 4,652,091
Classic Investment Grade Bond Fund 1,212,219 1,265,480
Classic Balanced Fund 2,479,454 3,504,817
Classic Capital Appreciation Fund 85,716 85,188
Classic Small Cap Fund 89,508 88,516
Registered investment company funds:
Vanguard Index 500 Fund 3,083,484 5,685,920
Fidelity Advisor Growth Opportunities Fund 1,240,336 1,212,335
Janus Worldwide Fund 641,576 909,066
American Century Value Advisor Fund 61,842 52,558
O'Reilly Automotive, Inc. Stock Fund* 933,152 12,260,640 20,062,772
Participant loans (interest rates ranging from
7.0% to 10.3%) -- 1,366,993
-----------------------
$22,575,286 $38,885,736
=======================
</TABLE>
*Party-in-interest to the Plan
<PAGE>
O'Reilly Automotive, Inc.
Profit Sharing and Savings Plan
EIN #-44-0618012 Plan #-002
Schedule H, Line 4j
Schedule of Reportable Transactions
Year ended December 31, 1999
<TABLE>
<CAPTION>
Identity Current
of Party Cost of Value of Net Gain
Involved Description of Assets Purchases Sales Assets Assets (Loss)
-------------------------------------------------------------------------------------------------------------------------
Category (iii) - Series of transactions in excess of 5% of plan assets
<S> <C> <C> <C> <C> <C> <C>
SunTrust O'Reilly Automotive, Inc. Stock Fund $8,367,497 $ -- $8,367,497 $8,367,497 $ --
SunTrust O'Reilly Automotive, Inc. Stock Fund -- 5,847,805 5,996,602 5,847,805 (148,797)
</TABLE>
There were no category (i), (ii) or (iv) reportable transactions during 1999.
<PAGE>
Consent of Independent Auditors
We consent to the incorporation by reference in the Registration Statement (Form
S-8 No. 33-73892) pertaining to the Profit Sharing and Savings Plan of O'Reilly
Automotive, Inc. of our report dated May 18, 2000, with respect to the financial
statements and schedules of the O'Reilly Automotive, Inc. Profit Sharing and
Savings Plan included in this Annual Report (Form 11-K) for the year ended
December 31, 1999.
By: /s/ Ernst & Young LLP
--------------------------
Ernst & Young LLP
Kansas City, Missouri
June 28, 2000
