AutoZone, Inc. (AZO) Earnings Call Transcript & Summary

Good morning, and thank you for joining us for AutoZone's 2023 Annual Meeting of Shareholders. I'm Bill Rhodes, Chairman, President and CEO, Customer Satisfaction, and I'll be presiding over this meeting. Of course, it would not be an official AutoZone meeting if we didn't start with our cheer and pledge. Ajay Salkar, will you please join us and lead us in the cheer.

A-U-T-O-Z-O-N-E.

Who's the best?

AutoZone.

Who's #1?

The customers, AutoZoners always put customers first. We know our parts and products. Our stores look great. We've got the best merchandise at the right price.

Great job, Ajay. Thank you. Does anyone have an Extra Miler Story to share with us this morning?

Good morning. My name is Tanisha Wellman, Director of Maintenance and Store Setup. This Extra Miler Story comes to us from [ Kevin Patterson ] in Knoxville, Tennessee. "I stopped by the AutoZone store location, 5723 Clinton Highway in Knoxville, Tennessee. Mike is the AutoZoner that helped me. I've been a mechanic for 30 years, and I was very impressed." "Usually, auto parts personnel try to sell you a bunch of stuff, but this man was completely honest. He only tried to give me what I needed. He was both knowledgeable and patient. He helped me work through an obscure problem and was professional, courteous and genuinely cared about his customers. I wish every location has a man like this. Keep up the great work at this store. In fact, the store is clean, well-stocked and I had a genuinely pleasant experience. Great job."

Thank you, Tanisha, for that great story. Now I'll turn the meeting over to Jenna Bedsole, our Senior Vice President, General Counsel and Secretary.

Ms. Cassandra Shedd from Computershare is serving as our independent Inspector of Elections. A complete list of the holders of record of the company's common stock on October 23, 2023, which holders are entitled to vote at this meeting, is available here for inspection. Also, I've received an affidavit of mailing from Computershare stating the notice of the meeting was duly given to stockholders of record as of the close of business on October 23, 2023. Finally, a tabulation of the proxies received from stockholders indicates that more than a majority of the outstanding shares entitled to vote are represented at this meeting, and a quorum is present.

Thanks, Jenna. I hereby call this meeting to order. As a reminder, it's not necessary for stockholders to vote this meeting if they've already voted. If you have not voted, yet voted or would like to change your vote, please raise your hand and a ballot will be provided to you. Before we proceed to the first order of business, I'd like to recognize our senior management team, the AutoZone Executive Committee. Thank you for your leadership in delivering another great year for our customers, AutoZoners, communities and shareholders. I'd also like to publicly thank Grant McGee, Charlie Pleas and Al Saltiel, each of whom will be retiring soon for their tremendous contributions to this company. Also with us today are my fellow director nominees, who I'll be introducing shortly, and Jeff Smith from Ernst & Young LLP, our independent auditor. Additionally, I'd like to take a moment to thank you, our shareholders, for allowing me the honor and privilege to serve as AutoZone's CEO for nearly 19 years. I'm incredibly proud of all that we've accomplished together, and I look forward to the next chapter of success with Phil Daniele serving as AutoZone's fifth CEO. With that, let's proceed to the 4 matters brought before the meeting today. Our first order of business is the election of directors to serve until the next Annual Meeting of Shareholders in 2024. The following directors have been nominated for reelection to the Board, all of whom are current directors and are present at this meeting. Mike George, Linda Goodspeed, Butch Graves, Enderson Guimaraes, Brian Hannasch, Bryan Jordan, Gale King, George Mrkonic, Jill Soltau and myself, Bill Rhodes. The second order of business is the ratification of the appointment of Ernst & Young LLP as the company's independent registered public accounting firm for fiscal 2024. The third order business is a nonbinding advisory vote to approve the compensation of our named executive officers. The fourth and final order of business is a vote on the frequency of the advisory vote on the executive compensation. The Board of Directors unanimously recommends that stockholders vote for each of the director nominees, for Ernst & Young, for the advisory vote on executive compensation and 1 year on the frequency vote. For those stockholders voting at the meeting, please complete your vote now, and we will collect your ballot. [Voting]

I now declare the polls of 2023 Annual Meeting of Shareholders are closed. Jenna, has the Inspector of Elections presented the results?

Yes. The Inspector of Elections has presented her preliminary report. There are present at this meeting in person or by proxy, 15.9 million shares of the company's common stock, representing 91% of the approximate 17.63 million shares deemed to be outstanding as of October 23, 2023. Based on this report, all 10 directors have been re-elected. The appointment of Ernst & Young LLP for fiscal year 2024 has been ratified. The nonbinding advisory vote on executive compensation has been approved and the advisory vote on executive compensation shall be held every year. The final vote results will be filed on a current report on a Form 8-K.

Thank you, Jenna. Since there's no further business, the official business of the meeting is hereby adjourned. At this time, we'd like to open up the floor for any questions. Being none, I'd like to thank our shareholders for your continued confidence in our mission. And I'd like to thank all AutoZoners across the globe for their commitment to providing WOW! Customer Service. Now let's proceed to live the pledge and deliver a great 2024. Please join me as we close it out.