x | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
¨ | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
Missouri | 000-21318 | 27-4358837 | ||
(State or other jurisdiction | Commission file | (I.R.S. Employer | ||
of incorporation or organization) | number | Identification No.) |
Page | |
June 30, 2016 | December 31, 2015 | ||||||
(Unaudited) | (Note) | ||||||
Assets | |||||||
Current assets: | |||||||
Cash and cash equivalents | $ | 398,259 | $ | 116,301 | |||
Accounts receivable, net | 186,192 | 161,078 | |||||
Amounts receivable from suppliers | 78,824 | 72,609 | |||||
Inventory | 2,741,030 | 2,631,015 | |||||
Other current assets | 33,828 | 29,023 | |||||
Total current assets | 3,438,133 | 3,010,026 | |||||
Property and equipment, at cost | 4,587,944 | 4,372,250 | |||||
Less: accumulated depreciation and amortization | 1,608,704 | 1,510,694 | |||||
Net property and equipment | 2,979,240 | 2,861,556 | |||||
Notes receivable, less current portion | — | 13,219 | |||||
Goodwill | 757,130 | 757,142 | |||||
Other assets, net | 36,137 | 34,741 | |||||
Total assets | $ | 7,210,640 | $ | 6,676,684 | |||
Liabilities and shareholders’ equity | |||||||
Current liabilities: | |||||||
Accounts payable | $ | 2,914,641 | $ | 2,608,231 | |||
Self-insurance reserves | 71,177 | 72,741 | |||||
Accrued payroll | 62,596 | 59,101 | |||||
Accrued benefits and withholdings | 59,966 | 72,203 | |||||
Income taxes payable | — | 1,444 | |||||
Other current liabilities | 258,295 | 232,678 | |||||
Total current liabilities | 3,366,675 | 3,046,398 | |||||
Long-term debt | 1,886,324 | 1,390,018 | |||||
Deferred income taxes | 72,961 | 79,772 | |||||
Other liabilities | 194,670 | 199,182 | |||||
Shareholders’ equity: | |||||||
Common stock, $0.01 par value: | |||||||
Authorized shares – 245,000,000 | |||||||
Issued and outstanding shares – | |||||||
94,881,546 as of June 30, 2016, and | |||||||
97,737,171 as of December 31, 2015 | 949 | 977 | |||||
Additional paid-in capital | 1,309,441 | 1,281,497 | |||||
Retained earnings | 379,620 | 678,840 | |||||
Total shareholders’ equity | 1,690,010 | 1,961,314 | |||||
Total liabilities and shareholders’ equity | $ | 7,210,640 | $ | 6,676,684 |
For the Three Months Ended June 30, | For the Six Months Ended June 30, | ||||||||||||||
2016 | 2015 | 2016 | 2015 | ||||||||||||
Sales | $ | 2,176,689 | $ | 2,035,518 | $ | 4,272,839 | $ | 3,937,421 | |||||||
Cost of goods sold, including warehouse and distribution expenses | 1,049,510 | 976,727 | 2,048,081 | 1,891,671 | |||||||||||
Gross profit | 1,127,179 | 1,058,791 | 2,224,758 | 2,045,750 | |||||||||||
Selling, general and administrative expenses | 702,118 | 673,023 | 1,381,071 | 1,309,609 | |||||||||||
Operating income | 425,061 | 385,768 | 843,687 | 736,141 | |||||||||||
Other income (expense): | |||||||||||||||
Interest expense | (18,701 | ) | (14,319 | ) | (33,522 | ) | (28,721 | ) | |||||||
Interest income | 1,193 | 577 | 1,945 | 1,157 | |||||||||||
Other, net | 1,241 | 182 | 2,258 | 1,295 | |||||||||||
Total other expense | (16,267 | ) | (13,560 | ) | (29,319 | ) | (26,269 | ) | |||||||
Income before income taxes | 408,794 | 372,208 | 814,368 | 709,872 | |||||||||||
Provision for income taxes | 151,000 | 138,700 | 301,200 | 263,500 | |||||||||||
Net income | $ | 257,794 | $ | 233,508 | $ | 513,168 | $ | 446,372 | |||||||
Earnings per share-basic: | |||||||||||||||
Earnings per share | $ | 2.69 | $ | 2.32 | $ | 5.31 | $ | 4.42 | |||||||
Weighted-average common shares outstanding – basic | 95,967 | 100,547 | 96,554 | 101,078 | |||||||||||
Earnings per share-assuming dilution: | |||||||||||||||
Earnings per share | $ | 2.65 | $ | 2.29 | $ | 5.24 | $ | 4.35 | |||||||
Weighted-average common shares outstanding – assuming dilution | 97,282 | 102,109 | 97,911 | 102,684 |
For the Six Months Ended June 30, | |||||||
2016 | 2015 | ||||||
Operating activities: | |||||||
Net income | $ | 513,168 | $ | 446,372 | |||
Adjustments to reconcile net income to net cash provided by operating activities: | |||||||
Depreciation and amortization of property, equipment and intangibles | 106,430 | 106,007 | |||||
Amortization of debt discount and issuance costs | 1,173 | 1,051 | |||||
Excess tax benefit from share-based compensation | (30,136 | ) | (32,947 | ) | |||
Deferred income taxes | (6,811 | ) | (15,326 | ) | |||
Share-based compensation programs | 9,853 | 11,304 | |||||
Other | 2,655 | 2,594 | |||||
Changes in operating assets and liabilities: | |||||||
Accounts receivable | (28,837 | ) | (34,199 | ) | |||
Inventory | (110,015 | ) | (6,186 | ) | |||
Accounts payable | 306,410 | 118,804 | |||||
Income taxes payable | 25,170 | 79,172 | |||||
Other | 9,333 | 21,807 | |||||
Net cash provided by operating activities | 798,393 | 698,453 | |||||
Investing activities: | |||||||
Purchases of property and equipment | (220,416 | ) | (186,531 | ) | |||
Proceeds from sale of property and equipment | 1,971 | 1,608 | |||||
Payments received on notes receivable | 1,047 | 1,981 | |||||
Net cash used in investing activities | (217,398 | ) | (182,942 | ) | |||
Financing activities: | |||||||
Proceeds from the issuance of long-term debt | 499,160 | — | |||||
Payment of debt issuance costs | (3,784 | ) | — | ||||
Principal payments on capital leases | — | (25 | ) | ||||
Repurchases of common stock | (856,845 | ) | (574,972 | ) | |||
Excess tax benefit from share-based compensation | 30,136 | 32,947 | |||||
Net proceeds from issuance of common stock | 32,296 | 36,021 | |||||
Net cash used in financing activities | (299,037 | ) | (506,029 | ) | |||
Net increase in cash and cash equivalents | 281,958 | 9,482 | |||||
Cash and cash equivalents at beginning of the period | 116,301 | 250,560 | |||||
Cash and cash equivalents at end of the period | $ | 398,259 | $ | 260,042 | |||
Supplemental disclosures of cash flow information: | |||||||
Income taxes paid | $ | 279,099 | $ | 194,715 | |||
Interest paid, net of capitalized interest | 27,174 | 27,711 |
• | Level 1 – Quoted prices (unadjusted) in active markets for identical assets or liabilities that the reporting entity can access at the measurement date. |
• | Level 2 – Inputs other than quoted prices in active markets included within Level 1 that are observable for the asset or liability, either directly or indirectly. |
• | Level 3 – Unobservable inputs for the asset or liability. |
June 30, 2016 | |||||||||||||||
Quoted Prices in Active Markets for Identical Instruments (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | Total | ||||||||||||
Marketable securities | $ | 18,535 | $ | — | $ | — | $ | 18,535 |
December 31, 2015 | |||||||||||||||
Quoted Prices in Active Markets for Identical Instruments (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | Total | ||||||||||||
Marketable securities | $ | 16,895 | $ | — | $ | — | $ | 16,895 |
June 30, 2016 | December 31, 2015 | ||||||||||||||
Carrying Amount | Estimated Fair Value | Carrying Amount | Estimated Fair Value | ||||||||||||
$500 million, 4.875% Senior Notes due 2021 | $ | 496,354 | $ | 559,895 | $ | 495,951 | $ | 542,078 | |||||||
$300 million, 4.625% Senior Notes due 2021 | 298,537 | 334,048 | 298,396 | 319,620 | |||||||||||
$300 million, 3.800% Senior Notes due 2022 | 297,700 | 324,051 | 297,535 | 303,595 | |||||||||||
$300 million, 3.850% Senior Notes due 2023 | 298,244 | 326,405 | $ | 298,136 | $ | 302,468 | |||||||||
$500 million, 3.550% Senior Notes due 2026 | $ | 495,489 | $ | 531,048 |
June 30, 2016 | December 31, 2015 | ||||||
Revolving Credit Facility | $ | — | $ | — | |||
$500 million, 4.875% Senior Notes due 2021(1), effective interest rate of 4.961% | 496,354 | 495,951 | |||||
$300 million, 4.625% Senior Notes due 2021(2), effective interest rate of 4.647% | 298,537 | 298,396 | |||||
$300 million, 3.800% Senior Notes due 2022(3), effective interest rate of 3.845% | 297,700 | 297,535 | |||||
$300 million, 3.850% Senior Notes due 2023(4), effective interest rate of 3.851% | 298,244 | 298,136 | |||||
$500 million, 3.550% Senior Notes due 2026(5), effective interest rate of 3.570% | 495,489 | — | |||||
Long-term debt | $ | 1,886,324 | $ | 1,390,018 |
(1) | Net of unamortized discount of $1.6 million as of June 30, 2016, and $1.8 million as of December 31, 2015, and debt issuance costs of $2.0 million as of June 30, 2016, and $2.3 million as of December 31, 2015. |
(2) | Net of unamortized discount of $0.3 million as of June 30, 2016, and December 31, 2015, and debt issuance costs of $1.2 million as of June 30, 2016, and $1.3 million as of December 31, 2015. |
(3) | Net of unamortized discount of $0.7 million as of June 30, 2016, and $0.8 million as of December 31, 2015, and debt issuance costs of $1.6 million as of June 30, 2016, and $1.7 million as of December 31, 2015. |
(4) | Net of unamortized discount of less than $0.1 million as of June 30, 2016, and December 31, 2015, and debt issuance costs of $1.7 million as of June 30, 2016, and $1.8 million as of December 31, 2015. |
(5) | Net of unamortized discount of $0.8 million as of June 30, 2016, and debt issuance costs of $3.7 million as of June 30, 2016. |
Warranty liabilities, balance at December 31, 2015 | $ | 35,223 | |
Warranty claims | (34,736 | ) | |
Warranty accruals | 37,550 | ||
Warranty liabilities, balance at June 30, 2016 | $ | 38,037 |
For the Three Months Ended June 30, | For the Six Months Ended June 30, | ||||||||||||||
2016 | 2015 | 2016 | 2015 | ||||||||||||
Shares repurchased | 2,075 | 1,987 | 3,306 | 2,637 | |||||||||||
Average price per share | $ | 262.17 | $ | 221.50 | $ | 259.14 | $ | 218.05 | |||||||
Total investment | $ | 544,165 | $ | 440,129 | $ | 856,802 | $ | 574,932 |
Shares | Weighted-Average Exercise Price | |||||
Outstanding at December 31, 2015 | 3,308 | $ | 80.86 | |||
Granted | 248 | 264.61 | ||||
Exercised | (420 | ) | 62.37 | |||
Forfeited | (40 | ) | 132.55 | |||
Outstanding at June 30, 2016 | 3,096 | $ | 97.43 | |||
Exercisable at June 30, 2016 | 2,229 | $ | 61.18 |
• | Risk-free interest rate – The United States Treasury rates in effect at the time the options are granted for the options’ expected life. |
• |
• | Expected life – Represents the period of time that options granted are expected to be outstanding. The Company uses historical experience to estimate the expected life of options granted. |
• | Expected volatility – Measure of the amount, by which the Company’s stock price is expected to fluctuate, based on a historical trend. |
• | Expected dividend yield – The Company has not paid, nor does it have plans in the foreseeable future to pay, any dividends. |
For the Six Months Ended June 30, | |||||
2016 | 2015 | ||||
Risk free interest rate | 1.52 | % | 1.55 | % | |
Expected life | 5.7 Years | 5.9 Years | |||
Expected volatility | 22.4 | % | 22.4 | % | |
Expected dividend yield | — | % | — | % |
For the Three Months Ended June 30, | For the Six Months Ended June 30, | ||||||||||||||
2016 | 2015 | 2016 | 2015 | ||||||||||||
Compensation expense for stock options awarded | $ | 3,804 | $ | 4,510 | $ | 8,140 | $ | 9,507 | |||||||
Income tax benefit from compensation expense related to stock options | 1,421 | 1,694 | 3,040 | 3,541 |
For the Three Months Ended June 30, | For the Six Months Ended June 30, | ||||||||||||||
2016 | 2015 | 2016 | 2015 | ||||||||||||
Compensation expense for shares issued under the ESPP | $ | 549 | $ | 497 | $ | 1,072 | $ | 987 | |||||||
Income tax benefit from compensation expense related to shares issued under the ESPP | 205 | 187 | 400 | 368 | |||||||||||
Compensation expense for restricted shares awarded | 322 | 407 | 641 | 810 | |||||||||||
Income tax benefit from compensation expense related to restricted awards | $ | 120 | $ | 153 | $ | 239 | $ | 302 |
For the Three Months Ended June 30, | For the Six Months Ended June 30, | ||||||||||||||
2016 | 2015 | 2016 | 2015 | ||||||||||||
Numerator (basic and diluted): | |||||||||||||||
Net income | $ | 257,794 | $ | 233,508 | $ | 513,168 | $ | 446,372 | |||||||
Denominator: | |||||||||||||||
Weighted-average common shares outstanding – basic | 95,967 | 100,547 | 96,554 | 101,078 | |||||||||||
Effect of stock options (1) | 1,315 | 1,562 | 1,357 | 1,606 | |||||||||||
Weighted-average common shares outstanding – assuming dilution | 97,282 | 102,109 | 97,911 | 102,684 | |||||||||||
Earnings per share: | |||||||||||||||
Earnings per share-basic | $ | 2.69 | $ | 2.32 | $ | 5.31 | $ | 4.42 | |||||||
Earnings per share-assuming dilution | $ | 2.65 | $ | 2.29 | $ | 5.24 | $ | 4.35 | |||||||
Antidilutive potential common shares not included in the calculation of diluted earnings per share: | |||||||||||||||
Stock options (1) | 285 | 226 | 312 | 312 | |||||||||||
Weighted-average exercise price per share of antidilutive stock options (1) | $ | 262.49 | $ | 206.72 | $ | 259.46 | $ | 200.65 |
(1) | See Note 6 for further information concerning the terms of the Company’s share-based compensation plans. |
• | an overview of the key drivers of the automotive aftermarket industry; |
• | our liquidity and capital resources; |
• | any contractual obligations to which we are committed; |
• | our critical accounting estimates; |
• | the inflation and seasonality of our business; and |
• | Number of Miles Driven – The number of total miles driven in the U.S. influences the demand for repair and maintenance products sold within the automotive aftermarket. According to the Department of Transportation, prior to 2007, the annual number of total miles driven in the U.S. had steadily increased; however, between 2008 and 2013, as the U.S. experienced difficult macroeconomic conditions and historically high levels of unemployment, the number of total miles driven in the U.S. remained relatively flat. In 2014, as the U.S. economy began to recover, miles driven also improved increasing 1.7%, and for 2015, miles driven increased 3.5%. Through May of 2016, year-to-date miles driven increased 3.3%. In total, vehicles in the U.S. are driven approximately three trillion miles per year, resulting in ongoing wear and tear and continued demand for the repair and maintenance products sold within the automotive aftermarket. We believe that as total employment continues to improve, total miles driven in the U.S. should continue to increase in line with the historical trend of long-term annual growth. |
• | Number of U.S. Registered Vehicles, New Light Vehicle Registrations and Average Vehicle Age – The total number of vehicles on the road and the average age of the vehicle population heavily influence the demand for products sold within the automotive aftermarket industry. As reported by The Auto Care Association, the total number of registered vehicles increased 6% from 2005 to 2015, bringing the number of light vehicles on the road to 258 million by the end of 2015. For the year ended December 31, 2015, the seasonally adjusted annual rate of light vehicle sales in the U.S. (“SAAR”) was approximately 17 million, and for 2016, the SAAR is estimated to again be approximately 17 million, contributing to the continued growth in the total number of registered vehicles on the road. In the past decade, vehicle scrappage rates have remained relatively stable, ranging from 4.4% to 5.7% annually. As a result, over the past decade, the average age of the U.S. vehicle population has increased, growing 22%, from 9.4 years in 2005 to 11.5 years in 2015. We believe this increase in average age can be attributed to better engineered and manufactured vehicles, which can be reliably driven at higher mileages due to better quality power trains and interiors and exteriors, and the consumer’s willingness to invest in maintaining these higher-mileage, better built vehicles. As the average age of the vehicle on the road increases, a larger percentage of miles are being driven by vehicles that are outside of a manufacturer warranty. These out-of-warranty, older vehicles generate strong demand for automotive aftermarket products as they go through more routine maintenance cycles, have more frequent mechanical failures and generally require more maintenance than newer vehicles. We believe consumers will continue to invest in these reliable, higher-quality, higher-mileage vehicles and these investments, along with an increasing total light vehicle fleet, will support continued demand for automotive aftermarket products. |
• | Unemployment – Unemployment, underemployment, the threat of future joblessness and the uncertainty surrounding the overall economic health of the U.S. have a negative impact on consumer confidence and the level of consumer discretionary spending. Long-term trends of high unemployment have historically impeded the growth of annual miles driven, as well as decrease consumer discretionary spending, both of which negatively impact demand for products sold in the automotive aftermarket industry. As of December 31, 2015, the U.S. unemployment rate was 5.0%, and as of June 30, 2016, the U.S. unemployment rate decreased to 4.9%. We believe total employment should continue to increase, and we would expect to see a corresponding increase in commuter traffic as unemployed individuals return to work, further aiding the positive long-term trend of growth of total miles driven in the U.S. and demand for automotive aftermarket products. |
Increase in Sales for the Three Months Ended June 30, 2016, Compared to the Same Period in 2015 | Increase in Sales for the Six Months Ended June 30, 2016, Compared to the Same Period in 2015 | ||||||
Store sales: | |||||||
Comparable store sales | $ | 85 | $ | 198 | |||
Non-comparable store sales: | |||||||
Sales for stores opened throughout 2015, excluding stores open at least one year that are included in comparable store sales | 37 | 83 | |||||
Sales for stores opened throughout 2016 | 19 | 25 | |||||
Sales from Leap Day | — | 24 | |||||
Sales in 2015 for stores that have closed | (1 | ) | (2 | ) | |||
Non-store sales: | |||||||
Includes sales of machinery and sales to independent parts stores and Team Members | 1 | 7 | |||||
Total increase in sales | $ | 141 | $ | 335 |
For the Six Months Ended June 30, | |||||||
Liquidity: | 2016 | 2015 | |||||
Total cash provided by/(used in): | |||||||
Operating activities | $ | 798,393 | $ | 698,453 | |||
Investing activities | (217,398 | ) | (182,942 | ) | |||
Financing activities | (299,037 | ) | (506,029 | ) | |||
Net increase in cash and cash equivalents | $ | 281,958 | $ | 9,482 | |||
Capital expenditures | $ | 220,416 | $ | 186,531 | |||
Free cash flow (1) | 577,977 | 511,922 |
(1) | Calculated as net cash provided by operating activities, less capital expenditures for the period. |
For the Twelve Months Ended June 30, | |||||||
2016 | 2015 | ||||||
GAAP net income | $ | 998,012 | $ | 845,047 | |||
Add: Interest expense | 61,930 | 55,783 | |||||
Rent expense | 277,088 | 268,944 | |||||
Provision for income taxes | 566,850 | 487,249 | |||||
Depreciation expense | 208,782 | 198,996 | |||||
Amortization expense | 1,897 | 6,212 | |||||
Non-cash share-based compensation | 20,448 | 22,262 | |||||
Non-GAAP EBITDAR | $ | 2,135,007 | $ | 1,884,493 | |||
Interest expense | $ | 61,930 | $ | 55,783 | |||
Capitalized interest | 7,860 | 8,887 | |||||
Rent expense | 277,088 | 268,944 | |||||
Total fixed charges | $ | 346,878 | $ | 333,614 | |||
Consolidated fixed charge coverage ratio | 6.15 | 5.65 | |||||
GAAP debt (1) | $ | 1,886,324 | $ | 1,389,205 | |||
Stand-by letters of credit | 39,010 | 50,506 | |||||
Discount on senior notes | 3,441 | 3,132 | |||||
Debt issuance costs | 10,235 | 7,663 | |||||
Six-times rent expense | 1,662,528 | 1,613,664 | |||||
Non-GAAP adjusted debt | $ | 3,601,538 | $ | 3,064,170 | |||
Consolidated leverage ratio | 1.69 | 1.63 |
(1) | Prior period amount has been reclassified to conform to current period presentation, due to the Company’s adoption of new accounting standards during the fourth quarter ended December 31, 2015. See Note 1 “Summary of Significant Accounting Policies” to the Consolidated Financial Statements of the Annual Report on Form 10-K for the year ended December 31, 2015. |
For the Three Months Ended June 30, | For the Six Months Ended June 30, | ||||||||||||||
2016 | 2015 | 2016 | 2015 | ||||||||||||
Shares repurchased | 2,075 | 1,987 | 3,306 | 2,637 | |||||||||||
Average price per share | $ | 262.17 | $ | 221.50 | $ | 259.14 | $ | 218.05 | |||||||
Total investment | $ | 544,165 | $ | 440,129 | $ | 856,802 | $ | 574,932 |
Period | Total Number of Shares Purchased | Average Price Paid per Share | Total Number of Shares Purchased as Part of Publicly Announced Programs | Maximum Dollar Value of Shares that May Yet Be Purchased Under the Programs (1) | ||||||||||
April 1, 2016, through April 30, 2016 | 292 | $ | 270.54 | 292 | $ | 501,441 | ||||||||
May 1, 2016, through May 31, 2016 | 1,054 | 259.97 | 1,054 | 977,524 | ||||||||||
June 1, 2016, through June 30, 2016 | 729 | 261.98 | 729 | $ | 786,394 | |||||||||
Total as of June 30, 2016 | 2,075 | $ | 262.17 | 2,075 |
(1) | Under the Company’s share repurchase program, as approved by its Board of Directors, the Company may, from time to time, repurchase shares of its common stock, solely through open market purchases effected through a broker dealer at prevailing market prices, based on a variety of factors such as price, corporate trading policy requirements and overall market conditions. The Company’s Board of Directors may increase or otherwise modify, renew, suspend or terminate the share repurchase program at any time, without prior notice. As announced on February 10, 2016, and May 27, 2016, the Company’s Board of Directors each time approved a resolution to increase the authorization amount under the share repurchase program by an additional $750 million, resulting in a cumulative authorization amount of $7.0 billion. Each additional $750 million authorization is effective for a three-year period, beginning on its respective announcement date. The authorizations under the share repurchase program that currently have capacity are scheduled to expire on February 10, 2019, and May 27, 2019. No other share repurchase programs existed during the six months ended June 30, 2016. |
Exhibit No. | Description |
3.1 | Amended and Restated Articles of Incorporation of the Registrant, filed as Exhibit 3.1 to the Registrant's Current Report on Form 8-K dated May 9, 2013, is incorporated herein by this reference. |
3.2 | Amended and Restated Bylaws of the Registrant, filed as Exhibit 3.1 to the Registrant's Current Report on Form 8-K dated August 13, 2014, is incorporated herein by this reference. |
4.1 | Indenture, dated as of March 8, 2016, by and among O'Reilly Automotive, Inc., the subsidiaries party thereto as guarantors, and UMB, Bank, N.A., as Trustee, filed as Exhibit 4.1 to the Registrant's Current Report on Form 8-K dated March 8, 2016, is incorporated herein by this reference. |
4.2 | Supplemental Indenture, dated as of March 8, 2016, by and among O'Reilly Automotive, Inc., the subsidiaries party thereto as guarantors, and UMB, Bank, N.A., as Trustee, filed as Exhibit 4.2 to the Registrant's Current Report on Form 8-K dated March 8, 2016, is incorporated herein by this reference. |
4.3 | Form of 3.550% Note due 2026, included in Exhibit 4.2 to the Registrant's Current Report on Form 8-K dated March 8, 2016, is incorporated herein by this reference. |
31.1 | Certificate of the Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002, filed herewith. |
31.2 | Certificate of the Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002, filed herewith. |
32.1 * | Certificate of the Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, furnished herewith. |
32.2 * | Certificate of the Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, furnished herewith. |
101.INS | XBRL Instance Document |
101.SCH | XBRL Taxonomy Extension Schema |
101.CAL | XBRL Taxonomy Extension Calculation Linkbase |
101.DEF | XBRL Taxonomy Extension Definition Linkbase |
101.LAB | XBRL Taxonomy Extension Label Linkbase |
101.PRE | XBRL Taxonomy Extension Presentation Linkbase |
* | Furnished (and not filed) herewith pursuant to Item 601 (b)(32)(ii) of Regulation S-K. |
O’REILLY AUTOMOTIVE, INC. | |||
August 8, 2016 | /s/ | Greg L. Henslee | |
Date | Greg L. Henslee | ||
President and Chief Executive Officer | |||
(Principal Executive Officer) | |||
August 8, 2016 | /s/ | Thomas McFall | |
Date | Thomas McFall | ||
Executive Vice President of Finance and Chief Financial Officer | |||
(Principal Financial and Accounting Officer) |
Exhibit No. | Description |
3.1 | Amended and Restated Articles of Incorporation of the Registrant, filed as Exhibit 3.1 to the Registrant's Current Report on Form 8-K dated May 9, 2013, is incorporated herein by this reference. |
3.2 | Amended and Restated Bylaws of the Registrant, filed as Exhibit 3.1 to the Registrant's Current Report on Form 8-K dated August 13, 2014, is incorporated herein by this reference. |
4.1 | Indenture, dated as of March 8, 2016, by and among O'Reilly Automotive, Inc., the subsidiaries party thereto as guarantors, and UMB, Bank, N.A., as Trustee, filed as Exhibit 4.1 to the Registrant's Current Report on Form 8-K dated March 8, 2016, is incorporated herein by this reference. |
4.2 | Supplemental Indenture, dated as of March 8, 2016, by and among O'Reilly Automotive, Inc., the subsidiaries party thereto as guarantors, and UMB, Bank, N.A., as Trustee, filed as Exhibit 4.2 to the Registrant's Current Report on Form 8-K dated March 8, 2016, is incorporated herein by this reference. |
4.3 | Form of 3.550% Note due 2026, included in Exhibit 4.2 to the Registrant's Current Report on Form 8-K dated March 8, 2016, is incorporated herein by this reference. |
31.1 | Certificate of the Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002, filed herewith. |
31.2 | Certificate of the Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002, filed herewith. |
32.1 * | Certificate of the Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, furnished herewith. |
32.2 * | Certificate of the Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, furnished herewith. |
101.INS | XBRL Instance Document |
101.SCH | XBRL Taxonomy Extension Schema |
101.CAL | XBRL Taxonomy Extension Calculation Linkbase |
101.DEF | XBRL Taxonomy Extension Definition Linkbase |
101.LAB | XBRL Taxonomy Extension Label Linkbase |
101.PRE | XBRL Taxonomy Extension Presentation Linkbase |
* | Furnished (and not filed) herewith pursuant to Item 601 (b)(32)(ii) of Regulation S-K. |
1. | I have reviewed this report on Form 10-Q of O’Reilly Automotive, Inc.; |
2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; |
4. | The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have: |
(a) | Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; |
(b) | Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; |
(c) | Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and |
(d) | Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and |
5. | The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions): |
(a) | All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and |
(b) | Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting. |
Date: August 8, 2016 | /s/ | Greg L. Henslee |
Greg L. Henslee | ||
President and Chief Executive Officer (Principal Executive Officer) |
1. | I have reviewed this report on Form 10-Q of O’Reilly Automotive, Inc.; |
2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; |
4. | The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have: |
(a) | Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; |
(b) | Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; |
(c) | Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and |
(d) | Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and |
5. | The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions): |
(a) | All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and |
(b) | Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting. |
Date: August 8, 2016 | /s/ | Thomas McFall |
Thomas McFall | ||
Executive Vice President of Finance and Chief Financial Officer (Principal Financial and Accounting Officer) |
(1) | The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and |
(2) | The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company. |
/s/ | Greg L. Henslee |
Greg L. Henslee | |
Chief Executive Officer |
(1) | The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and |
(2) | The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company. |
/s/ | Thomas McFall |
Thomas McFall | |
Chief Financial Officer |
Document and Entity Information - shares |
6 Months Ended | |
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Jun. 30, 2016 |
Aug. 01, 2016 |
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Document and Entity Information | ||
Document type | 10-Q | |
Amendment flag | false | |
Document period end date | Jun. 30, 2016 | |
Document fiscal year focus | 2016 | |
Current fiscal year end date | --12-31 | |
Document fiscal period focus | Q2 | |
Entity registrant name | O REILLY AUTOMOTIVE INC | |
Entity central index key | 0000898173 | |
Entity filer category | Large Accelerated Filer | |
Entity common stock, shares outstanding | 94,927,731 |
Condensed Consolidated Balance Sheets - USD ($) $ in Thousands |
Jun. 30, 2016 |
Dec. 31, 2015 |
[1] | ||
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Assets | |||||
Cash and cash equivalents | $ 398,259 | $ 116,301 | |||
Accounts receivable, net | 186,192 | 161,078 | |||
Amounts receivable from suppliers | 78,824 | 72,609 | |||
Inventory | 2,741,030 | 2,631,015 | |||
Other current assets | 33,828 | 29,023 | |||
Total current assets | 3,438,133 | 3,010,026 | |||
Property and equipment, at cost | 4,587,944 | 4,372,250 | |||
Less: accumulated depreciation and amortization | 1,608,704 | 1,510,694 | |||
Net property and equipment | 2,979,240 | 2,861,556 | |||
Notes receivable, less current portion | 0 | 13,219 | |||
Goodwill | 757,130 | 757,142 | |||
Other assets, net | 36,137 | 34,741 | |||
Total assets | 7,210,640 | 6,676,684 | |||
Liabilities and shareholders' equity | |||||
Accounts payable | 2,914,641 | 2,608,231 | |||
Self-insurance reserves | 71,177 | 72,741 | |||
Accrued payroll | 62,596 | 59,101 | |||
Accrued benefits and withholdings | 59,966 | 72,203 | |||
Income taxes payable | 0 | 1,444 | |||
Other current liabilities | 258,295 | 232,678 | |||
Total current liabilities | 3,366,675 | 3,046,398 | |||
Long-term debt | 1,886,324 | 1,390,018 | |||
Deferred income taxes | 72,961 | 79,772 | |||
Other liabilities | 194,670 | 199,182 | |||
Shareholders' equity: | |||||
Common stock, $0.01 par value: Authorized shares - 245,000,000; Issued and outstanding shares - 94,881,546 as of June 30, 2016, and 97,737,171 as of December 31, 2015 | 949 | 977 | |||
Additional paid-in capital | 1,309,441 | 1,281,497 | |||
Retained earnings | 379,620 | 678,840 | |||
Total shareholders' equity | 1,690,010 | 1,961,314 | |||
Total liabilities and shareholders' equity | $ 7,210,640 | $ 6,676,684 | |||
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Condensed Consolidated Balance Sheets (Parenthetical) - $ / shares |
Jun. 30, 2016 |
Dec. 31, 2015 |
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Statement of Financial Position [Abstract] | ||
Common stock, par value | $ 0.01 | $ 0.01 |
Common stock, shares authorized | 245,000,000 | 245,000,000 |
Common stock, shares issued | 94,881,546 | 97,737,171 |
Common stock, shares outstanding | 94,881,546 | 97,737,171 |
Condensed Consolidated Statements of Income - USD ($) shares in Thousands, $ in Thousands |
3 Months Ended | 6 Months Ended | ||
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Jun. 30, 2016 |
Jun. 30, 2015 |
Jun. 30, 2016 |
Jun. 30, 2015 |
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Income Statement [Abstract] | ||||
Sales | $ 2,176,689 | $ 2,035,518 | $ 4,272,839 | $ 3,937,421 |
Cost of goods sold, including warehouse and distribution expenses | 1,049,510 | 976,727 | 2,048,081 | 1,891,671 |
Gross profit | 1,127,179 | 1,058,791 | 2,224,758 | 2,045,750 |
Selling, general and administrative expenses | 702,118 | 673,023 | 1,381,071 | 1,309,609 |
Operating income | 425,061 | 385,768 | 843,687 | 736,141 |
Other income (expense): | ||||
Interest expense | (18,701) | (14,319) | (33,522) | (28,721) |
Interest income | 1,193 | 577 | 1,945 | 1,157 |
Other, net | 1,241 | 182 | 2,258 | 1,295 |
Total other expense | (16,267) | (13,560) | (29,319) | (26,269) |
Income before income taxes | 408,794 | 372,208 | 814,368 | 709,872 |
Provision for income taxes | 151,000 | 138,700 | 301,200 | 263,500 |
Net income | $ 257,794 | $ 233,508 | $ 513,168 | $ 446,372 |
Earnings per share-basic: | ||||
Earnings per share - basic | $ 2.69 | $ 2.32 | $ 5.31 | $ 4.42 |
Weighted-average common shares outstanding - basic | 95,967 | 100,547 | 96,554 | 101,078 |
Earnings per share-assuming dilution: | ||||
Earnings per share - assuming dilution | $ 2.65 | $ 2.29 | $ 5.24 | $ 4.35 |
Weighted-average common shares outstanding - assuming dilution | 97,282 | 102,109 | 97,911 | 102,684 |
Basis of Presentation |
6 Months Ended |
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Jun. 30, 2016 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of presentation | NOTE 1 - BASIS OF PRESENTATION The accompanying unaudited condensed consolidated financial statements of O’Reilly Automotive, Inc. and its subsidiaries (the “Company” or “O’Reilly”) have been prepared in accordance with United States generally accepted accounting principles (“U.S. GAAP”) for interim financial information and the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. Operating results for the three and six months ended June 30, 2016, are not necessarily indicative of the results that may be expected for the year ended December 31, 2016. For further information, refer to the consolidated financial statements and footnotes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2015. |
Fair Value Measurements |
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Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Fair value measurements | NOTE 2 – FAIR VALUE MEASUREMENTS The Company uses the fair value hierarchy, which prioritizes the inputs used to measure the fair value of certain of its financial instruments. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurement) and the lowest priority to unobservable inputs (Level 3 measurement). The Company uses the income and market approaches to determine the fair value of its assets and liabilities. The three levels of the fair value hierarchy are set forth below:
Financial assets and liabilities measured at fair value on a recurring basis: The Company invests in various marketable securities with the intention of selling these securities to fulfill its future unsecured obligation under the Company’s nonqualified deferred compensation plan, see Note 6 for further information concerning the Company’s benefit plans. The Company’s marketable securities were accounted for as trading securities and the carrying amount of its marketable securities were included in “Other assets, net” on the accompanying Condensed Consolidated Balance Sheets as of June 30, 2016, and December 31, 2015. The Company recorded an increase in fair value related to its marketable securities in the amounts of $0.4 million and less than $0.1 million for the three months ended June 30, 2016 and 2015, respectively, which were included in “Other income (expense)” on the accompanying Condensed Consolidated Statements of Income. The Company recorded an increase in fair value related to its marketable securities in the amounts of $0.5 million and $0.4 million for the six months ended June 30, 2016 and 2015, respectively, which were included in “Other income (expense)” on the accompanying Condensed Consolidated Statements of Income. The tables below identify the estimated fair value of the Company’s marketable securities, determined by reference to quoted market prices (Level 1), as of June 30, 2016, and December 31, 2015 (in thousands):
Non-financial assets and liabilities measured at fair value on a nonrecurring basis: Certain long-lived non-financial assets and liabilities may be required to be measured at fair value on a nonrecurring basis in certain circumstances, including when there is evidence of impairment. These non-financial assets and liabilities may include assets acquired in a business combination or property and equipment that are determined to be impaired. As of June 30, 2016, and December 31, 2015, the Company did not have any non-financial assets or liabilities that had been measured at fair value subsequent to initial recognition. Fair value of financial instruments: The carrying amounts of the Company’s senior notes are included in “Long-term debt” on the accompanying Condensed Consolidated Balance Sheets as of June 30, 2016, and December 31, 2015. See Note 3 for further discussion on the Company’s senior notes. The table below identifies the estimated fair value of the Company’s senior notes, using the market approach. The fair values as of June 30, 2016, and December 31, 2015, were determined by reference to quoted market prices of the same or similar instruments (Level 2) (in thousands):
The accompanying Condensed Consolidated Balance Sheets include other financial instruments, including cash and cash equivalents, accounts receivable, amounts receivable from suppliers and accounts payable. Due to the short-term nature of these financial instruments, the Company believes that the carrying values of these instruments approximate their fair values. |
Financing |
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Jun. 30, 2016 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Debt Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Financing | NOTE 3 – FINANCING The following table identifies the amounts included in “Long-term debt” on the accompanying Condensed Consolidated Balance Sheets as of June 30, 2016, and December 31, 2015 (in thousands):
Unsecured revolving credit facility: On January 14, 2011, the Company entered into a credit agreement, as amended by Amendment No. 1 dated as of September 9, 2011, and as further amended by Amendment No. 2 dated as of July 2, 2013, and as further amended by Amendment No. 3 dated as of June 18, 2015 (the “Credit Agreement”). The Credit Agreement provides for a $600 million unsecured revolving credit facility (the “Revolving Credit Facility”) arranged by Bank of America, N.A., which is scheduled to mature in July 2018. The Credit Agreement includes a $200 million sub-limit for the issuance of letters of credit and a $75 million sub-limit for swing line borrowings under the Revolving Credit Facility. As described in the Credit Agreement governing the Revolving Credit Facility, the Company may, from time to time, subject to certain conditions, increase the aggregate commitments under the Revolving Credit Facility by up to $200 million. As of June 30, 2016, and December 31, 2015, the Company had outstanding letters of credit, primarily to support obligations related to workers’ compensation, general liability and other insurance policies, in the amounts of $39.0 million and $37.5 million, respectively, reducing the aggregate availability under the Revolving Credit Facility by those amounts. As of June 30, 2016, and December 31, 2015, the Company had no outstanding borrowings under the Revolving Credit Facility. Borrowings under the Revolving Credit Facility (other than swing line loans) bear interest, at the Company’s option, at the Base Rate or Eurodollar Rate (both as defined in the Credit Agreement) plus an applicable margin. Swing line loans made under the Revolving Credit Facility bear interest at the Base Rate plus the applicable margin for Base Rate loans. In addition, the Company pays a facility fee on the aggregate amount of the commitments in an amount equal to a percentage of such commitments. The interest rate margins and facility fee are based upon the better of the ratings assigned to the Company’s debt by Moody’s Investor Service, Inc. and Standard & Poor’s Ratings Services, subject to limited exceptions. As of June 30, 2016, based upon the Company’s credit ratings, its margin for Base Rate loans was 0.000%, its margin for Eurodollar Rate loans was 0.875% and its facility fee was 0.125%. The Credit Agreement contains certain covenants, including limitations on indebtedness, a minimum consolidated fixed charge coverage ratio of 2.50 times, and a maximum consolidated leverage ratio of 3.00 times. The consolidated leverage ratio includes a calculation of adjusted debt to earnings before interest, taxes, depreciation, amortization, rent and non-cash share-based compensation expense. Adjusted debt includes outstanding debt, outstanding stand-by letters of credit and similar instruments, six-times rent expense and excludes any premium or discount recorded in conjunction with the issuance of long-term debt. In the event that the Company should default on any covenant contained within the Credit Agreement, certain actions may be taken, including, but not limited to, possible termination of commitments, immediate payment of outstanding principal amounts plus accrued interest and other amounts payable under the Credit Agreement and litigation from lenders. As of June 30, 2016, the Company remained in compliance with all covenants under the Credit Agreement. Senior notes: On March 8, 2016, the Company issued $500 million aggregate principal amount of unsecured 3.550% Senior Notes due 2026 (“3.550% Senior Notes due 2026”) at a price to the public of 99.832% of their face value under its shelf registration statement with United Missouri Bank, N.A. (“UMB”) as trustee. Interest on the 3.550% Senior Notes due 2026 is payable on March 15 and September 15 of each year, beginning on September 15, 2016, and is computed on the basis of a 360-day year. The Company has issued a cumulative $1.9 billion aggregate principal amount of unsecured senior notes, which are due between January 2021 and March 2026, with UMB as trustee. Interest on the senior notes, ranging from 3.550% to 4.875%, is payable semi-annually and is computed on the basis of a 360-day year. The senior notes are guaranteed on a senior unsecured basis by each of the Company’s subsidiaries (“Subsidiary Guarantors”) that incurs or guarantees obligations under the Company’s Credit Agreement or under other credit facility or capital markets debt of the Company’s or any of the Company’s Subsidiary Guarantors. The guarantees are joint and several and full and unconditional, subject to certain customary automatic release provisions, including release of the Subsidiary Guarantor’s guarantee under the Company’s Credit Agreement and certain other debt, or, in certain circumstances, the sale or other disposition of a majority of the voting power of the capital interest in, or of all or substantially all of the property of, the Subsidiary Guarantor. Each of the Subsidiary Guarantors is 100% owned, directly or indirectly, by the Company, and the Company has no independent assets or operations other than those of its subsidiaries. The only direct or indirect subsidiaries of the Company that would not be Subsidiary Guarantors would be minor subsidiaries. Neither the Company, nor any of its Subsidiary Guarantors, is subject to any material or significant restrictions on the Company’s ability to obtain funds from its subsidiaries by dividend or loan or to transfer assets from such subsidiaries, except as provided by applicable law. Each of the senior notes is subject to certain customary covenants, with which the Company complied as of June 30, 2016. |
Warranties |
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Product Warranties Disclosures [Abstract] | |||||||||||||||||||||||||
Warranties | NOTE 4 – WARRANTIES The Company provides warranties on certain merchandise it sells with warranty periods ranging from 30 days to limited lifetime warranties. The risk of loss arising from warranty claims is typically the obligation of the Company’s suppliers. Certain suppliers provide upfront allowances to the Company in lieu of accepting the obligation for warranty claims. For this merchandise, when sold, the Company bears the risk of loss associated with the cost of warranty claims. Differences between supplier allowances received by the Company in lieu of warranty obligations and estimated warranty expense are recorded as an adjustment to cost of sales. Estimated warranty costs, which are recorded as obligations at the time of sale, are based on the historical failure rate of each individual product line. The Company’s historical experience has been that failure rates are relatively consistent over time and that the ultimate cost of warranty claims to the Company has been driven by volume of units sold as opposed to fluctuations in failure rates or the variation of the cost of individual claims. The Company’s product warranty liabilities are included in “Other current liabilities” on the accompanying Condensed Consolidated Balance Sheets as of June 30, 2016, and December 31, 2015. The following table identifies the changes in the Company’s aggregate product warranty liabilities for the six months ended June 30, 2016 (in thousands):
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Share Repurchase Program |
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Share repurchase program | NOTE 5 – SHARE REPURCHASE PROGRAM In January of 2011, the Company’s Board of Directors approved a share repurchase program. Under the program, the Company may, from time to time, repurchase shares of its common stock, solely through open market purchases effected through a broker dealer at prevailing market prices, based on a variety of factors such as price, corporate trading policy requirements and overall market conditions. The Company’s Board of Directors may increase or otherwise modify, renew, suspend or terminate the share repurchase program at any time, without prior notice. As announced on February 10, 2016, and May 27, 2016, the Company’s Board of Directors each time approved a resolution to increase the authorization amount under the share repurchase program by an additional $750 million, resulting in a cumulative authorization amount of $7.0 billion. Each additional authorization is effective for a three-year period, beginning on its respective announcement date. The following table identifies shares of the Company’s common stock that have been repurchased as part of the Company’s publicly announced share repurchase program (in thousands, except per share data):
As of June 30, 2016, the Company had $786.4 million remaining under its share repurchase program. Subsequent to the end of the second quarter and through August 8, 2016, the Company repurchased less than 0.1 million shares of its common stock under its share repurchase program, at an average price of $277.44, for a total investment of $8.3 million. The Company has repurchased a total of 54.6 million shares of its common stock under its share repurchase program since the inception of the program in January of 2011 and through August 8, 2016, at an average price of $113.98, for a total aggregate investment of $6.2 billion. |
Share-Based Compensation and Benefit Plans |
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Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Share-based compensation and benefit plans | NOTE 6 – SHARE-BASED COMPENSATION AND BENEFIT PLANS The Company recognizes share-based compensation expense based on the fair value of the grants, awards or shares at the time of the grant, award or issuance. Share-based compensation includes stock option awards issued under the Company’s employee incentive plans and director stock plan, restricted stock awarded under the Company’s employee incentive plans, performance incentive plan and director stock plan, stock issued through the Company’s employee stock purchase plan and stock awarded to employees through other benefit programs. Stock options: The Company’s stock-based incentive plans provide for the granting of stock options for the purchase of common stock of the Company to directors and certain key employees of the Company. Options are granted at an exercise price that is equal to the closing market price of the Company’s common stock on the date of the grant. Director options granted under the plans expire after seven years and are fully vested after six months. Employee options granted under the plans expire after ten years and typically vest 25% per year, over four years. The Company records compensation expense for the grant date fair value of the option awards, adjusted for estimated forfeitures, evenly over the vesting period or the minimum required service period. The table below identifies stock option activity under these plans during the six months ended June 30, 2016 (in thousands, except per share data):
The fair value of each stock option award is estimated on the date of the grant using the Black-Scholes option pricing model. The Black-Scholes model requires the use of assumptions, including the risk free rate, expected life, expected volatility and expected dividend yield.
The table below identifies the weighted-average assumptions used for grants awarded during the six months ended June 30, 2016 and 2015:
The Company’s forfeiture rate is the estimated percentage of options awarded that are expected to be forfeited or canceled prior to becoming fully vested. The Company’s estimate is evaluated periodically and is based upon historical experience at the time of evaluation and reduces expense ratably over the vesting period or the minimum required service period. The following table summarizes activity related to stock options awarded by the Company for the three and six months ended June 30, 2016 and 2015 (in thousands, except per share data):
The weighted-average grant-date fair value of options granted during the six months ended June 30, 2016, was $65.18 compared to $51.61 for the six months ended June 30, 2015. The remaining unrecognized compensation expense related to unvested stock option awards at June 30, 2016, was $31.0 million, and the weighted-average period of time, over which this cost will be recognized, is 2.9 years. Other share-based compensation plans: The Company sponsors other share-based compensation plans: an employee stock purchase plan (the “ESPP”), which permits all eligible employees to purchase shares of the Company’s common stock at 85% of the fair market value; a performance incentive plan, which provides for the award of shares of restricted stock to its corporate and senior management, that vest evenly over a three-year period and are held in escrow until such vesting has occurred; and a director stock plan, which provides for the award of shares of restricted stock to the Company’s independent directors, that vest evenly over a three-year period and are held in escrow until such vesting has occurred. The fair value of shares issued under the ESPP is based on the average of the high and low market prices of the Company’s common stock during the offering periods, and compensation expense is recognized based on the discount between the fair value and the employee purchase price for the shares sold to employees. The fair value of shares awarded under restricted stock plans is based on the closing market price of the Company’s common stock on the date of the award, and compensation expense is recorded evenly over the vesting period or the minimum required service period. The table below summarizes activity related to the Company’s other share-based compensation plans for the three and six months ended June 30, 2016 and 2015 (in thousands):
Profit sharing and savings plan: The Company sponsors a contributory profit sharing and savings plan (the “401(k) Plan”) that covers substantially all employees who are at least 21 years of age and have completed one year of service. The Company makes matching contributions equal to 100% of the first 2% of each employee’s wages that are contributed and 25% of the next 4% of each employee’s wages that are contributed. An employee generally must be employed on December 31 to receive that year’s Company matching contribution, with the matching contribution funded annually at the beginning of the subsequent year following the year in which the matching contribution was earned. The Company may also make additional discretionary profit sharing contributions to the plan on an annual basis as determined by the Board of Directors. The Company did not make any discretionary contributions to the 401(k) Plan during the three or six months ended June 30, 2016 or 2015. The Company expensed matching contributions under the 401(k) Plan in the amounts of $5.5 million and $4.4 million for the three months ended June 30, 2016 and 2015, respectively, which was included in “Selling, general and administrative expenses” on the accompanying Condensed Consolidated Statements of Income. The Company expensed matching contributions under the 401(k) Plan in the amounts of $10.5 million and $8.7 million for the six months ended June 30, 2016 and 2015, respectively, which was included in “Selling, general and administrative expenses” on the accompanying Condensed Consolidated Statements of Income. Nonqualified deferred compensation plan: The Company sponsors a nonqualified deferred compensation plan (the “Deferred Compensation Plan”) for highly compensated employees whose contributions to the 401(k) Plan are limited due to the application of the annual limitations under the Internal Revenue Code. The Deferred Compensation Plan provides these employees with the opportunity to defer the full 6% of matched compensation, including salary and incentive based compensation, that was precluded under the Company’s 401(k) Plan, which is then matched by the Company using the same formula as the 401(k) Plan. An employee generally must be employed on December 31 to receive that year’s Company matching contribution, with the matching contribution funded annually at the beginning of the subsequent year following the year in which the matching contribution was earned. In the event of bankruptcy, the assets of this plan are available to satisfy the claims of general creditors. The Company has an unsecured obligation to pay, in the future, the value of the deferred compensation and Company match adjusted to reflect the performance, whether positive or negative, of selected investment measurement options chosen by each participant during the deferral period. The liability for compensation deferred under the Deferred Compensation Plan was $18.5 million and $16.9 million as of June 30, 2016, and December 31, 2015, respectively, and was included in “Other liabilities” on the accompanying Condensed Consolidated Balance Sheets. The Company expensed matching contributions under the Deferred Compensation Plan in the amount of less than $0.1 million for each of the three months ended June 30, 2016 and 2015, which was included in “Selling, general and administrative expenses” on the accompanying Condensed Consolidated Statements of Income. The Company expensed matching contributions under the Deferred Compensation Plan in the amount of $0.1 million for each of the six months ended June 30, 2016 and 2015, which was included in “Selling, general and administrative expenses” on the accompanying Condensed Consolidated Statements of Income. |
Earnings Per Share |
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Earnings Per Share [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Earnings per share | NOTE 7 – EARNINGS PER SHARE The following table illustrates the computation of basic and diluted earnings per share for the three and six months ended June 30, 2016 and 2015 (in thousands, except per share data):
For the three and six months ended June 30, 2016 and 2015, the computation of diluted earnings per share did not include certain securities. These securities represent underlying stock options not included in the computation of diluted earnings per share, because the inclusion of such equity awards would have been antidilutive. Subsequent to the end of the second quarter and through August 8, 2016, the Company repurchased less than 0.1 million shares of its common stock, at an average price of $277.44, for a total investment of $8.3 million. |
Legal Matters |
6 Months Ended |
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Jun. 30, 2016 | |
Loss Contingency [Abstract] | |
Legal matters | NOTE 8 – LEGAL MATTERS O’Reilly is currently involved in litigation incidental to the ordinary conduct of the Company’s business. The Company records reserves for litigation losses in instances where a material adverse outcome is probable and the Company is able to reasonably estimate the probable loss. The Company reserves for an estimate of material legal costs to be incurred in pending litigation matters. Although the Company cannot ascertain the amount of liability that it may incur from any of these matters, it does not currently believe that, in the aggregate, these matters, taking into account applicable insurance and reserves, will have a material adverse effect on its consolidated financial position, results of operations or cash flows in a particular quarter or annual period. As previously reported, the Company received a subpoena from the District Attorney of the County of Alameda, along with other environmental prosecutorial offices in the state of California, seeking documents and information related to the handling, storage and disposal of hazardous waste. The Company expects the District Attorney will seek injunctive and monetary relief. Management has an ongoing and open dialogue with these agencies regarding this matter and is cooperating fully with the request; however, at this time a prediction of the ultimate outcome of these efforts cannot be determined although the Company has accrued all amounts that it believes to be probable and reasonably estimable and does not believe that the ultimate resolution of this matter will have a material adverse effect on its consolidated financial position, results of operations or cash flows. As previously reported, on June 18, 2015, a jury in Greene County, Missouri, returned an unfavorable verdict in a litigated contract dispute in the matter Meridian Creative Alliance vs. O’Reilly Automotive Stores, Inc. et. al. in the amount of $12.5 million. The Company strongly believes that the verdict was unjust and unsupported by the law and the underlying facts and, further, that there are several potential bases for reversal on appeal. The Company is vigorously challenging the verdict in the Court of Appeals. As of June 30, 2016, the Company had reserved $18.7 million with respect to this matter. |
Recent Accounting Pronouncements |
6 Months Ended |
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Jun. 30, 2016 | |
New Accounting Pronouncements and Changes in Accounting Principles [Abstract] | |
Recent accounting pronouncements | NOTE 9 - RECENT ACCOUNTING PRONOUNCEMENTS In May of 2014, the Financial Accounting Standards Board (the “FASB”) issued Accounting Standard Update (“ASU”) No. 2014-09, “Revenue from Contracts with Customers (Topic 606)” (“ASU 2014-09”). Under ASU 2014-09, an entity is required to follow a five-step process to determine the amount of revenue to recognize when promised goods or services are transferred to customers. ASU 2014-09 offers specific accounting guidance for costs to obtain or fulfill a contract with a customer. In addition, an entity is required to disclose sufficient information to understand the nature, amount, timing, and uncertainty of revenue and cash flows arising from contracts with customers. In August of 2015, the FASB issued ASU No. 2015-14, “Revenue from Contracts with Customers (Topic 606): Deferral of the Effective Date” (“ASU 2015-14”), to defer the effective date of ASU 2014-09 by one year. For public companies, ASU 2015-14 changes ASU 2014-09 to be effective for annual reporting periods beginning after December 15, 2017, including interim periods within that reporting period. These ASUs can be adopted retrospectively or as a cumulative-effective adjustment at the date of adoption, with early adoption permitted, but not before December 15, 2016. The Company will adopt this guidance beginning with its first quarter ending March 31, 2018. The Company is in the process of evaluating the potential future impact, if any, of ASU 2014-09 on its consolidated financial position, results of operations and cash flows, and which method of adoption is most appropriate for the Company. In February of 2016, the FASB issued ASU No. 2016-02, “Leases (Topic 842)” (“ASU 2016-02”). Under ASU 2016-02, an entity will be required to recognize right-of-use assets and lease liabilities on its balance sheet and disclose key information about leasing arrangements. ASU 2016-02 offers specific accounting guidance for a lessee, a lessor and sale and leaseback transactions. Lessees and lessors are required to disclose qualitative and quantitative information about leasing arrangements to enable a user of the financial statements to assess the amount, timing and uncertainty of cash flows arising from leases. For public companies, ASU 2016-02 is effective for annual reporting periods beginning after December 15, 2018, including interim periods within that reporting period, and requires a modified retrospective adoption, with early adoption permitted. The Company will adopt this guidance beginning with its first quarter ending March 31, 2019. The Company is in the process of evaluating the future impact of ASU 2016-02 on its consolidated financial position, results of operations and cash flows. In March of 2016, the FASB issued ASU No. 2016-06, “Derivatives and Hedging (Topic 815): Contingent Put and Call Options in Debt Instruments” (“ASU 2016-06”). ASU 2016-06 clarifies the requirements for assessing whether contingent call or put options that can accelerate the payment of principal on debt instruments are clearly and closely related to the economic characteristics and risks of the debt hosts and requires entities to solely use the four-step decision sequence, which is already in existence, when assessing the embedded call or put options. For public companies, ASU 2016-06 is effective for annual reporting periods beginning after December 15, 2016, including interim periods within that reporting period, and can be adopted on a modified retrospective basis, with early adoption permitted. The Company will adopt this guidance beginning with its first quarter ending March 31, 2017. The application of this guidance is not expected to have a material impact on the Company’s consolidated financial condition, results of operations or cash flows. In March of 2016, the FASB issued ASU No. 2016-09, “Compensation - Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting” (“ASU 2016-09”). Under ASU 2016-09, several aspects of the accounting for share-based payment transactions, including tax consequences, classification of awards as either equity or liabilities, and classification on the statement of cash flows, were simplified. For public companies, ASU 2016-09 is effective for annual reporting beginning after December 15, 2016, including interim periods within that reporting period, with early adoption permitted. ASU 2016-09 includes various adoption methods, depending on the guidance being adopted; amendments related to the timing of when excess tax benefits are recognized, minimum statutory withholding requirements and forfeitures should be applied using a modified retrospective transition method, while the amendments related to the presentation of employee taxes paid on the statement of cash flows should be applied retrospectively, the amendments requiring recognition of excess tax benefits and deficiencies in the income statement should be applied prospectively, and amendments related to the presentation of excess tax benefits on the statement of cash flows should be applied either prospectively or retrospectively. The Company will adopt this guidance beginning with its first quarter ending March 31, 2017. The Company is in the process of evaluating the future impact of ASU 2016-09 on its consolidated financial position, results of operations and cash flows. In June of 2016, the FASB issued ASU No. 2016-13, “Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments” (“ASU 2016-13”). Under ASU 2016-13, businesses and other organizations are required to present financial assets, measured at amortized costs basis, at the net amount expected to be collected. The allowance for credit losses is a valuation account that is deducted from the amortized cost basis, such as trade receivables. The measurement of expected credit loss will be based on historical experience, current conditions, and reasonable and supportable forecasts that affect the collectibility of the reported amount. For public companies, ASU 2016-13 is effective for annual reporting periods beginning after December 15, 2019, including interim periods within that reporting period, and requires a modified retrospective adoption, with early adoption permitted. The Company will adopt this guidance beginning with its first quarter ending March 31, 2020. The application of this guidance is not expected to have a material impact on the Company’s consolidated financial condition, results of operations or cash flows. |
Fair Value Measurements (Policies) |
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Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Abstract] | |||||||||||||
Fair value of financial instruments, policy | The Company uses the fair value hierarchy, which prioritizes the inputs used to measure the fair value of certain of its financial instruments. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurement) and the lowest priority to unobservable inputs (Level 3 measurement). The Company uses the income and market approaches to determine the fair value of its assets and liabilities. The three levels of the fair value hierarchy are set forth below:
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Warranties (Policies) |
6 Months Ended |
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Jun. 30, 2016 | |
Product Warranties Disclosures [Abstract] | |
Warranties, policy | The Company provides warranties on certain merchandise it sells with warranty periods ranging from 30 days to limited lifetime warranties. The risk of loss arising from warranty claims is typically the obligation of the Company’s suppliers. Certain suppliers provide upfront allowances to the Company in lieu of accepting the obligation for warranty claims. For this merchandise, when sold, the Company bears the risk of loss associated with the cost of warranty claims. Differences between supplier allowances received by the Company in lieu of warranty obligations and estimated warranty expense are recorded as an adjustment to cost of sales. Estimated warranty costs, which are recorded as obligations at the time of sale, are based on the historical failure rate of each individual product line. The Company’s historical experience has been that failure rates are relatively consistent over time and that the ultimate cost of warranty claims to the Company has been driven by volume of units sold as opposed to fluctuations in failure rates or the variation of the cost of individual claims. |
Recent Accounting Pronouncements (Policies) |
6 Months Ended |
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Jun. 30, 2016 | |
New Accounting Pronouncements and Changes in Accounting Principles [Abstract] | |
Recent accounting pronouncements, policy | In May of 2014, the Financial Accounting Standards Board (the “FASB”) issued Accounting Standard Update (“ASU”) No. 2014-09, “Revenue from Contracts with Customers (Topic 606)” (“ASU 2014-09”). Under ASU 2014-09, an entity is required to follow a five-step process to determine the amount of revenue to recognize when promised goods or services are transferred to customers. ASU 2014-09 offers specific accounting guidance for costs to obtain or fulfill a contract with a customer. In addition, an entity is required to disclose sufficient information to understand the nature, amount, timing, and uncertainty of revenue and cash flows arising from contracts with customers. In August of 2015, the FASB issued ASU No. 2015-14, “Revenue from Contracts with Customers (Topic 606): Deferral of the Effective Date” (“ASU 2015-14”), to defer the effective date of ASU 2014-09 by one year. For public companies, ASU 2015-14 changes ASU 2014-09 to be effective for annual reporting periods beginning after December 15, 2017, including interim periods within that reporting period. These ASUs can be adopted retrospectively or as a cumulative-effective adjustment at the date of adoption, with early adoption permitted, but not before December 15, 2016. The Company will adopt this guidance beginning with its first quarter ending March 31, 2018. The Company is in the process of evaluating the potential future impact, if any, of ASU 2014-09 on its consolidated financial position, results of operations and cash flows, and which method of adoption is most appropriate for the Company. In February of 2016, the FASB issued ASU No. 2016-02, “Leases (Topic 842)” (“ASU 2016-02”). Under ASU 2016-02, an entity will be required to recognize right-of-use assets and lease liabilities on its balance sheet and disclose key information about leasing arrangements. ASU 2016-02 offers specific accounting guidance for a lessee, a lessor and sale and leaseback transactions. Lessees and lessors are required to disclose qualitative and quantitative information about leasing arrangements to enable a user of the financial statements to assess the amount, timing and uncertainty of cash flows arising from leases. For public companies, ASU 2016-02 is effective for annual reporting periods beginning after December 15, 2018, including interim periods within that reporting period, and requires a modified retrospective adoption, with early adoption permitted. The Company will adopt this guidance beginning with its first quarter ending March 31, 2019. The Company is in the process of evaluating the future impact of ASU 2016-02 on its consolidated financial position, results of operations and cash flows. In March of 2016, the FASB issued ASU No. 2016-06, “Derivatives and Hedging (Topic 815): Contingent Put and Call Options in Debt Instruments” (“ASU 2016-06”). ASU 2016-06 clarifies the requirements for assessing whether contingent call or put options that can accelerate the payment of principal on debt instruments are clearly and closely related to the economic characteristics and risks of the debt hosts and requires entities to solely use the four-step decision sequence, which is already in existence, when assessing the embedded call or put options. For public companies, ASU 2016-06 is effective for annual reporting periods beginning after December 15, 2016, including interim periods within that reporting period, and can be adopted on a modified retrospective basis, with early adoption permitted. The Company will adopt this guidance beginning with its first quarter ending March 31, 2017. The application of this guidance is not expected to have a material impact on the Company’s consolidated financial condition, results of operations or cash flows. In March of 2016, the FASB issued ASU No. 2016-09, “Compensation - Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting” (“ASU 2016-09”). Under ASU 2016-09, several aspects of the accounting for share-based payment transactions, including tax consequences, classification of awards as either equity or liabilities, and classification on the statement of cash flows, were simplified. For public companies, ASU 2016-09 is effective for annual reporting beginning after December 15, 2016, including interim periods within that reporting period, with early adoption permitted. ASU 2016-09 includes various adoption methods, depending on the guidance being adopted; amendments related to the timing of when excess tax benefits are recognized, minimum statutory withholding requirements and forfeitures should be applied using a modified retrospective transition method, while the amendments related to the presentation of employee taxes paid on the statement of cash flows should be applied retrospectively, the amendments requiring recognition of excess tax benefits and deficiencies in the income statement should be applied prospectively, and amendments related to the presentation of excess tax benefits on the statement of cash flows should be applied either prospectively or retrospectively. The Company will adopt this guidance beginning with its first quarter ending March 31, 2017. The Company is in the process of evaluating the future impact of ASU 2016-09 on its consolidated financial position, results of operations and cash flows. In June of 2016, the FASB issued ASU No. 2016-13, “Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments” (“ASU 2016-13”). Under ASU 2016-13, businesses and other organizations are required to present financial assets, measured at amortized costs basis, at the net amount expected to be collected. The allowance for credit losses is a valuation account that is deducted from the amortized cost basis, such as trade receivables. The measurement of expected credit loss will be based on historical experience, current conditions, and reasonable and supportable forecasts that affect the collectibility of the reported amount. For public companies, ASU 2016-13 is effective for annual reporting periods beginning after December 15, 2019, including interim periods within that reporting period, and requires a modified retrospective adoption, with early adoption permitted. The Company will adopt this guidance beginning with its first quarter ending March 31, 2020. The application of this guidance is not expected to have a material impact on the Company’s consolidated financial condition, results of operations or cash flows. |
Fair Value Measurements (Tables) |
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Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Valuation of marketable securities |
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Valuation of senior notes |
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Financing (Tables) |
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Outstanding financing facilities |
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Warranties (Tables) |
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Product Warranties Disclosures [Abstract] | |||||||||||||||||||||||||
Product warranty liabilities |
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Share Repurchase Program (Tables) |
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Proceeds from (Repurchase of) Equity [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of shares repurchased |
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Share-Based Compensation and Benefit Plans (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Restricted stock [Member] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Share-Based Compensation and Benefit Plans | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of activity of share-based compensation |
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Stock option [Member] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Share-Based Compensation and Benefit Plans | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of stock options |
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Black-Scholes option pricing model |
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Summary of activity of share-based compensation |
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Earnings Per Share (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2016 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Earnings Per Share [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Computation of basic and diluted earnings per share |
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Fair Value Measurements (Narrative) (Details) - USD ($) $ in Millions |
3 Months Ended | 6 Months Ended | |||
---|---|---|---|---|---|
Jun. 30, 2016 |
Jun. 30, 2015 |
Jun. 30, 2016 |
Jun. 30, 2015 |
Dec. 31, 2015 |
|
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Abstract] | |||||
Non-financial assets and liabilities measured at fair value on a nonrecurring basis | $ 0.0 | $ 0.0 | $ 0.0 | ||
Increase in fair value of marketable securities | $ 0.4 | $ 0.1 | $ 0.5 | $ 0.4 |
Fair Value Measurements (Fair Value of Marketable Securities) (Details) - USD ($) $ in Thousands |
Jun. 30, 2016 |
Dec. 31, 2015 |
---|---|---|
Fair Value Measurements | ||
Estimated fair value of marketable securities | $ 18,535 | $ 16,895 |
Fair value, inputs, Level 1 [Member] | ||
Fair Value Measurements | ||
Estimated fair value of marketable securities | 18,535 | 16,895 |
Fair value, inputs, Level 2 [Member] | ||
Fair Value Measurements | ||
Estimated fair value of marketable securities | 0 | 0 |
Fair value, inputs, Level 3 [Member] | ||
Fair Value Measurements | ||
Estimated fair value of marketable securities | $ 0 | $ 0 |
Fair Value Measurements (Fair Value of Senior Notes) (Details) - USD ($) $ in Thousands |
Jun. 30, 2016 |
Dec. 31, 2015 |
---|---|---|
$500 million, 4.875% Senior Notes due 2021 [Member] | ||
Fair Value Measurements | ||
Carrying amount of senior notes | $ 496,354 | $ 495,951 |
$500 million, 4.875% Senior Notes due 2021 [Member] | Fair value, inputs, Level 2 [Member] | ||
Fair Value Measurements | ||
Estimated fair value of senior notes | 559,895 | 542,078 |
$300 million, 4.625% Senior Notes due 2021 [Member] | ||
Fair Value Measurements | ||
Carrying amount of senior notes | 298,537 | 298,396 |
$300 million, 4.625% Senior Notes due 2021 [Member] | Fair value, inputs, Level 2 [Member] | ||
Fair Value Measurements | ||
Estimated fair value of senior notes | 334,048 | 319,620 |
$300 million, 3.800% Senior Notes due 2022 [Member] | ||
Fair Value Measurements | ||
Carrying amount of senior notes | 297,700 | 297,535 |
$300 million, 3.800% Senior Notes due 2022 [Member] | Fair value, inputs, Level 2 [Member] | ||
Fair Value Measurements | ||
Estimated fair value of senior notes | 324,051 | 303,595 |
$300 million, 3.850% Senior Notes due 2023 [Member] | ||
Fair Value Measurements | ||
Carrying amount of senior notes | 298,244 | 298,136 |
$300 million, 3.850% Senior Notes due 2023 [Member] | Fair value, inputs, Level 2 [Member] | ||
Fair Value Measurements | ||
Estimated fair value of senior notes | 326,405 | $ 302,468 |
$500 million, 3.550% Senior Notes due 2026 [Member] | ||
Fair Value Measurements | ||
Carrying amount of senior notes | 495,489 | |
$500 million, 3.550% Senior Notes due 2026 [Member] | Fair value, inputs, Level 2 [Member] | ||
Fair Value Measurements | ||
Estimated fair value of senior notes | $ 531,048 |
Financing (Unsecured Revolving Credit Facility) (Narrative) (Details) - Line of credit facility [Member] - Unsecured debt [Member] - USD ($) $ in Millions |
6 Months Ended | |
---|---|---|
Jun. 30, 2016 |
Dec. 31, 2015 |
|
Unsecured Revolving Credit Facility | ||
Credit agreement description | On January 14, 2011, the Company entered into a credit agreement, as amended by Amendment No. 1 dated as of September 9, 2011, and as further amended by Amendment No. 2 dated as of July 2, 2013, and as further amended by Amendment No. 3 dated as of June 18, 2015 (the “Credit Agreement”). The Credit Agreement provides for a $600 million unsecured revolving credit facility (the “Revolving Credit Facility”) arranged by Bank of America, N.A., which is scheduled to mature in July 2018. The Credit Agreement includes a $200 million sub-limit for the issuance of letters of credit and a $75 million sub-limit for swing line borrowings under the Revolving Credit Facility. As described in the Credit Agreement governing the Revolving Credit Facility, the Company may, from time to time, subject to certain conditions, increase the aggregate commitments under the Revolving Credit Facility by up to $200 million. | |
Credit agreement inception date | Jan. 14, 2011 | |
Current maximum borrowing capacity under credit facility | $ 600.0 | |
Line of credit facility expiration date | Jul. 02, 2018 | |
Maximum aggregate increase to credit facility allowable | $ 200.0 | |
Letters of credit | 39.0 | $ 37.5 |
Outstanding borrowings under credit facility | $ 0.0 | $ 0.0 |
Covenant description for debt instrument | The Credit Agreement contains certain covenants, including limitations on indebtedness, a minimum consolidated fixed charge coverage ratio of 2.50 times, and a maximum consolidated leverage ratio of 3.00 times. The consolidated leverage ratio includes a calculation of adjusted debt to earnings before interest, taxes, depreciation, amortization, rent and non-cash share-based compensation expense. Adjusted debt includes outstanding debt, outstanding stand-by letters of credit and similar instruments, six-times rent expense and excludes any premium or discount recorded in conjunction with the issuance of long-term debt. In the event that the Company should default on any covenant contained within the Credit Agreement, certain actions may be taken, including, but not limited to, possible termination of commitments, immediate payment of outstanding principal amounts plus accrued interest and other amounts payable under the Credit Agreement and litigation from lenders. | |
Line of credit facility fee percentage | 0.125% | |
Line of credit facility covenant compliance | As of June 30, 2016, the Company remained in compliance with all covenants under the Credit Agreement. | |
Spread over Base rate [Member] | ||
Unsecured Revolving Credit Facility | ||
Line of credit current interest rate | 0.00% | |
Spread over Eurodollar rate [Member] | ||
Unsecured Revolving Credit Facility | ||
Line of credit current interest rate | 0.875% | |
Through maturity [Member] | ||
Unsecured Revolving Credit Facility | ||
Minimum debt instrument consolidated fixed charge coverage ratio covenant | 250.00% | |
Maximum debt instrument consolidated leverage ratio covenant | 300.00% | |
Amendment one [Member] | ||
Unsecured Revolving Credit Facility | ||
Credit agreement amendment date | Sep. 09, 2011 | |
Amendment two [Member] | ||
Unsecured Revolving Credit Facility | ||
Credit agreement amendment date | Jul. 02, 2013 | |
Amendment three [Member] | ||
Unsecured Revolving Credit Facility | ||
Credit agreement amendment date | Jun. 18, 2015 | |
Letter of credit [Member] | ||
Unsecured Revolving Credit Facility | ||
Line of credit facility sublimit | $ 200.0 | |
Swing line revolver [Member] | ||
Unsecured Revolving Credit Facility | ||
Line of credit facility sublimit | $ 75.0 |
Financing (Senior Notes) (Narrative) (Details) $ in Millions |
6 Months Ended | |
---|---|---|
Mar. 08, 2016
USD ($)
d
Rate
|
Jun. 30, 2016
USD ($)
d
Rate
|
|
Financing | ||
Unsecured senior notes description | The Company has issued a cumulative $1.9 billion aggregate principal amount of unsecured senior notes, which are due between January 2021 and March 2026, with UMB as trustee. Interest on the senior notes, ranging from 3.550% to 4.875%, is payable semi-annually and is computed on the basis of a 360-day year. | |
Aggregate principle of unsecured senior notes | $ | $ 1,900 | |
Maturity date range, minimum | Jan. 14, 2021 | |
Maturity date range, maximum | Mar. 08, 2026 | |
Number of days in annual interest calculation period | d | 360 | |
Debt instrument covenant description | Each of the senior notes is subject to certain customary covenants, with which the Company complied as of June 30, 2016. | |
Minimum [Member] | ||
Financing | ||
Interest rate of senior notes | 3.55% | |
Maximum [Member] | ||
Financing | ||
Interest rate of senior notes | 4.875% | |
$500 million, 3.550% Senior Notes due 2026 [Member] | ||
Financing | ||
Issuance date of senior notes | Mar. 08, 2016 | |
Face amount of senior notes | $ | $ 500 | |
Percentage of face value of debt instrument | 99.832% | |
Interest rate of senior notes | 3.55% | |
Number of days in annual interest calculation period | d | 360 |
Financing (Outstanding Financing Facilities) (Details) - USD ($) $ in Thousands |
Jun. 30, 2016 |
Dec. 31, 2015 |
|||
---|---|---|---|---|---|
Financing | |||||
Revolving Credit Facility | $ 0 | $ 0 | |||
Long-term debt | 1,886,324 | 1,390,018 | [1] | ||
$500 million, 4.875% Senior Notes due 2021 [Member] | |||||
Financing | |||||
Senior notes | 496,354 | 495,951 | |||
Senior notes, unamortized discount | 1,600 | 1,800 | |||
Senior notes, unamortized debt issuance costs | $ 2,000 | 2,300 | |||
Senior notes, effective interest rate | 4.961% | ||||
$300 million, 4.625% Senior Notes due 2021 [Member] | |||||
Financing | |||||
Senior notes | $ 298,537 | 298,396 | |||
Senior notes, unamortized discount | 300 | 300 | |||
Senior notes, unamortized debt issuance costs | $ 1,200 | 1,300 | |||
Senior notes, effective interest rate | 4.647% | ||||
$300 million, 3.800% Senior Notes due 2022 [Member] | |||||
Financing | |||||
Senior notes | $ 297,700 | 297,535 | |||
Senior notes, unamortized discount | 700 | 800 | |||
Senior notes, unamortized debt issuance costs | $ 1,600 | 1,700 | |||
Senior notes, effective interest rate | 3.845% | ||||
$300 million, 3.850% Senior Notes due 2023 [Member] | |||||
Financing | |||||
Senior notes | $ 298,244 | 298,136 | |||
Senior notes, unamortized discount | 100 | 100 | |||
Senior notes, unamortized debt issuance costs | $ 1,700 | $ 1,800 | |||
Senior notes, effective interest rate | 3.851% | ||||
$500 million, 3.550% Senior Notes due 2026 [Member] | |||||
Financing | |||||
Senior notes | $ 495,489 | ||||
Senior notes, unamortized discount | 800 | ||||
Senior notes, unamortized debt issuance costs | $ 3,700 | ||||
Senior notes, effective interest rate | 3.57% | ||||
|
Warranties (Product Warranty Liabilities) (Details) $ in Thousands |
6 Months Ended |
---|---|
Jun. 30, 2016
USD ($)
| |
Product Warranties Disclosures [Abstract] | |
Warranty liabilities, beginning balance | $ 35,223 |
Warranty claims | (34,736) |
Warranty accruals | 37,550 |
Warranty liabilities, ending balance | $ 38,037 |
Share Repurchase Program (Narrative) (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands |
1 Months Ended | 3 Months Ended | 6 Months Ended | 67 Months Ended | ||||
---|---|---|---|---|---|---|---|---|
May 27, 2016 |
Feb. 10, 2016 |
Aug. 08, 2016 |
Jun. 30, 2016 |
Jun. 30, 2015 |
Jun. 30, 2016 |
Jun. 30, 2015 |
Aug. 08, 2016 |
|
Share Repurchase Program | ||||||||
Increase in authorized amount | $ 750,000 | $ 750,000 | ||||||
Cumulative authorized amount | $ 7,000,000 | |||||||
Authorization effective period | 3 years | 3 years | ||||||
Remaining balance under share repurchase program | $ 786,400 | $ 786,400 | ||||||
Common stock repurchased, shares | 2,075 | 1,987 | 3,306 | 2,637 | ||||
Common stock repurchased, average price per share | $ 262.17 | $ 221.50 | $ 259.14 | $ 218.05 | ||||
Common stock repurchased, value | $ 544,165 | $ 440,129 | $ 856,802 | $ 574,932 | ||||
Subsequent event [Member] | ||||||||
Share Repurchase Program | ||||||||
Common stock repurchased, shares | 100 | 54,600 | ||||||
Common stock repurchased, average price per share | $ 277.44 | $ 113.98 | ||||||
Common stock repurchased, value | $ 8,300 | $ 6,200,000 |
Share Repurchase Program (Schedule Of Shares Repurchased) (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2016 |
Jun. 30, 2015 |
Jun. 30, 2016 |
Jun. 30, 2015 |
|
Proceeds from (Repurchase of) Equity [Abstract] | ||||
Shares repurchased | 2,075 | 1,987 | 3,306 | 2,637 |
Average price per share | $ 262.17 | $ 221.50 | $ 259.14 | $ 218.05 |
Total investment | $ 544,165 | $ 440,129 | $ 856,802 | $ 574,932 |
Share-Based Compensation and Benefit Plans (Stock Options) (Narrative) (Details) - Stock option [Member] - USD ($) $ / shares in Units, $ in Millions |
6 Months Ended | |
---|---|---|
Jun. 30, 2016 |
Jun. 30, 2015 |
|
Share-Based Compensation and Benefit Plans | ||
Vesting of options, description | The Company’s stock-based incentive plans provide for the granting of stock options for the purchase of common stock of the Company to directors and certain key employees of the Company. Options are granted at an exercise price that is equal to the closing market price of the Company’s common stock on the date of the grant. Director options granted under the plans expire after seven years and are fully vested after six months. Employee options granted under the plans expire after ten years and typically vest 25% per year, over four years. The Company records compensation expense for the grant date fair value of the option awards, adjusted for estimated forfeitures, evenly over the vesting period or the minimum required service period. | |
Weighted-average grant-date fair value of options awarded | $ 65.18 | $ 51.61 |
Remaining unrecognized compensation expense | $ 31.0 | |
Weighted-average period for cost recognition | 2 years 10 months 22 days | |
Employee stock option [Member] | ||
Share-Based Compensation and Benefit Plans | ||
Options expiration period | 10 years | |
Vesting period | 4 years | |
Option vesting rate per year | 25.00% | |
Director [Member] | ||
Share-Based Compensation and Benefit Plans | ||
Options expiration period | 7 years | |
Vesting period | 6 months |
Share-Based Compensation and Benefit Plans (Other Share-Based Compensation) (Narrative) (Details) |
6 Months Ended |
---|---|
Jun. 30, 2016
Rate
| |
Restricted stock [Member] | Employee [Member] | |
Share-Based Compensation and Benefit Plans | |
Other employee benefit plan, description | a performance incentive plan, which provides for the award of shares of restricted stock to its corporate and senior management, that vest evenly over a three-year period and are held in escrow until such vesting has occurred |
Vesting period | 3 years |
Restricted stock [Member] | Director [Member] | |
Share-Based Compensation and Benefit Plans | |
Other employee benefit plan, description | a director stock plan, which provides for the award of shares of restricted stock to the Company’s independent directors, that vest evenly over a three-year period and are held in escrow until such vesting has occurred |
Vesting period | 3 years |
Employee stock purchase plan [Member] | |
Share-Based Compensation and Benefit Plans | |
Other employee benefit plan, description | an employee stock purchase plan (the “ESPP”), which permits all eligible employees to purchase shares of the Company’s common stock at 85% of the fair market value |
Employee stock purchase plan, stock purchase percentage | 85.00% |
Share-Based Compensation and Benefit Plans (Profit Sharing and Savings Plan) (Narrative) (Details) - Profit sharing and savings plan [Member] - USD ($) $ in Millions |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2016 |
Jun. 30, 2015 |
Jun. 30, 2016 |
Jun. 30, 2015 |
|
Share-Based Compensation and Benefit Plans | ||||
Profit sharing and savings plan, description | The Company sponsors a contributory profit sharing and savings plan (the “401(k) Plan”) that covers substantially all employees who are at least 21 years of age and have completed one year of service. The Company makes matching contributions equal to 100% of the first 2% of each employee’s wages that are contributed and 25% of the next 4% of each employee’s wages that are contributed. | |||
Profit sharing and savings plan, employer discretionary contribution | $ 0.0 | $ 0.0 | $ 0.0 | $ 0.0 |
Profit sharing and savings plan, cost recognized | $ 5.5 | $ 4.4 | $ 10.5 | $ 8.7 |
Employee's first 2% of contributed wages [Member] | ||||
Share-Based Compensation and Benefit Plans | ||||
Profit sharing and savings plan, Company match | 100.00% | |||
Employee's next 4% of contributed wages [Member] | ||||
Share-Based Compensation and Benefit Plans | ||||
Profit sharing and savings plan, Company match | 25.00% |
Share-Based Compensation and Benefit Plans (Nonqualified Deferred Compensation Plan) (Narrative) (Details) - Nonqualified deferred compensation plan [Member] - USD ($) $ in Millions |
3 Months Ended | 6 Months Ended | |||
---|---|---|---|---|---|
Jun. 30, 2016 |
Jun. 30, 2015 |
Jun. 30, 2016 |
Jun. 30, 2015 |
Dec. 31, 2015 |
|
Share-Based Compensation and Benefit Plans | |||||
Deferred compensation plan, description | The Company sponsors a nonqualified deferred compensation plan (the “Deferred Compensation Plan”) for highly compensated employees whose contributions to the 401(k) Plan are limited due to the application of the annual limitations under the Internal Revenue Code. The Deferred Compensation Plan provides these employees with the opportunity to defer the full 6% of matched compensation, including salary and incentive based compensation, that was precluded under the Company’s 401(k) Plan, which is then matched by the Company using the same formula as the 401(k) Plan. | ||||
Deferred compensation plan, obligation | $ 18.5 | $ 18.5 | $ 16.9 | ||
Deferred compensation plan, cost recognized | $ 0.1 | $ 0.1 | $ 0.1 | $ 0.1 |
Share-Based Compensation and Benefit Plans (Summary Of Stock Options) (Details) - Stock option [Member] shares in Thousands |
6 Months Ended |
---|---|
Jun. 30, 2016
$ / shares
shares
| |
Share-Based Compensation and Benefit Plans | |
Outstanding at December 31, 2015, shares | shares | 3,308 |
Outstanding at December 31, 2015, weighted-average exercise price | $ / shares | $ 80.86 |
Granted, shares | shares | 248 |
Granted, weighted-average exercise price | $ / shares | $ 264.61 |
Exercised, shares | shares | (420) |
Exercised, weighted-average exercise price | $ / shares | $ 62.37 |
Forfeited, shares | shares | (40) |
Forfeited, weighted-average exercise price | $ / shares | $ 132.55 |
Outstanding at June 30, 2016, shares | shares | 3,096 |
Outstanding at June 30, 2016, weighted-average exercise price | $ / shares | $ 97.43 |
Exercisable at June 30, 2016, shares | shares | 2,229 |
Exercisable at June 30, 2016, weighted-average exercise price | $ / shares | $ 61.18 |
Share-Based Compensation and Benefit Plans (Black-Scholes Option Pricing Model) (Details) - Stock option [Member] |
6 Months Ended | |
---|---|---|
Jun. 30, 2016
Rate
|
Jun. 30, 2015
Rate
|
|
Share-Based Compensation and Benefit Plans | ||
Risk-free interest rate | 1.52% | 1.55% |
Expected life | 5 years 8 months 28 days | 5 years 11 months 5 days |
Expected volatility | 22.40% | 22.40% |
Expected dividend yield | 0.00% | 0.00% |
Share-Based Compensation and Benefit Plans (Stock Option Activity) (Details) - Stock option [Member] - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2016 |
Jun. 30, 2015 |
Jun. 30, 2016 |
Jun. 30, 2015 |
|
Share-Based Compensation and Benefit Plans | ||||
Compensation expense for share-based compensation | $ 3,804 | $ 4,510 | $ 8,140 | $ 9,507 |
Income tax benefit from compensation expense for share-based compensation | $ 1,421 | $ 1,694 | $ 3,040 | $ 3,541 |
Share-Based Compensation and Benefit Plans (Other Share-Based Compensation Activity) (Details) - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2016 |
Jun. 30, 2015 |
Jun. 30, 2016 |
Jun. 30, 2015 |
|
Employee stock purchase plan [Member] | ||||
Share-Based Compensation and Benefit Plans | ||||
Compensation expense for share-based compensation | $ 549 | $ 497 | $ 1,072 | $ 987 |
Income tax benefit from compensation expense for share-based compensation | 205 | 187 | 400 | 368 |
Restricted stock [Member] | ||||
Share-Based Compensation and Benefit Plans | ||||
Compensation expense for share-based compensation | 322 | 407 | 641 | 810 |
Income tax benefit from compensation expense for share-based compensation | $ 120 | $ 153 | $ 239 | $ 302 |
Earnings Per Share (Narrative) (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands |
1 Months Ended | 3 Months Ended | 6 Months Ended | 67 Months Ended | ||
---|---|---|---|---|---|---|
Aug. 08, 2016 |
Jun. 30, 2016 |
Jun. 30, 2015 |
Jun. 30, 2016 |
Jun. 30, 2015 |
Aug. 08, 2016 |
|
Earnings Per Share | ||||||
Common stock repurchased, shares | 2,075 | 1,987 | 3,306 | 2,637 | ||
Common stock repurchased, average price per share | $ 262.17 | $ 221.50 | $ 259.14 | $ 218.05 | ||
Common stock repurchased, value | $ 544,165 | $ 440,129 | $ 856,802 | $ 574,932 | ||
Subsequent event [Member] | ||||||
Earnings Per Share | ||||||
Common stock repurchased, shares | 100 | 54,600 | ||||
Common stock repurchased, average price per share | $ 277.44 | $ 113.98 | ||||
Common stock repurchased, value | $ 8,300 | $ 6,200,000 |
Earnings Per Share (Computation of Basic and Diluted Earnings Per Share) (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands |
3 Months Ended | 6 Months Ended | |||||
---|---|---|---|---|---|---|---|
Jun. 30, 2016 |
Jun. 30, 2015 |
Jun. 30, 2016 |
Jun. 30, 2015 |
||||
Numerator (basic and diluted): | |||||||
Net income | $ 257,794 | $ 233,508 | $ 513,168 | $ 446,372 | |||
Denominator: | |||||||
Weighted-average common shares outstanding - basic | 95,967 | 100,547 | 96,554 | 101,078 | |||
Effect of stock options | [1] | 1,315 | 1,562 | 1,357 | 1,606 | ||
Weighted-average common shares outstanding - assuming dilution | 97,282 | 102,109 | 97,911 | 102,684 | |||
Earnings per share - basic | $ 2.69 | $ 2.32 | $ 5.31 | $ 4.42 | |||
Earnings per share - assuming dilution | $ 2.65 | $ 2.29 | $ 5.24 | $ 4.35 | |||
Antidilutive stock options | [1] | 285 | 226 | 312 | 312 | ||
Weighted-average exercise price | [1] | $ 262.49 | $ 206.72 | $ 259.46 | $ 200.65 | ||
|
Legal Matters (Narrative) (Details) $ in Millions |
6 Months Ended |
---|---|
Jun. 30, 2016
USD ($)
| |
Loss Contingency [Abstract] | |
Name of plaintiff | Meridian Creative Alliance |
Awarded to plaintiff | $ 12.5 |
Loss contingency accrual, provision | $ 18.7 |
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