Tractor Supply's (NASDAQ:TSCO) impressive first-quarter results were dwarfed by an amazing second quarter. The company grew net sales by 35% with comparable store sales of 30.5%, compared to their prior-year period, exceeding the outlook given during their first-quarter conference call which called for sales growth of 24% to 29%, and comparable sales growth of 20% to 25%.
To keep up with increasing customer volume, the company had to hire 5,000 new team members and open a new mixing center in Florida to increase its distribution capacity. We believe the executive team is also doing the right thing by sharing the profits with their frontline employees. The company increased wages across all stores and distribution centers by $1 for all hourly workers, offering health care and benefits to part-time team members, and making 2,000 frontline managers at stores and distribution centers eligible to receive annual restricted stock units. These actions are definitely a boost to morale and work culture that could pay dividends down the line. Shareholders in TSCO are also benefitting from strong results via a dividend increase of 14% to $0.40 per quarter, from $0.35 not including any gains in the share price.
The company also started rolling out curbside pickup, same-day and next-day delivery options, relaunched its website, and launched its new mobile app starting in July. They also started offering the option to shoppers of buying online and pick-up in store. The growth in e-commerce for the quarter ended was in the "triple-digits" (management didn't disclose a concrete number).
With so much growth in their pockets this year, the company now has the challenge to retain those new and recurring customers in their channels. In order to do that, the company is focusing on efforts to increase productivity at stores, so team members can spend the majority of their working hours
