Slides
Page 1
SECOND QUARTER FISCAL 2027 EARNINGS CALL OCTOBER 29, 2026
Page 2
Certain statements in this presentation, other than statements of historical fact, including estimates, projections, statements related to our business plans and operating results are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Monro has identified some of these forward-looking statements with words such as “continue,” “design,” “expect,” “may,” “believe,” “focus,” “will,” “plan,” “estimate,” and the negative of these words or other comparable terminology. These forward-looking statements are based on Monro’s current expectations, estimates, projections and assumptions as of the date such statements are made, and are subject to risks and uncertainties that may cause results to differ materially from those expressed or implied in the forward-looking statements. Additional information regarding these risks and uncertainties are described in the Company’s filings with the Securities and Exchange Commission, including in the “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” sections of our most recently filed periodic reports on Forms 10-K and Form 10-Q, which are available on Monro’s website at https://corporate.monro.com/investors/financials/sec-filings/default.aspx. Monro assumes no obligation to update or revise these forward-looking statements for any reason, even if new information becomes available in the future. In addition to including references to operating income, net (loss) income, and diluted (loss) earnings per share, which are generally accepted accounting principals (“GAAP”) measures, this presentation includes references to adjusted operating income, adjusted net (loss) income, and adjusted diluted (loss) earnings per share, which are non-GAAP financial measures. Monro has included reconciliations from adjusted operating income, adjusted net (loss) income, and adjusted diluted (loss) earnings per share to their most directly comparable GAAP measures, operating income, net (loss) income, and diluted (loss) earnings per share in the appendix to this presentation. Management views these non-GAAP financial measures as a way to better assess comparability between periods because management believes these non-GAAP financial measures show the Company’s core business operations while excluding certain items that are not part of our core operations such as litigation reserve costs, consulting costs related to our operational improvement plan, pension settlement expense, costs related to shareholder matters, transition costs related to back-office optimization, write-off of debt issuance costs, and store closing costs, net of related gains (losses) on the sale of owned locations, lease assignments and early lease terminations. These non-GAAP financial measures are not intended to represent, and should not be considered more meaningful than, or as an alternative to, their most directly comparable GAAP measures. These non-GAAP financial measures may be different from similarly titled non-GAAP financial measures used by other companies. Safe Harbor Statement and Non-GAAP Measures 2
Page 3
Monro Shareholder Value Drivers Four Key Areas of Focus Identified as Opportunities for Improvement 3 Driving Profitable Customer Acquisition & Activation ▪ During the second quarter, we continued to refine digital marketing & leveraged the strength of our CRM platform to address specific opportunities in both our brake & oil categories ▪ The increased precision of our marketing execution resulted in a year- over-year reduction in our cost per lead during the quarter ▪ In oil, we have been testing two promotional approaches ▪ Believe that these promotional offerings helped to support an improvement in store traffic in September relative to July & August ▪ Seen a significant increase in ARO for oil change visits scheduled through both our customer call center & our online appointment system Increasing Merchandising Productivity ▪ Merchandising team has shifted their focus to working closely with our parts suppliers to ensure that our stores are stocking the right products, at the best price to meet the needs of our customers ▪ Currently have an initiative underway aimed at improving the overall quality of brake assortment in many of our store locations ▪ Continuing to work as a strong partner with existing core vendors, while identifying new vendors that can help us meet customers’ needs is key to helping drive improved sales as well as better margins ▪ Saw year-over-year comp store sales growth in both batteries & maintenance services during the second quarter Improving Our Customer Experience & Selling Effectiveness ▪ District Manager Toolkit represents one of the most important structural improvements we are making to how we operate at the store level ▪ Encouraged by the early results we’ve seen in a subset of stores, where we’ve already observed a meaningful improvement in just the past several months ▪ 146 of the stores that have received DM Toolkit & coaching support achieved mid-single-digit growth in sales, with a bottom-line improvement of more than 20% year-over-year in the second quarter ▪ During the second quarter, we took an important step to further accelerate this progress by establishing a dedicated operating efficiency team Closed Store Real Estate Dispositions ▪ Continued our process to exit real estate ▪ During the second quarter, successfully exited a total of 9 leases & sold 3 locations, which resulted in cumulative proceeds of $3M ▪ This brings us to a total of 15 leases exited & 7 locations sold, resulting in cumulative proceeds of $6M fiscal year-to-date ▪ Remaining balance of 25 stores that have the potential to be monetized during the next several quarters
Page 4
2.2% 2.9% -2.2% -1.9%-1.4% -3.2% -0.2% 0.2% -5% 0% 5% 10% July August September October MTD FY26 FY271.1% 1.2% -2.4% -1.7% -1.8% -10% -5% 0% 5% Q2FY26 Q3FY26 Q4FY26 Q1FY27 Q2FY27 Second Quarter Fiscal 2027 Highlights ▪ Comp store sales decreased 1.8% ▪ Held our tire unit volumes flat ▪ ConfiDrive digital courtesy inspection process helped us drive average repair order growth during the quarter, and was a key contributor to the comp store sales gains we saw in batteries and maintenance services ▪ Maintained our marketing investment throughout the quarter, despite sales headwinds Challenging Operating Environment in the Full-Service Auto Aftermarket driven by Lower Store Traffic & Consumer Weakness ▪ Product and service category performance: ▪ Batteries: +8% ▪ Service: +3% ▪ Alignments: -2% ▪ Tires: -4% ▪ Brakes: -4% ▪ Front/End Shocks: -5% ▪ Service categories ~53% of sales, consistent with the prior year period 4 Quarterly Comparable Store Sales Trends Monthly Comparable Store Sales Trends 1 Fiscal 2027 represents preliminary results through October 24, 2026 Q2FY27 Key Highlights Q2FY27 Key Highlights 1
Page 5
Gross Margin Decrease driven by Higher Occupancy Costs as a Percentage of Sales; Maintained Investment in Marketing, despite Sales Headwinds Second Quarter Fiscal 2027 Results 1 Please refer to the reconciliations of adjusted operating income and adjusted diluted (loss) earnings per share in the appendix to this presentation and in our earnings release for further details regarding excluded items in Q2FY27 and Q2FY26. Adjusted operating income and adjusted diluted (loss) earnings per share are non-GAAP measures that exclude certain items that are not part of our core operations such as litigation reserve costs, consulting costs related to our operational improvement plan, pension settlement expense, costs related to shareholder matters, transition costs related to back-office optimization, write-off of debt issuance costs, and store closing costs, net of related gains (losses) on the sale of owned locations, lease assignments and early lease terminations. Reconciliations of operating income to adjusted operating income and diluted (loss) earnings per share to adjusted diluted (loss) earnings per share are included in our earnings release dated October 29, 2026. 5 Q2FY27 Q2FY26 Δ Sales (millions) $283.6 $288.9 (1.8%) Same Store Sales -1.8% 1.1% (290) Bps Gross Margin 35.2% 35.7% (50) Bps Adjusted Operating Income1 1.6% 4.8% (320) Bps Adjusted Diluted (Loss) Earnings Per Share1 $(.01) $.21 (104.8%) (% of sales)
Page 6
Financial Position Cash Flow, Balance Sheet, and Liquidity 6 Cash Flow First Half Fiscal 2027 ▪ Generated operating cash flow of ~$4M during the first half of fiscal 2027 ▪ Received ~$6M from disposal of property and equipment from successfully exiting 15 leases and selling 7 owned locations ▪ Capex of ~$13M ▪ Paid ~$19M in principal payments for financing leases ▪ Distributed ~$18M in dividends ▪ $375.0M in senior secured credit facilities, consisting of a $250.0M term loan facility and a $125.0M revolving credit facility, both maturing on 10/23/2030, with fees commensurate with a private lending facility ▪ New credit facilities are secured by substantially all of the assets of Monro and its subsidiaries ▪ Term loan and revolving loan facilities bear interest at floating rates ▪ Credit agreement for the new credit facilities includes customary affirmative and negative covenants, including financial maintenance covenants, certain prepayment requirements, and restrictions on the amount of dividend payments, subject to compliance with certain financial metric requirements ▪ Substantially paid down our obligations under our supply chain financing program and will no longer accept new supplier obligations into that program after 12/31/2026 ▪ As of 10/24/2026, we had ~$27M of cash and equivalents and $60M available under the new credit facilities New Credit Facilities
Page 7
Fiscal 2027 Expectations 7 Fiscal 2027 Expectations ▪ While we will continue to drive our performance improvement initiatives, we now expect to deliver year-over-year comparable store sales that are flat to slightly down in fiscal 2027, given continued macro pressures on the consumer ▪ The results of our store optimization plan reduced total sales by $9M in the first quarter of fiscal 2027 ▪ Gross margin for the full year of fiscal 2027 will largely depend on where comparable store sales land, but we would expect to be consistent to down slightly vs. fiscal 2026 ▪ Expect higher selling, general and administrative expenses as we invest in additional marketing to support our topline ▪ Expect that net interest expense will be $28M to $32M due to higher interest and fees associated with the new credit facilities and higher debt levels under the new credit facilities related to the substantial paydown of obligations under our supply chain finance program ▪ Expect CAPEX spend of $25M to $35M
Page 8
Appendix 8
Page 9
Reconciliation of Adjusted Operating Income (Unaudited) 9 2026 2025 Operating Income $2,591 $12,750 Litigation reserve 1,650 - Consulting costs related to operational improvement plan 1,159 8,264 Costs related to shareholder matters 313 - Transition costs related to back-office optimization 176 527 Store closing costs, net of related gains on sale of owned locations, lease assignments and early lease terminations (1,443) (7,561) Adjusted Operating Income $4,446 $13,980 (Dollars in Thousands) Quarter Ended Fiscal September
Page 10
Reconciliation of Adjusted Net (Loss) Income (Unaudited) 10 2026 2025 Net (Loss) Income $(1,611) $5,665 Litigation reserve 1,650 - Consulting costs related to operational improvement plan 1,159 8,264 Costs related to shareholder matters 313 - Transition costs related to back-office optimization 176 527 Store closing costs, net of related gains on sale of owned locations, lease assignments and early lease terminations (1,443) (7,561) Provision for income taxes on pre-tax adjustments (481) (320) Adjusted Net (Loss) Income $(237) $6,575 (Dollars in Thousands) Quarter Ended Fiscal September
Page 11
Reconciliation of Adjusted Diluted (Loss) Earnings Per Share (Unaudited) 11 2026 2025 Diluted (Loss) Earnings Per Share $(.05) $.18 Litigation reserve .04 - Consulting costs related to operational improvement plan .03 .19 Costs related to shareholder matters .01 - Transition costs related to back-office optimization .00 .01 Store closing costs, net of related gains on sale of owned locations, lease assignments and early lease terminations (.03) (.18) Adjusted Diluted (Loss) Earnings Per Share $(.01) $.21 Quarter Ended Fiscal September Note: Amounts may not foot due to rounding.