Second Quarter Earnings per Share Increase
18.3% to $1.23 vs. $1.04

Second Quarter Sales Increase 10.6% and
Same-Store Sales Increase 4.6%

Raises Full Year 2011 Net Sales and EPS Guidance

Tractor Supply Company (NASDAQ: TSCO), the largest retail farm and ranch store chain in the United States, today announced financial results for its second fiscal quarter ended June 25, 2011.

Second Quarter Results

Net sales increased 10.6% to $1.18 billion from $1.07 billion in the prior year's second quarter. Same-store sales increased 4.6%, compared to a 6.1% increase in the prior-year period. The same-store sales increase was driven by continued strong results in core consumable, usable and edible (CUE) products, principally animal and pet-related merchandise.

Gross margin increased 11.8% to $402.5 million, or 34.1% of sales, compared to $360.1 million, or 33.8% of sales, in the prior year's second quarter. The increase in gross margin reflects improved direct product margin, partially offset by increased transportation costs. Direct product margin increased as a result of improved inventory management, strategic sourcing, private branding, and pricing.

Selling, general and administrative expenses, including depreciation and amortization, improved to 21.9% of sales for the second quarter compared to 22.2% of sales in the prior year's second quarter. The improvement as a percent of sales was primarily attributable to strong same-store sales and expense control with respect to advertising and store occupancy costs.

Net income for the quarter was $91.2 million, or $1.23 per diluted share, compared to net income of $77.3 million, or $1.04 per diluted share, in the second quarter of the prior year. All references to shares outstanding and per-share amounts reflect a two-for-one stock split that was effective on September 2, 2010.

The Company opened 16 stores and relocated one store in the second quarter compared to opening 19 stores in the prior year's second quarter.

Jim Wright, Chairman and Chief Executive Officer, stated, "Our ability to achieve record results, despite unfavorable weather patterns, further demonstrates that the structural changes we made to the business over the past few years have been successful. Through excellent seasonal preparedness and execution, we anticipated our customers' needs, maintained appropriate in-stock positions and our customers responded positively to our efforts. As a result, we experienced strong sales and earnings growth, positive ticket and traffic, margin expansion and SG&A leverage."

First Six Months Results

Net sales increased 13.4% to $2.01 billion from $1.78 billion in the first six months of 2010. Same-store sales increased 7.0% compared to a 4.7% increase in the first six months of 2010. Gross margin increased 14.4% to $676.1 million, or 33.6% of sales, compared to $591.1 million, or 33.3% of sales, in the first six months of 2010.

Selling, general and administrative expenses, including depreciation and amortization, increased 11.6% to $503.1 million, or 25.0% of sales, compared to $450.9 million, or 25.4% of sales, for the first six months of 2010.

Net income was $109.5 million, or $1.47 per diluted share, compared to net income of $87.9 million, or $1.18 per diluted share, for the first six months of 2010.

The Company opened 42 new stores and relocated one store in 2011 compared to 38 new store openings and one store closure during the first six months of 2010.

Company Outlook

Based on strong performance in the second quarter, the Company raised its financial expectations for fiscal 2011. Net sales are anticipated to range between $4.10 billion to $4.14 billion compared to the Company's previously expected range of $4.04 billion to $4.11 billion. Same-store sales for the year are now expected to increase 5% to 6% compared to the prior expectation of an increase of 3.5% to 5.0%. The Company now anticipates net income will range between $2.75 to $2.82 per diluted share compared to its previous guidance of $2.62 to $2.70 per diluted share.

Mr. Wright concluded, "As we look to the remainder of the year, we are optimistic about the momentum we have generated in our business. To continue growing, we remain focused on executing the merchandise, marketing and operational plans that will enable Tractor Supply Company to meet our customers' needs, expand operating margins and improve our processes continuously. Additionally, we will continue to invest in our stores and infrastructure while delivering value to our shareholders."