UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q


[X]		QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

		For the quarterly period ended July 3, 2004

		OR

[ ]		TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

		For the transition period from to

Commission File Number 333-61713

American Tire Distributors, Inc.


A Delaware Corporation		IRS Employer Identification No. 56-0754594

12200 Herbert Wayne Court

Suite 150

Huntersville, North Carolina 28078

(704) 992-2000

Indicate by a check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes x No o

Indicate by a check mark whether the registrant is an accelerated filer (as defined in Rule 12b-2 of the Exchange Act). Yes o No x

Number of common shares outstanding at August 10, 2004: 5,086,917

TABLE OF CONTENTS


			Page

PART I		FINANCIAL INFORMATION

	ITEM 1.	Financial Statements
		Condensed Consolidated Balance Sheets — July 3, 2004 (unaudited) and December 27, 2003		1
		Condensed Consolidated Statements of Operations (unaudited) — Quarters and Six Months Ended July 3, 2004 and June 28, 2003		2
		Condensed Consolidated Statements of Cash Flows (unaudited) — Six Months Ended July 3, 2004 and June 28, 2003		3
		Notes to Condensed Consolidated Financial Statements		4

	ITEM 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations		16

	ITEM 3.	Quantitative and Qualitative Disclosures about Market Risk		20

	ITEM 4.	Controls and Procedures		20

PART II		OTHER INFORMATION

	ITEM 1.	Legal Proceedings		21

	ITEM 6.	Exhibits and Reports on Form 8-K		21
		Signatures		22

Cautionary Statement on Forward-Looking Information

This Form 10-Q contains forward-looking statements relating to the Company’s business and financial outlook, which are based on the Company’s current expectations, estimates, forecast and projections. In some cases, you can identify forward-looking statements by terminology such as “may,” “will,” “should,” “expects,” “plans,” “anticipates,” “believes,” “estimates,” “predicts,” “potential,” “continue” or other comparable terminology. These forward-looking statements are not guarantees of future performance and involve risks, uncertainties, estimates and assumptions that are difficult to predict. Therefore, actual outcomes and results may differ materially from those expressed in these forward-looking statements. You should not place undue reliance on any of these forward-looking statements. Further, any forward-looking statement speaks only as of the date on which it is made, and the Company undertakes no obligation to update any such statement to reflect new information, the occurrence of future events or circumstances or otherwise.

The Private Securities Litigation Reform Act of 1995 provides a “safe harbor” for forward-looking statements to encourage companies to provide prospective information about their companies without fear of litigation. The Company would like to take advantage of the “safe harbor” provisions of the Private Securities Litigation Reform Act in connection with the forward-looking statements included in this document.

Factors that could cause actual results to differ materially from those indicated by the forward-looking statements or that could contribute to such differences include, but are not limited to, integration of new systems, unanticipated expenditures, acquisitions and the successful integration of acquisitions into the business, changing relationships with customers, suppliers and strategic partners, changes to governmental regulation of the tire industry, the impact of competitive products, changes to the competitive environment, the acceptance of new products in the market, the economy and world events.

PART I. FINANCIAL INFORMATION


Item 1.	*Financial Statements.*

American Tire Distributors, Inc.

Condensed Consolidated Balance Sheets

(dollars in thousands, except per share amounts)


				July 3,			December 27,
				2004			2003

				(Unaudited)
Assets
Current assets:
	Cash and cash equivalents			$	3,739		$	3,326
	Accounts receivable, net of allowance for doubtful accounts of $854 and $1,112.				128,550			96,120
	Inventories				197,179			174,051
	Deferred income taxes				5,743			6,462
	Other current assets				12,679			10,625

		Total current assets			347,890			290,584

Property and equipment, net					20,159			17,662
Goodwill, net					93,940			93,940
Other intangible assets, net					1,854			2,238
Deferred income taxes					8,491			8,849
Other assets					7,491			5,730

			Total assets	$	479,825		$	419,003

Liabilities and Stockholders’ Equity
Current liabilities:
	Accounts payable			$	209,893		$	170,716
	Accrued expenses				23,206			17,952
	Current maturities of long-term debt				1,967			2,919

		Total current liabilities			235,066			191,587

Revolving credit facility and other long-term debt					142,994			137,044
Series D Senior Notes					28,600			28,600
Capital lease obligations					14,102			14,153
Other liabilities					5,103			4,590
Redeemable preferred stock (Note 9)					9,535			10,535
Commitments and contingencies (Note 11)
Stockholders’ equity:
	Preferred stock (Note 10)				53,399			50,944
	Common stock, par value $.01 per share; 50,000,000 shares authorized; 5,086,917 shares issued and outstanding				51			51
	Additional paid-in capital				22,818			22,388
	Warrants				1,352			1,782
	Note receivable from sale of stock				—			(17	)
	Accumulated deficit				(33,195	)		(42,654	)

		Total stockholders’ equity			44,425			32,494

			Total liabilities and stockholders’ equity	$	479,825		$	419,003

The accompanying notes are an integral part of these condensed consolidated financial statements.

American Tire Distributors, Inc.

Condensed Consolidated Statements of Operations

(Unaudited)

(dollars in thousands)



		Quarters Ended						Six Months Ended

		July 3,			June 28,			July 3,			June 28,
		2004			2003			2004			2003

Net sales		$	314,105		$	286,137		$	615,471		$	544,216
Cost of goods sold			259,401			234,476			503,168			448,075

	Gross profit		54,704			51,661			112,303			96,141
Selling, general and administrative expenses			41,856			40,444			86,260			79,752

	Operating income		12,848			11,217			26,043			16,389

Other income (expense):
	Interest expense		(2,353	)		(3,930	)		(5,853	)		(7,686	)
	Other, net		(36	)		24			(333	)		252

Income from operations before income taxes			10,459			7,311			19,857			8,955
Provision for income taxes			4,184			2,924			7,943			3,582

Net income		$	6,275		$	4,387		$	11,914		$	5,373

The accompanying notes are an integral part of these condensed consolidated financial statements.

American Tire Distributors, Inc.

Condensed Consolidated Statements of Cash Flows

(Unaudited)

(dollars in thousands)



			Six Months Ended

			July 3,			June 28,
			2004			2003

Cash flows from operating activities:
	Net income		$	11,914		$	5,373
	Adjustments to reconcile net income to net cash provided by operating activities:
		Depreciation and amortization of other intangibles		2,508			3,430
		Amortization of other assets		472			604
		Provision for doubtful accounts		111			736
		Deferred income taxes		1,077			3,161
		Other, net		(244	)		399
	Change in operating assets and liabilities:
		Accounts receivable		(32,541	)		(18,835	)
		Inventories		(23,128	)		(3,758	)
		Other current assets		(2,054	)		1,087
		Accounts payable and accrued expenses		44,431			10,697
		Other, net		(1,288	)		(843	)

		Net cash provided by operating activities		1,258			2,051

Cash flows from investing activities:
	Purchase of property and equipment			(1,830	)		(1,117	)
	Proceeds from sale of property and equipment			28			530
	Other, net			—			(50	)

		Net cash used in investing activities		(1,802	)		(637	)

Cash flows from financing activities:
	Net proceeds from (repayments of) revolving credit facility and other long-term debt			1,957			(800	)
	Series A preferred stock redemption			(1,000	)		(500	)

		Net cash provided by (used in) financing activities		957			(1,300	)

Net increase in cash and cash equivalents				413			114
Cash and cash equivalents, beginning of period				3,326			2,693

Cash and cash equivalents, end of period			$	3,739		$	2,807

Supplemental disclosures of cash flow information:
	Cash payments for interest		$	6,033		$	6,990

	Cash payments for taxes, net		$	7,509		$	625

Supplemental disclosures of noncash activities:
	Capital expenditures financed by debt		$	2,812		$	—

The accompanying notes are an integral part of these condensed consolidated financial statements.

American Tire Distributors, Inc.

Notes to Condensed Consolidated Financial Statements

(Unaudited)


1.	Nature of Business:

American Tire Distributors, Inc. (together with its subsidiaries, the “Company”) (formerly Heafner Tire Group, Inc.), is a Delaware corporation engaged in the wholesale distribution of tires, wheels, equipment and related accessories. On May 30, 2002, the Company changed its name from Heafner Tire Group, Inc. to American Tire Distributors, Inc.


2.	Basis of Presentation:

The unaudited condensed consolidated financial statements have been prepared in accordance with the instructions to Form 10-Q and therefore do not include all information and footnotes necessary for a fair presentation of financial position, results of operations, and changes in financial position in conformity with accounting principles generally accepted in the United States. In the opinion of the Company, all adjustments, consisting of only normal recurring adjustments, necessary for a fair presentation of the financial position of the Company, the results of its operations and cash flows have been made. These financial statements should be read in conjunction with the financial statements and notes thereto included in the Company’s consolidated financial statements reported on Form 10-K for the fiscal year ended December 27, 2003. The results of the operations for the quarter and six months ended July 3, 2004 are not necessarily indicative of the operating results for the full fiscal year.

The Company’s fiscal year is based on either a 52 or 53-week period ending on the Saturday closest to each December 31. Therefore, the financial results of certain fiscal years, and the associated 14-week quarters, will not be exactly comparable to the prior and subsequent 52-week fiscal years and the associated quarters having only 13 weeks. The quarters ended July 3, 2004 and June 28, 2003 contain operating results for 13 weeks. The six months ended July 3, 2004 and June 28, 2003 contain operating results for 27 weeks and 26 weeks, respectively.

Certain prior period amounts have been reclassified to conform to the current period presentation.


3.	Recently Issued Accounting Pronouncements:

In May 2003, the Financial Accounting Standards Board (“FASB”) issued Statement of Financial Accounting Standards (“SFAS”) No. 150, “Accounting for Certain Financial Instruments with Characteristics of Both Liabilities and Equity.” SFAS No. 150 establishes standards for how financial instruments with characteristics of both liabilities and equity should be measured and classified and requires that an issuer classify a financial instrument that is within its scope as a liability. SFAS No. 150 is effective for financial instruments entered into or modified after May 31, 2003, except for mandatorily redeemable financial instruments of nonpublic entities. On November 7, 2003, the FASB issued FASB Staff Position (“FSP”) No. 150-3 “Effective Date, Disclosures, and Transition for Mandatorily Redeemable Financial Instruments of Certain Nonpublic Entities and Certain Mandatorily Redeemable Noncontrolling Interests under FASB Statement No. 150, Accounting for Certain Financial Instruments with Characteristics of Both Liabilities and Equity.” FSP No. 150-3 requires that implementation of certain provisions of SFAS No. 150 be deferred indefinitely. The adoption of SFAS No. 150 did not have a material impact on the Company’s consolidated financial position or results of operations.


4.	Stock Options:

As permitted by SFAS No. 123, “Accounting For Stock-Based Compensation,” the Company accounts for stock option grants in accordance with Accounting Principles Board Opinion No. 25, “Accounting for Stock Issued to Employees” (“APB No. 25”) and its related interpretations. Pursuant to APB No. 25, compensation expense is recognized for financial reporting purposes using the intrinsic value method. The

American Tire Distributors, Inc.

Notes to Condensed Consolidated Financial Statements — (Continued)

amount of compensation expense to be recognized is determined by the excess of the fair value of common stock over the exercise price of the related option at the measurement date. The exercise price of all stock options represented fair value of the underlying common stock at the date of grant. Accordingly, no compensation expense has been recorded in the condensed consolidated statements of operations.

In December 2002, the FASB issued SFAS No. 148, “Accounting for Stock-Based Compensation-Transition and Disclosure,” an amendment of SFAS No. 123. This statement provides alternative methods of transition for a voluntary change to the fair value based method of accounting for stock-based employee compensation. In addition, this statement amends the disclosure requirements of SFAS No. 123 to require more prominent disclosures in both annual and interim financial statements regarding the method of accounting for stock-based employee compensation and the effect of the method used on reported results. At this time, the Company has not voluntarily adopted the fair value method of accounting under SFAS No. 123, but is required to provide certain pro forma disclosures, which are presented below.

The following information is presented as if the Company had accounted for its employee stock options under the fair value method prescribed by SFAS No. 123 (in thousands):



	For the Quarters						For the Six Months
	Ended						Ended

	July 3,			June 28,			July 3,			June 28,
	2004			2003			2004			2003

Net income, as reported	$	6,275		$	4,387		$	11,914		$	5,373
Deduct: Total stock-based employee compensation expense determined under the fair value based method for all awards, net of tax		(37	)		(160	)		(298	)		(184	)

Pro forma net income	$	6,238		$	4,227		$	11,616		$	5,189

During first quarter 2004, the Company granted options for 268,226 shares with an exercise price of $4.25. The weighted average fair value of options granted during first quarter 2004, estimated on the date of grant using the Black-Scholes option pricing model, was $1.40. The fair value of options granted in first quarter 2004 was determined using the following assumptions: a weighted average risk-free interest rate of 3.98%, no dividend yield, expected life of 10 years, which equals the terms of the options, and no expected volatility. There were no options granted in second quarter 2004.

The Company granted options for 198,308 shares in first quarter 2003 with an exercise price of $3.00. The weighted average fair value of options granted during first quarter 2003, estimated on the date of grant using the Black-Scholes option pricing model, was $1.00. The fair value of options granted in first quarter 2003 was determined using the following assumptions: a risk-free interest rate of 4.05%, no dividend yield, expected life of 10 years, which equals the terms of the options, and no expected volatility. There were no options granted in second quarter 2003.


5.	Inventories:

Inventories consist of tires, wheels, equipment and related accessories and are valued at the lower of cost, determined on the first-in, first-out (FIFO) method or market. The Company performs periodic assessments to determine the existence of obsolete, slow-moving and non-saleable inventories and records necessary provisions to reduce such inventories to net realizable value. Terms with a majority of the Company’s tire vendors allow for return of tire products, within limitations, as specified in their supply agreements. All of the Company’s inventories are held as collateral under the revolving credit facility (“Revolver”).

American Tire Distributors, Inc.

Notes to Condensed Consolidated Financial Statements — (Continued)


6.	Shipping and Handling Costs:

Outbound shipping and handling costs are classified as selling, general and administrative expenses in the accompanying condensed consolidated statements of operations. Such expenses totaled $15.7 million and $15.4 million for the quarters ended July 3, 2004 and June 28, 2003, respectively, and $31.6 million and $30.7 million for the six months ended July 3, 2004 and June 28, 2003, respectively.


7.	Deferred Income Taxes:

The Company has deferred tax assets, consisting primarily of net operating loss carryforwards (“NOLs”) of $14.2 million and $15.3 million at July 3, 2004 and December 27, 2003, respectively. The decrease in net deferred tax assets is primarily attributable to current period income and the corresponding NOL utilization. Management has evaluated the Company’s deferred tax assets and has concluded that the realizability of the deferred tax assets is more likely than not, except as it relates to certain state NOLs, for which a valuation allowance of $1.0 million is recorded as of July 3, 2004, unchanged from December 27, 2003. The valuation allowance relates to certain deferred tax assets, that in management’s assessment, may not be realized due to the sale of Winston Tire Company (“Winston”) in May 2001. This evaluation considered the historical and long-term expected profitability of the Company. Given the timing of the reversal of its temporary differences and the expiration date of its NOLs, the Company believes that taxable income generated in current and future years will be sufficient to utilize the remaining net deferred tax assets. The Company’s ability to generate future taxable income is dependent on numerous factors including general economic conditions, the state of the replacement tire market and other factors beyond management’s control. There can be no assurance that the Company will meet its expectation of future taxable income and adjustments to the valuation allowance may be required in the future.


8.	Long-term Debt and Other Financing Arrangements:


	Revolving Credit Facility

On March 19, 2004, the Company executed a Third Amended and Restated Loan and Security Agreement to the Revolver. The Borrowers to the Revolver are the Company and its subsidiaries. The Revolver provides for borrowings in the aggregate principal amount of up to the lesser of $245.0 million, less defined reserves, or the Borrowing Base, as defined in the agreement. On April 2, 2004, the Company and its lenders executed an amendment to the Revolver to amend the requirements and form of the officer’s compliance certificate to be issued to the lenders.

Borrowings under the Revolver bear interest, at (i) the Base Rate, as defined, plus the applicable margin (0.75% as of July 3, 2004) or (ii) the Eurodollar Rate, as defined, plus the applicable margin (2.25% as of July 3, 2004). These margins are subject to performance-based step-downs resulting in margins ranging from 0.25% to 1.25% for Base Rate loans and 1.75% to 2.75% for Eurodollar Rate loans, respectively.

The Revolver, as amended, requires the Company to meet a fixed charge coverage test, as defined, as well as certain covenants, which among other things, limits the ability of the Company to incur additional indebtedness; enter into guarantees; make loans and investments; make capital expenditures; declare dividends; engage in mergers, consolidations and asset sales; enter into transactions with affiliates; create liens and encumbrances; enter into sale/leaseback transactions; modify material agreements; and change the business it conducts. As of July 3, 2004, the Company was in compliance with these covenants. The Company’s obligations under the Revolver are secured by all inventories and accounts receivable. The Revolver expires February 15, 2008.

American Tire Distributors, Inc.

Notes to Condensed Consolidated Financial Statements — (Continued)


	Derivative Instruments

During second quarter 2003, the Company entered into an interest rate swap agreement (“Swap”) to manage exposure to fluctuations in interest rates. The Swap represents a contract to exchange floating rate for fixed interest payments periodically over the life of the agreement without exchange of the underlying notional amount. The notional amount of the Swap is used to measure interest to be paid or received and does not represent the amount of exposure to credit loss. At July 3, 2004, the Swap in place covers a notional amount of $50.0 million of indebtedness at a fixed interest rate of 2.14% and expires in June 2006. The Swap has not been designated for hedge accounting treatment. Accordingly, the Company recognizes the fair value of the Swap in the accompanying condensed consolidated balance sheets and any changes in the fair value are recorded as adjustments to interest expense in the accompanying condensed consolidated statements of operations. The fair value of the Swap is the estimated amount that the Company would pay or receive to terminate the agreement at the reporting date. The fair value of the Swap was an asset of $0.7 million and $0.2 million at July 3, 2004 and December 27, 2003, respectively, and is included in other assets in the accompanying condensed consolidated balance sheets. As a result of the change in fair value, $0.6 million and $0.4 million net reductions to interest expense were recorded for the quarter and six months ended July 3, 2004, respectively. For the quarter and six months ended June 28, 2003, the Company recorded additional interest expense of $0.3 million relating to the change in fair value of the Swap.


	Capital Lease Obligations

As of July 3, 2004, the Company has a capital lease obligation of $14.1 million relating to the sale and leaseback of three of its owned facilities. All cash paid to the lessor is recorded as interest expense and the capital lease obligation will be reduced when the Company no longer has continuing involvement with the properties. The initial term of the lease is for 20 years, followed by two 10-year renewal options. The annual rent paid under the terms of the lease is $1.6 million (paid quarterly) and is adjusted for Consumer Price Index changes every two years. As of April 25, 2004, the annual rent increased to $1.7 million. In addition, the purchaser received warrants to purchase 153,597 shares of the Company’s common stock. The warrants have a term of 10 years with a stated exercise price of $3.00 per warrant. The Company recorded these warrants at fair value and has presented them as a component of stockholders’ equity in the accompanying condensed consolidated balance sheets.


	Debt Maturities

Aggregate annual maturities of long-term debt at July 3, 2004, are as follows (in thousands):


Year Ending
December:

2004 (remainder)	$	1,097
2005		1,477
2006		644
2007		264
2008		169,989
Thereafter		14,192

	$	187,663

American Tire Distributors, Inc.

Notes to Condensed Consolidated Financial Statements — (Continued)


9.	Redeemable Preferred Stock:

The following represents the Company’s issued and outstanding redeemable preferred stock (dollars in thousands, except share amounts):


		July 3,		December 27,
		2004		2003

		(Unaudited)
Redeemable preferred stock Series A — 4% cumulative; 7,000 shares authorized; 5,500 and 6,500 shares issued and outstanding, respectively		$	5,500	$	6,500
Redeemable preferred stock Series B — variable rate cumulative; 4,500 shares authorized, issued and outstanding			4,035		4,035

	Total redeemable preferred stock	$	9,535	$	10,535

The stated value of Series A preferred stock is $1,000 per share. Holders of Series A preferred stock are entitled to receive, when and if declared by the Board of Directors, cumulative cash dividends at an annual rate of 4%, subject to adjustment based on the volume of purchases from one of the Company’s suppliers. Additional dividends will accrue, when and if declared by the Board of Directors, and are payable on the last business day of January. For the six months ended July 3, 2004, the Company declared and paid a dividend based on a 4% rate. The Series A preferred stock is classified as a liability in the accompanying condensed consolidated balance sheets and the related dividends are included in interest expense in the accompanying condensed consolidated statements of operations. The Series A preferred stock can be redeemed by the Company, beginning on the last business day of December 2002 and on the last business day of each June and December thereafter, through June 2007. During the six months ending July 3, 2004, the Company redeemed 1,000 shares of the Series A preferred stock for $1.0 million.

The stated value of Series B preferred stock is initially $1,000 per share, to be adjusted based on tire purchase credits as determined by the number of units purchased under a purchase agreement with a supplier entered into in May 1997. If the Company does not meet certain tire purchase requirements, holders of Series B preferred stock are entitled to receive dividend payments, when and if declared by the Board of Directors, at the prime rate. The remaining value of Series B preferred stock shall be redeemed by the Company on the last business day of June 2007 at a price equal to the adjusted stated value plus all accrued and unpaid dividends. The Series B preferred stock is classified as a liability in the accompanying condensed consolidated balance sheets. To date, the Company has met the purchase requirements, and no dividends have been declared and paid.


10.	Preferred Stock:

The following represents the Company’s issued and outstanding preferred stock (dollars in thousands, except share amounts):


		July 3,		December 27,
		2004		2003

		(Unaudited)
Preferred stock Series C — 12% cumulative; 1,333,334 shares authorized, issued and outstanding		$	16,680	$	15,960
Preferred stock Series D — 12% cumulative; 9,637,592 shares authorized, issued and outstanding			36,719		34,984

	Total preferred stock	$	53,399	$	50,944

American Tire Distributors, Inc.

Notes to Condensed Consolidated Financial Statements — (Continued)

Shares of Series C preferred stock accrue dividends at an annual rate of 12%. However, as long as any shares of Series A preferred stock or Series B preferred stock remain outstanding, no dividends may be paid. Shares of Series C preferred stock are convertible into common stock at a conversion price of $3.00 per common share.

Shares of Series D preferred stock accrue dividends at an annual rate of 12%. However, as long as any shares of Series A preferred stock or Series B preferred stock remain outstanding, no dividends may be paid. In addition, shares of Series D preferred stock are convertible into common stock at a conversion price of $3.00 per common share.

On October 31, 2003, the Company amended and restated its articles of incorporation to eliminate the redemption clause of the Series C and Series D preferred stock. No dividends have been declared or paid to date on the Series C or Series D preferred stock.


11.	Commitments and Contingencies:


	Guaranteed Lease Obligations

The Company remains liable as a guarantor on certain leases of Winston, its discontinued retail segment. As of July 3, 2004, total obligations of the Company, as guarantor on these leases is approximately $11.8 million extending over 15 years. However, the Company has secured assignments or sublease agreements for the vast majority of these commitments with contractual assigned or subleased rentals of approximately $11.2 million. A provision has been made for the net present value of the estimated shortfall.


	Legal Proceedings

The Company is involved from time to time in various lawsuits, including alleged class action lawsuits arising out of the ordinary conduct of its business. Although no assurances can be given, management does not expect that any of these matters will have a material adverse effect on the Company’s business or financial condition. The Company is also involved in various proceedings incidental to the ordinary course of its business. The Company believes, based on consultation with legal counsel, that none of these will have a material adverse effect on its financial condition or results of operations.


12.	Subsequent Event:

On July 30, 2004, the Company completed the purchase of all the outstanding stock of Texas Market Tire Holdings I, Inc., dba Big State Tire Supply (“Big State”), a tire distributor located in Lubbock, Texas pursuant to the terms of that certain Stock Purchase Agreement dated July 2, 2004. Big State operates nine distribution centers located in Texas, Oklahoma and New Mexico. The acquisition was financed by the Company’s existing Revolver.

American Tire Distributors, Inc.

Notes to Condensed Consolidated Financial Statements — (Continued)


13.	Subsidiary Guarantor Financial Information:

The Company’s Series D Senior Notes are guaranteed on a full, unconditional and joint and several basis by all of the Company’s subsidiaries, each of which is wholly-owned. The condensed consolidating financial information for the Company is as follows (dollars in thousands, except per share amounts):

Condensed consolidating balance sheets as of July 3, 2004 and December 27, 2003, are as follows:



				As of July 3, 2004

				Parent			Subsidiary
				Company			Guarantors		Eliminations			Consolidated


				(Unaudited)
Assets
Current assets:
	Cash and cash equivalents			$	3,706		$	33	$	—		$	3,739
	Accounts receivable, net				94,894			33,656		—			128,550
	Inventories				140,288			56,891		—			197,179
	Other current assets				17,965			457		—			18,422

		Total current assets			256,853			91,037		—			347,890

Property and equipment, net					17,102			3,057		—			20,159
Goodwill and other intangible assets, net					51,208			44,586		—			95,794
Investment in subsidiaries					55,663			—		(55,663	)		—
Other assets					15,584			398		—			15,982

			Total assets	$	396,410		$	139,078	$	(55,663	)	$	479,825

Liabilities and Stockholders’ Equity
Current liabilities:
	Accounts payable			$	209,893		$	—	$	—		$	209,893
	Accrued expenses				21,491			1,715		—			23,206
	Current maturities of long-term debt				1,967			—		—			1,967
	Intercompany payables (receivables)				(80,478	)		80,478		—			—

		Total current liabilities			152,873			82,193		—			235,066

Revolving credit facility and other long-term debt					142,994			—		—			142,994
Series D Senior Notes					28,600			—		—			28,600
Capital lease obligations					14,102			—		—			14,102
Other liabilities					3,881			1,222		—			5,103
Redeemable preferred stock					9,535			—		—			9,535
Stockholders’ equity:
	Intercompany investment				—			49,454		(49,454	)		—
	Preferred stock				53,399			—		—			53,399
	Common stock, par value $.01 per share; 50,000,000 shares authorized; 5,086,917 shares issued and outstanding				51			—		—			51
	Additional paid-in capital				22,818			—		—			22,818
	Warrants				1,352			—		—			1,352
	Accumulated deficit				(33,195	)		6,209		(6,209	)		(33,195	)

		Total stockholders’ equity			44,425			55,663		(55,663	)		44,425

			Total liabilities and stockholders’ equity	$	396,410		$	139,078	$	(55,663	)	$	479,825

American Tire Distributors, Inc.

Notes to Condensed Consolidated Financial Statements — (Continued)



				As of December 27, 2003

				Parent			Subsidiary
				Company			Guarantors		Eliminations			Consolidated

Assets
Current assets:
	Cash and cash equivalents			$	3,295		$	31	$	—		$	3,326
	Accounts receivable, net				71,058			25,062		—			96,120
	Inventories				123,126			50,925		—			174,051
	Other current assets				16,548			539		—			17,087

			Total current assets		214,027			76,557		—			290,584

Property and equipment, net					14,421			3,241		—			17,662
Goodwill and other intangible assets, net					51,441			44,737		—			96,178
Investment in subsidiaries					49,967			—		(49,967	)		—
Other assets					14,142			437		—			14,579

			Total assets	$	343,998		$	124,972	$	(49,967	)	$	419,003

Liabilities and Stockholders’ Equity
Current liabilities:
	Accounts payable			$	170,716		$	—	$	—		$	170,716
	Accrued expenses				16,408			1,544		—			17,952
	Current maturities of long-term debt				2,915			4		—			2,919
	Intercompany payables (receivables)				(72,159	)		72,159		—			—

			Total current liabilities		117,880			73,707		—			191,587

Revolving credit facility and other long-term debt					137,044			—		—			137,044
Series D Senior Notes					28,600			—		—			28,600
Capital lease obligations					14,153			—		—			14,153
Other liabilities					3,292			1,298		—			4,590
Redeemable preferred stock					10,535			—		—			10,535
Stockholders’ equity:
	Intercompany investment				—			49,454		(49,454	)		—
	Preferred stock				50,944			—		—			50,944
	Common stock, par value $.01 per share; 50,000,000 shares authorized; 5,086,917 shares issued and outstanding				51			—		—			51
	Additional paid-in capital				22,388			—		—			22,388
	Warrants				1,782			—		—			1,782
	Note receivable from sale of stock				(17	)		—		—			(17	)
	Accumulated deficit				(42,654	)		513		(513	)		(42,654	)

		Total stockholders’ equity			32,494			49,967		(49,967	)		32,494

			Total liabilities and stockholders’ equity	$	343,998		$	124,972	$	(49,967	)	$	419,003

American Tire Distributors, Inc.

Notes to Condensed Consolidated Financial Statements — (Continued)

Condensed consolidating statements of operations for the quarters ended July 3, 2004 and June 28, 2003 are as follows:



		For the Quarter Ended
		July 3, 2004

		Parent			Subsidiary
		Company			Guarantors		Eliminations			Consolidated


		(Unaudited)
Net sales		$	222,458		$	91,647	$	—		$	314,105
Cost of goods sold			183,294			76,107		—			259,401

	Gross profit		39,164			15,540		—			54,704
Selling, general and administrative expenses			30,959			10,897		—			41,856

	Operating income		8,205			4,643		—			12,848
Other income (expense):
	Interest expense		(2,353	)		—		—			(2,353	)
	Other, net		(106	)		70		—			(36	)
	Equity earnings of subsidiaries		2,828			—		(2,828	)		—

Income from operations before income taxes			8,574			4,713		(2,828	)		10,459
Provision for income taxes			2,299			1,885		—			4,184

Net income		$	6,275		$	2,828	$	(2,828	)	$	6,275



		For the Quarter Ended
		June 28, 2003

		Parent			Subsidiary
		Company			Guarantors		Eliminations			Consolidated


		(Unaudited)
Net sales		$	203,722		$	82,415	$	—		$	286,137
Cost of goods sold			166,297			68,179		—			234,476

	Gross profit		37,425			14,236		—			51,661
Selling, general and administrative expenses			29,661			10,783		—			40,444

	Operating income		7,764			3,453		—			11,217
Other income (expense):
	Interest expense		(3,930	)		—		—			(3,930	)
	Other, net		(28	)		52		—			24
	Equity earnings of subsidiaries		2,103			—		(2,103	)		—

Income from operations before income taxes			5,909			3,505		(2,103	)		7,311
Provision for income taxes			1,522			1,402		—			2,924

Net income		$	4,387		$	2,103	$	(2,103	)	$	4,387

American Tire Distributors, Inc.

Notes to Condensed Consolidated Financial Statements — (Continued)

Condensed consolidating statements of operations for the six months ended July 3, 2004 and June 28, 2003 are as follows:



		For the Six Months Ended
		July 3, 2004

		Parent			Subsidiary
		Company			Guarantors			Eliminations			Consolidated


		(Unaudited)
Net sales		$	436,791		$	178,680		$	—		$	615,471
Cost of goods sold			355,899			147,269			—			503,168

	Gross profit		80,892			31,411			—			112,303
Selling, general and administrative expenses			64,204			22,056			—			86,260

	Operating income		16,688			9,355			—			26,043
Other income (expense):
	Interest expense		(5,851	)		(2	)		—			(5,853	)
	Other, net		(473	)		140			—			(333	)
	Equity earnings of subsidiaries		5,696			—			(5,696	)		—

Income from operations before income taxes			16,060			9,493			(5,696	)		19,857
Provision for income taxes			4,146			3,797			—			7,943

Net income		$	11,914		$	5,696		$	(5,696	)	$	11,914



		For the Six Months Ended
		June 28, 2003

		Parent			Subsidiary
		Company			Guarantors		Eliminations			Consolidated


		(Unaudited)
Net sales		$	391,063		$	153,153	$	—		$	544,216
Cost of goods sold			320,504			127,571		—			448,075

	Gross profit		70,559			25,582		—			96,141
Selling, general and administrative expenses			58,500			21,252		—			79,752

	Operating income		12,059			4,330		—			16,389
Other income (expense):
	Interest expense		(7,686	)		—		—			(7,686	)
	Other, net		120			132		—			252
	Equity earnings of subsidiaries		2,677			—		(2,677	)		—

Income from operations before income taxes			7,170			4,462		(2,677	)		8,955
Provision for income taxes			1,797			1,785		—			3,582

Net income		$	5,373		$	2,677	$	(2,677	)	$	5,373

American Tire Distributors, Inc.

Notes to Condensed Consolidated Financial Statements — (Continued)

Condensed consolidating statements of cash flows for the six months ended July 3, 2004 and June 28, 2003 are as follows:



				For the Six Months Ended
				July 3, 2004

				Parent			Subsidiary
				Company			Guarantors			Eliminations			Consolidated


				(Unaudited)
Cash flows from operating activities:
	Net income			$	11,914		$	5,696		$	(5,696	)	$	11,914
	Adjustments to reconcile net income to net cash provided by (used in) operating activities:
		Depreciation and amortization of other intangibles and other assets			2,267			713			—			2,980
		Provision for doubtful accounts			17			94			—			111
		Other, net			844			(11	)		—			833
		Equity earnings of subsidiaries			(5,696	)		—			5,696			—
	Change in operating assets and liabilities:
		Accounts receivable			(23,853	)		(8,688	)		—			(32,541	)
		Inventories			(17,162	)		(5,966	)		—			(23,128	)
		Other current assets			(2,136	)		82			—			(2,054	)
		Accounts payable and accrued expenses			44,260			171			—			44,431
		Other, net			(1,245	)		(43	)		—			(1,288	)

			Net cash provided by (used in) operating activities		9,210			(7,952	)		—			1,258

Cash flows from investing activities:
Purchase of property and equipment					(1,460	)		(370	)		—			(1,830	)
Proceeds from sale of property and equipment					7			21			—			28
Intercompany					(8,307	)		8,307			—			—

			Net cash provided by (used in) investing activities		(9,760	)		7,958			—			(1,802	)

Cash flows from financing activities:
Net proceeds from (repayments of) revolving credit facility and other long-term debt					1,961			(4	)		—			1,957
Series A preferred stock redemption					(1,000	)		—			—			(1,000	)

			Net cash provided by (used in) financing activities		961			(4	)		—			957

Net increase in cash and cash equivalents					411			2			—			413
Cash and cash equivalents, beginning of period					3,295			31			—			3,326

Cash and cash equivalents, end of period				$	3,706		$	33		$	—		$	3,739

American Tire Distributors, Inc.

Notes to Condensed Consolidated Financial Statements — (Continued)



				For the Six Months Ended
				June 28, 2003

				Parent			Subsidiary
				Company			Guarantors			Eliminations			Consolidated


				(Unaudited)
Cash flows from operating activities:
	Net income			$	5,373		$	2,677		$	(2,677	)	$	5,373
	Adjustments to reconcile net income to net cash provided by (used in) operating activities:
		Depreciation and amortization of other intangibles and other assets			2,398			1,636			—			4,034
		Provision for doubtful accounts			771			(35	)		—			736
		Other, net			3,536			24			—			3,560
		Equity earnings of subsidiaries			(2,677	)		—			2,677			—
	Change in operating assets and liabilities:
		Accounts receivable			(15,470	)		(3,365	)		—			(18,835	)
		Inventories			(2,392	)		(1,366	)		—			(3,758	)
		Other current assets			690			397			—			1,087
		Accounts payable and accrued expenses			10,650			47			—			10,697
		Other, net			(778	)		(65	)		—			(843	)

			Net cash provided by (used in) operating activities		2,101			(50	)		—			2,051

Cash flows from investing activities:
Purchase of property and equipment					(593	)		(524	)		—			(1,117	)
Proceeds from sale of property and equipment					478			52			—			530
Other, net					(50	)		—			—			(50	)
Intercompany					(423	)		423			—			—

			Net cash used in investing activities		(588	)		(49	)		—			(637	)

Cash flows from financing activities:
Net repayments of revolving credit facility and other long-term debt					(794	)		(6	)		—			(800	)
Series A preferred stock redemption					(500	)		—			—			(500	)

			Net cash used in financing activities		(1,294	)		(6	)		—			(1,300	)

Net increase (decrease) in cash and cash equivalents					219			(105	)		—			114
Cash and cash equivalents, beginning of period					2,538			155			—			2,693

Cash and cash equivalents, end of period				$	2,757		$	50		$	—		$	2,807


Item 2.	*Management’s Discussion and Analysis of Financial Condition and Results of Operations.*

The following discussion and analysis provides information which management believes is relevant to an assessment and understanding of the Company’s consolidated results of operations and financial condition. The discussion should be read in conjunction with the condensed consolidated financial statements and notes thereto contained in Part I of this report on Form 10-Q and with the Company’s Annual Report on Form 10-K for the fiscal year ended December 27, 2003.

Results of Operations

Quarter Ended July 3, 2004 Compared to Quarter Ended June 28, 2003

Consolidated net sales in second quarter 2004 increased $28.0 million, or 9.8% to $314.1 million from $286.1 million in second quarter 2003. The increase in sales is primarily attributable to an increase in light truck tire, wheel and equipment sales as well as certain manufacturer price increases that were part of an overall industry increase.

Gross profit increased $3.0 million, or 5.9% to $54.7 million in second quarter 2004 from $51.7 million in second quarter 2003 due primarily to the increase in sales. Gross profit as a percentage of sales decreased 0.7% to 17.4% in second quarter 2004 compared to 18.1% in second quarter 2003. The reduction in margin percentage was primarily due to various marketing programs that were in effect in second quarter 2004.

Selling, general and administrative expenses increased $1.5 million to $41.9 million in second quarter 2004 compared to $40.4 million in second quarter 2003. The increase in selling, general and administrative expenses is primarily due to increases in employee related expenses ($1.4 million), fuel costs ($0.1 million) and other net increases ($0.4 million), partially offset by a decrease in the provision for doubtful accounts ($0.4 million). The increase in employee related expenses is due in part to incentive based compensation associated with the increase in sales and profits. As a percentage of sales, selling, general and administrative expenses decreased to 13.3% in second quarter 2004 compared to 14.1% in second quarter 2003.

Operating income increased $1.6 million in second quarter 2004 to $12.8 million from $11.2 million in second quarter 2003 due primarily to an overall increase in sales partially offset by an increase in selling, general and administrative expenses.

Interest expense decreased $1.5 million in second quarter 2004 to $2.4 million from $3.9 million in second quarter 2003. The decrease is due primarily to a decline in interest rates, reduced debt levels and a $0.8 million net reduction to interest expense relating to the change in fair value of the interest rate swap agreement entered into in second quarter 2003.

The Company recognized an income tax provision of $4.2 million in second quarter 2004 compared to $2.9 million in second quarter 2003. The effective tax rate in each quarter was approximately 40%.

Net income increased $1.9 million in second quarter 2004 to $6.3 million from $4.4 million in second quarter 2003. The increase is due primarily to the increase in operating income and a decrease in interest expense, both of which were partially offset by the increase in the income tax provision.

Six Months Ended July 3, 2004 Compared to Six Months Ended June 28, 2003

Consolidated net sales for the six-month period in 2004 increased $71.3 million, or 13.1%, to $615.5 million from $544.2 million for the six-month period in 2003. The increase in sales is primarily attributable to an increase in light and medium truck tire, equipment and wheel sales as well as certain manufacturer price increases that were part of an overall industry increase. The results for 2004 also include an additional week of sales.

Gross profit increased $16.2 million, or 16.8%, to $112.3 million in the six-month period in 2004 from $96.1 million in the six-month period in 2003 due primarily to the increase in sales as well as a continuing shift to sales of the Company’s higher margin tires and wheels. Gross profit as a percentage of sales increased 0.5% to 18.2% in the six-month period in 2004 compared to 17.7% in the six-month period in 2003. Various marketing programs that were in effect in second quarter 2004 negatively impacted gross profit margins in 2004. This reduction in 2004 margins was partially offset by an aggressive first quarter 2003 marketing program, which resulted in reduced margins on certain products.

Selling, general and administrative expenses increased $6.5 million to $86.3 million in the six-month period in 2004 compared to $79.8 million in the six-month period in 2003. The increase in selling, general and administrative expenses is primarily due to increases in employee related expenses ($6.0 million) and other net increases ($1.1 million), partially offset by a reduction in amortization expense ($0.6 million) relating to noncompete agreements that ended in the second quarter of 2003. The increase in employee related expenses is due in part to incentive based compensation associated with an increase in sales and profits and the inclusion of an additional week in first quarter 2004. As a percentage of sales, selling, general and administrative expenses decreased to 14.0% for the six-month period in 2004 compared to 14.7% for the six-month period in 2003.

Operating income increased $9.6 million in the six-month period in 2004 to $26.0 million from $16.4 million in the six-month period in 2003 due primarily to an overall increase in sales and improvements in the Company’s gross profit margins, partially offset by an increase in selling, general and administrative expenses.

Interest expense decreased $1.8 million in the six-month period in 2004 to $5.9 million from $7.7 million in the six-month period in 2003. The decrease is due primarily to a decline in interest rates, reduced debt levels and a $0.7 million net reduction in interest expense relating to the change in fair value of the interest rate swap agreement entered into in second quarter 2003.

The Company recognized an income tax provision of $7.9 million in the six-month period of 2004 compared to $3.6 million in the six-month period of 2003. The effective tax rate in each period was approximately 40%.

Net income increased $6.5 million in the six-month period of 2004 to $11.9 million from $5.4 million in the six-month period of 2003. The increase is due primarily to the increase in operating income partially offset by the increase in the income tax provision.


	*EBITDA*

The Company evaluates performance based on several factors, of which the primary financial measure is earnings before interest, taxes, depreciation and amortization (“EBITDA”). EBITDA should not be considered an alternative to, or more meaningful than, net income or cash flow as determined in accordance with accounting principles generally accepted in the United States. The following table is a reconciliation of net income to EBITDA:

Reconciliation of net income to EBITDA:



	Quarters Ended				Six Months Ended

	July 3,		June 28,		July 3,		June 28,
	2004		2003		2004		2003


	(in thousands)				(in thousands)
Net income	$	6,275	$	4,387	$	11,914	$	5,373
Interest expense		2,353		3,930		5,853		7,686
Provision for income taxes		4,184		2,924		7,943		3,582
Depreciation and amortization of other intangibles		1,356		1,671		2,508		3,430

EBITDA	$	14,168	$	12,912	$	28,218	$	20,071

EBITDA increased $1.3 million to $14.2 million in second quarter 2004 compared to $12.9 million in second quarter 2003. The increase in EBITDA is due primarily to the increase in sales and improvements in the Company’s gross profit margins, partially offset by the increase in selling, general and administrative expenses.

EBITDA increased $8.1 million to $28.2 million for the six-month period 2004 compared to $20.1 million for the six-month period 2003. The increase in EBITDA is due primarily to the increase in sales and improvements in the Company’s gross profit margins, partially offset by the increase in selling, general and administrative expenses.

Critical Accounting Polices

The preparation of financial statements and related disclosures in conformity with accounting principles generally accepted in the United States requires management to make judgments, assumptions and estimates that affect the amounts reported. Please see the discussion of critical accounting policies and estimates in the Company’s Annual Report on Form 10-K for the fiscal year ended December 27, 2003.

Liquidity and Capital Resources

At July 3, 2004, the combined net indebtedness (net of cash) of the Company was $183.9 million compared to $179.4 million at December 27, 2003. Total commitments by the lenders under the Company’s revolving credit facility (“Revolver”) were $245.0 million at July 3, 2004, of which $57.1 million was available for additional borrowings. The amount available to borrow is limited by the Borrowing Base computation, as defined in the agreement.


	*Cash Flows from Operating Activities*

The Company’s principal source of cash during the six-month period of 2004 was provided by operations. Net cash provided by operating activities decreased to $1.3 million in the six-month period of 2004, a decrease of $0.8 million, compared to $2.1 million in the six-month period of 2003. The decrease is primarily due to an increase in the Company’s net working capital requirements as a result of increased business activity as well as the increase in cash payments for taxes due to the utilization of net operating loss carryforwards, partially offset by improvements in the Company’s profitability. Net working capital at July 3, 2004, totaled $112.8 million compared to $99.0 million at December 27, 2003, an increase of $13.8 million.


	*Cash Flows from Investing Activities*

Net cash used in investing activities increased $1.2 million to $(1.8) million in the six-month period of 2004 compared to $(0.6) million in the six-month period of 2003 due primarily to the sale of property and equipment in first quarter 2003 which generated proceeds of $0.5 million. Capital expenditures during the six-month period in 2004 of $1.8 million were primarily for information technology upgrades and leasehold improvements. During the six-month period of 2004, the Company also had capital expenditures financed by debt of $2.8 million relating to information technology upgrades.


	*Cash Flows from Financing Activities*

Net cash provided by financing activities increased $2.3 million to $1.0 million in the six-month period of 2004 compared to $(1.3) million in the six-month period of 2003 primarily due to net proceeds from the revolving credit facility and other long-term debt partially offset by the redemption on the Series A preferred stock.


	*Revolving Credit Facility*

defined reserves, or the Borrowing Base, as defined in the agreement. On April 2, 2004, the Company and its lenders executed an amendment to the Revolver to amend the requirements and form of the officer’s compliance certificate to be issued to the lenders.

The Company anticipates that its principal use of cash going forward will be to meet working capital and debt service requirements and to make capital expenditures. Based upon current and anticipated levels of operations, the Company believes that its cash flow from operations, together with amounts available under the Revolver, will be adequate to meet its anticipated requirements. There can be no assurance, however, that the Company’s business will continue to generate sufficient cash flow from operations in the future to meet these requirements or to service its debt, and the Company may be required to refinance all or a portion of its existing debt, or to obtain additional financing. These increased borrowings may result in higher interest payments. In addition, there can be no assurance that any such refinancing would be possible or that any additional financing could be obtained. The inability to obtain additional financing could have a material adverse effect on the Company.

Income Taxes

the sale of Winston Tire Company (“Winston”) in May 2001. This evaluation considered the historical and long-term expected profitability of the Company. Given the timing of the reversal of its temporary differences and the expiration date of its NOLs, the Company believes that taxable income generated in current and future years will be sufficient to utilize the remaining net deferred tax assets. The Company’s ability to generate future taxable income is dependent on numerous factors including general economic conditions, the state of the replacement tire market and other factors beyond management’s control. There can be no assurance that the Company will meet its expectation of future taxable income and adjustments to the valuation allowance may be required in the future.

Recently Issued Accounting Pronouncements


Item 3.	*Quantitative and Qualitative Disclosure about Market Risk.*

For the period ended July 3, 2004, the Company did not experience any material changes from the quantitative and qualitative disclosures about market risk presented in the Company’s Annual Report on Form 10-K for the fiscal year ended December 27, 2003.


Item 4.	*Controls and Procedures.*


	Evaluation of Disclosure Controls and Procedures

Based on their evaluation as of the end of the period covered by this quarterly report on Form 10-Q, the Company’s principal executive officer and principal financial officer have concluded that the Company’s disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934 (the “Exchange Act”)) are effective to ensure that information required to be disclosed by the Company in reports that it files or submits under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in Securities and Exchange Commission rules and forms.


	Changes in Internal Controls

During the quarter ended July 3, 2004, there was no change in the Company’s internal controls over financial reporting that has materially affected, or is reasonably likely to materially affect, the Company’s internal control over financial reporting, except that as part of an ongoing implementation of an Oracle enterprise resource planning system, the Company is updating the internal controls over financial reporting as necessary to accommodate any modifications to its business processes or accounting procedures.

PART II. OTHER INFORMATION


Item 1.	*Legal Proceedings.*

There have been no material developments in legal proceedings involving the Company since those reported in the Company’s Annual Report on Form 10-K for the fiscal year ended December 27, 2003.


Item 6.	*Exhibits and Reports on Form 8-K.*

(a) Exhibits


	31.1	Certification of Principal Executive Officer pursuant to Rules 13a-14(a) and 15d-14(a) under the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

	31.2	Certification of Principal Financial Officer pursuant to Rules 13a-14(a) and 15d-14(a) under the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

(b) Reports on Form 8-K


	No report on Form 8-K was filed during the quarter ended July 3, 2004.

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, as amended, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

Date: August 10, 2004


	AMERICAN TIRE DISTRIBUTORS, INC.


	By:	/s/ SCOTT A. DEININGER



	Scott A. Deininger
	Senior Vice President of
	Finance and Administration
	(On behalf of the Registrant and
	as Principal Financial Officer)

AMERICAN TIRE DISTRIBUTORS INC 10-Q