8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934.

Date of Report (Date of Earliest Event Reported):

October 17, 2006

MONRO MUFFLER BRAKE, INC.

(Exact name of registrant as specified in its charter)

New York	0-19357	16-0838627
(State of Incorporation)	(Commission File Number)	(I.R.S. Employer Identification No.)
200 Holleder Parkway, Rochester, New York		14615
(Address of Principal Executive Offices)		(Zip Code)
Registrant’s telephone number, including area code		(585) 647-6400

Not Applicable

(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 2.02      Results of Operations and Financial Condition

     On October 17, 2006, Monro Muffler Brake, Inc. (the “Company”) issued a press release announcing its operating results for the second quarter ended September 23, 2006. A copy of the press release is furnished herewith.

Item 9.01      Financial Statements and Exhibits

     (a)            Not applicable.

     (b)            Not applicable.

     (c)            The following is a list of exhibits furnished with this Current Report on Form 8-K:

Exhibit No.	Description
99.1	Press Release dated October 17, 2006.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Company has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

	MONRO MUFFLER BRAKE, INC.
		(Registrant)
October 17, 2006		By:	/s/ Catherine D’Amico
			Catherine D’Amico Executive Vice President - Finance

EX-99.1

Exhibit 99.1

WALL STREET PLAZA
88 PINE STREET, 32ND FLOOR
NEW YORK, NY 10005, US

TEL   + 1 212 850 5600
FAX  + 1 212 850 5790

CONTACT: Robert Gross
President and Chief Executive Officer
(585) 647-6400

Catherine D’Amico
EVP of Finance and Chief Financial Officer
(585) 647-6400

Investor Relations:
Cara O’Brien/Melissa Myron
Media: Evan Goetz
Financial Dynamics
(212) 850-5600

FOR IMMEDIATE RELEASE

MONRO MUFFLER BRAKE, INC. ANNOUNCES SECOND QUARTER RESULTS
~ Second Quarter Sales Increase 12.2% to a Record $107.3 Million ~
~Second Quarter Comparable Store Sales Increase 1.1%~

     ROCHESTER, N.Y. — October 17, 2006 — Monro Muffler Brake, Inc. (Nasdaq: MNRO), a leading provider of automotive undercar repair and tire services, today announced financial results for the second quarter and six months ended September 23, 2006.

     Second quarter sales increased 12.2% to a record $107.3 million due to a 1.1% comparable store sales increase and a $12.2 million contribution from new stores, which includes $9.9 million related to the 75 ProCare Automotive locations that were acquired on April 29, 2006. Comparable store sales were driven by an approximate 9% increase in comparable store tire sales and an approximate 4% gain in the comparable store maintenance service category. The Company opened two locations and closed two during the quarter.

     Gross profit in the second quarter increased 11.0% to $44.1 million from $39.7 million last year. Gross margin was 41.1% compared to 41.6%. Vendor price increases on certain products, such as tires and oil, negatively impacted gross margin, and were partially offset by an increase in vendor rebates recorded as a reduction of cost of sales compared to the prior-year quarter. Selling, general, and

administrative expenses were $32.1 million, or 29.9% of sales, versus $26.8 million, or 28.0% of sales, last year primarily due to the addition of the less profitable ProCare business and a corresponding increase in advertising spending. In addition, approximately one percentage point of the increase in selling, general, & administrative expenses was a result of certain vendor rebates shifting from SG & A into cost of sales due to the impact of EITF 02-16 on renegotiated vendor contracts.

     Second quarter net income was $5.6 million or $.37 per diluted share, which includes the previously disclosed $1.7 million after-tax impairment charge related to the Company’s Strauss Discount Auto equity investment. Excluding this one-time charge, net income was $7.3 million, or $.48 per diluted share, compared to $7.6 million, or $.51 per diluted share, last year.

     For the six month period, net sales increased 8.1% to $205.7 million from $190.3 million last year. Net income for the first six months of fiscal 2007 was $13.2 million, or $.87 per diluted share, which includes the aforementioned $1.7 million after-tax impairment charge. Excluding the one-time impairment charge, net income was $14.8 million, or $.98 per diluted share, versus $15.4 million, or $1.03 per diluted share, in the year-ago period.

     Robert G. Gross, President and Chief Executive Officer, commented, “During the second quarter, our comparable store sales showed sequential improvement each month and we ended the quarter with a 5% increase in September. As the external environment improved, our customers began to return to more normalized spending patterns and looked to Monro to provide many of the major maintenance services that had been deferred.”

     Mr. Gross continued, “In addition, we continued to make progress with the recently-acquired ProCare locations. We have substantially completed transitioning the stores to our proven business model and the new signage is in place. During the second quarter, we continued to see improvements in ProCare’s comparable store sales and the new stores were dilutive by $.02 to our bottom line, which was in-line with our expectations. We are planning to launch Grand re-Opening events in November and expect these sales-driving efforts to result in continued improvement in ProCare’s results, as well as benefit the Monro stores already in these markets. While we view fiscal 2007 as a transition year for the ProCare locations, we remain confident this group of stores will positively contribute to our bottom line in fiscal 2008 and beyond.”

     Based upon year-to-date results and current trends, the Company is tightening its anticipated earnings per diluted share range to $1.68 to $1.72, excluding the $.11 impact of the aforementioned one-

time impairment charge. The Company currently expects third quarter diluted earnings per share to be between $.31 and $.34, with a comparable store sales increase of 1% to 3%.

     Mr. Gross concluded, “The sequential improvement in sales during the second quarter validates our position as a trusted service provider in the industry and demonstrates that our strategy to drive traffic, build a loyal customer base, and increase our market share is working. That said, we are not satisfied with our second quarter results and are focused on driving further improvements in the second half of the year. In addition, we believe the challenging macroeconomic environment will present us with attractive acquisition opportunities and several possibilities are at various stages of negotiation.”

Monro Muffler Brake will be hosting a conference call today, October 17, 2006, at 11:00 a.m. Eastern to discuss the quarterly results. The call will be simultaneously broadcast over the Internet at www.vcall.com. An archive of the webcast will be available at this web site an hour after the live call through midnight October 31, 2006.

Monro Muffler Brake operates a chain of stores providing automotive undercar repair and tire services in the United States, operating under the brand names of Monro Muffler Brake and Service, ProCare, Mr. Tire and Tread Quarters Discount Tires. The Company currently operates 701 stores and has 16 dealer locations in New York, Pennsylvania, Ohio, Connecticut, Massachusetts, West Virginia, Virginia, Maryland, Vermont, New Hampshire, New Jersey, North Carolina, South Carolina, Indiana, Rhode Island, Delaware, Maine and Michigan. Monro’s stores provide a full range of services for exhaust systems, brake systems, steering and suspension systems, tires and many vehicle maintenance services.

The statements contained in this press release that are not historical facts may contain statements of future expectations and other forward-looking statements made pursuant to the Safe Harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are subject to risks, uncertainties and other important factors that could cause actual results to differ materially from those expressed. These factors include, but are not necessarily limited to, product demand, dependence on and competition within the primary markets in which the Company’s stores are located, the need for and costs associated with store renovations and other capital expenditures, the effect of economic conditions, the impact of competitive services and pricing, product development, parts supply restraints or difficulties, industry regulation, risks relating to leverage and debt service (including sensitivity to fluctuations in interest rates), continued availability of capital resources and financing, risks relating to integration of acquired businesses, the availability of vendor rebates, and other factors set forth elsewhere herein and in the Company’s Securities and Exchange Commission filings, including the report on Form 10-K for the fiscal year ended March 2006 and subsequent periodic filings.

###

MONRO MUFFLER BRAKE, INC.
Financial Highlights
(Unaudited)
(Dollars in thousands, except per share amounts)

	Quarter Ended Fiscal September
	2006		2005			% Change
Sales	$	107,285	$	95,641			12.2	%
Cost of sales, including distribution and occupancy costs		63,181		55,897			13.0
Gross profit		44,104		39,744			11.0
Operating, selling, general and administrative expenses		32,108		26,777			19.9
Operating income		11,996		12,967			(7.5	)
Interest expense, net		895		810			10.4
Other expense (income), net		2,148		(122	)
Income before provision for income taxes		8,953		12,279			(27.1	)
Provision for income taxes		3,357		4,666			(28.0	)
Net income	$	5,596	$	7,613			(26.5	)
Diluted earnings per common share	$	.37	$	.51			(27.5	)
Weighted average number of diluted shares outstanding		15,202		14,986
Number of stores open, (at end of quarter)		701		625

MONRO MUFFLER BRAKE, INC.
Supplemental Information — Reconciliation of GAAP and Comparable Basis
Net Income and Earnings per Share
(Dollars in thousands, except per share amounts)

	Quarter Ended Fiscal September
	2006		2005
Net income as reported	$	5,596	$	7,613
Add back: Impairment charge		1,673
Comparable basis net income	$	7,269	$	7,613
Comparable basis diluted earnings per share	$	.48	$	.51

MONRO MUFFLER BRAKE, INC.
Financial Highlights
(Unaudited)
(Dollars in thousands, except per share amounts)

	Six Months Ended Fiscal September
	2006		2005		% Change
Sales	$	205,730	$	190,266		8.1	%
Cost of sales, including distribution and occupancy costs		120,590		109,819		9.8
Gross profit		85,140		80,447		5.8
Operating, selling, general and administrative expenses		61,720		53,678		15.0
Operating income		23,420		26,769		(12.5	)
Interest expense, net		1,530		1,692		(9.6	)
Other expense, net		1,522		303
Income before provision for income taxes		20,368		24,774		(17.8	)
Provision for income taxes		7,210		9,414		(23.4	)
Net income	$	13,158	$	15,360		(14.3	)
Diluted earnings per common share	$	.87	$	1.03		(15.5	)
Weighted average number of diluted shares outstanding		15,209		14,926

MONRO MUFFLER BRAKE, INC.
Supplemental Information — Reconciliation of GAAP and Comparable Basis
Net Income and Earnings per Share
(Dollars in thousands, except per share amounts)

	Six Months Ended Fiscal September
	2006		2005
Net income as reported	$	13,158	$	15,360
Add back: Impairment charge		1,673
Comparable basis net income	$	14,831	$	15,360
Comparable basis diluted earnings per share	$	.98	$	1.03

MONRO MUFFLER BRAKE, INC.
Financial Highlights
(Unaudited)
(Dollars in thousands)

	September 23,		March 25,
	2006		2006
Assets
Current assets
Cash	$	1,001	$	3,780
Inventories		62,567		60,378
Other current assets		21,758		20,950
Total current assets		85,326		85,108
Property, plant and equipment, net		169,399		163,625
Other noncurrent assets		59,651		54,662
Total assets	$	314,376	$	303,395
Liabilities and Shareholders’ Equity
Current liabilities	$	53,847	$	53,716
Long-term debt		42,289		46,327
Other long-term liabilities		10,236		10,362
Total liabilities		106,372		110,405
Total shareholders’ equity		208,004		192,990
Total liabilities and shareholders’ equity	$	314,376	$	303,395

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