10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)

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

For the quarterly period ended September 27, 2014

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: 0-19357

MONRO MUFFLER BRAKE, INC.

(Exact name of registrant as specified in its charter)

New York	16-0838627
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification #)
200 Holleder Parkway, Rochester, New York	14615
(Address of principal executive offices)	(Zip code)

585-647-6400

(Registrant’s telephone number, including area code)

(Former name, former address and former fiscal year, if changed since last report)

Indicate by 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.    x  Yes    ¨  No

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate website, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).    x  Yes    ¨  No

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. (Check one):

Large accelerated filer	x	Accelerated filer	¨
Non-accelerated filer	¨  (Do not check if a smaller reporting company)	Smaller reporting company	¨

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).    ¨  Yes    x  No

As of October 24, 2014, 31,575,114 shares of the registrant’s common stock, par value $ .01 per share, were outstanding.

MONRO MUFFLER BRAKE, INC.

INDEX

	Page No.
Part I. Financial Information
Item 1. Financial Statements (Unaudited)
Consolidated Balance Sheets at September 27, 2014 and March 29, 2014		3
Consolidated Statements of Comprehensive Income for the quarters and six months ended September  27, 2014 and September 28, 2013		4
Consolidated Statement of Changes in Shareholders’ Equity for the six months ended September  27, 2014		5
Consolidated Statements of Cash Flows for the six months ended September 27, 2014 and September  28, 2013		6
Notes to Consolidated Financial Statements		7
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations		12
Item 3. Quantitative and Qualitative Disclosures About Market Risk		15
Item 4. Controls and Procedures		15
Part II. Other Information
Item 1. Legal Proceedings		16
Item 5. Other Information		16
Item 6. Exhibits		16
Signatures		17
Exhibit Index		18

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MONRO MUFFLER BRAKE, INC.

PART I - FINANCIAL INFORMATION

Item 1. Financial Statements

MONRO MUFFLER BRAKE, INC.

CONSOLIDATED BALANCE SHEETS

(UNAUDITED)

	September 27, 2014			March 29, 2014
	(Dollars in thousands)
Assets
Current assets:
Cash and equivalents	$	7,763		$	1,205
Trade receivables		3,153			2,728
Federal and state income taxes receivable		—			2,171
Inventories		142,775			124,920
Deferred income tax assets		13,971			13,710
Other current assets		30,153			23,382
Total current assets		197,815			168,116
Property, plant and equipment		569,862			531,505
Less - Accumulated depreciation and amortization		(259,214	)		(249,622	)
Net property, plant and equipment		310,648			281,883
Goodwill		334,649			270,039
Intangible assets		35,012			29,371
Other non-current assets		11,031			10,547
Long-term deferred income tax assets		14,936			—
Total assets	$	904,091		$	759,956
Liabilities and Shareholders’ Equity
Current liabilities:
Current portion of long-term debt, capital leases and financing obligations	$	9,302		$	7,552
Trade payables		70,968			53,321
Federal and state income taxes payable		1,677			—
Accrued payroll, payroll taxes and other payroll benefits		19,071			20,206
Accrued insurance		33,750			32,353
Warranty reserves		10,205			9,557
Other current liabilities		13,434			13,752
Total current liabilities		158,407			136,741
Long-term capital leases and financing obligations		128,283			81,199
Long-term debt		151,017			105,841
Accrued rent expense		5,441			5,700
Other long-term liabilities		12,476			11,558
Deferred income tax liabilities		—			140
Long-term income taxes payable		3,129			2,793
Total liabilities		458,753			343,972
Commitments
Shareholders’ equity:
Class C Convertible Preferred Stock, $1.50 par value, $.064 conversion value, 150,000 shares authorized; 32,500 shares issued and outstanding		49			49
Common Stock, $.01 par value, 65,000,000 shares authorized; 37,649,070 and 37,567,902 shares issued at September 27, 2014 and March 29, 2014, respectively		376			376
Treasury Stock, 6,076,951 shares at cost		(90,241	)		(90,241	)
Additional paid-in capital		145,980			141,365
Accumulated other comprehensive loss		(3,258	)		(3,135	)
Retained earnings		392,432			367,570
Total shareholders’ equity		445,338			415,984
Total liabilities and shareholders’ equity	$	904,091		$	759,956

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

3

MONRO MUFFLER BRAKE, INC.

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(UNAUDITED)

	Quarter Ended Fiscal September						Six Months Ended Fiscal September
	2014			2013			2014			2013
	(Dollars in thousands, except per share data)
Sales	$	221,299		$	205,321		$	438,806		$	411,492
Cost of sales, including distribution and occupancy costs		131,827			123,573			259,311			250,866
Gross profit		89,472			81,748			179,495			160,626
Operating, selling, general and administrative expenses		60,545			57,837			121,158			113,607
Operating income		28,927			23,911			58,337			47,019
Interest expense, net of interest income		2,772			2,048			4,908			3,858
Other income, net		(227	)		(179	)		(305	)		(231	)
Income before provision for income taxes		26,382			22,042			53,734			43,392
Provision for income taxes		10,052			8,392			20,472			16,171
Net income		16,330			13,650			33,262			27,221
Other comprehensive loss, net of tax:
Changes in pension, net of tax benefit		(62	)		(177	)		(123	)		(177	)
Comprehensive income	$	16,268		$	13,473		$	33,139		$	27,044
Earnings per share:
Basic	$	.51		$	.43		$	1.05		$	.86
Diluted	$	.50		$	.42		$	1.01		$	.84

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

4

MONRO MUFFLER BRAKE, INC.

CONSOLIDATED STATEMENT OF CHANGES IN SHAREHOLDERS’ EQUITY

(UNAUDITED)

(Dollars in thousands)

	Preferred Stock		Common Stock		Treasury Stock			Additional Paid-in Capital			Accumulated Other Comprehensive Loss (2)			Retained Earnings			Total
Balance at March 29, 2014	$	49	$	376	$	(90,241	)	$	141,365		$	(3,135	)	$	367,570		$	415,984
Net income															33,262			33,262
Other comprehensive loss:
Pension liability adjustment (($198) pre-tax)												(123	)					(123	)
Cash dividends (1): Preferred															(198	)		(198	)
Common															(8,202	)		(8,202	)
Stock issuance costs									(14	)								(14	)
Tax benefit from exercise of stock options									546									546
Exercise of stock options									1,783									1,783
Stock-based compensation									2,300									2,300
Balance at September 27, 2014	$	49	$	376	$	(90,241	)	$	145,980		$	(3,258	)	$	392,432		$	445,338

(1) Represents first and second quarter fiscal year 2015 dividend payment of $.13 per common share or common share equivalent paid each quarter on June 12, 2014 and August 28, 2014, respectively.

(2) The balance relates to the pension liability.

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

5

MONRO MUFFLER BRAKE, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(UNAUDITED)

	Six Months Ended Fiscal September
	2014			2013
	(Dollars in thousands) Increase (Decrease) in Cash
Cash flows from operating activities:
Net income	$	33,262		$	27,221
Adjustments to reconcile net income to net cash provided by operating activities –
Depreciation and amortization		17,074			15,331
Loss (gain) on disposal of assets		354			(121	)
Stock-based compensation expense		2,300			2,253
Excess tax benefits from share-based payment arrangements		(49	)		(97	)
Net change in deferred income taxes		542			907
Change in operating assets and liabilities:
Trade receivables		(420	)		(257	)
Inventories		(13,506	)		(2,426	)
Other current assets		(6,331	)		(312	)
Other non-current assets		95			816
Trade payables		17,647			(1,301	)
Accrued expenses		1,415			2,675
Federal and state income taxes payable		2,717			2,726
Other long-term liabilities		(760	)		(118	)
Long-term income taxes payable		336			(377	)
Total adjustments		21,414			19,699
Net cash provided by operating activities		54,676			46,920
Cash flows from investing activities:
Capital expenditures		(18,720	)		(13,913	)
Acquisitions, net of cash acquired		(64,157	)		(17,013	)
Proceeds from the disposal of assets		172			74
Net cash used for investing activities		(82,705	)		(30,852	)
Cash flows from financing activities:
Proceeds from borrowings		194,150			168,099
Principal payments on long-term debt, capital leases and financing obligations		(152,995	)		(179,411	)
Exercise of stock options		1,783			2,818
Excess tax benefits from share-based payment arrangements		49			97
Dividends to shareholders		(8,400	)		(7,067	)
Net cash provided by (used for) financing activities		34,587			(15,464	)
Increase in cash		6,558			604
Cash at beginning of period		1,205			1,463
Cash at end of period	$	7,763		$	2,067

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

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MONRO MUFFLER BRAKE, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Note 1 – Condensed Consolidated Financial Statements

The consolidated balance sheets as of September 27, 2014 and March 29, 2014, the consolidated statements of comprehensive income for the quarters and six months ended September 27, 2014 and September 28, 2013, the consolidated statement of changes in shareholders’ equity for the six months ended September 27, 2014, and the consolidated statements of cash flows for the six months ended September 27, 2014 and September 28, 2013, include financial information for Monro Muffler Brake, Inc. and its wholly-owned subsidiary, Monro Service Corporation (collectively, “Monro”, “we”, “us”, “our”). These unaudited, condensed consolidated financial statements have been prepared by Monro. We believe all known adjustments (consisting of normal recurring accruals or adjustments) have been made to fairly state the financial position, results of operations and cash flows for the unaudited periods presented.

Interim results are not necessarily indicative of results for a full year. The year-end consolidated balance sheet data was derived from audited financial statements, but does not include all disclosures required by accounting principles generally accepted in the United States of America. The information included in this Form 10-Q should be read in conjunction with the audited financial statements and notes thereto included in our Annual Report on Form 10-K for the year ended March 29, 2014.

We report our results on a 52/53 week fiscal year with the fiscal year ending on the last Saturday in March of each year. The following are the dates represented by each fiscal period reported in these condensed financial statements:

“Quarter Ended Fiscal September 2014”	June 29, 2014 – September 27, 2014 (13 weeks)
“Quarter Ended Fiscal September 2013”	June 30, 2013 – September 28, 2013 (13 weeks)
“Six Months Ended Fiscal September 2014”	March 30, 2014 – September 27, 2014 (26 weeks)
“Six Months Ended Fiscal September 2013”	March 31, 2013 – September 28, 2013 (26 weeks)

Fiscal year 2015, ending March 28, 2015, is a 52 week year.

Recent Accounting Pronouncements

In April 2014, the Financial Accounting Standards Board (“FASB”) issued new accounting guidance for the reporting of discontinued operations. This guidance eliminates certain exceptions from reporting discontinued operations that exist under current guidance, and also requires several new disclosures about disposals that qualify as discontinued operations. This guidance is effective for fiscal years and interim periods within those years beginning on or after December 15, 2014, with early adoption permitted. The adoption of this guidance is not anticipated to have a material effect on Monro’s Consolidated Financial Statements.

In May 2014, the FASB issued new accounting guidance for the reporting of revenue from contracts with customers. This guidance provides guidelines a company will apply to determine the measurement of revenue and timing of when it is recognized. This guidance is effective for the first interim period within annual reporting periods beginning after December 15, 2016 and early adoption is not permitted. We are currently evaluating the potential effect of the adoption of this guidance on our Consolidated Financial Statements.

Other recent authoritative guidance issued by the FASB (including technical corrections to the Accounting Standards Codification) and the Securities and Exchange Commission did not, or are not expected to have a material effect on Monro’s Consolidated Financial Statements.

Note 2 – Acquisitions

Acquisitions are strategic moves in our plan designed, among other things, to fill in and expand our presence in existing and contiguous markets, and leverage fixed operating costs such as distribution and advertising.

Subsequent Event

On September 28, 2014, we acquired nine retail tire and automotive repair stores located in Georgia from Wood & Fullerton Stores, LLC. These stores operate under the Mr. Tire name. The acquisition was financed through our existing credit facility.

Fiscal 2015

On August 8, 2014, we acquired 35 retail tire and automotive repair stores located in Florida from Hennelly Tire & Auto, Inc. These stores operate under The Tire Choice name. The acquisition was financed through our existing credit facility.

7

MONRO MUFFLER BRAKE, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

On June 15, 2014, we acquired ten and nine retail tire and automotive repair stores located in Michigan from Lentz U.S.A. Service Centers, Inc. and Kan Rock Tire Company, Inc., respectively. These stores operate under the Monro Brake & Tire name.

On April 13, 2014, we acquired two retail tire and automotive repair stores located in New Hampshire from Bald Tire & Auto, Inc. These stores were previously Tire Warehouse franchise locations and continue to operate under the Tire Warehouse name.

The acquisitions resulted in goodwill related to, among other things, growth opportunities and unidentifiable intangible assets. All of the goodwill is expected to be deductible for tax purposes. We have recorded finite-lived intangible assets at their estimated fair value related to trade names, customer relationships and favorable leases.

In accordance with accounting guidance on business combinations, we expensed all costs related to the acquisitions in the six months ended September 27, 2014. The total costs related to the acquisitions were $.3 million and $.7 million for the three and six months ended September 27, 2014, respectively. These costs are included in the Consolidated Statements of Comprehensive Income primarily under operating, selling, general and administrative expenses.

The purchase price of the acquisitions has been preliminarily allocated to the net tangible and intangible assets acquired, with the remainder recorded as goodwill on the basis of estimated fair values, as follows:

	As of September 27, 2014
	(Dollars in thousands)
Inventories	$	4,384
Other current assets		437
Property, plant and equipment		24,588
Intangible assets		7,755
Long-term deferred income tax assets		15,167
Other non-current assets		17
Total assets acquired		52,348
Warranty reserves		702
Other current liabilities		2,468
Long-term capital leases and financing obligations		48,064
Other long-term liabilities		1,122
Total liabilities assumed		52,356
Total net identifiable assets acquired	$	(8	)
Total consideration transferred	$	64,192
Less: total net identifiable assets acquired		(8	)
Goodwill	$	64,200

The following are the intangible assets acquired and their respective fair values and weighted average useful lives:

	Dollars in thousands		As of Acquisition Date Weighted Average Useful Life
Trade names	$	3,548		14 years
Customer relationships		2,612		7 years
Favorable leases		1,595		17 years
Total	$	7,755		12 years

8

MONRO MUFFLER BRAKE, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Sales for the fiscal 2015 acquired entities for the three and six months ended September 27, 2014 totaled $9.7 million and $10.6 million, respectively, for the period from acquisition date through September 27, 2014.

Supplemental pro forma information for the current or prior reporting periods has not been presented due to the impracticability of obtaining detailed, accurate or reliable data for the periods the acquired entities were not owned by Monro.

Fiscal 2014

As part of the acquisition process, we finalized the purchase accounting for the following fiscal 2014 acquisitions during the second quarter of fiscal 2015:

Curry’s Automotive Group, involving ten retail tire and automotive repair stores located in the Washington D.C. metropolitan area, which were acquired on August 18, 2013, and

Mitchell Tire Service, involving one retail tire and automotive repair store located in New Jersey which were acquired on August 11, 2013.

The resulting adjustments were not material to the Consolidated Financial Statements.

The aggregated fiscal 2014 acquisitions are not material to the Consolidated Financial Statements. Additionally, supplemental pro forma information for the current or prior reporting periods has not been presented due to the impracticability of obtaining detailed, accurate or reliable data for the periods the acquired entity was not owned by Monro.

We continue to refine the valuation data and estimates primarily related to road hazard warranty, intangible assets, real estate and real property leases for all other fiscal 2014 acquisitions and all fiscal 2015 acquisitions, and expect to complete the valuations no later than the first anniversary date of the respective acquisition. We anticipate that adjustments will continue to be made to the fair values of identifiable assets acquired and liabilities assumed and those adjustments may or may not be material.

Note 3 – Earnings Per Share

Basic earnings per common share (“EPS”) amounts are computed by dividing income available to common shareholders, after deducting preferred stock dividends, by the average number of common shares outstanding. Diluted EPS amounts assume the issuance of common stock for all potentially dilutive equivalent securities outstanding.

9

MONRO MUFFLER BRAKE, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

The following is a reconciliation of basic and diluted EPS for the respective periods:

	Quarter Ended						Six Months Ended
	Fiscal September						Fiscal September
	2014			2013			2014			2013
	(Dollars in thousands, except per share data)
Numerator for earnings per common share calculation:
Net Income	$	16,330		$	13,650		$	33,262		$	27,221
Preferred stock dividends		(99	)		(83	)		(198	)		(167	)
Income available to common stockholders	$	16,231		$	13,567		$	33,064		$	27,054
Denominator for earnings per common share calculation:
Weighted average common shares, basic		31,561			31,390			31,539			31,346
Effect of dilutive securities:
Preferred stock		760			760			760			760
Stock options		457			403			484			417
Weighted average common shares, diluted		32,778			32,553			32,783			32,523
Basic earnings per common share:	$	.51		$	.43		$	1.05		$	.86
Diluted earnings per common share:	$	.50		$	.42		$	1.01		$	.84

The computation of diluted EPS excludes the effect of the assumed exercise of approximately 126,000 and 125,000 stock options for the three and six months ended fiscal September 27, 2014, respectively, and 95,000 and 149,000 for the three and six months ended September 28, 2013, respectively. Such amounts were excluded as the exercise prices of these stock options were greater than the average market value of our Common Stock for those periods, resulting in an anti-dilutive effect on diluted EPS.

Note 4 – Income Taxes

In the normal course of business, we provide for uncertain tax positions and the related interest and penalties, and adjust our unrecognized tax benefits and accrued interest and penalties accordingly. The total amounts of unrecognized tax benefits were $6.2 million and $5.9 million at September 27, 2014 and March 29, 2014, respectively, the majority of which, if recognized, would affect the effective tax rate. As of September 27, 2014, we had approximately $.3 million of interest and penalties accrued related to unrecognized tax benefits.

We file U.S. federal income tax returns and income tax returns in various state jurisdictions. Our fiscal 2011 through fiscal 2013 U.S. federal tax years and various state tax years remain subject to income tax examinations by tax authorities.

Note 5 – Fair Value

Long-term debt, including current portion, had a carrying amount and a fair value of $151.7 million as of September 27, 2014, as compared to a carrying amount and a fair value of $106.5 million as of March 29, 2014. The fair value of long-term debt was estimated based on discounted cash flow analyses using either quoted market prices for the same or similar issues, or the current interest rates offered to Monro for debt with similar maturities.

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MONRO MUFFLER BRAKE, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Note 6 – Supplemental Disclosure of Cash Flow Information

The following represents non-cash investing and financing activities during the periods indicated:

Six Months Ended September 27, 2014:

In connection with the fiscal 2015 acquisitions, liabilities were assumed as follows:

Fair value of assets acquired	$	52,348,000
Goodwill acquired		64,200,000
Cash paid, net of cash acquired		(64,192,000	)
Liabilities assumed	$	52,356,000

Six Months Ended September 28, 2013:

In connection with the fiscal 2014 acquisitions, liabilities were assumed as follows:

Fair value of assets acquired	$	6,511,000
Goodwill acquired		14,577,000
Gain on bargain purchase		(217,000	)
Cash paid, net of cash acquired		(17,015,000	)
Liabilities assumed	$	3,856,000

These amounts reflect final purchase accounting adjustments for the fiscal 2014 acquisitions. (See Note 2).

Purchase accounting adjustments related to the fiscal 2014 acquisitions increased goodwill by $.4 million in fiscal 2015.

Note 7 – Cash Dividend

In May 2014, our Board of Directors declared its intention to pay a regular quarterly cash dividend during fiscal 2015 of $.13 per common share or common share equivalent to be paid beginning with the first quarter of fiscal 2015. However, the declaration of and any determination as to the payment of future dividends will be at the discretion of the Board of Directors and will depend on our financial condition, results of operations, capital requirements, compliance with charter and credit facility restrictions, and such other factors as the Board of Directors deems relevant.

Note 8 – Subsequent Events

See Note 2 for a discussion of an acquisition we completed subsequent to September 27, 2014.

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

The statements contained in this Quarterly Report on Form 10-Q that are not historical facts, including (without limitation) statements made in the Management’s Discussion and Analysis of Financial Condition and Results of Operations, 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. When used in this Quarterly Report on Form 10-Q, the words “anticipates”, “believes”, “contemplates”, “see”, “could”, “estimate”, “appear”, “intend”, “plans” and variations thereof and similar expressions, are intended to identify forward-looking statements. 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 Monro’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, 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, disruption or unauthorized access to our computer systems, risks relating to protection of customer and employee personal data, risks relating to litigation, risks relating to integration of acquired businesses, including goodwill impairment and the risks set forth in our Annual Report on Form 10-K for the fiscal year ended March 29, 2014. Except as required by law, we do not undertake to update any forward-looking statement that may be made from time to time by us or on our behalf.

Results of Operations

The following table sets forth income statement data of Monro Muffler Brake, Inc. expressed as a percentage of sales for the fiscal periods indicated:

	Quarter Ended Fiscal September						Six Months Ended Fiscal September
	2014			2013			2014			2013
Sales		100.0	%		100.0	%		100.0	%		100.0	%
Cost of sales, including distribution and occupancy costs		59.6			60.2			59.1			61.0
Gross profit		40.4			39.8			40.9			39.0
Operating, selling, general and administrative expenses		27.4			28.2			27.6			27.6
Operating income		13.1			11.6			13.3			11.4
Interest expense - net		1.3			1.0			1.1			0.9
Other income - net		(0.1	)		(0.1	)		(0.1	)		(0.1	)
Income before provision for income taxes		11.9			10.7			12.2			10.5
Provision for income taxes		4.5			4.1			4.7			3.9
Net income		7.4	%		6.6	%		7.6	%		6.6	%

Second Quarter and Six Months Ended September 27, 2014 Compared to Second Quarter and Six Months Ended September 28, 2013

Sales were $221.3 million for the quarter ended September 27, 2014 as compared with $205.3 million for the quarter ended September 28, 2013. The sales increase of $16.0 million or 7.8%, was due primarily to an increase of $18.9 million related to new stores, of which $16.5 million came from the fiscal 2014 and fiscal 2015 acquisitions. Partially offsetting this was a decrease in comparable store sales of 2%. Additionally, there was a decrease in sales from closed stores amounting to $1.8 million. There were 91 selling days in both the quarters ended September 27, 2014 and September 28, 2013.

During the quarter ended September 27, 2014, we completed the bulk sale of approximately $2.9 million of slower moving inventory to a barter company in exchange for barter credits. There was no similar transaction in the second quarter of fiscal 2014 or the first quarter of fiscal 2015.

12

Sales were $438.8 million for the six months ended September 27, 2014 as compared with $411.5 million for the six months ended September 28, 2013. The sales increase of $27.3 million or 6.6%, was due to an increase of $30.1 million related to new stores. This was partially offset by a decrease in comparable store sales of .6% and a decrease in sales from closed stores amounting to $3.3 million. There were 181 selling days in the first six months of fiscal 2015 and fiscal 2014.

At September 27, 2014, we had 1,003 company-operated stores and one franchise location as compared with 940 company-operated stores and three franchise locations at September 28, 2013. During the quarter ended September 27, 2014, we added 42 stores and closed five stores. Year-to-date, we have added 61 stores and closed 11 stores.

We believe that the decline in comparable store sales resulted mainly from the continued weak economic conditions as consumers continued to defer repairs to their vehicles. Comparable store tire, shocks, and exhaust sales, as well as maintenance services declined in the second quarter of fiscal 2015. However, other service categories, including brakes, alignments and oil changes, increased on a comparable store basis as compared to the prior year, demonstrating that needed repairs cannot be deferred indefinitely.

Gross profit for the quarter ended September 27, 2014 was $89.5 million or 40.4% of sales as compared with $81.7 million or 39.8% of sales for the quarter ended September 28, 2013. The increase in gross profit for the quarter ended September 27, 2014, as a percentage of sales, is due to several factors, as discussed below.

Total material costs, including outside purchases, decreased as a percentage of sales as compared to the prior year. This was largely due to a shift in mix of tires sold to lower cost direct import tires, which carry a higher margin.

Labor costs were relatively flat as a percentage of sales as compared to the prior year through focused payroll control.

Partially offsetting these decreases was an increase in distribution and occupancy costs as a percentage of sales from the prior year related primarily to increased warehouse and distribution costs. These resulted from increased frequency of delivery to our service stores, and some additional warehousing for higher inventory levels. Additionally, we completed the bulk sale of approximately $2.9 million of slower moving inventory to a barter company in exchange for barter credits during the quarter ended September 27, 2014, and the margin recognized in these transactions is typically less than our normal profit margin. The barter transaction for the quarter ended September 27, 2014 decreased gross profit as a percentage of sales by .3%.

Additionally, excluding the new stores opened in fiscal 2014 and fiscal 2015, gross profit actually improved by 130 basis points as compared to the second quarter of last year.

Gross profit for the six months ended September 27, 2014 was $179.5 million or 40.9% of sales as compared with $160.6 million or 39.0% of sales for the six months ended September 28, 2013. The year-to-date increase in gross profit as a percent of sales is largely due to decreased material costs as described above.

Operating expenses for the quarter ended September 27, 2014 were $60.5 million or 27.4% of sales as compared with $57.8 million or 28.2% of sales for the quarter ended September 28, 2013. Excluding the increase in operating expenses related to new stores opened in fiscal 2014 and fiscal 2015 and the increase in due diligence costs, operating expenses actually decreased by approximately $2.0 million as compared to the same quarter as last year. This demonstrates that we experienced leverage in this line through focused cost control on lower comparable sales, as well as pay plans that adjust for performance.

For the six months ended September 27, 2014, operating expenses increased by $7.6 million to $121.2 million from the comparable period of the prior year and remained flat at 27.6% of sales. Accounting for the increase were $7.3 million of operating expenses related to new stores opened in fiscal 2014 and fiscal 2015, as well as an increase of $.6 million of due diligence costs compared to the first six months of the prior year.

Operating income for the quarter ended September 27, 2014 of approximately $28.9 million increased by 21.0% as compared to operating income of approximately $23.9 million for the quarter ended September 28, 2013, and increased as a percentage of sales from 11.6% to 13.1% for the reasons described above.

Operating income for the six months ended September 27, 2014 of approximately $58.3 million increased by 24.1% as compared to operating income of approximately $47.0 million for the six months ended September 28, 2013, and increased as a percentage of sales from 11.4% to 13.3% for the reasons described above.

Net interest expense for the quarter ended September 27, 2014 increased by approximately $.7 million as compared to the same period in the prior year, and increased from 1.0% to 1.3% as a percentage of sales for the same periods. The weighted average debt outstanding for the quarter ended September 27, 2014 increased by approximately $39 million as compared to the quarter ended September 28, 2013. This increase is primarily related to an increase in debt outstanding under our Revolving Credit Facility agreement for the purchase of our fiscal 2014 and fiscal 2015 acquisitions, as well as an increase in capital lease debt recorded in

13

connection with these acquisitions. There was an increase in the weighted average interest rate of approximately 60 basis points from the prior year primarily due to purchase accounting adjustments for recent acquisitions in both the current and prior year second quarter, which artificially impacted interest expense for the comparative quarters. Without these adjustments, the weighted average interest rate was relatively flat between the second quarters of both years.

Net interest expense for the six months ended September 27, 2014 increased by approximately $1.1 million as compared to the same period in the prior year, and increased from .9% to 1.1% as a percentage of sales for the same periods. Weighted average debt increased by approximately $6 million and the weighted average interest rate increased by approximately 90 basis points as compared to the same period of the prior year. Without the aforementioned purchase accounting adjustments, the weighted average interest rate increased by approximately 30 basis points as compared to the first six months of last year.

The effective tax rate for the quarter ended September 27, 2014 and September 28, 2013 remained flat at 38.1% of pre-tax income.

The effective tax rate for the six months ended September 27, 2014 and September 28, 2013 was 38.1% and 37.3%, respectively, of pre-tax income.

Net income for the quarter ended September 27, 2014 of $16.3 million increased 19.6% from net income for the quarter ended September 28, 2013. Earnings per share on a diluted basis for the quarter ended September 27, 2014 of $.50 increased 19.0%.

For the six months ended September 27, 2014, net income of $33.3 million increased 22.2% and diluted earnings per share of $1.01 increased 20.2%.

Capital Resources and Liquidity

Capital Resources

Our primary capital requirements in fiscal 2015 are the upgrading of facilities and systems and the funding of our store expansion program, including potential acquisitions of existing store chains. For the six months ended September 27, 2014, we spent approximately $82.9 million on these items. Capital requirements were met primarily by cash flow from operations and from our revolving credit facility.

In May 2014, our Board of Directors declared its intention to pay a regular quarterly cash dividend of $.13 per common share or common share equivalent beginning with the first quarter of fiscal year 2015. We paid dividends of $8.4 million during the six months ended September 27, 2014. However, the declaration of and any determination as to the payment of future dividends will be at the discretion of the Board of Directors and will depend on Monro’s financial condition, results of operations, capital requirements, compliance with charter and credit facility restrictions, and such other factors as the Board of Directors deems relevant.

On September 28, 2014, we acquired nine retail tire and automotive repair stores in Georgia. This acquisition was financed through our existing credit facility.

We plan to continue to seek suitable acquisition candidates. We believe we have sufficient resources available (including cash flow from operations and bank financing) to expand our business as currently planned for the next twelve months.

Liquidity

In June 2011, we entered into a five-year, $175 million Revolving Credit Facility agreement with seven banks (the “Credit Facility”). The Credit Facility amended and restated, in its entirety, the Credit Facility previously entered into by Monro as of July 2005 and amended from time to time. The Credit Facility also provided an accordion feature permitting us to request an increase in availability of up to an additional $75 million.

In December 2012, the Credit Facility was amended to include the following: the committed sum was increased by $75 million to $250 million; the term was extended for another one and a half years, such that the Facility now expires in December 2017; and the $75 million accordion feature was maintained. There were no other changes in terms including those related to covenants or interest rates. There are now six banks participating in the syndication. There was $151.0 million outstanding under the Credit Facility at September 27, 2014.

Within the Credit Facility, we have a sub-facility of $40 million available for the purpose of issuing standby letters of credit. There was an outstanding letter of credit for $23.7 million at September 27, 2014.

The net availability under the Credit Facility at September 27, 2014 was $75.3 million.

14

Specific terms of the Credit Facility permit the payment of cash dividends not to exceed 50% of the prior year’s net income, and permit mortgages and specific lease financing arrangements with other parties with certain limitations. Additionally, the Credit Facility is not secured by our real property, although we have agreed not to encumber our real property, with certain permissible exceptions. The agreement also requires the maintenance of specified interest and rent coverage ratios. We were in compliance with all debt covenants at September 27, 2014.

We have financed certain store properties and equipment with capital leases/financing obligations, which amounted to $136.9 million at September 27, 2014 and are due in installments through 2042.

Recent Accounting Pronouncements

In April 2014, the Financial Accounting Standards Board (“FASB”) issued new accounting guidance for the reporting of discontinued operations. This guidance eliminates certain exceptions from reporting discontinued operations that exist under current guidance, and also requires several new disclosures about disposals that qualify as discontinued operations. This guidance is effective for fiscal years and interim periods within those years beginning on or after December 15, 2014, with early adoption permitted. The adoption of this guidance is not anticipated to have a material effect on Monro’s Consolidated Financial Statements.

In May 2014, the FASB issued new accounting guidance for the reporting of revenue from contracts with customers. This guidance provides guidelines a company will apply to determine the measurement of revenue and timing of when it is recognized. This guidance is effective for the first interim period within annual reporting periods beginning after December 15, 2016 and early adoption is not permitted. We are currently evaluating the potential effect of the adoption of this guidance on our Consolidated Financial Statements.

Other recent authoritative guidance issued by the FASB (including technical corrections to the Accounting Standards Codification) and the Securities and Exchange Commission did not, or are not expected to have a material effect on Monro’s Consolidated Financial Statements.

Item 3. Quantitative and Qualitative Disclosures About Market Risk

We are exposed to market risk from potential changes in interest rates. At September 27, 2014 and March 29, 2014, approximately .4% and .6%, respectively, of our debt financing, excluding capital leases and financing obligations, was at fixed interest rates and therefore, the fair value is affected by changes in market interest rates. Our cash flow exposure on floating rate debt would result in annual interest expense fluctuations of approximately $1.5 million based upon our debt position at September 27, 2014 and $1.1 million for the fiscal year ended March 29, 2014, given a 1% change in LIBOR.

Debt financing, including current portion, had a carrying amount and a fair value of $151.7 million as of September 27, 2014, as compared to a carrying amount and a fair value of $106.5 million as of March 29, 2014.

Item 4. Controls and Procedures

Conclusion regarding the effectiveness of disclosure controls and procedures

We maintain disclosure controls and procedures that are designed to ensure that information required to be disclosed in reports that we file or furnish to the Securities and Exchange Commission pursuant to the Securities Exchange Act of 1934, as amended, is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission’s rules and forms, and that such information is accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosure.

In conjunction with the close of each fiscal quarter and under the supervision of our Chief Executive Officer and Chief Financial Officer, we conduct an update, a review and an evaluation of the effectiveness of our disclosure controls and procedures. It is the conclusion of our Chief Executive Officer and Chief Financial Officer, based upon an evaluation completed as of the end of the most recent fiscal quarter reported on herein, that our disclosure controls and procedures were effective.

Changes in internal controls over financial reporting

There were no changes in our internal control over financial reporting during the quarter ended September 27, 2014 that materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

15

MONRO MUFFLER BRAKE, INC.

PART II - OTHER INFORMATION

Item 1. Legal Proceedings

We are not a party or subject to any legal proceedings other than certain claims and lawsuits that arise in the normal course of our business. We do not believe that such claims or lawsuits, individually or in the aggregate, will have a material adverse effect on our financial condition or results of operations.

Item 5. Other Information

Effective October 2014, the salary of Robert G. Gross, our Executive Chairman, was reduced by $60,000. Such voluntary salary reduction was implemented at the direction of Mr. Gross, who requested that we use the funds made available by such reduction to provide assistance to Monro employees facing financial hardships. No other changes to Mr. Gross’ compensation were made. Mr. Gross’ new annual salary of $360,000 was effective beginning October 1, 2014.

Item 6. Exhibits

Exhibits

10.68 – Employment Agreement by and between Monro Muffler Brake, Inc. and Catherine D’Amico, dated August 27, 2014, incorporated by reference to exhibit 99.1 to the Current Report on Form 8-K filed on August 29, 2014.

31.1 – Certification of John W. Van Heel pursuant to Section 302 of the Sarbanes – Oxley Act of 2002

31.2 – Certification of Catherine D’Amico pursuant to Section 302 of the Sarbanes – Oxley Act of 2002

32.1 – Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes – Oxley Act of 2002

101.CAL – XBRL Taxonomy Extension Calculation Linkbase

101.INS – XBRL Instance Document

101.LAB – XBRL Taxonomy Extension Label Linkbase

101.PRE – XBRL Taxonomy Extension Presentation Linkbase

101.SCH – XBRL Taxonomy Extension Schema Linkbase

101.DEF – XBRL Taxonomy Extension Definition Linkbase

16

SIGNATURES

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

	MONRO MUFFLER BRAKE, INC.
DATE: November 6, 2014	By:	/s/ John W. Van Heel
		John W. Van Heel
		Chief Executive Officer and President
DATE: November 6, 2014	By:	/s/ Catherine D’Amico
		Catherine D’Amico
		Executive Vice President – Finance, Treasurer and Chief Financial Officer (Principal Financial Officer and Principal Accounting Officer)

17

EXHIBIT INDEX

Exhibit No.	Description	Page No.
31.1	Certification of John W. Van Heel pursuant to Section 302 of the Sarbanes-Oxley Act of 2002		19
31.2	Certification of Catherine D’Amico pursuant to Section 302 of the Sarbanes-Oxley Act of 2002		20
32.1	Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002		21
101.CAL	XBRL Taxonomy Extension Calculation Linkbase
101.INS	XBRL Instance Document
101.LAB	XBRL Taxonomy Extension Label Linkbase
101.PRE	XBRL Taxonomy Extension Presentation Linkbase
101.SCH	XBRL Taxonomy Extension Schema Linkbase
101.DEF	XBRL Taxonomy Extension Definition Linkbase

18

EX-31.1

Exhibit 31.1

CERTIFICATION

I, John W. Van Heel, certify that:

1. I have reviewed this Quarterly Report on Form 10-Q of Monro Muffler Brake, Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15(d)-15(f)) for the registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: November 6, 2014

/s/ John W. Van Heel

John W. Van Heel

Chief Executive Officer and President

19

EX-31.2

Exhibit 31.2

CERTIFICATION

I, Catherine D’Amico, certify that:

1. I have reviewed this Quarterly Report on Form 10-Q of Monro Muffler Brake, Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15(d)-15(f)) for the registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: November 6, 2014

/s/ Catherine D’Amico

Catherine D’Amico

Executive Vice President – Finance and Chief Financial Officer

20

EX-32.1

Exhibit 32.1

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350

(SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002)

Pursuant to, and solely for purposes of, 18 U.S.C. Section 1350 (Section 906 of the Sarbanes-Oxley Act of 2002), each of the undersigned hereby certifies in the capacity and on the date indicated below that:

1. The Quarterly Report of Monro Muffler Brake, Inc. (“Monro”) on Form 10-Q for the period ended September 27, 2014 as filed with the Securities and Exchange Commission on the date hereof (the “Report”) fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

2. The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of Monro.

/s/ John W. Van Heel	Dated: November 6, 2014
John W. Van Heel
Chief Executive Officer and President
/s/ Catherine D’Amico	Dated: November 6, 2014
Catherine D’Amico
Executive Vice President – Finance and
Chief Financial Officer

21

XML

Supplemental Disclosure of Cash Flow Information (Details) (USD $)	6 Months Ended
	Sep. 28, 2013	Sep. 27, 2014
Supplemental Cash Flow [Line Items]
Fair value of assets acquired	$ 6,511,000	$ 52,348,000
Goodwill acquired	14,577,000	64,200,000
Cash paid, net of cash acquired	(17,015,000)	(64,192,000)
Gain on bargain purchase	(217,000)
Liabilities assumed	3,856,000	52,356,000
Goodwill Purchase Price Adjustment		$ 400,000

XML

Acquisitions

6 Months Ended

Sep. 27, 2014

Business Combinations [Abstract]

Mergers Acquisitions And Dispositions Disclosures [Text Block]

Note 2 – Acquisitions

Acquisitions are strategic moves in our plan designed, among other things, to fill in and expand our presence in existing and contiguous markets, and leverage fixed operating costs such as distribution and advertising.

Subsequent Event

On September 28, 2014, we acquired nine retail tire and automotive repair stores located in Georgiafrom Wood & Fullerton Stores, LLC. These stores operate under the Mr. Tire name. The acquisition wasfinanced through our existing credit facility.

Fiscal 2015

       On August 8, 2014, we acquired 35 retail tire and automotive repair stores located in Florida from Hennelly Tire & Auto, Inc. These stores operate under The Tire Choice name. The acquisition was financed through our existing credit facility.

       On June 15, 2014, we acquired ten and nine retail tire and automotive repair stores located in Michigan from Lentz U.S.A. Service Centers, Inc. and KanRock Tire Company, Inc., respectively. These stores operate under the Monro Brake & Tire name.

       On April 13, 2014, we acquired two retail tire and automotive repair stores located in New Hampshire from Bald Tire & Auto, Inc. These stores were previously Tire Warehouse franchise locations and continue to operate under the Tire Warehouse name.

The acquisitions resulted in goodwill related to, among other things, growth opportunities and unidentifiable intangible assets. All of the goodwill is expected to be deductible for tax purposes. We have recorded finite-lived intangible assets at their estimated fair value related to trade names, customer relationships and favorable leases.

       In accordance with accounting guidance on business combinations, we expensed all costs related to the acquisitions in the six months ended September 27, 2014. The total costs related to the acquisitions were $.3 million and $.7 million for the three and six months ended September 27, 2014, respectively. These costs are included in the Consolidated Statements of Comprehensive Income primarily under operating, selling, general and administrative expenses.

       The purchase price of the acquisitions has been preliminarily allocated to the net tangible and intangible assets acquired, with the remainder recorded as goodwill on the basis of estimated fair values, as follows:

	As of September 27,
	2014
	(Dollars in thousands)
Inventories		$	4,384
Other current assets			437
Property, plant and equipment			24,588
Intangible assets			7,755
Long-term deferred income tax assets			15,167
Other non-current assets			17
Total assets acquired			52,348
Warranty reserves			702
Other current liabilities			2,468
Long-term capital leases and financing obligations			48,064
Other long-term liabilities			1,122
Total liabilities assumed			52,356
Total net identifiable assets acquired		$	(8)
Total consideration transferred		$	64,192
Less: total net identifiable assets acquired			(8)
Goodwill		$	64,200

       The following are the intangible assets acquired and their respective fair values and weighted average useful lives:

		As of
		Acquisition
		Date
		Weighted
	Dollars in	Average
	thousands	Useful Life
Trade names	$3,548	14 years
Customer relationships	2,612	7 years
Favorable leases	1,595	17 years
Total	$7,755	12 years

Sales for the fiscal 2015 acquired entities for the three and six months ended September 27, 2014 totaled $9.7 million and $10.6 million, respectively, for the period from acquisition date through September 27, 2014.

Supplemental pro forma information for the current or prior reporting periods has not been presented due to the impracticability of obtaining detailed, accurate or reliable data for the periods the acquired entities were not owned by Monro.

Fiscal 2014

As part of the acquisition process, we finalized the purchase accounting for the following fiscal 2014 acquisitions during the second quarter of fiscal 2015:

Curry's Automotive Group, involving ten retail tire and automotive repair stores located in the Washington D.C. metropolitan area, which were acquired on August 18, 2013, and

Mitchell Tire Service, involving one retail tire and automotive repair store located in New Jersey which were acquired on August 11, 2013.

The resulting adjustments were not material to the Consolidated Financial Statements.

The aggregated fiscal 2014acquisitionsare not material to the Consolidated Financial Statements. Additionally, supplemental proforma information for the current or prior reporting periods has not been presented due to the impracticability of obtaining detailed, accurate or reliable data for the periods the acquired entity was not owned by Monro.

We continue to refine the valuation data and estimates primarily related to road hazard warranty, intangible assets, real estate and real property leases for all other fiscal 2014 acquisitions and all fiscal 2015acquisitions, and expect to complete the valuations no later than the first anniversary date of the respective acquisition. We anticipate that adjustments will continue to be made to the fair values of identifiable assets acquired and liabilities assumed and those adjustments may or may not be material.

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Condensed Consolidated Financial Statements

6 Months Ended

Sep. 27, 2014

Organization Consolidation And Presentation Of Financial Statements Disclosure [Abstract]

Organization, Consolidation and Presentation of Financial Statements Disclosure [Text Block]

Note 1 –Condensed Consolidated Financial Statements

The consolidated balance sheets as of September 27, 2014 and March 29, 2014, the consolidated statements of comprehensive incomefor the quarters and six monthsended September 27, 2014 and September 28, 2013,the consolidated statement of changes in shareholders' equity for thesix months ended September 27, 2014, and the consolidated statements of cash flows for the six months ended September 27, 2014 and September 28, 2013, include financial information for Monro Muffler Brake, Inc. and its wholly-owned subsidiary, Monro Service Corporation (collectively, “Monro”, “we”, “us”, “our”). These unaudited,condensed consolidated financial statements have been prepared by Monro. We believe all known adjustments (consisting of normal recurring accruals or adjustments) have been made to fairly state the financial position, results of operations and cash flows for the unaudited periods presented.

Interim results are not necessarily indicative of results for a full year. The year-endconsolidated balance sheet data was derived from audited financial statements, but does not include all disclosures required by accounting principles generally accepted in the United States of America. The information included in this Form 10-Q should be read in conjunction with the audited financial statements and notes thereto included in our Annual Report on Form 10-K for the year ended March 29, 2014.

We report our results on a 52/53 week fiscal year with the fiscal year ending on the last Saturday in March of each year. The following are the dates represented by each fiscal period reported in these condensed financial statements:

       “Quarter Ended Fiscal September 2014”June 29, 2014 – September 27, 2014 (13 weeks)
“Quarter Ended Fiscal September 2013”June 30, 2013 – September 28, 2013 (13 weeks)

       “Six Months Ended Fiscal September 2014”March 30, 2014– September 27, 2014 (26 weeks)

       “Six Months Ended Fiscal September 2013”March 31, 2013– September 28, 2013 (26 weeks)

       Fiscal year 2015, ending March 28, 2015, is a 52 week year.

Recent Accounting Pronouncements

       In April 2014, the Financial Accounting Standards Board (“FASB”) issued new accounting guidance for the reporting of discontinued operations.This guidance eliminates certain exceptions from reporting discontinued operations that exist under current guidance, and also requires several new disclosures about disposals that qualify as discontinued operations. This guidance is effective for fiscal years and interim periods within those years beginning on or after December 15, 2014, with early adoption permitted. The adoption of this guidance is not anticipated to have a material effect on Monro's Consolidated Financial Statements.

In May 2014, the FASB issued new accounting guidance for the reporting of revenue from contracts with customers. This guidance provides guidelines a company will apply to determine the measurement of revenue and timing of when it is recognized. This guidance is effective for the firstinterim period within annual reporting periods beginning after December 15, 2016 and early adoption is not permitted. We are currently evaluating the potential effect of the adoption of this guidance on our Consolidated Financial Statements.

       Other recent authoritative guidance issued by the FASB (including technical corrections to the Accounting Standards Codification) and the Securities and Exchange Commission did not, or are not expected to have a material effect on Monro's Consolidated Financial Statements.

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Consolidated Balance Sheets (Unaudited) (USD $) In Thousands, unless otherwise specified	Sep. 27, 2014	Mar. 29, 2014
Current assets
Cash and equivalents	$ 7,763	$ 1,205
Trade receivables	3,153	2,728
Federal and state income taxes receivable	0	2,171
Inventories	142,775	124,920
Deferred income tax assets	13,971	13,710
Other current assets	30,153	23,382
Total current assets	197,815	168,116
Property, plant and equipment	569,862	531,505
Less - Accumulated depreciation and amortization	(259,214)	(249,622)
Net property, plant and equipment	310,648	281,883
Goodwill	334,649	270,039
Intangible assets	35,012	29,371
Other non-current assets	11,031	10,547
Long-term deferred income tax assets	14,936	0
Total assets	904,091	759,956
Current liabilities
Current portion of long-term debt, capital leases and financing obligations	9,302	7,552
Trade payables	70,968	53,321
Federal and state income taxes payable	1,677	0
Accrued payroll, payroll taxes and other payroll benefits	19,071	20,206
Accrued insurance	33,750	32,353
Warranty reserves	10,205	9,557
Other current liabilities	13,434	13,752
Total current liabilities	158,407	136,741
Long-term capital leases and financing obligations	128,283	81,199
Long-term debt	151,017	105,841
Accrued rent expense	5,441	5,700
Other long-term liabilities	12,476	11,558
Deferred income tax liabilities	0	140
Long-term income taxes payable	3,129	2,793
Total liabilities	458,753	343,972
Commitments
Shareholders' equity
Class C Convertible Preferred Stock, $1.50 par value, $.064 conversion value, 150,000 shares authorized; 32,500 shares issued and outstanding	49	49
Common Stock, $.01 par value, 65,000,000 shares authorized; 37,649,070 and 37,567,902 shares issued at September 27, 2014 and March 29, 2014, respectively	376	376
Treasury Stock, 6,076,951 shares at cost	(90,241)	(90,241)
Additional paid-in capital	145,980	141,365
Accumulated other comprehensive loss	(3,258)	(3,135)
Retained earnings	392,432	367,570
Total shareholders' equity	445,338	415,984
Total liabilities and shareholders' equity	$ 904,091	$ 759,956

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Consolidated Statement of Changes in Shareholders' Equity (Parentheticals) (USD $) In Thousands, except Per Share data, unless otherwise specified	3 Months Ended		6 Months Ended
	Sep. 27, 2014	Jun. 28, 2014	Sep. 27, 2014
DividendsCashAbstract
Preferred stock cash dividends per common stock equivalent	$ 0.13	$ 0.13
Common stock cash dividends per share	$ 0.13	$ 0.13
Pension liability adjustment - pre-tax
Pension liability adjustment - pre-tax			$ (198)

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Earnings Per Share (Details) (USD $) In Thousands, except Share data, unless otherwise specified	3 Months Ended		6 Months Ended
	Sep. 27, 2014	Sep. 28, 2013	Sep. 27, 2014	Sep. 28, 2013
Numerator For Earnings Per Share Calculation [Abstract]
Net income	$ 16,330	$ 13,650	$ 33,262	$ 27,221
Preferred stock dividends	(99)	(83)	(198)	(167)
Income available to common shareholders	$ 16,231	$ 13,567	$ 33,064	$ 27,054
Denominator for earnings per common share calculation:
Weighted average common shares, basic	31,561,000	31,390,000	31,539,000	31,346,000
Effect of dilutive securities:
Preferred stock	760,000	760,000	760,000	760,000
Stock options	457,000	403,000	484,000	417,000
Weighted average number of common shares, diluted	32,778,000	32,553,000	32,783,000	32,523,000
Basic Earnings per common share:	$ 0.51	$ 0.43	$ 1.05	$ 0.86
Diluted Earnings per common share:	$ 0.50	$ 0.42	$ 1.01	$ 0.84
Antidilutive securities excluded from computation of earnings per share	126,000	95,000	125,000	149,000

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Fair Value (Details) (USD $) In Millions, unless otherwise specified	Sep. 27, 2014	Mar. 29, 2014
Fair Value Disclosures [Abstract]
Carrying amount of long-term debt ( including current portion)	$ 151.7	$ 106.5
Fair value of long-term debt (including current portion)	$ 151.7	$ 106.5

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Consolidated Statements of Cash Flows (USD $) In Thousands, unless otherwise specified	6 Months Ended
	Sep. 27, 2014	Sep. 28, 2013
Cash flows from operating activities
Net income	$ 33,262	$ 27,221
Adjustments to reconcile net income to net cash provided by operating activities -
Depreciation and amortization	17,074	15,331
Loss (gain) on disposal of assets	354	(121)
Stock-based compensation expense	2,300	2,253
Excess tax benefits from share-based payment arrangements	(49)	(97)
Net change in deferred income taxes	542	907
Change in operating assets and liabilities:
Trade receivables	(420)	(257)
Inventories	(13,506)	(2,426)
Other current assets	(6,331)	(312)
Other non-current assets	95	816
Trade payables	17,647	(1,301)
Accrued expenses	1,415	2,675
Federal and state income taxes payable	2,717	2,726
Other long-term liabilities	(760)	(118)
Long-term income taxes payable	336	(377)
Total adjustments	21,414	19,699
Net cash provided by operating activities	54,676	46,920
Cash flows from investing activiites:
Capital expenditures	(18,720)	(13,913)
Acquisitions, net of cash acquired	(64,157)	(17,013)
Proceeds from the disposal of assets	172	74
Net cash used for investing activities	(82,705)	(30,852)
Cash flows from financing activities:
Proceeds from borrowings	194,150	168,099
Principal payments on long-term debt, capital leases and financing obligations	(152,995)	(179,411)
Exercise of stock options	1,783	2,818
Excess tax benefits from share-based payment arrangements	49	97
Dividends to shareholders	(8,400)	(7,067)
Net cash provided by (used for) financing activities	34,587	(15,464)
Increase in cash	6,558	604
Cash at beginning of period	1,205	1,463
Cash at end of period	$ 7,763	$ 2,067

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Consolidated Balance Sheets (Parentheticals) (Unaudited) (USD $)	Sep. 27, 2014	Mar. 29, 2014
Common stock par value	$ 0.01	$ 0.01
Common stock authorized	65,000,000	65,000,000
Common shares issued	37,649,070	37,567,902
Treasury stock	6,076,951	6,076,951
Preferred Class C [Member]
Preferred stock par value	$ 1.50	$ 1.50
Preferred stock conversion value	$ 0.064	$ 0.064
Preferred stock shares authorized	150,000	150,000
Preferred stock shares issued	32,500	32,500
Preferred stock shares outstanding	32,500	32,500

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Earnings Per Share (Tables)

6 Months Ended

Sep. 27, 2014

Earnings Per Share Basic And Diluted [Abstract]

Schedule Of Earnings Per Share Basic And Diluted Table Text Block

		Quarter Ended				Six Months Ended
		Fiscal September				Fiscal September
			2014		2013		2014		2013
		(Dollars in thousands,
		except per share data)
Numerator for earnings per common share calculation:
Net Income		$	16,330	$	13,650	$	33,262	$	27,221
Preferred stock dividends			(99)		(83)		(198)		(167)
Income available to common stockholders		$	16,231	$	13,567	$	33,064	$	27,054
Denominator for earnings per common share calculation:
Weighted average common shares, basic			31,561		31,390		31,539		31,346
Effect of dilutive securities:
	Preferred stock		760		760		760		760
	Stock options		457		403		484		417
Weighted average common shares, diluted			32,778		32,553		32,783		32,523
Basic Earnings per common share:		$	.51	$	.43	$	1.05	$	.86
Diluted Earnings per common share:		$	.50	$	.42	$	1.01	$	.84

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Document and Entity Information	3 Months Ended
	Sep. 27, 2014	Oct. 24, 2014
Document And Entity Information [Abstract]
Document Type	10-Q
Document Period End Date	Sep. 27, 2014
Amendment Flag	false
Entity Registrant Name	MONRO MUFFLER BRAKE INC
Entity Central Index Key	0000876427
Entity Current Reporting Status	Yes
Entity Voluntary Filers	No
Current Fiscal Year End Date	--03-28
Entity Filer Category	Large Accelerated Filer
Entity Well Known Seasoned Issuer	Yes
Entity Common Stock Shares Outstanding		31,575,114
Document Fiscal Year Focus	2015
Document Fiscal Period Focus	Q2

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Supplemental Disclosure of Cash Flow Information (Tables)

6 Months Ended

Sep. 27, 2014

Supplemental Cash Flow Information Abstract

ScheduleOfBusinessAcquisitionsByAcquisitionTextBlock

Fair value of assets acquired	$	52,348,000
Goodwill acquired		64,200,000
Cash paid, net of cash acquired		(64,192,000)
Liabilities assumed	$	52,356,000

Fair value of assets acquired	$	6,511,000
Goodwill acquired		14,577,000
Gain on bargain purchase		(217,000)
Cash paid, net of cash acquired		(17,015,000)
Liabilities assumed	$	3,856,000

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Consolidated Statements of Comprehensive Income (Unaudited) (USD $) In Thousands, except Per Share data, unless otherwise specified	3 Months Ended		6 Months Ended
	Sep. 27, 2014	Sep. 28, 2013	Sep. 27, 2014	Sep. 28, 2013
Statements of Comprehensive Income
Sales	$ 221,299	$ 205,321	$ 438,806	$ 411,492
Cost of sales, including distribution and occupancy costs	131,827	123,573	259,311	250,866
Gross profit	89,472	81,748	179,495	160,626
Operating, selling, general and administrative expenses	60,545	57,837	121,158	113,607
Operating income	28,927	23,911	58,337	47,019
Interest expense, net of interest income	2,772	2,048	4,908	3,858
Other income, net	(227)	(179)	(305)	(231)
Income before provision for income taxes	26,382	22,042	53,734	43,392
Provision for income taxes	10,052	8,392	20,472	16,171
Net income	16,330	13,650	33,262	27,221
Other comprehensive loss:
Changes in pension, net of tax benefit	(62)	(177)	(123)	(177)
Comprehensive income	$ 16,268	$ 13,473	$ 33,139	$ 27,044
Earnings per share
Basic	$ 0.51	$ 0.43	$ 1.05	$ 0.86
Diluted	$ 0.50	$ 0.42	$ 1.01	$ 0.84

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Fair Value

6 Months Ended

Sep. 27, 2014

Fair Value Disclosures [Abstract]

Fair Value Disclosures [Text Block]

Note 5 –Fair Value

Long-term debt, including current portion, had a carrying amount and a fair value of $151.7million as of September 27, 2014, as compared to a carrying amount and a fair value of $106.5 million as of March 29, 2014. The fair value of long-term debt was estimated based on discounted cash flow analyses using either quoted market prices for the same or similar issues, or the current interest rates offered to Monro for debt with similar maturities.

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Income Taxes

6 Months Ended

Sep. 27, 2014

Income Tax Disclosure [Abstract]

Income Tax Disclosure Text Block

Note 4 – Income Taxes

       In the normal course of business, we provide for uncertain tax positions and the related interest and penalties, and adjustour unrecognized tax benefits and accrued interest and penalties accordingly. The total amounts of unrecognized tax benefits were $6.2 million and $5.9 million at September 27, 2014 and March 29, 2014, respectively, the majority of which, if recognized, would affect the effective tax rate. As of September 27, 2014, we had approximately $.3million of interest and penalties accrued related to unrecognized tax benefits.

We file U.S. federal income tax returns and income tax returns in various state jurisdictions. Our fiscal 2011 through fiscal 2013U.S. federal tax years and various state tax years remain subject to income tax examinations by tax authorities.

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Income Taxes (Details) (USD $) In Millions, unless otherwise specified	Sep. 27, 2014	Mar. 29, 2014
Income Tax Uncertainties
Unrecognized tax benefits	$ 6.2	$ 5.9
Interest and penalties accrued related to unrecognized tax benefits	$ 0.3

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Condensed Consolidated Financial Statements (Details)	6 Months Ended
	Sep. 27, 2014
Organization Consolidation And Presentation Of Financial Statements Disclosure [Abstract]
Company reported results maximum	53 weeks
Company reported results minimum	52 weeks
Company reported results current year fiscal quarter	13 weeks
Company reported results prior year fiscal quarter	13 weeks
Company reported results current fiscal year to date	26 weeks
Company reported results prior fiscal year to date	26 weeks
Company reported results current fiscal year	52 weeks

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Subsequent Events

6 Months Ended

Sep. 27, 2014

Subsequent Events [Abstract]

Subsequent Events [Text Block]

Note 8 – Subsequent Events

See Note 2 for a discussion of an acquisition we completed subsequent to September 27, 2014.

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Supplemental Disclosure of Cash Flow Information

6 Months Ended

Sep. 27, 2014

Supplemental Cash Flow Information Abstract

Cash Flow Supplemental Disclosures Text Block

Note 6 – Supplemental Disclosure of Cash Flow Information

The following represents non-cash investing and financing activities during the periods indicated:

SixMonths Ended September 27, 2014:

In connection with the fiscal 2015 acquisitions, liabilities were assumed as follows:

Fair value of assets acquired	$	52,348,000
Goodwill acquired		64,200,000
Cash paid, net of cash acquired		(64,192,000)
Liabilities assumed	$	52,356,000

Six Months Ended September 28, 2013:

In connection with the fiscal 2014 acquisitions, liabilities were assumed as follows:

Fair value of assets acquired	$	6,511,000
Goodwill acquired		14,577,000
Gain on bargain purchase		(217,000)
Cash paid, net of cash acquired		(17,015,000)
Liabilities assumed	$	3,856,000

These amounts reflect final purchase accounting adjustments for the fiscal 2014 acquisitions. (See Note 2).

Purchase accounting adjustments related to the fiscal 2014 acquisitions increased goodwill by $.4 million in fiscal 2015.

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Cash Dividend

6 Months Ended

Sep. 27, 2014

DividendsCashAbstract

Cash Dividends [Text Block]

Note 7 – Cash Dividend

       In May 2014, our Board of Directors declared its intention to pay a regular quarterly cash dividend during fiscal 2015 of $.13 per common share or common share equivalent to be paid beginning with the first quarter of fiscal 2015. However, the declaration of and any determination as to the payment of future dividends will be at the discretion of the Board of Directors and will depend on our financial condition, results of operations, capital requirements, compliance with charter and credit facility restrictions, and such other factors as the Board of Directors deems relevant.

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Acquisitions (Tables)

6 Months Ended

Sep. 27, 2014

Business Combinations [Abstract]

Schedule Of Purchase Price [Table Text Block]

	As of September 27,
	2014
	(Dollars in thousands)
Inventories		$	4,384
Other current assets			437
Property, plant and equipment			24,588
Intangible assets			7,755
Long-term deferred income tax assets			15,167
Other non-current assets			17
Total assets acquired			52,348
Warranty reserves			702
Other current liabilities			2,468
Long-term capital leases and financing obligations			48,064
Other long-term liabilities			1,122
Total liabilities assumed			52,356
Total net identifiable assets acquired		$	(8)
Total consideration transferred		$	64,192
Less: total net identifiable assets acquired			(8)
Goodwill		$	64,200

ScheduleOfIndefiniteLivedIntangibleAssetsAcquiredAsPartOfBusinessCombinationTextBlock

		As of
		Acquisition
		Date
		Weighted
	Dollars in	Average
	thousands	Useful Life
Trade names	$3,548	14 years
Customer relationships	2,612	7 years
Favorable leases	1,595	17 years
Total	$7,755	12 years

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Acquisitions Additional Information (Details) (USD $) In Thousands, unless otherwise specified	6 Months Ended
	Sep. 27, 2014
All finite lived intangible assets
Acquired Finite-Lived Intangible Assets [Line Items]
BusinessCombinationRecognizedIdentifiableAssetsAcquiredAndLiabilitiesAssumedIntangibles	$ 7,755
Weighted average useful life	12 years
Trade names
Acquired Finite-Lived Intangible Assets [Line Items]
BusinessCombinationRecognizedIdentifiableAssetsAcquiredAndLiabilitiesAssumedIntangibles	3,548
Weighted average useful life	14 years
Customer relationships
Acquired Finite-Lived Intangible Assets [Line Items]
BusinessCombinationRecognizedIdentifiableAssetsAcquiredAndLiabilitiesAssumedIntangibles	2,612
Weighted average useful life	7 years
Favorable leases
Acquired Finite-Lived Intangible Assets [Line Items]
BusinessCombinationRecognizedIdentifiableAssetsAcquiredAndLiabilitiesAssumedIntangibles	$ 1,595
Weighted average useful life	17 years

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Cash Dividends (Details) (USD $)	3 Months Ended
	Mar. 28, 2015	Dec. 27, 2014	Sep. 27, 2014	Jun. 28, 2014
DividendsCashAbstract
Common stock cash dividends per share declared	$ 0.13	$ 0.13	$ 0.13	$ 0.13

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Consolidated Statement of Changes in Shareholders' Equity (USD $) In Thousands, unless otherwise specified	Total	Preferred Stock	Common Stock	Treasury Stock	Additional Paid-in Capital	Accumulated Other Comprehensive Loss	Retained Earnings
Balance beginning at Mar. 29, 2014	$ 415,984	$ 49	$ 376	$ (90,241)	$ 141,365	$ (3,135)	$ 367,570
Net income	33,262						33,262
Other comprehensive loss:
Pension liability adjustment (($198) pre-tax)	(123)					(123)
Cash dividends:
Preferred stock cash dividends	(198)						(198)
Common stock cash dividends	(8,202)						(8,202)
Stock issuance costs	(14)				(14)
Tax benefit from exercise of stock options	546				546
Exercise of stock options	1,783				1,783
Stock-based compensation	2,300				2,300
Balance ending at Sep. 27, 2014	$ 445,338	$ 49	$ 376	$ (90,241)	$ 145,980	$ (3,258)	$ 392,432

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Earnings Per Share

6 Months Ended

Sep. 27, 2014

Earnings Per Share Basic And Diluted [Abstract]

Earnings Per Share Text Block

Note 3 – Earnings Per Share

       Basic earnings per common share (“EPS”) amounts are computed by dividing income available to common shareholders, after deducting preferred stock dividends, by the average number of common shares outstanding. Diluted EPS amounts assume the issuance of common stock for all potentially dilutive equivalent securities outstanding.

The following is a reconciliation of basic and diluted EPS for the respective periods:

		Quarter Ended				Six Months Ended
		Fiscal September				Fiscal September
			2014		2013		2014		2013
		(Dollars in thousands,
		except per share data)
Numerator for earnings per common share calculation:
Net Income		$	16,330	$	13,650	$	33,262	$	27,221
Preferred stock dividends			(99)		(83)		(198)		(167)
Income available to common stockholders		$	16,231	$	13,567	$	33,064	$	27,054
Denominator for earnings per common share calculation:
Weighted average common shares, basic			31,561		31,390		31,539		31,346
Effect of dilutive securities:
	Preferred stock		760		760		760		760
	Stock options		457		403		484		417
Weighted average common shares, diluted			32,778		32,553		32,783		32,523
Basic Earnings per common share:		$	.51	$	.43	$	1.05	$	.86
Diluted Earnings per common share:		$	.50	$	.42	$	1.01	$	.84

The computation of diluted EPS excludes the effect of the assumed exercise of approximately 126,000 and 125,000stock options for the three and six months ended fiscal September 27, 2014, respectively,and 95,000 and 149,000 for the three and six months ended September 28, 2013, respectively. Such amounts were excluded as the exercise prices of these stock options were greater than the average market value of ourCommon Stock for those periods, resulting in an anti-dilutive effect on diluted EPS.

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Acquisitions (Details) (USD $)	3 Months Ended	6 Months Ended		6 Months Ended
	Sep. 27, 2014	Sep. 27, 2014	Sep. 28, 2013	Sep. 28, 2013 Curry Acquisition numberofstores	Sep. 27, 2014 Hennelly Acquistion [Member] numberofstores	Sep. 27, 2014 Lentz Acquisition [Member] numberofstores	Sep. 27, 2014 Kan Rock Acquisition [Member] numberofstores	Sep. 27, 2014 Bald Tire Acquisition [Member] numberofstores	Sep. 27, 2014 Wood & Fullerton Acquisition [Member] numberofstores	Sep. 28, 2013 Mitchell Acquisition [Member] numberofstores
Business Acquisition [Line Items]
Number of stores acquired				10	35	10	9	2	9	1
Total costs related to acquisitions	$ 200,000	$ 600,000
Sales for the fiscal 2015 acquired entities	9,700,000	10,600,000
Schedule Of Business Acquisitions Purchase Price Allocation [Line Items]
Inventories	4,384,000	4,384,000
Other current assets	437,000	437,000
Property, plant and equipment	24,588,000	24,588,000
Intangible assets	7,755,000	7,755,000
Long-term deferred income tax assets	15,167,000	15,167,000
Other non-current assets	17,000	17,000
Total assets acquired	52,348,000	52,348,000	6,511,000
Warranty reserves	702,000	702,000
Other current liabilities	2,468,000	2,468,000
Long-term capital leases and financing obligations	48,064,000	48,064,000
Other long-term liabilities	1,122,000	1,122,000
Total liabilities assumed	52,356,000	52,356,000	3,856,000
Total net identifiable assets acquied	(8,000)	(8,000)
Total consideration transferred	64,192,000	64,192,000
Less: total net identifiable assets acquired	(8,000)	(8,000)
Goodwill	$ 64,200,000	$ 64,200,000	$ 14,577,000