##### Table of Contents









UNITED STATES SECURITIES AND EXCHANGE
COMMISSION

Washington, D.C. 20549




---

Form 10-Q

|           |  |                                                                                             
|---------- |  | --------------------------------------------------------------------------------------------
|(Mark One) |  |                                                                                             
|þ          |  | QUARTERLY REPORT PURSUANT TO SECTION 13
    OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 
|           |  | For the quarterly period ended
    October 31, 2004                                         
|           |  | or                                                                                          
|          
|o          |  | 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 001-13927

CSK Auto Corporation

(Exact name of registrant as specified in its
charter)


|                                                                   |  |                                         
|------------------------------------------------------------------ |  | ----------------------------------------
|Delaware                                                           |  | 86-0765798                              
|(State or other jurisdiction of
    Incorporation or organization) |  | (I.R.S. Employer
    Identification No.)
|                                                                  
|645 E. Missouri Ave. Suite 400,
    Phoenix, Arizona               |  | 85012                                   
|(Address of principal executive
    offices)                       |  | (Zip Code)                              

(602) 265-9200

(Registrants telephone number, including
area code)


N/A

(Former name, former address and former fiscal
year,


if changed since last reports)


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.

Yes
þ                    No
o

Indicate by check mark whether the registrant is
an accelerated filer (as defined in Exchange Act
Rule 12b-2).

Yes
þ                    No
o

As of December 7, 2004, CSK Auto Corporation
had 44,995,989 shares of common stock outstanding.



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TABLE OF CONTENTS

|                                   |  |                                                                                                          |    |      |    | 
|---------------------------------- |  | -------------------------------------------------------------------------------------------------------- | -- | ---- | -- | 
|                                   |  |                                                                                                          |    | Page
|                                   |  |                                                                                                          |    |     
|PART I 
    Financial Information
|Item 1.                            |  | Financial Statements
    (unaudited)                                                                     |    |      | 2  | 
|                                   |  | Consolidated Balance
    Sheets                                                                          |    |      | 2  | 
|                                   |  | Consolidated Statements of
    Operations                                                                |    |      | 3  | 
|                                   |  | Consolidated Statements of
    Cash Flows                                                                |    |      | 4  | 
|                                   |  | Notes to Consolidated
    Financial Statements                                                           |    |      | 5  | 
|Item 2.                            |  | Managements Discussion
    and Analysis of Financial Condition and Results of Operations                |    |      | 11 | 
|Item 3.                            |  | Quantitative and Qualitative
    Disclosures About Market Risk                                           |    |      | 18 | 
|Item 4.                            |  | Controls and Procedures                                                                                  |    |      | 18 | 
|                                  
|                                   |  | PART II 
    Other Information                                                                          |    |      |    | 
|Item 1.                            |  | Legal Proceedings                                                                                        |    |      | 20 | 
|Item 2.                            |  | Unregistered Sales of
    Securities and Use of Proceeds and Issuer Repurchases of Equity
    Securities |    |      | 21 | 
|Item 3.                            |  | Defaults upon Senior
    Securities                                                                      |    |      | 21 | 
|Item 4.                            |  | Submission of Matters to a
    Vote of Security Holders                                                  |    |      | 21 | 
|Item 5.                            |  | Other Information                                                                                        |    |      | 21 | 
|Item 6.                            |  | Exhibits                                                                                                 |    |      | 21 | 
|Signature                          |  |                                                                                                          | 23 |     
|EX-31.1                           
|EX-31.2                           
|EX-32.1                           



1



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##### Table of Contents






PART I

FINANCIAL INFORMATION






|        |                     
|------- | --------------------
|Item 1. | Financial Statements

CSK AUTO CORPORATION AND
SUBSIDIARIES



CONSOLIDATED BALANCE SHEETS


|                                                                    |                                                                                                                                                                                         |                                            |         |             |           |   |         |           |           | 
|------------------------------------------------------------------- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ------------------------------------------ | ------- | ----------- | --------- | - | ------- | --------- | --------- | 
|                                                                    |                                                                                                                                                                                         | October 31,                                |         | February 1,
|                                                                    |                                                                                                                                                                                         | 2004                                       |         | 2004       
|                                                                    |                                                                                                                                                                                         |                                            |         |            
|                                                                    |                                                                                                                                                                                         |                                           
|                                                                    |                                                                                                                                                                                         | (In thousands, except share data)         
|                                                                    |                                                                                                                                                                                         |                                           
|                                                                    |                                                                                                                                                                                         | (Unaudited)                               
|ASSETS                                                             
|Cash and cash equivalents                                           |                                                                                                                                                                                         | $                                          | 54,673  |             |           | $ | 37,221  |          
|Receivables, net of allowances of $653 and
    $1,577, respectively |                                                                                                                                                                                         |                                            | 127,295 |             |           |   | 136,523 |          
|Inventories                                                         |                                                                                                                                                                                         |                                            | 697,541 |             |           |   | 666,263 |          
|Deferred income taxes                                               |                                                                                                                                                                                         |                                            |        |             |           |   | 787     |          
|Prepaid expenses and other current assets                           |                                                                                                                                                                                         |                                            | 20,481  |             |           |   | 21,123  |          
|                                                                    |                                                                                                                                                                                         |                                            |         |             |           |   |         |          
|                                                                    | Total current assets                                                                                                                                                                    |                                            |         | 899,990     |           |   |         | 861,917   |          
|                                                                    |                                                                                                                                                                                         |                                            |         |             |           |   |         |          
|Property and equipment, net                                         |                                                                                                                                                                                         |                                            | 124,459 |             |           |   | 124,813 |          
|Leasehold interests, net                                            |                                                                                                                                                                                         |                                            | 10,990  |             |           |   | 12,278  |          
|Goodwill                                                            |                                                                                                                                                                                         |                                            | 127,069 |             |           |   | 127,069 |          
|Other assets, net                                                   |                                                                                                                                                                                         |                                            | 30,757  |             |           |   | 27,388  |          
|                                                                    |                                                                                                                                                                                         |                                            |         |             |           |   |         |          
|                                                                    | Total assets                                                                                                                                                                            |                                            | $       | 1,193,265   |           |   | $       | 1,153,465 |          
|                                                                    |                                                                                                                                                                                         |                                            |         |             |           |   |         |          
|                                                                   
|LIABILITIES AND STOCKHOLDERS
    EQUITY                           
|Accounts payable                                                    |                                                                                                                                                                                         | $                                          | 183,557 |             |           | $ | 177,150 |          
|Accrued payroll and related expenses                                |                                                                                                                                                                                         |                                            | 44,647  |             |           |   | 47,498  |          
|Accrued expenses and other current liabilities                      |                                                                                                                                                                                         |                                            | 54,038  |             |           |   | 49,617  |          
|Deferred income taxes                                               |                                                                                                                                                                                         |                                            | 23,903  |             |           |   |        |          
|Current maturities of amounts due under senior
    credit facility  |                                                                                                                                                                                         |                                            | 2,550   |             |           |   | 2,550   |          
|Senior notes called for redemption                                  |                                                                                                                                                                                         |                                            | 14,975  |             |           |   |        |          
|Current maturities of capital lease obligations                     |                                                                                                                                                                                         |                                            | 7,125   |             |           |   | 10,240  |          
|                                                                    |                                                                                                                                                                                         |                                            |         |             |           |   |         |          
|                                                                    | Total current liabilities                                                                                                                                                               |                                            |         | 330,795     |           |   |         | 287,055   |          
|                                                                    |                                                                                                                                                                                         |                                            |         |             |           |   |         |          
|Long term debt                                                      |                                                                                                                                                                                         |                                            | 467,822 |             |           |   | 492,463 |          
|Obligations under capital leases                                    |                                                                                                                                                                                         |                                            | 11,324  |             |           |   | 15,017  |          
|Deferred income taxes                                               |                                                                                                                                                                                         |                                            | 13,250  |             |           |   | 13,121  |          
|Other liabilities                                                   |                                                                                                                                                                                         |                                            | 20,159  |             |           |   | 14,251  |          
|                                                                    |                                                                                                                                                                                         |                                            |         |             |           |   |         |          
|                                                                    | Total non-current liabilities                                                                                                                                                           |                                            |         | 512,555     |           |   |         | 534,852   |          
|                                                                    |                                                                                                                                                                                         |                                            |         |             |           |   |         |          
|Commitments and contingencies                                       |                                                                                                                                                                                         |                                            |         |             |           |   |         |          
|Stockholders equity:                                               |                                                                                                                                                                                         |                                            |         |             |           |   |         |          
|                                                                    | Common stock, $0.01 par value,
    58,000,000 shares authorized, 44,987,963 and
    46,497,936 shares issued and outstanding at
    October 31, 2004 and February 1, 2004, respectively |                                            |         | 450         |           |   |         | 465       |          
|                                                                    | Additional paid-in capital                                                                                                                                                              |                                            |         | 444,876     |           |   |         | 466,576   |          
|                                                                    | Deferred compensation                                                                                                                                                                   |                                            |         | (1,115      | )         |   |         |          |          
|                                                                    | Stockholder receivable                                                                                                                                                                  |                                            |         | (65         | )         |   |         | (73       | )        
|                                                                    | Accumulated deficit                                                                                                                                                                     |                                            |         | (94,231     | )         |   |         | (135,410  | )        
|                                                                    |                                                                                                                                                                                         |                                            |         |             |           |   |         |          
|                                                                    |                                                                                                                                                                                         | Total stockholders equity                 |         |             | 349,915   |   |         |           | 331,558   | 
|                                                                    |                                                                                                                                                                                         |                                            |         |             |           |   |         |          
|                                                                    |                                                                                                                                                                                         | Total liabilities and stockholders equity |         | $           | 1,193,265 |   |         | $         | 1,153,465 | 
|                                                                    |                                                                                                                                                                                         |                                            |         |             |           |   |         |          

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

2



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##### Table of Contents



CSK AUTO CORPORATION AND
SUBSIDIARIES



CONSOLIDATED STATEMENTS OF
OPERATIONS


|                                           |                              |                                       |         |                         |  |             |         |             |  |   |           |         |  |   |           |         | 
|------------------------------------------ | ---------------------------- | ------------------------------------- | ------- | ----------------------- |  | ----------- | ------- | ----------- |  | - | --------- | ------- |  | - | --------- | ------- | 
|                                           |                              |                                       |         |                        
|                                           |                              | Thirteen Weeks Ended                  |         | Thirty-Nine Weeks Ended
|                                           |                              |                                       |         |                        
|                                           |                              | October 31,                           |         | November 2,             |  | October 31, |         | November 2,
|                                           |                              | 2004                                  |         | 2003                    |  | 2004        |         | 2003       
|                                           |                              |                                       |         |                         |  |             |         |            
|                                           |                              |                                      
|                                           |                              | (In thousands, except per share data)
|                                           |                              |                                      
|                                           |                              | (Unaudited)                          
|Net sales                                  |                              | $                                     | 401,457 |                         |  | $           | 409,750 |             |  | $ | 1,207,568 |         |  | $ | 1,205,713 |        
|Cost of sales                              |                              |                                       | 210,565 |                         |  |             | 217,565 |             |  |   | 636,763   |         |  |   | 644,802   |        
|                                           |                              |                                       |         |                         |  |             |         |             |  |   |           |         |  |   |           |        
|Gross profit                               |                              |                                       | 190,892 |                         |  |             | 192,185 |             |  |   | 570,805   |         |  |   | 560,911   |        
|Other costs and expenses:                  |                              |                                       |         |                         |  |             |         |             |  |   |           |         |  |   |           |        
|                                           | Operating and administrative |                                       |         | 158,718                 |  |             |         | 155,068     |  |   |           | 477,900 |  |   |           | 462,266 | 
|                                           | Store closing costs          |                                       |         | 721                     |  |             |         | 203         |  |   |           | 1,608   |  |   |           | 339     | 
|                                           |                              |                                       |         |                         |  |             |         |             |  |   |           |         |  |   |           |        
|Operating profit                           |                              |                                       | 31,453  |                         |  |             | 36,914  |             |  |   | 91,297    |         |  |   | 98,306    |        
|Interest expense                           |                              |                                       | 7,837   |                         |  |             | 12,396  |             |  |   | 23,684    |         |  |   | 39,583    |        
|Loss on debt retirement                    |                              |                                       |        |                         |  |             |        |             |  |   |          |         |  |   | 4,315     |        
|                                           |                              |                                       |         |                         |  |             |         |             |  |   |           |         |  |   |           |        
|Income before income taxes                 |                              |                                       | 23,616  |                         |  |             | 24,518  |             |  |   | 67,613    |         |  |   | 54,408    |        
|Income tax expense                         |                              |                                       | 9,248   |                         |  |             | 9,476   |             |  |   | 26,434    |         |  |   | 21,029    |        
|                                           |                              |                                       |         |                         |  |             |         |             |  |   |           |         |  |   |           |        
|Net income                                 |                              | $                                     | 14,368  |                         |  | $           | 15,042  |             |  | $ | 41,179    |         |  | $ | 33,379    |        
|                                           |                              |                                       |         |                         |  |             |         |             |  |   |           |         |  |   |           |        
|Basic earnings per share:                  |                              |                                       |         |                         |  |             |         |             |  |   |           |         |  |   |           |        
|                                           | Net income                   |                                       | $       | 0.32                    |  |             | $       | 0.33        |  |   | $         | 0.90    |  |   | $         | 0.74    | 
|                                           |                              |                                       |         |                         |  |             |         |             |  |   |           |         |  |   |           |        
|Shares used in computing per share amounts |                              |                                       | 45,126  |                         |  |             | 45,827  |             |  |   | 45,939    |         |  |   | 45,396    |        
|                                           |                              |                                       |         |                         |  |             |         |             |  |   |           |         |  |   |           |        
|Diluted earnings per share:                |                              |                                       |         |                         |  |             |         |             |  |   |           |         |  |   |           |        
|                                           | Net income                   |                                       | $       | 0.32                    |  |             | $       | 0.33        |  |   | $         | 0.89    |  |   | $         | 0.73    | 
|                                           |                              |                                       |         |                         |  |             |         |             |  |   |           |         |  |   |           |        
|Shares used in computing per share amounts |                              |                                       | 45,269  |                         |  |             | 46,239  |             |  |   | 46,211    |         |  |   | 45,619    |        
|                                           |                              |                                       |         |                         |  |             |         |             |  |   |           |         |  |   |           |        

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

3



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##### Table of Contents



CSK AUTO CORPORATION AND
SUBSIDIARIES



CONSOLIDATED STATEMENTS OF CASH
FLOWS


|                                               |                                                                                       |                                                                 |                                                                     |             |         |         |        |          |         |         |  
|---------------------------------------------- | ------------------------------------------------------------------------------------- | --------------------------------------------------------------- | ------------------------------------------------------------------- | ----------- | ------- | ------- | ------ | -------- | ------- | ------- | -
|                                               |                                                                                       |                                                                
|                                               |                                                                                       | Thirty-Nine Weeks Ended                                        
|                                               |                                                                                       |                                                                
|                                               |                                                                                       | October 31,                                                     |                                                                     | November 2,
|                                               |                                                                                       | 2004                                                            |                                                                     | 2003       
|                                               |                                                                                       |                                                                 |                                                                     |            
|                                               |                                                                                       |                                                                
|                                               |                                                                                       | (In thousands)                                                 
|                                               |                                                                                       |                                                                
|                                               |                                                                                       | (Unaudited)                                                    
|Cash flows from operating activities:          |                                                                                       |                                                                 |                                                                     |             |         |         |        |         
|                                               | Net income                                                                            |                                                                 | $                                                                   | 41,179      |         |         | $      | 33,379   |        
|                                               | Adjustments to reconcile net income to net cash
    provided by operating activities: |                                                                 |                                                                     |             |         |         |        |          |        
|                                               |                                                                                       | Depreciation and amortization of property and
    equipment     |                                                                     |             | 20,333  |         |        |          | 22,999  |        
|                                               |                                                                                       | Amortization of deferred financing costs                        |                                                                     |             | 1,456   |         |        |          | 3,201   |        
|                                               |                                                                                       | Amortization of long term debt fair market value
    adjustment |                                                                     |             | (80     | )       |        |          | (807    | )      
|                                               |                                                                                       | Amortization of other items                                     |                                                                     |             | 3,208   |         |        |          | 2,897   |        
|                                               |                                                                                       | Accretion of debt discount                                      |                                                                     |             | 42      |         |        |          | 702     |        
|                                               |                                                                                       | Losses on disposals of property, equipment and
    other assets |                                                                     |             | 685     |         |        |          | 683     |        
|                                               |                                                                                       | Tax benefit relating to stock option exercises                  |                                                                     |             | 190     |         |        |          | 1,859   |        
|                                               |                                                                                       | Write off of debt issuance costs                                |                                                                     |             |        |         |        |          | 2,268   |        
|                                               |                                                                                       | Premium paid on early retirement of debt                        |                                                                     |             |        |         |        |          | (350    | )      
|                                               |                                                                                       | Proceeds from interest rate swap termination                    |                                                                     |             |        |         |        |          | 6,031   |        
|                                               |                                                                                       | Deferred income taxes                                           |                                                                     |             | 24,819  |         |        |          | 19,278  |        
|                                               |                                                                                       | Change in operating assets and liabilities:                     |                                                                     |             |         |         |        |          |         |        
|                                               |                                                                                       |                                                                 | Receivables                                                         |             |         | 10,352  |        |          |         | 534     |  
|                                               |                                                                                       |                                                                 | Inventories                                                         |             |         | (36,723 | )      |          |         | (33,268 | )
|                                               |                                                                                       |                                                                 | Prepaid expenses and other current assets                           |             |         | 642     |        |          |         | (4,363  | )
|                                               |                                                                                       |                                                                 | Accounts payable                                                    |             |         | 3,933   |        |          |         | (9,467  | )
|                                               |                                                                                       |                                                                 | Accrued payroll, accrued expenses and other
    current liabilities |             |         | 2,396   |        |          |         | 12,238  |  
|                                               |                                                                                       |                                                                 | Other operating activities                                          |             |         | 631     |        |          |         | 1,249   |  
|                                               |                                                                                       |                                                                 |                                                                     |             |         |         |        |         
|                                               |                                                                                       | Net cash provided by operating activities                       |                                                                     |             | 73,063  |         |        |          | 59,063  |        
|                                               |                                                                                       |                                                                 |                                                                     |             |         |         |        |         
|Cash flows from investing activities:          |                                                                                       |                                                                 |                                                                     |             |         |         |        |         
|                                               | Capital expenditures                                                                  |                                                                 |                                                                     | (16,399     | )       |         |        | (10,568  | )      
|                                               | Other investing activities                                                            |                                                                 |                                                                     | (2,366      | )       |         |        | (2,542   | )      
|                                               |                                                                                       |                                                                 |                                                                     |             |         |         |        |         
|                                               |                                                                                       | Net cash used in investing activities                           |                                                                     |             | (18,765 | )       |        |          | (13,110 | )      
|                                               |                                                                                       |                                                                 |                                                                     |             |         |         |        |         
|Cash flows from financing activities:          |                                                                                       |                                                                 |                                                                     |             |         |         |        |         
|                                               | Borrowings under senior credit facility                                               |                                                                 |                                                                     | 20,600      |         |         |        | 291,000  |        
|                                               | Payments under senior credit facility                                                 |                                                                 |                                                                     | (21,875     | )       |         |        | (293,000 | )      
|                                               | Retirement of balance of 11% senior
    subordinated notes                            |                                                                 |                                                                     |            |         |         |        | (9,547   | )      
|                                               | Payment of debt issuance costs                                                        |                                                                 |                                                                     | (1,192      | )       |         |        | (4,162   | )      
|                                               | Payments on capital lease obligations                                                 |                                                                 |                                                                     | (11,093     | )       |         |        | (12,335  | )      
|                                               | Proceeds from repayment of stockholder receivable                                     |                                                                 |                                                                     | 8           |         |         |        | 216      |        
|                                               | Proceeds from exercise of stock options                                               |                                                                 |                                                                     | 621         |         |         |        | 13,415   |        
|                                               | Repurchase of common stock                                                            |                                                                 |                                                                     | (23,726     | )       |         |        |         |        
|                                               | Other financing activities                                                            |                                                                 |                                                                     | (189        | )       |         |        | (207     | )      
|                                               |                                                                                       |                                                                 |                                                                     |             |         |         |        |         
|                                               |                                                                                       | Net cash used in financing activities                           |                                                                     |             | (36,846 | )       |        |          | (14,620 | )      
|                                               |                                                                                       |                                                                 |                                                                     |             |         |         |        |         
|                                               |                                                                                       | Net increase in cash and cash equivalents                       |                                                                     |             | 17,452  |         |        |          | 31,333  |        
|Cash and cash equivalents, beginning of period |                                                                                       |                                                                 | 37,221                                                              |             |         |         | 15,519 |         
|                                               |                                                                                       |                                                                 |                                                                     |             |         |         |        |         
|Cash and cash equivalents, end of period       |                                                                                       | $                                                               | 54,673                                                              |             |         | $       | 46,852 |         
|                                               |                                                                                       |                                                                 |                                                                     |             |         |         |        |         

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

4



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##### Table of Contents



CSK AUTO CORPORATION AND
SUBSIDIARIES



NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS


Thirteen and Thirty-nine Weeks Ended
October 31, 2004


CSK Auto Corporation is a holding company. At
October 31, 2004, CSK Auto Corporation had no business
activity other than its investment in CSK Auto, Inc.
(Auto), a wholly owned subsidiary. On a consolidated
basis, CSK Auto Corporation and its subsidiaries are referred to
herein as the Company, we,
us, or our.

Auto is a specialty retailer of automotive
aftermarket parts and accessories. At October 31, 2004, we
operated 1,129 stores in 19 states as a fully integrated
company and single business segment under three brand names:
Checker Auto Parts, founded in 1969 and operating in the
Southwestern, Rocky Mountain and Northern Plains states and
Hawaii; Schucks Auto Supply, founded in 1917 and operating
in the Pacific Northwest and Alaska; and Kragen Auto Parts,
founded in 1947 and operating primarily in California.



|         |                      
|-------- | ---------------------
|Note 1  | Basis of Presentation

We prepared the unaudited consolidated financial
statements included herein in accordance with generally accepted
accounting principles for interim financial information and with
instructions to Form 10-Q and Article 10 of
Regulation S-X. Accordingly, the financial statements do
not include all information and footnotes required by generally
accepted accounting principles for fiscal year end financial
statements. In the opinion of management, the consolidated
financial statements reflect all adjustments, which are of a
normal recurring nature, necessary for a fair presentation of
our financial position and the results of our operations. The
accompanying consolidated financial statements should be read in
conjunction with the consolidated financial statements and
related notes thereto for the fiscal year ended February 1,
2004 (fiscal 2003), as included in our Annual Report on
Form 10-K filed with the SEC on April 15, 2004 (our
2003 10-K).

Certain amounts in the prior fiscal years
financial statements have been reclassified to conform to the
current fiscal year presentation. This has no impact on our
previously reported financial position, results of operations or
cash flows.



|         |            
|-------- | -----------
|Note 2  | Inventories

Inventories are valued at the lower of cost or
market, our costs being determined utilizing the Last-in
First-out (LIFO) method. Under the LIFO method,
costs of sales reflect the costs of the most recently purchased
inventories. Inventory carrying balances on the other hand,
reflect the costs relating to prices paid in prior years under
the LIFO method. Our costs of acquiring inventories through
normal purchasing activities have been moderately decreasing, as
our increased size, financial performance and cash flows have
enabled us to take advantage of volume discounts and lower
product acquisition costs. Accordingly, it costs us less money
to replace inventory today than the LIFO balances carried for
similar inventory in our financial statements.

The replacement cost of inventories, including
the capitalization of certain purchase related costs, was
approximately $579.0 million and $552.0 million at
October 31, 2004 and February 1, 2004, respectively,
as compared to financial statement carrying values of
$697.5 million and $666.3 million. While financial
statement carrying balances are higher than replacement costs,
such carrying balances are not higher than the net realizable
value amount (NRV) we expect to earn by selling the
inventory through our retail stores in the normal course of
business. Under generally accepted accounting principles, NRV
reflects the expected selling price of the inventories, less
selling costs and a normal profit margin to compute our NRV
floor.

We evaluate the difference between carrying
balances and NRV of our inventories at each balance sheet
reporting date. At October 31, 2004, we estimated that the
NRV of our inventories exceeded carrying balances by
approximately $8.0 million. Though not anticipated at this
time, if our evaluation in a future period indicated that
carrying balances exceeded the NRV of the inventories, the
carrying balances of the inventory would be reduced to NRV, with
a corresponding charge to operations.

5



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##### Table of Contents



CSK AUTO CORPORATION AND
SUBSIDIARIES


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)



|         |                    
|-------- | -------------------
|Note 3  | Store Closing Costs

On an on-going basis, store locations are
reviewed and analyzed based on several factors including market
saturation, store profitability, and store size and format. In
addition, we analyze sales trends and geographical and
competitive factors to determine the viability and future
profitability of our store locations. If a store location does
not meet our required performance, it is considered for closure.
As a result of past acquisitions, we have closed numerous
locations due to overlap with previously existing store
locations.

We account for the costs of closed stores in
accordance with Statement of Financial Accounting Standard
(SFAS) No. 146, Accounting for Costs
Associated with Exit or Disposal Activities. Under
SFAS No. 146, costs of operating lease commitments for
a closed store are recognized as expense at fair value at the
time we cease operating the store. Fair value of the liability
is determined as the present value of future cash flows
discounted using a credit-adjusted risk free rate. Accretion
expense represents interest on our recorded closed store
liabilities at the same credit adjusted risk free rate used to
discount the cash flows. In addition, SFAS No. 146
also requires that the amount of remaining lease payments owed
be reduced by estimated sublease income (but not to an amount
less than zero). Sublease income in excess of costs associated
with the lease is recognized as it is earned and included as a
reduction to operating and administrative expense in the
accompanying financial statements.

The allowance for store closing costs is included
in accrued expenses and other long term liabilities in the
accompanying financial statements and primarily represents the
discounted value of the following future net cash outflows
related to closed stores: (1) future rents to be paid over
the remaining terms of the lease agreements for the stores (net
of estimated probable sublease income); (2) lease
commissions associated with the anticipated store subleases; and
(3) contractual expenses associated with the closed store
vacancy periods. Certain operating expenses, such as utilities
and repairs, are expensed as incurred and no provision is made
for employee termination costs.

As of October 31, 2004, we had a total of
143 store locations included in the allowance for store closing
costs. Of this total, 13 locations were vacant and 130 locations
were subleased. In addition to these stores, we had 55 service
centers of which 3 were vacant and 52 were subleased. Future
rental payments will be made through the expiration of the
non-cancelable leases, the longest of which runs through March
2018.

Activity in the allowance for store closings and
the related payments for the thirty-nine weeks ended
October 31, 2004 (the thirty-nine weeks of fiscal
2004) are as follows ($ in thousands):

|                               |                                        |                |                          |        |        |       | 
|------------------------------ | -------------------------------------- | -------------- | ------------------------ | ------ | ------ | ----- | 
|Balance, beginning of year     |                                        | $              | 12,148                   |       
|Store closing costs:           |                                        |                |                          |       
|                               | Provision for store closing costs      |                |                          | 106    |       
|                               | Revisions in estimates                 |                |                          | 345    |       
|                               | Accretion                              |                |                          | 418    |       
|                               | Operating expenses and other           |                |                          | 739    |       
|                               |                                        |                |                          |       
|                               |                                        |                | Store closing costs, net |        |        | 1,608 | 
|Payments:                      |                                        |                |                          |       
|                               | Rent expense, net of sublease income   |                |                          | (2,249 | )     
|                               | Occupancy and other expenses           |                |                          | (696   | )     
|                               | Lease buyouts and sublease commissions |                |                          | (2,110 | )     
|                               |                                        |                |                          |       
|                               |                                        | Total payments |                          |        | (5,055 | )    
|                               |                                        |                |                          |       
|Balance as of October 31, 2004 |                                        | $              | 8,701                    |       
|                               |                                        |                |                          |       

6



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##### Table of Contents



CSK AUTO CORPORATION AND
SUBSIDIARIES


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)

We expect cash outflows for vacant stores (which
includes certain operating expenses that are expensed as
incurred), sublease losses and lease buyouts to be approximately
$7.0 million during our fiscal year ending January 30,
2005 (fiscal 2004). We expect the remainder of cash
outflows relating to these stores to occur primarily during
fiscal years 2005 through 2007.



|         |     
|-------- | ----
|Note 4  | Debt

Outstanding debt, excluding capital leases, is
comprised of the following ($ in thousands):

|                                                       |                                                                               |             |         |             |   |   |         |         |  
|------------------------------------------------------ | ----------------------------------------------------------------------------- | ----------- | ------- | ----------- | - | - | ------- | ------- | -
|                                                       |                                                                               | October 31, |         | February 1,
|                                                       |                                                                               | 2004        |         | 2004       
|                                                       |                                                                               |             |         |            
|Senior credit facility  term loan                     |                                                                               | $           | 253,725 |             |   | $ | 255,000 |        
|Remaining 12% senior notes                             |                                                                               |             | 14,910  |             |   |   | 14,910  |        
|                                                       | Remaining unamortized original issue discount
    (OID) on 12% senior notes |             |         | (107        | ) |   |         | (149    | )
|7% senior subordinated notes                           |                                                                               |             | 225,000 |             |   |   | 225,000 |        
|                                                       |                                                                               |             |         |             |   |   |         |        
|                                                       | Notes and loans, including current maturities                                 |             |         | 493,528     |   |   |         | 494,761 |  
|SFAS No. 133 fair market value
    (FMV) adjustment: |                                                                               |             |         |             |   |   |         |        
|                                                       | $100.0 million of 7% senior
    subordinated notes                            |             |         | (8,353      | ) |   |         |        |  
|                                                       | Remaining FMV adjustment on 12% senior notes                                  |             |         | 172         |   |   |         | 252     |  
|                                                       |                                                                               |             |         |             |   |   |         |        
|Total debt                                             |                                                                               |             | 485,347 |             |   | $ | 495,013 |        
|Less: Current maturities                               |                                                                               |             |         |             |   |   |         |        
|                                                       | Remaining balance, OID and FMV adjustment on
    12% senior notes             |             |         | 14,975      |   |   |         |        |  
|                                                       | Under senior credit facility                                                  |             |         | 2,550       |   |   |         | 2,550   |  
|                                                       |                                                                               |             |         |             |   |   |         |        
|                                                       | Total long term debt                                                          |             | $       | 467,822     |   |   | $       | 492,463 |  
|                                                       |                                                                               |             |         |             |   |   |         |        

We have made an election to redeem the
approximately $15.0 million remaining balance of
Autos $280.0 million 12% senior notes due 2006
in December 2004, the first date such senior notes become
redeemable pursuant to the indenture governing such notes, at a
redemption price equal to 106% of the principal amount plus
accrued and unpaid interest. In connection with the planned
redemption, we expect to record a charge during the fourth
quarter of fiscal 2004 of approximately $1.0 million. This
charge will consist of redemption premium paid, the write-off of
the remaining unamortized debt discount, and the write-off of
certain unamortized debt issuance costs, partially offset by a
fair market value adjustment to the senior notes associated with
the termination in June 2003 of an interest rate swap agreement.
We reclassified the approximately $15.0 million balance as
a current liability on the accompanying consolidated balance
sheet to reflect our election to redeem the notes during the
fourth quarter of fiscal 2004.

On August 10, 2004, we amended our senior
credit facility to provide for an immediate reduction of the
interest rate on the term loan of 25 basis points and an
opportunity for an additional 25 basis points reduction of
the interest rate on such term loan upon the achievement of
certain conditions, as more particularly set forth in the
amendment. The current interest rates on our revolving credit
facility and term loan are LIBOR +275 basis points and
LIBOR +200 basis points, respectively. The amendment also
provides for a one-year extension of the term loan maturity to
August 2010.

On April 5, 2004, we entered into an
interest rate swap agreement to effectively convert
$100.0 million of our 7% senior subordinated notes due
2014 to a floating rate, set semi-annually in arrears, equal to
the 6 month LIBOR +283 basis points. The agreement is
for the term of such notes. The hedge is accounted for as a
fair value hedge; accordingly, the fair value of the
derivative and changes in the fair value of the underlying debt
will be reported on our consolidated balance sheet and
recognized in the results of operations. Based upon our

7



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##### Table of Contents



CSK AUTO CORPORATION AND
SUBSIDIARIES


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)

assessment of effectiveness of the hedge, changes
in the fair value of this derivative and the underlying debt
will not have a significant effect on our consolidated results
of operations. At October 31, 2004, the fair value of the
interest rate swap was a liability of approximately
$8.4 million, which is included in other long-term
liabilities with an identical amount reflected as a basis
adjustment in long term debt on the accompanying Consolidated
Balance Sheet.

In June 2003, we replaced our $300.0 million
credit facility with a new $325.0 million facility. In
connection therewith, we expensed $3.8 million of certain
unamortized debt issuance costs and certain direct costs. With
proceeds from the new credit facility, we also redeemed the
remaining $9.5 million in aggregate principal amount of
Autos 11% senior subordinated notes, including
accrued and unpaid interest associated therewith. In connection
with that redemption, we paid $0.3 million in early
redemption premiums and expensed $0.2 million of
unamortized deferred debt issuance costs. All of these costs
were reflected in the $4.3 million loss on debt retirement
that is shown on the Consolidated Statement of Operations for
the thirty-nine weeks ended November 2, 2003.



|         |                   
|-------- | ------------------
|Note 5  | Earnings Per Share

Calculation of the numerator and denominator used
in computing per share amounts is summarized as follows (in
thousands):

|                                     |                                             |                                               |   |                         |        |             |   |             |        |  |   |        |        |  |   |        |        | 
|------------------------------------ | ------------------------------------------- | --------------------------------------------- | - | ----------------------- | ------ | ----------- | - | ----------- | ------ |  | - | ------ | ------ |  | - | ------ | ------ | 
|                                     |                                             |                                               |   |                        
|                                     |                                             | Thirteen Weeks Ended                          |   | Thirty-Nine Weeks Ended
|                                     |                                             |                                               |   |                        
|                                     |                                             | October 31,                                   |   | November 2,             |        | October 31, |   | November 2,
|                                     |                                             | 2004                                          |   | 2003                    |        | 2004        |   | 2003       
|                                     |                                             |                                               |   |                         |        |             |   |            
|Numerator for basic and diluted EPS: |                                             |                                               |   |                         |        |             |   |             |        |  |   |        |        |  |   |       
|                                     | Net income                                  |                                               | $ | 14,368                  |        |             | $ | 15,042      |        |  | $ | 41,179 |        |  | $ | 33,379 |       
|                                     |                                             |                                               |   |                         |        |             |   |             |        |  |   |        |        |  |   |       
|Denominator for basic EPS:           |                                             |                                               |   |                         |        |             |   |             |        |  |   |        |        |  |   |       
|                                     | Weighted average shares outstanding (basic) |                                               |   | 45,126                  |        |             |   | 45,827      |        |  |   | 45,939 |        |  |   | 45,396 |       
|                                     |                                             |                                               |   |                         |        |             |   |             |        |  |   |        |        |  |   |       
|Denominator for diluted EPS:         |                                             |                                               |   |                         |        |             |   |             |        |  |   |        |        |  |   |       
|                                     | Weighted average shares outstanding (basic) |                                               |   | 45,126                  |        |             |   | 45,827      |        |  |   | 45,939 |        |  |   | 45,396 |       
|                                     | Effect of dilutive securities               |                                               |   | 143                     |        |             |   | 412         |        |  |   | 272    |        |  |   | 223    |       
|                                     |                                             |                                               |   |                         |        |             |   |             |        |  |   |        |        |  |   |       
|                                     |                                             | Weighted average shares outstanding (diluted) |   |                         | 45,269 |             |   |             | 46,239 |  |   |        | 46,211 |  |   |        | 45,619 | 
|                                     |                                             |                                               |   |                         |        |             |   |             |        |  |   |        |        |  |   |       

Options to purchase approximately
1.8 million shares of common stock were not included in our
computation of diluted earnings per share for the third quarter
of fiscal 2004 because they would have been anti-dilutive.



|         |                         
|-------- | ------------------------
|Note 6  | Stock Based Compensation

We have stock-based employee compensation plans,
which are described more fully in Note 11 of the Notes to
Consolidated Financial Statements in our 2003 10-K. On
October 18, 2004, the Company issued 81,614 shares of
restricted stock to our executive officers and other associates
pursuant to our CSK Auto Corporation 2004 Stock and Incentive
Plan. The restricted stock was valued at the closing market
price of the stock on the New York Stock Exchange on the grant
date and approximately $1.1 million was recorded as
deferred compensation with an offset to additional paid-in
capital in stockholders equity on the Consolidated Balance
Sheet. The deferred compensation in stockholders equity
will be amortized to expense over the three year vesting period.
No material compensation expense was recorded during the third
quarter of fiscal 2004.

8



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##### Table of Contents



CSK AUTO CORPORATION AND
SUBSIDIARIES


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)

We continue to apply the recognition and
measurement provisions of Accounting Principles Board
(APB) Opinion No. 25, Accounting for Stock
Issued to Employees and related interpretations in
accounting for those plans. No stock-based employee compensation
expense was reflected in net income for stock option grants as
the intrinsic value of all options granted under those plans was
zero. The following table illustrates the effect on net income
and earnings per share if we had applied the fair value
recognition provisions of SFAS No. 123
Accounting for Stock-Based Compensation ($ in
thousands, except per share amounts):

|                                                                                                                                                   |             |                      |        |                         |  |             |        |             |  |   |        |      |  |   |        |      | 
|-------------------------------------------------------------------------------------------------------------------------------------------------- | ----------- | -------------------- | ------ | ----------------------- |  | ----------- | ------ | ----------- |  | - | ------ | ---- |  | - | ------ | ---- | 
|                                                                                                                                                   |             |                      |        |                        
|                                                                                                                                                   |             | Thirteen Weeks Ended |        | Thirty-Nine Weeks Ended
|                                                                                                                                                   |             |                      |        |                        
|                                                                                                                                                   |             | October 31,          |        | November 2,             |  | October 31, |        | November 2,
|                                                                                                                                                   |             | 2004                 |        | 2003                    |  | 2004        |        | 2003       
|                                                                                                                                                   |             |                      |        |                         |  |             |        |            
|Net income  as reported                                                                                                                           |             | $                    | 14,368 |                         |  | $           | 15,042 |             |  | $ | 41,179 |      |  | $ | 33,379 |     
|Add: Stock-based employee compensation expense
    included in reported net income, net of related income taxes                                    |             |                      | 24     |                         |  |             |       |             |  |   | 24     |      |  |   |       |     
|Less: Total stock-based employee compensation
    expense determined under fair value based method for all awards,
    net of related income taxes |             |                      | (224   | )                       |  |             | (166   | )           |  |   | (557   | )    |  |   | (568   | )   
|                                                                                                                                                   |             |                      |        |                         |  |             |        |             |  |   |        |      |  |   |        |     
|Net income  pro forma                                                                                                                             |             | $                    | 14,168 |                         |  | $           | 14,876 |             |  | $ | 40,646 |      |  | $ | 32,811 |     
|                                                                                                                                                   |             |                      |        |                         |  |             |        |             |  |   |        |      |  |   |        |     
|Earnings per share  basic:                                                                                                                        |             |                      |        |                         |  |             |        |             |  |   |        |      |  |   |        |     
|                                                                                                                                                   | As reported |                      | $      | 0.32                    |  |             | $      | 0.33        |  |   | $      | 0.90 |  |   | $      | 0.74 | 
|                                                                                                                                                   | Pro forma   |                      | $      | 0.31                    |  |             | $      | 0.32        |  |   | $      | 0.88 |  |   | $      | 0.72 | 
|Earnings per share  diluted:                                                                                                                      |             |                      |        |                         |  |             |        |             |  |   |        |      |  |   |        |     
|                                                                                                                                                   | As reported |                      | $      | 0.32                    |  |             | $      | 0.33        |  |   | $      | 0.89 |  |   | $      | 0.73 | 
|                                                                                                                                                   | Pro forma   |                      | $      | 0.31                    |  |             | $      | 0.32        |  |   | $      | 0.88 |  |   | $      | 0.72 | 



|         |                         
|-------- | ------------------------
|Note 7  | Stock Repurchase Program

On June 8, 2004, our Board of Directors
approved a share repurchase program that authorized our purchase
of shares of our common stock with an aggregate purchase price
not to exceed $25.0 million. The program provides that we
may buy shares in the open market or in privately negotiated
transactions and that we will base our decisions on whether to
repurchase shares and the timing of any such repurchases on
factors including the stock price, our cash and debt levels, and
general economic and market conditions. Shares of stock
repurchased under the program will be retired and returned to
the status of authorized and unissued shares. This program will
expire in December 2005. During the third quarter of fiscal
2004, we repurchased 0.3 million shares of our common stock
at a cost of approximately $4.0 million under this program.
Since the inception of this program, we have repurchased
approximately 1.6 million shares of our common stock at a
cost of approximately $23.7 million. The repurchase has
been recorded as a reduction to additional paid-in capital.



|         |              
|-------- | -------------
|Note 8  | Legal Matters

During the third quarter of fiscal 2003, we
received notification from the State of California Board of
Equalization (the Board) of an assessment for
approximately $1.2 million for sales tax and approximately
$0.6 million for related interest based on the Boards
audit findings for the tax periods of October 1997 through
September 2000. During this time period, we refunded the sales
tax associated with battery cores to customers who returned a
battery core to our stores. The Board believes that the sales
tax associated with the battery cores should have been remitted
to the taxing authority rather than refunded to the customers.
Based on the

9



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##### Table of Contents



CSK AUTO CORPORATION AND
SUBSIDIARIES


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)

Boards position, we could be responsible
for the sales tax and related interest associated with this
matter for the audited periods of October 1997 through September
2000, plus the additional unaudited time period through December
2002, when we changed our business practices in this area to
mitigate potential future tax related liability.

We believe that we have a strong basis under
California law for disputing the payment of this assessment, and
in October 2003 we timely filed a Petition for Redetermination
with the Board. In May 2004, we received a response from the
Board indicating that the district office that conducted the
audit upheld its position and requested confirmation of our
desire to proceed with the scheduling of an appeals conference
concerning this matter. We responded affirmatively to the
Boards letter in May 2004 and are presently waiting for
formal scheduling by the Board of an appeals conference before
an appeals division attorney or auditor. Our practices through
December 2002 relative to the handling of taxes on battery cores
had been consistent for over a decade, and it is our position
that our consistent treatment of battery core charges, together
with prior tax audits and tax auditors written commentary
concerning our handling of such charges, permits us to rely upon
precedent set in prior audits. Reliance on prior audits is a
position that is supportable under California law. We also have
other defenses and intend to vigorously defend our position with
regard to this matter. A liability for the potential sales tax
and related interest payments has not been recorded in our
consolidated financial statements.

We were served on October 26, 2004 with a
lawsuit that was filed in the Superior Court in San Diego,
California. The case was brought by a sales associate in
California who resigned in January 2003, and purports to be a
class action on behalf of all current and former California
hourly store employees claiming that plaintiff and those
similarly situated were not paid for: (i) all time worked
(i.e. off the clock work), (ii) the minimum
reporting time pay when they reported to work a second time in a
day, (iii) all overtime due, (iv) all wages due at
termination, and (v) amounts due for late or missed meal
periods or rest breaks. Plaintiff also alleges that we violated
certain record keeping requirements arising out of the foregoing
alleged violations. The lawsuit claims these alleged practices
are unfair business practices, and requests back pay,
restitution, penalties for violations of various Labor Code
sections and for failure to pay all wages due on termination,
and interest for the last four years, plus attorney fees and
that the Company be enjoined from committing further unfair
business practices. We believe we have meritorious defenses to
all of these claims and intend to defend the claims vigorously.
If one or more of the claims is permitted by the court to
proceed as a class action and is decided against us, the
aggregate potential financial exposure could be material to our
annual results of operations. We do not believe an adverse
outcome would materially affect our liquidity or consolidated
financial position. However, the litigation is in its early
stages and we cannot predict the outcome with any certainty. A
liability for this matter has not been recorded in our
consolidated financial statements.

We currently and from time to time are involved
in other litigation incidental to the conduct of our business,
including asbestos and similar product liability claims, slip
and fall and other general liability claims, discrimination and
employment claims, vendor disputes, and miscellaneous
environmental and real estate claims. The damages claimed in
some of this litigation are substantial. Based on internal
review, we accrue reserves using our best estimate of the
probable and reasonably estimable contingent liabilities. We do
not currently believe that any of these other legal claims
incidental to the conduct of our business, individually or in
the aggregate, will result in liabilities material to our
consolidated financial position, results of operations or cash
flows.

10



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##### Table of Contents








|        |                                                                                          
|------- | -----------------------------------------------------------------------------------------
|Item 2. | Managements Discussion and Analysis
    of Financial Condition and Results of Operations

Overview

CSK Auto Corporation is the largest specialty
retailer of automotive parts and accessories in the Western
United States and one of the largest retailers of these products
in the United States based, in each case, on our number of
stores. As of October 31, 2004, through our wholly owned
subsidiary Auto, we operated 1,129 stores in 19 states
under one fully integrated operating format and three brand
names:



| |   |                                                                                                                                        
| | - | ---------------------------------------------------------------------------------------------------------------------------------------
| |  | Checker Auto Parts, founded in 1969, with 422
    stores in the Southwestern, Rocky Mountain and Northern Plains
    states and Hawaii;
|
| |  | Schucks Auto Supply, founded in 1917, with 225
    stores in the Pacific Northwest and Alaska; and                                     
|
| |  | Kragen Auto Parts, founded in 1947, with 482
    stores primarily in California.                                                       

In the following discussion, we refer to the
thirteen and thirty-nine week periods ended on October 31,
2004 and November 2, 2003, respectively, as the third
quarter and thirty-nine weeks of those
respective fiscal years.

During the thirty-nine weeks of fiscal 2004, we
opened 22 stores, relocated 5 stores and closed 7 stores in
addition to the 5 stores closed upon relocation. Our goal for
fiscal 2004 is to open approximately 40 to 45 stores, consisting
of approximately 30 to 35 new stores and 10 relocated stores.
During fiscal 2004, we expect to close approximately 8 stores
(in addition to approximately 10 stores closed due to
relocation) for a net increase of approximately 25 stores.

We experienced 5.2% same store sales increases
during the first quarter of fiscal 2004 and same store sales
decreases of 2.5% and 3.2% during the second quarter and third
quarter of fiscal 2004, respectively. We believe that many
factors contributed to our same store sales decreases in the
second and third quarters of fiscal 2004, including milder
temperatures in many of our key markets, economic conditions and
higher gas prices. Despite the difficult sales environment, our
gross profit rate increased almost 80 basis points compared
to the thirty-nine weeks of fiscal 2003. Our inventory
management process allowed us to effectively control our
inventory with only a slight increase compared to the same
period of last year. In light of these conditions, we will
continue to: (1) analyze our operating and administrative
expenses to further reduce our cost structure; (2) review
and refine our core product categories, such as batteries,
brakes, shocks, starters and alternators, to ensure that we are
meeting our customers expectations; (3) add new
product offerings as we deem appropriate to give our customers
additional reasons to shop our stores; and (4) review our
marketing programs, sales promotions, event marketing and sports
sponsorships to build customer awareness and help drive store
traffic. Our goal is to remain focused on our long-term
objectives and continue to manage our business toward
achievement of those objectives.

Automotive Information Systems, Inc.
(AIS) is a wholly owned subsidiary of Auto that
provides diagnostic vehicle repair information to automotive
technicians, automotive replacement parts manufacturers,
automotive test equipment manufacturers, and to DIY consumers.
For the past several months, we have been examining alternatives
that will allow us to maximize the potential value of AIS
without significantly increasing our capital commitment. We do
not anticipate that any potential transaction will have a
material effect on our fiscal 2004 consolidated results of
operations or our financial condition.

The following discussion and analysis presents
factors that affected our consolidated results of operations for
the thirteen and thirty-nine weeks ended October 31, 2004
and our consolidated financial position at that date. The
following information should be read in conjunction with the
Consolidated Financial Statements and Notes included in this
Form 10-Q as well as our 2003 10-K.

11



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##### Table of Contents





| |                      
| | ---------------------
| | Results of Operations

The following table expresses the Statements of
Operations as a percentage of sales for the periods shown:

|                             |  |                      |       |                         |  |             |       |             |  |  |       |   |  |  |       |  
|---------------------------- |  | -------------------- | ----- | ----------------------- |  | ----------- | ----- | ----------- |  |  | ----- | - |  |  | ----- | -
|                             |  |                      |       |                        
|                             |  | Thirteen Weeks Ended |       | Thirty-Nine Weeks Ended
|                             |  |                      |       |                        
|                             |  | October 31,          |       | November 2,             |  | October 31, |       | November 2,
|                             |  | 2004                 |       | 2003                    |  | 2004        |       | 2003       
|                             |  |                      |       |                         |  |             |       |            
|Net sales                    |  |                      | 100.0 | %                       |  |             | 100.0 | %           |  |  | 100.0 | % |  |  | 100.0 | %
|Cost of sales                |  |                      | 52.5  |                         |  |             | 53.1  |             |  |  | 52.7  |   |  |  | 53.5  |  
|                             |  |                      |       |                         |  |             |       |             |  |  |       |   |  |  |       |  
|Gross profit                 |  |                      | 47.5  |                         |  |             | 46.9  |             |  |  | 47.3  |   |  |  | 46.5  |  
|Operating and administrative |  |                      | 39.5  |                         |  |             | 37.8  |             |  |  | 39.6  |   |  |  | 38.3  |  
|Store closing costs          |  |                      | 0.1   |                         |  |             | 0.1   |             |  |  | 0.1   |   |  |  |      |  
|                             |  |                      |       |                         |  |             |       |             |  |  |       |   |  |  |       |  
|Operating profit             |  |                      | 7.9   |                         |  |             | 9.0   |             |  |  | 7.6   |   |  |  | 8.2   |  
|Interest expense             |  |                      | 2.0   |                         |  |             | 3.0   |             |  |  | 2.0   |   |  |  | 3.3   |  
|Loss on debt retirement      |  |                      |      |                         |  |             |      |             |  |  |      |   |  |  | 0.4   |  
|                             |  |                      |       |                         |  |             |       |             |  |  |       |   |  |  |       |  
|Income before income taxes   |  |                      | 5.9   |                         |  |             | 6.0   |             |  |  | 5.6   |   |  |  | 4.5   |  
|Income tax expense           |  |                      | 2.3   |                         |  |             | 2.3   |             |  |  | 2.2   |   |  |  | 1.7   |  
|                             |  |                      |       |                         |  |             |       |             |  |  |       |   |  |  |       |  
|Net Income                   |  |                      | 3.6   | %                       |  |             | 3.7   | %           |  |  | 3.4   | % |  |  | 2.8   | %
|                             |  |                      |       |                         |  |             |       |             |  |  |       |   |  |  |       |  

Thirteen Weeks Ended October 31, 2004
Compared to Thirteen Weeks Ended November 2, 2003

Net sales for the third quarter of fiscal 2004
decreased 2.0% to $401.5 million from $409.8 million
for the third quarter of fiscal 2003. Same store sales decreases
of 3.2% (negative 3.8% for retail and flat sales for commercial)
were partially offset by our increased store count (net of
closures). Sales decreases were observed in all major product
categories.

Gross profit was $190.9 million, or 47.5% of
net sales, for the third quarter of fiscal 2004 as compared to
$192.2 million, or 46.9% of net sales, for the third
quarter of fiscal 2003. Gross profit, as a percent to sales,
increased during the quarter primarily due to lower acquisition
costs on selected products, improvements in our balance of sales
through our category management and reduced store inventory
shrinkage as a result of improved store procedures and enhanced
inventory control systems.

Operating and administrative expenses were
$158.7 million or 39.5% of net sales in the third quarter
of fiscal 2004, compared to $155.1 million or 37.8% of net
sales in the third quarter of fiscal 2003. The increased
expenses and increase as a percent of sales are primarily
attributable to our increased store count, higher advertising as
a result of certain marketing initiatives, increased payroll and
benefit-related expenses and the effect of the decline in sales
on certain fixed operating costs.

Interest expense for the third quarter of fiscal
2004 decreased to $7.8 million from $12.4 million in
the third quarter of fiscal 2003 primarily as a result of the
lower interest rates and corresponding reduced interest expense
associated with our refinancing completed in January 2004.

Income tax expense for the third quarter of
fiscal 2004 was $9.2 million, compared to $9.5 million
for the comparable period of fiscal 2003. Our effective tax rate
was comparable quarter over quarter.

Net income decreased to $14.4 million, or
$0.32 per diluted common share, for the third quarter of
fiscal 2004, compared to net income of $15.0 million, or
$0.33 per diluted common share, for the third quarter of
fiscal 2003.

Thirty-nine Weeks Ended October 31, 2004
Compared to Thirty-nine Weeks Ended November 2,
2003

Net sales for the thirty-nine weeks of fiscal
2004 increased 0.2% to $1,207.6 million from
$1,205.7 million for the thirty-nine weeks of fiscal 2003.
Same store sales were flat compared to the thirty-nine weeks of
fiscal 2003 with higher sales generated by our net increase in
store count. During the first quarter of fiscal 2004,

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same store sales increased 5.2% and were strong
in core product categories such as batteries, brakes, shocks and
rotating electric parts. During the second quarter of fiscal
2004, we experienced weaker than anticipated demand in
heat-related categories primarily as a result of milder
temperatures in many of our key markets and higher gas prices.
During the third quarter of fiscal 2004, sales decreases were
observed in all major product categories.


Gross profit was $570.8 million, or 47.3% of
net sales, for the thirty-nine weeks of fiscal 2004 as compared
to $560.9 million, or 46.5% of net sales, for the
thirty-nine weeks of fiscal 2003. The improvement in gross
margin rates year over year has resulted from lower product
acquisition costs on selected items, improvements in our balance
of sales through enhanced category management, and reduced store
inventory shrinkage as a result of improved store procedures and
enhanced inventory control systems.

Operating and administrative expenses were
$477.9 million or 39.6% of net sales in the thirty-nine
weeks of fiscal 2004, compared to $462.3 million or 38.3%
of net sales in the thirty-nine weeks of fiscal 2003. The
increase year over year is primarily attributable to increased
store count, higher payroll rates and benefit-related costs and
increased advertising.

Interest expense for the thirty-nine weeks of
fiscal 2004 decreased to $23.7 million from
$39.6 million in the thirty-nine weeks of fiscal 2003
primarily as a result of the lower interest rates and
corresponding reduced interest expense associated with our
refinancing completed in January 2004.

In June 2003, we replaced our $300.0 million
credit facility with a new $325.0 million facility. In
connection therewith, we expensed $3.8 million of certain
unamortized debt issuance costs and certain direct costs. With
proceeds from the new credit facility, we also redeemed the
remaining $9.5 million in aggregate principal amount of
Autos 11% senior subordinated notes, including
accrued and unpaid interest associated therewith. In connection
with that redemption, we paid $0.3 million in early
redemption premiums and expensed $0.2 million of
unamortized deferred debt issuance costs. All of these costs
were reflected in the $4.3 million loss on debt retirement
that is shown on the Consolidated Statement of Operations for
the thirty-nine weeks ended November 2, 2003.

Income tax expense for the thirty-nine weeks of
fiscal 2004 was $26.4 million, compared to
$21.0 million for the comparable period of fiscal 2003. Our
effective tax rate was comparable period over period.

Net income increased to $41.2 million, or
$0.89 per diluted common share, for the thirty-nine weeks
of fiscal 2004, compared to net income of $33.4 million, or
$0.73 per diluted common share, for the thirty-nine weeks
of fiscal 2003.

Liquidity and Capital Resources



| |                      
| | ---------------------
| | Overview of Liquidity

Our primary cash requirements include working
capital (primarily inventory), interest on our debt and capital
expenditures. Other than capital lease payments, we are required
to make only minimal debt amortization payments prior to fiscal
2009. We intend to fund our cash requirements with cash flows
from operating activities, borrowings under our senior credit
facility and short-term trade credit relating to extended
payment terms for inventory purchases. The following table
outlines our liquidity:

|                                            |  |                  |         |             |  |   |         | 
|------------------------------------------- |  | ---------------- | ------- | ----------- |  | - | ------- | 
|                                            |  | October 31,      |         | February 1,
|                                            |  | 2004             |         | 2004       
|                                            |  |                  |         |            
|                                            |  |                 
|                                            |  | ($ In thousands)
|Cash                                        |  | $                | 54,673  |             |  | $ | 37,221  | 
|Availability under revolving line of credit |  |                  | 115,038 |             |  |   | 120,068 | 
|Working capital                             |  |                  | 569,195 |             |  |   | 574,862 | 

Availability under our revolving line of credit
decreased during the thirty-nine weeks of fiscal 2004 relative
to prior periods, primarily due to the issuance of letters of
credit relating to our increased purchases of import products.

13



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We have made an election to redeem the
approximately $15.0 million remaining balance of our
$280.0 million 12% senior notes due 2006 in December
2004, the first date such senior notes become redeemable
pursuant to the indenture governing such notes, at a redemption
price equal to 106% of the principal amount plus accrued and
unpaid interest. In connection with the planned redemption, we
expect to record a charge during the fourth quarter of fiscal
2004 of approximately $1.0 million. This charge will
consist of redemption premium paid, the write-off of the
remaining unamortized debt discount, and the write-off of
certain unamortized debt issuance costs, partially offset by a
fair market value adjustment to the senior notes associated with
the termination in June 2003 of an interest rate swap agreement.
Upon redemption of the 12% senior notes, our actual cash
outlay for principal, redemption premium, and accrued and unpaid
interest will be approximately $16.7 million.

On August 10, 2004, we amended our senior
credit facility to provide for an immediate reduction of the
interest rate on the term loan of 25 basis points and an
opportunity for an additional 25 basis points reduction of
the interest rate on such term loan upon the achievement of
certain conditions, as more particularly set forth in the
amendment. The amendment also provides for a one-year extension
of the term loan maturity to August 2010. We anticipate that
this interest rate reduction will reduce our interest expense in
the fourth quarter fiscal of 2004 by approximately
$0.2 million.

On June 8, 2004, our Board of Directors
approved a share repurchase program that authorized the purchase
of shares of our common stock with an aggregate purchase price
not to exceed $25.0 million. The program provides that we
may buy shares in the open market or in privately negotiated
transactions and that we will base our decisions on whether to
repurchase shares and the timing of any such repurchases on
factors including the stock price, our cash and debt levels, and
general economic and market conditions. Shares of stock
repurchased under the program will be retired and returned to
the status of authorized and unissued shares. This program will
expire in December 2005. During the third quarter of fiscal
2004, we repurchased 0.3 million shares of our common stock
at a cost of approximately $4.0 million under this program.
Since the inception of this program, we have repurchased
approximately 1.6 million shares of our common stock at a
cost of approximately $23.7 million.

We lease our office and warehouse facilities, all
but one of our retail stores, and much of our equipment.
Substantially all of our store leases are operating leases with
private landlords and provide for monthly rental payments based
on a contractual amount. These leases generally require minimal
initial cash outlay and we expect that substantially all of our
new store locations will be leased pursuant to similar operating
leases.

In order to facilitate an understanding of our
contractual obligations and commercial commitments, the
following data is provided ($ in thousands):

|                               |  |                             |           |         |  |             |        |             |  |            |         |  |  |   |         |  |  |   |         | 
|------------------------------ |  | --------------------------- | --------- | ------- |  | ----------- | ------ | ----------- |  | ---------- | ------- |  |  | - | ------- |  |  | - | ------- | 
|                               |  |                            
|                               |  | Payments Due by Fiscal Year
|                               |  |                            
|Contractual Obligation         |  | Total                       |           | 2004(1) |  | 2005  2006 |        | 2007  2008 |  | Thereafter
|                               |  |                             |           |         |  |             |        |             |  |           
|Long-term debt(2)              |  | $                           | 493,635   |         |  | $           | 16,185 |             |  | $          | 5,100   |  |  | $ | 5,100   |  |  | $ | 467,250 | 
|Interest on long-term debt(3)  |  |                             | 201,250   |         |  |             | 11,555 |             |  |            | 49,104  |  |  |   | 48,690  |  |  |   | 91,901  | 
|Capital lease obligations(4)   |  |                             | 21,538    |         |  |             | 2,476  |             |  |            | 12,805  |  |  |   | 4,391   |  |  |   | 1,866   | 
|Operating lease obligations(5) |  |                             | 717,354   |         |  |             | 30,254 |             |  |            | 223,713 |  |  |   | 171,809 |  |  |   | 291,578 | 
|                               |  |                             |           |         |  |             |        |             |  |            |         |  |  |   |         |  |  |   |         | 
|Total contractual obligations  |  | $                           | 1,433,777 |         |  | $           | 60,470 |             |  | $          | 290,722 |  |  | $ | 229,990 |  |  | $ | 852,595 | 
|                               |  |                             |           |         |  |             |        |             |  |            |         |  |  |   |         |  |  |   |         | 



---



|    |                                                                                                                                                                                                                                                                                                                                         
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(1) | Represents the period from November 1, 2004
    to January 30, 2005.                                                                                                                                                                                                                                                                    
|   
|(2) | Change from 2003 10-K due to the extension of the
    term loan portion of our senior credit facility to
    August 10, 2010 and our election to redeem the remaining
    approximately $15.0 million balance of our 12% senior
    notes in December 2004.                                                                             
|   
|(3) | Interest on the term loan was calculated assuming
    the current interest rate of 4.06% would be in effect through
    the loan expiration date of August 2010. $100.0 million of
    our $225.0 million 7% senior subordinated notes is subject
    to an interest rate swap agreement. The estimate of the effect
    of the interest

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| |                                                                                                                                                     
| | ----------------------------------------------------------------------------------------------------------------------------------------------------
| | rate swap on interest was made assuming the
    current interest rate related to the rate swap would be in
    effect for the term of the rate swap.



|    |                                                                                                                                                         
|--- | --------------------------------------------------------------------------------------------------------------------------------------------------------
|(4) | Capital lease payments include both principal and
    interest.                                                                                         
|   
|(5) | Operating lease obligations are not reduced to
    reflect sublease income. Changes from 2003 10-K due primarily to
    new stores and lease extensions.

Other commercial commitments consist of standby
letters of credit totaling $30.0 million, the longest term
of which expires in June 2005. Our inventory purchase
commitments are cancelable and therefore not included in the
above table.

Analysis of Cash Flows

The following table summarizes our cash flows
from operating activities:

|                                                  |                                      |                         |         |             |  |   |         |        | 
|------------------------------------------------- | ------------------------------------ | ----------------------- | ------- | ----------- |  | - | ------- | ------ | 
|                                                  |                                      |                        
|                                                  |                                      | Thirty-Nine Weeks Ended
|                                                  |                                      |                        
|                                                  |                                      | October 31,             |         | November 2,
|                                                  |                                      | 2004                    |         | 2003       
|                                                  |                                      |                         |         |            
|                                                  |                                      |                        
|                                                  |                                      | ($ In thousands)       
|Net income                                        |                                      | $                       | 41,179  |             |  | $ | 33,379  |       
|Non-cash expenses and adjustments                 |                                      |                         | 50,653  |             |  |   | 52,730  |       
|Change in inventory, net of accounts payable      |                                      |                         | (32,790 | )           |  |   | (42,735 | )     
|Proceeds from interest rate swap termination      |                                      |                         |        |             |  |   | 6,031   |       
|Changes in other operating assets and liabilities |                                      |                         | 14,021  |             |  |   | 9,658   |       
|                                                  |                                      |                         |         |             |  |   |         |       
|                                                  | Cash flows from operating activities |                         | $       | 73,063      |  |   | $       | 59,063 | 
|                                                  |                                      |                         |         |             |  |   |         |       

During the thirty-nine weeks of fiscal 2004, net
cash provided by operating activities was $73.1 million
compared to $59.1 million of cash provided by operating
activities during the thirty-nine weeks of fiscal 2003. The
change primarily relates to an increase of $7.8 million in
net income resulting primarily from lower interest expense and a
reduction of our inventory purchases (net of accounts payable)
by $9.9 million as a result of improved payables
management. Cash flows from operations during the thirty-nine
weeks of fiscal 2003 were favorably impacted by
$6.0 million associated with the termination of an interest
rate swap agreement.

Net cash used in investing activities totaled
$18.8 million for the thirty-nine weeks of fiscal 2004,
compared to $13.1 million used during the thirty-nine weeks
of fiscal 2003. Capital expenditures increased during the
thirty-nine weeks of fiscal 2004 relative to the thirty-nine
weeks of fiscal 2003 as a result of new store improvements,
additional capital upgrades to existing stores, and the purchase
of certain leased assets.

Net cash used in financing activities totaled
$36.8 million in the thirty-nine weeks of fiscal 2004
compared to $14.6 million in the thirty-nine weeks of
fiscal 2003. The change primarily relates to the following:
(1) during the thirty-nine weeks of fiscal 2004, we
utilized approximately $23.7 million of our cash to
repurchase and subsequently retire approximately
1.6 million shares of our common stock; no such purchases
were made in fiscal 2003; (2) during the thirty-nine weeks
of fiscal 2003, proceeds from the exercise of stock options were
$12.8 million higher than the thirty-nine weeks of fiscal
2004 as a result of significant stock option exercises
(3) during the thirty-nine weeks of fiscal 2003, we retired
$9.5 million of our 11% senior subordinated notes; no
such retirements occurred during the thirty-nine weeks of fiscal
2004; and (4) payments for debt issuance costs were
$3.0 million less during the thirty-nine weeks of fiscal
2004 than in the thirty-nine weeks of fiscal 2003 as a result of
the June 2003 refinancing of our former senior credit facility.

Store Closures

On an on-going basis, store locations are
reviewed and analyzed based on several factors including market
saturation, store profitability, and store size and format. In
addition, we analyze sales trends and geographical and
competitive factors to determine the viability and future
profitability of our store locations. If a store

15



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location does not meet our required performance,
it is considered for closure. As a result of past acquisitions,
we have closed numerous locations due to overlap with previously
existing store locations.


We account for the costs of closed stores in
accordance with SFAS No. 146, Accounting for
Costs Associated with Exit or Disposal Activities. Under
SFAS No. 146, costs of operating lease commitments for
a closed store are recognized as expense at fair value at the
time we cease operating the store. Fair value of the liability
is determined as the present value of future cash flows
discounted using a credit-adjusted risk free rate. Accretion
expense represents interest on our recorded closed store
liabilities at the same credit adjusted risk free rate used to
discount the cash flows. In addition, SFAS No. 146
also requires that the amount of remaining lease payments owed
be reduced by estimated sublease income (but not to an amount
less than zero). Sublease income in excess of costs associated
with the lease is recognized as it is earned and included as a
reduction to operating and administrative expense in the
accompanying financial statements.

The allowance for store closing costs is included
in accrued expenses and other long term liabilities in the
accompanying financial statements and primarily represents the
discounted value of the following future net cash outflows
related to closed stores: (1) future rents to be paid over
the remaining terms of the lease agreements for the stores (net
of estimated probable sublease income); (2) lease
commissions associated with the anticipated store subleases; and
(3) contractual expenses associated with the closed store
vacancy periods. Certain operating expenses, such as utilities
and repairs, are expensed as incurred and no provision is made
for employee termination costs.

As of October 31, 2004, we had a total of
143 store locations included in the allowance for store closing
costs. Of this total, 13 locations were vacant and 130 locations
were subleased. In addition to these stores, we had 55 service
centers of which 3 were vacant and 52 were subleased. Future
rental payments will be made through the expiration of the
non-cancelable leases, the longest of which runs through March
2018.

Activity in the allowance for store closings and
the related payments for the thirty-nine weeks of fiscal 2004
are as follows ($ in thousands):

|                               |                                        |                |                          |        |        |       | 
|------------------------------ | -------------------------------------- | -------------- | ------------------------ | ------ | ------ | ----- | 
|Balance, beginning of year     |                                        | $              | 12,148                   |       
|Store closing costs:           |                                        |                |                          |       
|                               | Provision for store closing costs      |                |                          | 106    |       
|                               | Revisions in estimates                 |                |                          | 345    |       
|                               | Accretion                              |                |                          | 418    |       
|                               | Operating expenses and other           |                |                          | 739    |       
|                               |                                        |                |                          |       
|                               |                                        |                | Store closing costs, net |        |        | 1,608 | 
|Payments:                      |                                        |                |                          |       
|                               | Rent expense, net of sublease income   |                |                          | (2,249 | )     
|                               | Occupancy and other expenses           |                |                          | (696   | )     
|                               | Lease buyouts and sublease commissions |                |                          | (2,110 | )     
|                               |                                        |                |                          |       
|                               |                                        | Total payments |                          |        | (5,055 | )    
|                               |                                        |                |                          |       
|Balance as of October 31, 2004 |                                        | $              | 8,701                    |       
|                               |                                        |                |                          |       

We expect cash outflows for vacant stores (which
includes certain operating expenses that are expensed as
incurred), sublease losses and lease buyouts to be approximately
$7.0 million during fiscal 2004. We expect the remainder of
cash outflows relating to these stores to occur primarily during
fiscal 2005 through 2007.

Factors Affecting Liquidity and Capital
Resources



| |             
| | ------------
| | Sales Trends

Our business is somewhat seasonal in nature, with
the highest sales occurring in the months of June through
October (overlapping our second and third fiscal quarters.) In
addition, our business is affected by weather conditions. While
unusually severe or inclement weather typically tends to reduce
sales, as our

16



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##### Table of Contents



customers are more likely to defer elective
maintenance during such periods, extremely hot and cold
temperatures tend to enhance sales by causing auto parts to fail
and sales of seasonal product to increase.


Our same store sales were flat during the
thirty-nine weeks of fiscal 2004, which was comprised of 5.2%
same store sales increases during the first quarter of fiscal
2004 and same store sales decreases of 2.5% and 3.2% during the
second and third quarters of fiscal 2004, respectively. Based on
our estimate of future sales trends and in recognition of our
7.5% same store sales increase in the fourth quarter of fiscal
2003, we expect same store sales to be in the range of negative
1.5% to negative 3.5% for the fourth quarter of fiscal 2004.



| |          
| | ---------
| | Inflation

We do not believe our operations have been
materially affected by inflation. We believe that we will be
able to mitigate the effects of future merchandise cost
increases principally through economies of scale resulting from
increased volumes of purchases, selective forward buying and the
use of alternative suppliers.



| |               
| | --------------
| | Debt Covenants

Our credit agreement contains negative covenants
and restrictions on actions by us and our subsidiaries
including, without limitation, restrictions and limitations on
indebtedness, liens, guarantees, mergers, asset dispositions not
in the ordinary course of business, investments, loans, advances
and acquisitions, payment of dividends, transactions with
Affiliates (as defined in the credit agreement), change in
business conducted, and certain prepayments (other than in the
ordinary course of business) and amendments of subordinated
indebtedness. Our credit agreement requires that we meet certain
financial covenants, ratios and tests, including a maximum
leverage ratio and a minimum interest coverage ratio. The
Consolidated Leverage Ratio is Consolidated Total Funded
Debt, as defined in the credit agreement, divided by
Consolidated EBITDA as defined in the credit
agreement. The Interest Coverage Ratio is Consolidated
EBITDA, as defined in the credit agreement, divided by
cash interest expense, as defined in the credit
agreement. At October 31, 2004 we were in compliance with
the covenants. We anticipate meeting all required covenants
under our existing credit agreement in fiscal 2004.

A breach of the covenants, ratios, or
restrictions contained in our credit agreement could result in
an event of default thereunder. Upon the occurrence of such an
event of default, the lenders under our credit agreement could
elect to declare all amounts outstanding under the credit
agreement, together with accrued interest, to be immediately due
and payable. If we were unable to repay those amounts, the
lenders could proceed against the collateral granted to them to
secure the indebtedness. The collateral consists of
substantially all of our assets. If the lenders under the credit
agreement accelerate the payment of the indebtedness, we cannot
be assured that our assets would be sufficient to repay in full
that indebtedness.

Although we have significantly reduced our
outstanding debt over recent years, we are still highly
leveraged. The degree to which we are leveraged could have
important consequences on our ability to obtain additional
financing for working capital, capital expenditures,
acquisitions or general corporate purposes. A substantial
portion of our cash flow from operations must be dedicated to
the payment of interest on our indebtedness, thereby reducing
the funds available for other purposes. We are substantially
more leveraged than some of our competitors, which might place
us at a competitive disadvantage to those competitors that have
lower debt service obligations and significantly greater
operating and financial flexibility than we do. We may not be
able to adjust rapidly to changing market conditions and we may
be more vulnerable in the event of a downturn in general
economic conditions or in our business.



| |               
| | --------------
| | Interest Rates

Financial market risks relating to our operations
result primarily from changes in interest rates. Interest earned
on our cash equivalents as well as interest paid on our variable
rate debt and interest received or paid on our interest rate
swap is sensitive to changes in interest rates. Our variable
rate debt relates to borrowings under our senior credit
facility, which is primarily vulnerable to movements in the
LIBOR rate. We hold no market risk sensitive instruments for
trading purposes.

17



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##### Table of Contents



On April 5, 2004, we entered into an
interest rate swap agreement to effectively convert
$100.0 million of our 7% senior subordinated notes due
2014 to a floating rate, set semi-annually in arrears, equal to
the 6 month LIBOR +283 basis points. The agreement is
for the term of the notes. We entered into the interest rate
swap to hedge the changes in the fair value of the underlying
fixed rate debt that result from changes in the general level of
market interest rates. The hedge is accounted for as a
fair value hedge; accordingly, the fair value of the
derivative and changes in the fair value of the underlying debt
will be reported on our consolidated balance sheet and
recognized in the results of operations. Based upon our
assessment of effectiveness of the hedge, changes in the fair
value of this derivative and the underlying debt will not have a
significant effect on our consolidated results of operations. At
October 31, 2004, the fair value of the interest rate swap
was a liability of approximately $8.4 million, which is
included in other long-term liabilities with an identical amount
reflected as a basis adjustment in long term debt on the
accompanying Consolidated Balance Sheet.

At October 31, 2004, including the
$100.0 million of senior subordinated notes that are
subject to the interest rate swap agreement, 70% of our
outstanding debt was at variable interest rates and 30% of our
outstanding debt was at fixed interest rates. With
$354.0 million in variable rate debt outstanding, a 1%
change in the LIBOR rate to which this variable rate debt is
tied would result in a $3.5 million change in our annual
interest expense. This estimate assumes that our debt balance
remains constant for an annual period and the interest rate
change occurs at the beginning of the period.



| |                            
| | ---------------------------
| | Critical Accounting Matters

For a discussion of our critical accounting
matters, please refer to our 2003 10-K.



| |                           
| | --------------------------
| | Forward-Looking Statements

Certain statements contained in the foregoing
Managements Discussion and Analysis of Financial Condition
and Results of Operations are forward-looking statements. They
discuss, among other things, expected growth, future store
development and relocation strategy, business strategies, future
revenues and future performance. The forward-looking statements
are subject to risks, uncertainties and assumptions, including,
but not limited to, competitive pressures and impacts, demand
for our products, factors impacting procurement of import
products, fluctuations in and the overall condition of the
economy, timing and number of equity awards issued and the
market value of such awards, inflation, consumer debt levels,
factors impacting consumer spending and driving habits,
conditions affecting new store development, weather conditions,
the possibility that we may fail to complete our assessment of,
or we may identify material weaknesses in, our internal control
over financial reporting in the course of our assessment of
internal control over financial reporting pursuant to
Section 404 of the Sarbanes-Oxley Act, and litigation and
regulatory matters. Actual results may differ materially from
anticipated results described in these forward-looking
statements. Additional information regarding these and other
risks that may cause differences are contained in our periodic
and other filings with the Securities and Exchange Commission.






|        |                                                               
|------- | --------------------------------------------------------------
|Item 3. | Quantitative and Qualitative Disclosures
    About Market Risk

See Factors Affecting Liquidity and Capital
Resources above.






|        |                        
|------- | -----------------------
|Item 4. | Controls and Procedures

Evaluation of Disclosure Controls and
Procedures

Our management carried out an evaluation, under
the supervision and with the participation of our Chief
Executive Officer (CEO) and Chief Financial Officer
(CFO), of the effectiveness of the design and
operation of our disclosure controls and procedures (as defined
in Rules 13a-15(e) and 15d-15(e) under the Securities
Exchange Act of 1934, as amended (the Exchange
Act)), as of October 31, 2004, the end of the period
covered by this Quarterly Report on Form 10-Q. Based upon
that evaluation, the CEO and CFO concluded that as of the
evaluation date, our disclosure controls and procedures are
effective at a reasonable assurance level to ensure that
information required to be disclosed by the Company in reports
that it files or

18



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##### Table of Contents



submits under the Exchange Act is recorded,
processed, summarized and reported within the time periods
specified in Securities and Exchange Commission rules and forms.


Changes in Internal Control Over Financial
Reporting

During the fiscal quarter ended October 31,
2004, there has been no change in our internal control over
financial reporting (as defined in Rule 13a-15(f) and
15d-15(f) under the Exchange Act) that has materially affected
or is reasonably likely to materially affect, our internal
control over financial reporting.

19



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##### Table of Contents






PART II

OTHER INFORMATION






|        |                  
|------- | -----------------
|Item 1. | Legal Proceedings

During the third quarter of fiscal 2003, we
received notification from the State of California Board of
Equalization (the Board) of an assessment for
approximately $1.2 million for sales tax and approximately
$0.6 million for related interest based on the Boards
audit findings for the tax periods of October 1997 through
September 2000. During this time period, we refunded the sales
tax associated with battery cores to customers who returned a
battery core to our stores. The Board believes that the sales
tax associated with the battery cores should have been remitted
to the taxing authority rather than refunded to the customers.
Based on the Boards position, we could be responsible for
the sales tax and related interest associated with this matter
for the audited periods of October 1997 through September 2000,
plus the additional unaudited time period through December 2002,
when we changed our business practices in this area to mitigate
potential future tax related liability.

We believe that we have a strong basis under
California law for disputing the payment of this assessment, and
in October 2003 we timely filed a Petition for Redetermination
with the Board. In May 2004, we received a response from the
Board indicating that the district office that conducted the
audit upheld its position and requested confirmation of our
desire to proceed with the scheduling of an appeals conference
concerning this matter. We have responded affirmatively to the
Boards letter in May 2004 and are presently waiting for
formal scheduling by the Board of an appeals conference before
an appeals division attorney or auditor. Our practices through
December 2002 relative to the handling of taxes on battery cores
had been consistent for over a decade, and it is our position
that our consistent treatment of battery core charges, together
with prior tax audits and tax auditors written commentary
concerning our handling of such charges, permits us to rely upon
precedent set in prior audits. Reliance on prior audits is a
position that is supportable under California law. We also have
other defenses and intend to vigorously defend our position with
regard to this matter. A liability for the potential sales tax
and related interest payments has not been recorded in our
consolidated financial statements.

We were served on October 26, 2004 with a
lawsuit that was filed in the Superior Court in San Diego,
California. The case was brought by a sales associate in
California who resigned in January 2003, and purports to be a
class action on behalf of all current and former California
hourly store employees claiming that plaintiff and those
similarly situated were not paid for: (i) all time worked
(i.e. off the clock work), (ii) the minimum
reporting time pay when they reported to work a second time in a
day, (iii) all overtime due, (iv) all wages due at
termination, and (v) amounts due for late or missed meal
periods or rest breaks. Plaintiff also alleges that CSK violated
certain record keeping requirements arising out of the foregoing
alleged violations. The lawsuit claims these alleged practices
are unfair business practices, and requests back pay,
restitution, penalties for violations of various Labor Code
sections and for failure to pay all wages due on termination,
and interest for the last four years, plus attorney fees and
that the Company be enjoined from committing further unfair
business practices. We believe we have meritorious defenses to
all of these claims and intend to defend the claims vigorously.
If one or more of the claims is permitted by the court to
proceed as a class action and is decided against us, the
aggregate potential financial exposure could be material to our
annual results of operations. We do not believe an adverse
outcome would materially affect our liquidity or consolidated
financial position. However, the litigation is in its early
stages and we cannot predict the outcome with any certainty. A
liability for this matter has not been recorded in our
consolidated financial statements.

We currently and from time to time are involved
in other litigation incidental to the conduct of our business,
including asbestos and similar product liability claims, slip
and fall and other general liability claims, discrimination and
employment claims, vendor disputes, and miscellaneous
environmental and real estate claims. The damages claimed in
some of this litigation are substantial. Based on internal
review, we accrue reserves using our best estimate of the
probable and reasonably estimable contingent liabilities. We do
not currently believe that any of these other legal claims
incidental to the conduct of our business, individually or

20



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##### Table of Contents



in the aggregate, will result in liabilities
material to our consolidated financial position, results of
operations or cash flows.







|        |                                                                                                         
|------- | --------------------------------------------------------------------------------------------------------
|Item 2. | Unregistered Sales of Securities and Use of
    Proceeds and Issuer Repurchases of Equity
    Securities

|                                    |  |                                            |           |                  |  |                     |       |                  |  |  |           |  |  |   |           | 
|----------------------------------- |  | ------------------------------------------ | --------- | ---------------- |  | ------------------- | ----- | ---------------- |  |  | --------- |  |  | - | --------- | 
|                                    |  |                                           
|                                    |  | Issuer Repurchases of Equity Securities(1)
|                                    |  |                                           
|                                    |  |                                            |           | Total Number of  |  | Dollar Value of    
|                                    |  |                                            |           | Shares Purchased |  | Shares That May    
|                                    |  | Total Number of                            |           | Average Price    |  | as Part of Publicly |       | Yet be Purchased
|Period                              |  | Shares Purchased                           |           | Paid Per Share   |  | Announced Plans     |       | Under the Plan  
|                                    |  |                                            |           |                  |  |                     |       |                 
|Balance as of August 1, 2004        |  |                                            | 1,274,956 | (2)              |  | $                   | 15.50 |                  |  |  | 1,274,956 |  |  | $ | 5,234,924 | 
|August 2, 2004 to August 29, 2004   |  |                                            |          |                  |  |                     |      |                  |  |  |          |  |  |   | 5,234,924 | 
|August 30, 2004 to October 3, 2004  |  |                                            | 300,000   |                  |  |                     | 13.20 |                  |  |  | 300,000   |  |  |   | 1,275,034 | 
|October 4, 2004 to October 31, 2004 |  |                                            |          |                  |  |                     |      |                  |  |  |          |  |  |   | 1,275,034 | 
|                                    |  |                                            |           |                  |  |                     |       |                  |  |  |           |  |  |   |           | 
|As of October 31, 2004              |  |                                            | 1,574,956 |                  |  | $                   | 15.06 |                  |  |  | 1,574,956 |  |  | $ | 1,275,034 | 



---



|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(1) | On June 8, 2004, our Board of Directors
    approved a share repurchase program authorizing us to acquire up
    to $25.0 million of our common stock. The program expires
    in December 2005. See Note 7 to the Consolidated Financial
    Statements.                                                                                                                                                                                       
|   
|(2) | Consists of a) 475,756 shares purchased
    in a privately negotiated transaction with Investcorp S.A.,
    formerly one of the Companys significant shareholders, at
    an approximate 1% discount from the average market price of our
    common stock on the date of purchase. Charles K. Marquis, a
    member of our Board of Directors, is employed by Investcorp; and
    b) 799,200 shares purchased in open market
    transactions.






|        |                                    
|------- | -----------------------------------
|Item 3. | Defaults upon Senior
    Securities

NONE






|        |                                                        
|------- | -------------------------------------------------------
|Item 4. | Submission of Matters to a Vote of Security
    Holders

NONE






|        |                  
|------- | -----------------
|Item 5. | Other Information

NONE






|        |         
|------- | --------
|Item 6. | Exhibits

(a) Exhibits:

| |   |       |  |                                                                                                                                                                                                                                                
| | - | ----- |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | 3 | .01   |  | Restated Certificate of Incorporation of the
    Company, incorporated herein by reference to Exhibit 3.01
    of our Annual Report on Form 10-K, filed on May 4,
    1998 (File No. 001-13927).                                               
| | 3 | .02   |  | Certificate of Correction to the Restated
    Certificate of Incorporation of the Company, incorporated herein
    by reference to Exhibit 3.02 of our Annual Report on
    Form 10-K, filed on May 4, 1998 (File
    No. 001-13927).          
| | 3 | .02.1 |  | Certificate of Amendment to the Restated
    Certificate of Incorporation of CSK Auto Corporation,
    incorporated herein by reference to Exhibit 3.02.1 of our
    Report on Form 10-Q, filed on September 18, 2002 (File
    No. 001-13927).
| | 3 | .03   |  | Amended and Restated By-Laws of the Company,
    incorporated herein by reference to Exhibit 3.03 of our
    Annual Report on Form 10-K, filed on April 28, 1999
    (File No. 001-13927).                                                     
| | 3 | .03.1 |  | First Amendment to Amended and Restated By-Laws
    of the Company, incorporated herein by reference to
    Exhibit 3.03.1 of our Annual Report on Form 10-K,
    filed on May 1, 2001 (File No. 001-13927).                                   

21



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##### Table of Contents



| |    |       |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
| | -- | ----- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | 3  | .03.2 |  | Second Amendment to Amended and Restated Bylaws
    of the Company, dated May 6, 2004 incorporated herein by
    reference to Exhibit 3.03.2 of our Report on
    Form 10-Q, filed June 14, 2004 (File
    No. 001-13927).                                                                                                                                                                                                                                              
| | 4  | .01   |  | Amended and Restated Credit Agreement dated as of
    January 16, 2004, by and among CSK Auto, Inc., JPMorgan
    Chase Bank, as Administrative Agent, Credit Suisse First Boston,
    acting through its Cayman Islands branch, as Syndication Agent,
    and Bank of America, N.A., incorporated herein by reference to
    Exhibit 99.2 of our Current Report on Form 8-K, filed
    January 20, 2004.                                                               
| | 4  | .01.1 |  | Amendment No. 1 to Amended and Restated
    Credit Agreement among CSK Auto, Inc. and JPMorgan Chase Bank,
    as administrative agent for the Lenders, dated as of
    April 29, 2004, incorporated herein by reference to
    Exhibit 4.01.1 of our Quarterly Report on Form 10-Q,
    filed June 14, 2004.                                                                                                                                                           
| | 4  | .01.2 |  | Amendment No. 2 to Amended and Restated
    Credit Agreement among CSK Auto, Inc. and JPMorgan Chase Bank,
    as administrative agent for the Lenders, dated as of
    August 10, 2004, incorporated herein by reference to
    Exhibit 99.1 of our current Report on Form 8-K, filed
    August 12, 2004.                                                                                                                                                             
| | 4  | .02   |  | Form of Common Stock certificate, incorporated
    herein by reference to our Registration Statement on
    Form S-1 (File No. 333-43211).                                                                                                                                                                                                                                                                                                                              
| | 4  | .03   |  | Purchase Agreement, dated December 7, 2001,
    by and among CSK Auto, Inc; CSK Auto Corporation, Automotive
    Information Systems, Inc. and CSKAUTO.COM, Inc., as Guarantors;
    and Credit Suisse First Boston Corporation, J.P. Morgan
    Securities Inc. and UBS Warburg LLC as Purchasers, incorporated
    herein by reference to Exhibit 99.4 of our Current Report
    on Form 8-K, filed January 18, 2002.                                                 
| | 4  | .04   |  | Indenture, dated December 21, 2001, by and
    among CSK Auto, Inc.; CSK Auto Corporation, as guarantor;
    Automotive Information Systems, Inc. and CSKAUTO.COM, Inc., as
    subsidiary guarantors; and the Bank of New York, as Trustee,
    incorporated herein by reference to Exhibit 99.3 of our
    Current Report on Form 8-K, filed January 18, 2002.                                                                                                        
| | 4  | .05   |  | Purchase Agreement, dated January 9, 2004,
    by and among CSK Auto, Inc. as issuer; CSK Auto Corporation,
    Automotive Information Systems, Inc. and CSKAUTO.COM, Inc. as
    Guarantors; and Credit Suisse First Boston LLC, Lehman Brothers
    Inc., J.P. Morgan Securities Inc., Piper Jaffray &
    Co. and Banc of America Securities LLC, incorporated herein by
    reference to Exhibit 99.5 of our Current Report on
    Form 8-K, filed January 20, 2004.
| | 4  | .06   |  | Indenture dated as of January 16, 2004 by
    and among CSK Auto, Inc. (as Issuer), CSK Auto Corporation,
    Automotive Information Systems, Inc. and CSKAUTO.COM, Inc. (each
    a Guarantor) and The Bank of New York (as Trustee), incorporated
    herein by reference to Exhibit 99.3 of our Current Report
    on Form 8-K, filed January 20, 2004.                                                                                                              
| | 10 | .1    |  | Amendment and Restated Supplemental Executive
    Retirement Plan Agreement between CSK Auto, Inc. and Maynard
    Jenkins dated May 4, 2004, incorporated herein by reference
    to exhibit 10.1 of our Current Report on Form 10-Q,
    filed June 14, 2004.                                                                                                                                                                                                         
| | 10 | .2    |  | 2004 Stock and Incentive Plan approved by the
    Companys shareholders on June 16, 2004, incorporated
    herein by reference to exhibit 10.2 of our Current Report
    on Form 10-Q, filed September 10, 2004.                                                                                                                                                                                                                                                       
| | 10 | .3    |  | Amendment to employment agreement between
    Mr. James Bazlen and CSK Auto, Inc., dated effective
    October 15, 2004, incorporated here in by reference to
    Exhibit 99.4 of our Current Report on Form 8-K, filed
    October 20, 2004.                                                                                                                                                                                                                           
| | 31 | .1    |  | Certification by the Chief Executive Officer
    pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.                                                                                                                                                                                                                                                                                                                                                             
| | 31 | .2    |  | Certification by the Chief Financial Officer
    pursuant to Section 302 of the Sarbanes-Oxley Act of 2002                                                                                                                                                                                                                                                                                                                                                              
| | 32 | .0    |  | Certification by the Chief Executive Officer and
    Chief Financial Officer pursuant to 18 U.S.C.
    Section 1350, as adopted pursuant to Section 906 of
    the Sarbanes-Oxley Act of 2002.                                                                                                                                                                                                                                                                          

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SIGNATURE

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.



| |                     
| | --------------------
| | CSK AUTO CORPORATION



| |     |                  
| | --- | -----------------
| | By: | /s/ DON W. WATSON

| |                        
| | -----------------------
| |                        
| | Don W. Watson          
| | Chief Financial Officer

Dated: December 9, 2004

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##### Table of Contents






EXHIBIT INDEX

|        |   |             |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|------- | - | ----------- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Exhibit |   |            
|Number  |   | Description
|        |   |            
|        | 3 | .01         |  | Restated Certificate of Incorporation of the
    Company, incorporated herein by reference to Exhibit 3.01
    of our Annual Report on Form 10-K, filed on May 4,
    1998 (File No. 001-13927).                                                                                                                                                                                                                                                                        
|        | 3 | .02         |  | Certificate of Correction to the Restated
    Certificate of Incorporation of the Company, incorporated herein
    by reference to Exhibit 3.02 of our Annual Report on
    Form 10-K, filed on May 4, 1998 (File
    No. 001-13927).                                                                                                                                                                                                                                   
|        | 3 | .02.1       |  | Certificate of Amendment to the Restated
    Certificate of Incorporation of CSK Auto Corporation,
    incorporated herein by reference to Exhibit 3.02.1 of our
    Report on Form 10-Q, filed on September 18, 2002 (File
    No. 001-13927).                                                                                                                                                                                                                         
|        | 3 | .03         |  | Amended and Restated By-Laws of the Company,
    incorporated herein by reference to Exhibit 3.03 of our
    Annual Report on Form 10-K, filed on April 28, 1999
    (File No. 001-13927).                                                                                                                                                                                                                                                                              
|        | 3 | .03.1       |  | First Amendment to Amended and Restated By-Laws
    of the Company, incorporated herein by reference to
    Exhibit 3.03.1 of our Annual Report on Form 10-K,
    filed on May 1, 2001 (File No. 001-13927).                                                                                                                                                                                                                                                            
|        | 3 | .03.2       |  | Second Amendment to Amended and Restated Bylaws
    of the Company, dated May 6, 2004 incorporated herein by
    reference to Exhibit 3.03.2 of our Report on
    Form 10-Q, filed June 14, 2004 (File
    No. 001-13927).                                                                                                                                                                                                                                              
|        | 4 | .01         |  | Amended and Restated Credit Agreement dated as of
    January 16, 2004, by and among CSK Auto, Inc., JPMorgan
    Chase Bank, as Administrative Agent, Credit Suisse First Boston,
    acting through its Cayman Islands branch, as Syndication Agent,
    and Bank of America, N.A., incorporated herein by reference to
    Exhibit 99.2 of our Current Report on Form 8-K, filed
    January 20, 2004.                                                               
|        | 4 | .01.1       |  | Amendment No. 1 to Amended and Restated
    Credit Agreement among CSK Auto, Inc. and JPMorgan Chase Bank,
    as administrative agent for the Lenders, dated as of
    April 29, 2004 incorporated herein by reference to
    Exhibit 4.01.1 of our Quarterly Report on Form 10-Q,
    filed June 14, 2004.                                                                                                                                                            
|        | 4 | .01.2       |  | Amendment No. 2 to Amended and Restated
    Credit Agreement among CSK Auto, Inc. and JPMorgan Chase Bank,
    as administrative agent for the Lenders, dated as of
    August 10, 2004, incorporated herein by reference to
    Exhibit 99.1 of our current Report on Form 8-K, filed
    August 12, 2004.                                                                                                                                                             
|        | 4 | .02         |  | Form of Common Stock certificate, incorporated
    herein by reference to our Registration Statement on
    Form S-1 (File No. 333-43211).                                                                                                                                                                                                                                                                                                                              
|        | 4 | .03         |  | Purchase Agreement, dated December 7, 2001,
    by and among CSK Auto, Inc; CSK Auto Corporation, Automotive
    Information Systems, Inc. and CSKAUTO.COM, Inc., as Guarantors;
    and Credit Suisse First Boston Corporation, J.P. Morgan
    Securities Inc. and UBS Warburg LLC as Purchasers, incorporated
    herein by reference to Exhibit 99.4 of our Current Report
    on Form 8-K, filed January 18, 2002.                                                 
|        | 4 | .04         |  | Indenture, dated December 21, 2001, by and
    among CSK Auto, Inc.; CSK Auto Corporation, as guarantor;
    Automotive Information Systems, Inc. and CSKAUTO.COM, Inc., as
    subsidiary guarantors; and the Bank of New York, as Trustee,
    incorporated herein by reference to Exhibit 99.3 of our
    Current Report on Form 8-K, filed January 18, 2002.                                                                                                        
|        | 4 | .05         |  | Purchase Agreement, dated January 9, 2004,
    by and among CSK Auto, Inc. as issuer; CSK Auto Corporation,
    Automotive Information Systems, Inc. and CSKAUTO.COM, Inc. as
    Guarantors; and Credit Suisse First Boston LLC, Lehman Brothers
    Inc., J.P. Morgan Securities Inc., Piper Jaffray &
    Co. and Banc of America Securities LLC, incorporated herein by
    reference to Exhibit 99.5 of our Current Report on
    Form 8-K, filed January 20, 2004.
|        | 4 | .06         |  | Indenture dated as of January 16, 2004 by
    and among CSK Auto, Inc. (as Issuer), CSK Auto Corporation,
    Automotive Information Systems, Inc. and CSKAUTO.COM, Inc. (each
    a Guarantor) and The Bank of New York (as Trustee), incorporated
    herein by reference to Exhibit 99.3 of our Current Report
    on Form 8-K, filed January 20, 2004.                                                                                                              

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|        |    |             |  |                                                                                                                                                                                                                                                               
|------- | -- | ----------- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Exhibit |    |            
|Number  |    | Description
|        |    |            
|        | 10 | .1          |  | Amendment and Restated Supplemental Executive
    Retirement Plan Agreement between CSK Auto, Inc. and Maynard
    Jenkins dated May 4, 2004 incorporated herein by reference
    to exhibit 10.1 of our Current Report on Form 10-Q,
    filed June 14, 2004.
|        | 10 | .2          |  | 2004 Stock and Incentive Plan approved by the
    Companys shareholders on June 16, 2004, incorporated
    herein by reference to exhibit 10.2 of our Current Report
    on Form 10-Q, filed September 10, 2004.                                             
|        | 10 | .3          |  | Amendment to employment agreement between
    Mr. James Bazlen and CSK Auto, Inc., dated effective
    October 15, 2004, incorporated here in by reference to
    Exhibit 99.4 of our Current Report on Form 8-K, filed
    October 20, 2004.                 
|        | 31 | .1          |  | Certification by the Chief Executive Officer
    pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.                                                                                                                                                   
|        | 31 | .2          |  | Certification by the Chief Financial Officer
    pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.                                                                                                                                                   
|        | 32 | .0          |  | Certification by the Chief Executive Officer and
    Chief Financial Officer pursuant to 18 U.S.C.
    Section 1350, as adopted pursuant to Section 906 of
    the Sarbanes-Oxley Act of 2002.                                                                

25