ATLANTA, April 19, 2016 /PRNewswire/ -- Genuine Parts
Company (NYSE: GPC) announced today first quarter sales and
earnings for the quarter ended March 31,
2016.
Sales for the first quarter ended March
31, 2016 were $3.72 billion,
compared to sales of $3.74 billion
for the same period in 2015. Net income for the first quarter
was $158.0 million compared to
$161.0 million recorded for the same
period in the previous year. Earnings per share on a diluted basis
were $1.05, equal to the earnings per
share for the first quarter last year. Currency negatively
impacted total revenue growth by approximately 1.5% and earnings
per share by an approximate $0.01 in
the first quarter.
Tom Gallagher, Chairman and Chief
Executive Officer, commented, "We are pleased to report that our
first quarter performance was in-line with our expectations.
Our growth initiatives for the automotive business along with
consistently strong industry fundamentals continue to drive our
positive automotive performance. Our non-automotive
businesses continue to operate in a difficult economic
environment."
Total sales in the first quarter were down 0.5% from the prior
year, inclusive of the 1.5% currency headwind, which was partially
offset by acquisitions. Sales for the Automotive Group were
up 2%, consisting of an approximate 3.5% core sales increase, a 1%
benefit from acquisitions, and a reduction of 2.5% from currency
translation. Sales at Motion Industries, our Industrial
Group, were down 2.5%, including a 3% underlying sales decrease and
a 1% currency headwind, offset by a 1.5% contribution from
acquisitions. Sales at EIS, our Electrical/Electronic Group,
and S. P. Richards, our Office
Products Group, were each down approximately 3%.
Mr. Gallagher concluded, "Despite the fragile industrial
economic conditions which continue to pressure our near term growth
outlook, our teams remain focused on key sales and cost initiatives
necessary to drive long term growth for the Company. We will
continue to support our sales and earnings growth with a strong
balance sheet, solid cash flows and effective capital allocation
intended to maximize shareholder value."
Conference Call
Genuine Parts Company will hold a conference call today at
11:00 a.m. EDT to discuss the results
of the quarter and the future outlook. Interested parties may
listen to the call on the Company's website, www.genpt.com, by
clicking "Investors", or by dialing 800-263-8506, conference ID
4915825. A replay will also be available on the Company's
website or at 877-870-5176, conference ID 4915825, two hours after
the completion of the call until 12:00 a.m.
Eastern time on May 3,
2016.
Forward Looking Statements
Some statements in this report, as well as in other materials we
file with the Securities and Exchange Commission (SEC) or otherwise
release to the public and in materials that we make available on
our website, constitute forward-looking statements that are subject
to the safe harbor provisions of the Private Securities Litigation
Reform Act of 1995. Senior officers may also make verbal
statements to analysts, investors, the media and others that are
forward-looking. Forward-looking statements may relate, for
example, to future operations, prospects, strategies, financial
condition, economic performance (including growth and earnings),
industry conditions and demand for our products and services.
The Company cautions that its forward-looking statements involve
risks and uncertainties, and while we believe that our expectations
for the future are reasonable in view of currently available
information, you are cautioned not to place undue reliance on our
forward-looking statements. Actual results or events may
differ materially from those indicated as a result of various
important factors. Such factors may include, among other
things, slowing demand for the Company's products, changes in
general economic conditions, including, unemployment, inflation or
deflation, high energy costs, uncertain credit markets and other
macro-economic conditions, the ability to maintain favorable vendor
arrangements and relationships, disruptions in our vendors'
operations, competitive product, service and pricing pressures, the
Company's ability to successfully implement its business
initiatives in each of its four business segments, the Company's
ability to successfully integrate its acquired businesses, the
uncertainties and costs of litigation, as well as other risks and
uncertainties discussed in the Company's Annual Report on Form 10-K
for 2015 and from time to time in the Company's subsequent filings
with the SEC.
Forward-looking statements are only as of the date they are
made, and the Company undertakes no duty to update its
forward-looking statements except as required by law. You are
advised, however, to review any further disclosures we make on
related subjects in our subsequent Forms 10-K, 10-Q, 8-K and other
reports to the SEC.
About Genuine Parts Company
Genuine Parts Company is a distributor of automotive replacement
parts in the U.S., Canada,
Mexico and Australasia. The
Company also distributes industrial replacement parts in the U.S.,
Canada and Mexico through its Motion Industries
subsidiary. S. P. Richards Company, the Office Products
Group, distributes business products in the U.S. and Canada. The Electrical/Electronic Group, EIS,
Inc., distributes electrical and electronic components throughout
the U.S., Canada and Mexico.
GENUINE PARTS
COMPANY and SUBSIDIARIES
|
CONDENSED
CONSOLIDATED STATEMENTS OF INCOME
|
|
|
Three Months Ended
March 31,
|
|
2016
|
2015
|
|
(Unaudited)
|
|
(in thousands, except
per share data)
|
|
|
|
Net sales
|
$3,718,267
|
$3,736,051
|
Cost of goods
sold
|
2,613,796
|
2,623,232
|
Gross
profit
|
1,104,471
|
1,112,819
|
|
|
|
Operating
expenses:
|
|
|
Selling,
administrative & other expenses
|
823,172
|
825,554
|
Depreciation and
amortization
|
34,654
|
35,884
|
|
857,826
|
861,438
|
|
|
|
Income before income
taxes
|
246,645
|
251,381
|
Income
taxes
|
88,620
|
90,371
|
|
|
|
Net income
|
$
158,025
|
$
161,010
|
|
|
|
Basic net income per
common share
|
$1.06
|
$1.05
|
|
|
|
Diluted net income
per common share
|
$1.05
|
$1.05
|
|
|
|
Weighted average
common shares outstanding
|
149,593
|
152,656
|
|
|
|
Dilutive effect of
stock options and
|
|
|
non-vested restricted stock awards
|
749
|
918
|
|
|
|
Weighted average
common shares outstanding – assuming dilution
|
150,342
|
153,574
|
|
|
|
GENUINE PARTS
COMPANY and SUBSIDIARIES
|
SEGMENT
INFORMATION AND FINANCIAL HIGHLIGHTS
|
|
|
|
Three Months Ended
March 31,
|
|
2016
|
2015
|
|
(Unaudited)
|
|
(in
thousands)
|
|
|
|
Net sales:
|
|
|
Automotive
|
$1,932,178
|
$1,898,508
|
Industrial
|
1,152,627
|
1,181,823
|
Office
Products
|
476,654
|
490,298
|
Electrical/Electronic
Materials
|
175,847
|
182,046
|
Other (1)
|
(19,039)
|
(16,624)
|
Total net
sales
|
$3,718,267
|
$3,736,051
|
|
|
|
Operating
profit:
|
|
|
Automotive
|
$ 153,710
|
$ 150,641
|
Industrial
|
81,833
|
87,769
|
Office
Products
|
34,204
|
36,524
|
Electrical/Electronic
Materials
|
14,841
|
15,463
|
Total operating
profit
|
284,588
|
290,397
|
Interest expense,
net
|
(4,822)
|
(5,327)
|
Intangible
amortization
|
(8,760)
|
(8,604)
|
Other, net
|
(24,361)
|
(25,085)
|
Income before income
taxes
|
$
246,645
|
$
251,381
|
|
|
|
Capital
expenditures
|
$
11,670
|
$
16,427
|
|
|
|
Depreciation and
amortization
|
$
34,654
|
$
35,884
|
|
|
|
(1) Represents the
net effect of discounts, incentives and freight billed reported as
a component of net sales.
|
GENUINE PARTS
COMPANY and SUBSIDIARIES
|
CONDENSED
CONSOLIDATED BALANCE SHEETS
|
|
|
|
|
March 31,
|
March 31,
|
|
2016
|
2015
|
|
(Unaudited)
|
|
(in
thousands)
|
ASSETS
|
|
|
CURRENT
ASSETS
|
|
|
Cash and cash
equivalents
|
$ 205,135
|
$ 166,495
|
Trade accounts
receivable, net
|
1,981,651
|
1,978,233
|
Merchandise
inventories, net
|
3,074,641
|
3,007,295
|
Prepaid expenses and
other current assets
|
508,841
|
482,676
|
|
|
|
TOTAL CURRENT
ASSETS
|
5,770,268
|
5,634,699
|
|
|
|
Goodwill and other
intangible assets, less accumulated amortization
|
1,412,985
|
1,346,336
|
Deferred tax
assets
|
114,917
|
144,112
|
Other
assets
|
504,153
|
467,092
|
Net property, plant
and equipment
|
648,204
|
646,116
|
|
|
|
TOTAL
ASSETS
|
$8,450,527
|
$8,238,355
|
|
LIABILITIES AND
EQUITY
|
|
|
CURRENT
LIABILITIES
|
|
|
Trade accounts
payable
|
$2,961,318
|
$2,608,491
|
Current portion of
debt
|
450,000
|
393,697
|
Income taxes
payable
|
46,137
|
26,479
|
Dividends
payable
|
98,339
|
93,844
|
Other current
liabilities
|
656,132
|
636,850
|
|
|
|
TOTAL CURRENT
LIABILITIES
|
4,211,926
|
3,759,361
|
|
|
|
|
|
|
Long-term
debt
|
250,000
|
500,000
|
Pension and other
post-retirement benefit liabilities
|
231,652
|
275,470
|
Deferred tax
liabilities
|
50,736
|
67,672
|
Other long-term
liabilities
|
462,501
|
444,810
|
|
|
|
Common
stock
|
149,623
|
152,325
|
Retained
earnings
|
3,944,626
|
3,855,295
|
Accumulated other
comprehensive loss
|
(862,519)
|
(827,682)
|
|
|
|
TOTAL PARENT
EQUITY
|
3,231,730
|
3,179,938
|
|
|
|
Noncontrolling
interests in subsidiaries
|
11,982
|
11,104
|
|
|
|
TOTAL
EQUITY
|
3,243,712
|
3,191,042
|
|
|
|
TOTAL LIABILITIES AND
EQUITY
|
$8,450,527
|
$8,238,355
|
|
|
|
|
|
|
|
GENUINE PARTS
COMPANY and SUBSIDIARIES
|
CONDENSED
CONSOLIDATED STATEMENTS OF CASH FLOWS
|
|
|
|
Three Months Ended
March 31,
|
|
2016
|
2015
|
|
(Unaudited)
|
|
(in
thousands)
|
OPERATING
ACTIVITIES:
|
|
|
Net income
|
$158,025
|
$161,010
|
Adjustments to
reconcile net income to net cash provided by operating
activities:
|
|
|
Depreciation and
amortization
|
34,654
|
35,884
|
Share-based
compensation
|
4,249
|
3,316
|
Excess tax benefits
from share-based compensation
|
(5,144)
|
(3,734)
|
Changes in operating
assets and liabilities
|
(56,739)
|
(73,964)
|
|
|
|
NET CASH PROVIDED BY
OPERATING ACTIVITIES
|
135,045
|
122,512
|
|
|
|
INVESTING
ACTIVITIES:
|
|
|
Purchases of property,
plant and equipment
|
(11,670)
|
(16,427)
|
Acquisitions and other
investing activities
|
(73,625)
|
(30,129)
|
|
|
|
NET CASH USED IN
INVESTING ACTIVITIES
|
(85,295)
|
(46,556)
|
|
|
|
FINANCING
ACTIVITIES:
|
|
|
Proceeds from
debt
|
975,000
|
779,910
|
Payments on
debt
|
(900,000)
|
(650,000)
|
Share-based awards
exercised, net of taxes paid
|
(5,586)
|
(3,804)
|
Excess tax benefits
from share-based compensation
|
5,144
|
3,734
|
Dividends
paid
|
(92,596)
|
(88,039)
|
Purchases of
stock
|
(46,431)
|
(84,252)
|
|
|
|
NET CASH USED IN
FINANCING ACTIVITIES
|
(64,469)
|
(42,451)
|
|
|
|
EFFECT OF EXCHANGE
RATE CHANGES ON CASH
|
8,223
|
(4,740)
|
|
|
|
NET (DECREASE)
INCREASE IN CASH AND CASH EQUIVALENTS
|
(6,496)
|
28,765
|
|
|
|
CASH AND CASH
EQUIVALENTS AT BEGINNING OF PERIOD
|
211,631
|
137,730
|
|
|
|
CASH AND CASH
EQUIVALENTS AT END OF PERIOD
|
$205,135
|
$166,495
|
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SOURCE Genuine Parts Company