Genuine Parts Company Reports Sales And Earnings For The Second Quarter Ended June 30, 2014 - Company Generates Record Sales of $3.9 Billion and Earnings Per Share of $1.28 -

- EPS Up 9% Before One-Time Adjustment in Prior Year -

ATLANTA, July 21, 2014 /PRNewswire/ -- Genuine Parts Company (NYSE:  GPC) reports sales and earnings for the second quarter and six months ended June 30, 2014. 

Thomas C. Gallagher, Chairman and Chief Executive Officer, announced today that record sales totaling $3.9 billion were up 6% compared to the second quarter of 2013.  Net income for the quarter was $197.7 million compared to $216.4 million recorded in the same period of the previous year.  Earnings per share on a diluted basis were $1.28 compared to $1.39 for the second quarter last year.  Before the one-time adjustment in 2013 described below, second quarter net income of $197.7 million and earnings per share on a diluted basis of $1.28 were both up 9% compared to the same period in 2013.

In association with the April 1, 2013 acquisition of the remaining 70% interest in GPC Asia Pacific, the Company's initial 30% investment was remeasured and, net of certain one-time purchase accounting costs, amounted to a pre-tax income adjustment of approximately $36 million recorded in the second quarter of 2013.  This adjustment, combined with the lower tax rate for the remeasurement, favorably impacted diluted earnings per share in the second quarter of 2013 by $0.22.

For the six months ended June 30, 2014, sales totaled $7.5 billion, up 10% compared to the same period in 2013.  Net income for the six months was $355.2 million compared to $360.7 million recorded in the previous year.  Earnings per share on a diluted basis were $2.30 compared to $2.31 for the same period last year.

Before the one-time adjustment in 2013, net income for the six months of $355.2 million was up 9% compared to the previous year.  Earnings per share on a diluted basis of $2.30 were up 10% compared to the same period in 2013 excluding the adjustment.

In review of the second quarter, Mr. Gallagher commented, "We are pleased to report record sales as well as a solid 9% comparative earnings increase.  Our 6% total sales increase includes 5% underlying sales growth and a 2.5% contribution from acquisitions offset by a currency headwind of approximately 1%.  Our progress in the quarter was also supported by sales growth in all four of our business segments, with sales for the Automotive Group up 5% including 7% underlying growth offset by a 2% currency headwind.  Sales at Motion Industries, our Industrial Group, were up 7% including 4% underlying growth and 3% from acquisitions.  Sales at EIS, our Electrical/Electronic Group, increased by 32% due to acquisitions.  Sales for S. P. Richards, our Office Products Group, were up 4% and includes 2% underlying growth along with 2% from acquisitions."

Mr. Gallagher concluded, "In the second quarter, we again achieved our core objectives of growing sales and earnings, producing operating margin improvement, generating solid cash flows while maintaining a strong balance sheet.  We are both proud of and encouraged by this accomplishment and, looking ahead, we enter the second half of 2014 poised to demonstrate ongoing progress in driving improved results.  We remain optimistic about our prospects for growth in each of our four businesses."

Conference Call

Genuine Parts Company will hold a conference call today at 11:00 a.m. Eastern time 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 "Investor Services", or by dialing 877-331-5106, conference ID 66908522.  A replay of the call will also be available on the Company's website or at 855-859-2056, conference ID 66908522, after the completion of the conference call until 12:00 a.m. Eastern time on August 4, 2014.

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 2013 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 nationwide 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 June 30,

Six Months Ended June 30,


2014


2013


2014


2013



(Unaudited)












(in thousands, except per share data)











Net sales

$3,908,387


$3,675,997


$7,533,284


$6,874,799


Cost of goods sold

2,729,219


2,570,889


5,269,486


4,847,943


Gross profit

1,179,168


1,105,108


2,263,798


2,026,856




















Operating expenses:









Selling, administrative & other expenses

832,205


753,527


1,636,006


1,427,139


Depreciation and amortization

36,783


36,853


73,640


62,852



868,988


790,380


1,709,646


1,489,991




















Income before income taxes

310,180


314,728


554,152


536,865


Income taxes

112,453


98,371


198,941


176,119


Net income

$  197,727


$  216,357


$  355,211


$  360,746




















Basic net income per common share

$1.29


$1.40


$2.31


$2.33


Diluted net income per common share

$1.28


$1.39


$2.30


$2.31




















Weighted average common shares outstanding

153,463


155,050


153,595


154,971


Dilutive effect of stock options and









   non-vested restricted stock awards

1,069


1,094


1,063


1,075


Weighted average common shares outstanding –









   assuming dilution

154,532


156,144


154,658


156,046


 

 

 

GENUINE PARTS COMPANY and SUBSIDIARIES
SEGMENT INFORMATION AND FINANCIAL HIGHLIGHTS
















Three Months Ended June 30,

Six Months Ended June 30,


2014


2013


2014


2013



(Unaudited)


(in thousands)










Net sales:









Automotive

$2,110,396


$2,011,802


$4,008,911


$3,556,339


Industrial

1,209,235


1,132,032


2,352,509


2,234,112


Office Products

418,785


402,272


836,883


822,400


Electrical/Electronic Materials

188,034


142,970


368,365


282,155


Other (1)

(18,063)


(13,079)


(33,384)


(20,207)


Total net sales

$3,908,387


$3,675,997


$7,533,284


$6,874,799











Operating profit:









Automotive

$   206,683


$   186,382


$   356,793


$   307,425


Industrial

95,428


88,891


178,478


167,786


Office Products

31,183


29,768


65,129


62,960


Electrical/Electronic Materials

16,463


12,221


31,992


22,672


Total operating profit

349,757


317,262


632,392


560,843


Interest expense, net

(6,224)


(7,852)


(12,430)


(11,205)


Intangible amortization

(8,498)


(8,986)


(17,374)


(12,761)


Other, net

(24,855)


14,304


(48,436)


(12)


Income before income taxes

$   310,180


$   314,728


$   554,152


$   536,865











Capital expenditures

$     21,536


$     37,883


$     39,923


$     50,807











Depreciation and amortization

$     36,783


$     36,853


$     73,640


$     62,852


(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








June 30,


June 30,



2014


2013



(Unaudited)



(in thousands)


ASSETS





CURRENT ASSETS





Cash and cash equivalents

$   152,863


$   196,770


Trade accounts receivable, net

1,909,268


1,759,176


Merchandise inventories, net

2,987,143


2,799,150


Prepaid expenses and other current assets

463,087


352,645







TOTAL CURRENT ASSETS

5,512,361


5,107,741







Goodwill and other intangible assets, less accumulated amortization

1,432,862


1,270,447


Deferred tax assets

89,196


179,850


Other assets

555,825


459,320


Net property, plant and equipment

661,304


642,955







TOTAL ASSETS

$8,251,548


$7,660,313





LIABILITIES AND EQUITY





CURRENT LIABILITIES





Trade accounts payable

$2,489,570


$2,064,878


Current portion of debt

306,358


650,102


Income taxes payable

22,639


10,865


Dividends payable

88,211


83,407


Other current liabilities

600,076


513,695







TOTAL CURRENT LIABILITIES

3,506,854


3,322,947







Long-term debt

500,000


250,000


Retirement and other post-retirement benefit liabilities

137,616


494,572


Deferred tax liabilities

85,584



Other long-term liabilities

484,000


506,655







Common stock

153,306


154,859


Retained earnings and other

3,725,279


3,521,735


Accumulated other comprehensive loss

(351,415)


(600,223)


TOTAL PARENT EQUITY

3,527,170


3,076,371







Noncontrolling interests in subsidiaries

10,324


9,768


TOTAL EQUITY

3,537,494


3,086,139







TOTAL LIABILITIES AND EQUITY

$8,251,548


$7,660,313


 

 

 

GENUINE PARTS COMPANY and SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS








Six Months Ended June 30,



2014


2013



(Unaudited)



(in thousands)







OPERATING ACTIVITIES:





Net income

$355,211


$360,746


Adjustments to reconcile net income to net cash provided by
operating activities:





Depreciation and amortization

73,640


62,852


Share-based compensation

7,855


5,455


Excess tax benefits from share-based compensation

(5,948)


(9,410)


Other

753


(51,051)


Changes in operating assets and liabilities

(64,409)


98,486












NET CASH PROVIDED BY OPERATING ACTIVITIES

367,102


467,078







INVESTING ACTIVITIES:





Purchases of property, plant and equipment

(39,923)


(50,807)


Acquisitions and other investing activities

(178,889)


(596,105)







NET CASH USED IN INVESTING ACTIVITIES

(218,812)


(646,912)







FINANCING ACTIVITIES:





Proceeds from debt

1,246,613


1,269,550


Payments on debt

(1,214,169)


(1,098,998)


Share-based awards exercised, net of taxes paid

(6,754)


(10,948)


Excess tax benefits from share-based compensation

5,948


9,410


Dividends paid

(171,171)


(159,908)


Purchase of stock

(53,769)


(26,318)







NET CASH USED IN FINANCING ACTIVITIES

(193,302)


(17,212)







EFFECT OF EXCHANGE RATE CHANGES ON CASH

982


(9,279)







NET DECREASE IN CASH AND CASH EQUIVALENTS

(44,030)


(206,325)







CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD

196,893


403,095







CASH AND CASH EQUIVALENTS AT END OF PERIOD

$152,863


$196,770


 

 

Logo - http://photos.prnewswire.com/prnh/20081002/CLTH108LOGO 

SOURCE Genuine Parts Company



RELATED LINKS
http://www.genpt.com

More by this Source


Custom Packages

Browse our custom packages or build your own to meet your unique communications needs.

Start today.

 

PR Newswire Membership

Fill out a PR Newswire membership form or contact us at (888) 776-0942.

Learn about PR Newswire services

Request more information about PR Newswire products and services or call us at (888) 776-0942.