Genuine Parts Company Reports Sales And Earnings For The Third Quarter Ended September 30, 2013 - Sales Up 9% and EPS Up 1% -

ATLANTA, Oct. 18, 2013 /PRNewswire/ -- Genuine Parts Company (NYSE:  GPC) reported sales and earnings for the third quarter and nine months ended September 30, 2013. 

(Logo: http://photos.prnewswire.com/prnh/20081002/CLTH108LOGO )

Thomas C. Gallagher, Chairman and Chief Executive Officer, announced today that sales totaling $3.69 billion were up 9% compared to the third quarter of 2012.  Net income for the quarter was $173.7 million, up slightly from $172.9 million recorded in the same period of the previous year.  Earnings per share on a diluted basis were $1.12, up 1% compared to $1.11 for the third quarter last year.

For the nine months ended September 30, 2013, sales totaled $10.56 billion, up 7% compared to the same period in 2012.  Net income for the nine months was $534.5 million, an increase of 10% from $487.8 million recorded in the previous year.  Earnings per share on a diluted basis were $3.43, up 10% compared to $3.11 for the same period last year.

In review of the quarter, Mr. Gallagher commented, "While we achieved another quarter of record sales for the Company, the third quarter proved to be challenging for us.  This was especially true in our non-automotive businesses, as the demand patterns across these segments decelerated in the quarter.  Fortunately, our Automotive Group performed reasonably well for us and continues to report solid progress in their operations."

Mr. Gallagher added, "In the third quarter, sales for the Automotive Group were up 22% for the second consecutive period.  This increase includes core North American growth of approximately 5% and the positive impact of the Australasian acquisition.  We were pleased by the ongoing positive sales trends in both North America and at GPC Asia Pacific.  Sales for Motion Industries, our Industrial Group, were down by 2.5%; and EIS, our Electrical/Electronic Group, showed sales down approximately 5%.  S. P. Richards, our Office Products Group, had a 3% sales decrease for the quarter."

Mr. Gallagher concluded, "In these challenging times, we are especially focused on our sales initiatives and expense controls across all of our businesses.  For the long-term we remain committed to our core objectives of growing sales and earnings, showing operating margin improvement, generating solid cash flows and maintaining a strong balance sheet.  Our cash flows are very strong again this year and the Company is in excellent financial condition."

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 toll-free at 877-331-5106, conference ID 72999067.  A replay of the call will also be available on the Company's website or by dialing toll-free at 855-859-2056, conference ID 72999067, after the completion of the conference call until 12:00 a.m. Eastern time on November 2, 2013.

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 2012 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 Sept. 30,

Nine Months Ended Sept. 30,


2013

2012

2013

2012


(Unaudited)


(in thousands, except per share data)






Net sales

$3,685,243

$3,375,778

$10,560,042

$9,894,902

Cost of goods sold

2,584,320

2,399,742

7,432,263

7,027,469

Gross profit

1,100,923

976,036

3,127,779

2,867,433











Operating expenses:





Selling, administrative & other expenses

793,957

678,894

2,221,096

2,027,098

Depreciation and amortization

35,220

25,609

98,072

73,329


829,177

704,503

2,319,168

2,100,427











Income before income taxes

271,746

271,533

808,611

767,006

Income taxes

98,000

98,590

274,119

279,190

Net income

$  173,746

$  172,943

$  534,492

$  487,816











Basic net income per common share

$1.12

$1.11

$3.45

$3.14

Diluted net income per common share

$1.12

$1.11

$3.43

$3.11











Weighted average common shares outstanding

154,567

155,147

154,835

155,568

Dilutive effect of stock options and





   non-vested restricted stock awards

1,096

988

1,082

1,038

Weighted average common shares outstanding –





   assuming dilution

155,663

156,135

155,917

156,606

 

GENUINE PARTS COMPANY and SUBSIDIARIES
SEGMENT INFORMATION AND FINANCIAL HIGHLIGHTS





Three Months Ended Sept. 30,

Nine Months Ended Sept. 30,


2013

2012

2013

2012


(Unaudited)


(in thousands)






Net sales:





      Automotive

$2,016,076

$1,650,857

$5,572,415

$4,789,258

      Industrial

1,110,309

1,138,854

3,344,421

3,398,801

      Office Products

430,457

444,255

1,252,857

1,283,748

      Electrical/Electronic Materials

142,818

150,877

424,973

447,433

      Other (1)

(14,417)

(9,065)

(34,624)

(24,338)

            Total net sales

$3,685,243

$3,375,778

$10,560,042

$9,894,902






Operating profit:





      Automotive

$   180,166

$   150,648

$     487,591

$   418,187

      Industrial

79,596

94,621

247,382

274,002

      Office Products

28,094

29,942

91,054

98,068

      Electrical/Electronic Materials

12,625

13,555

35,297

38,454

      Total operating profit

300,481

288,766

861,324

828,711

      Interest expense, net

(7,031)

(4,971)

(18,236)

(14,705)

      Intangible amortization

(7,726)

(3,428)

(20,487)

(9,180)

      Other, net

(13,978)

(8,834)

(13,990)

(37,820)

            Income before income taxes

$   271,746

$  271,533

$    808,611

$  767,006






Capital expenditures

$     33,338

$    20,259

$      84,146

$    71,627






Depreciation and amortization

$     35,220

$    25,609

$      98,072

$    73,329






(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



Sept. 30,

Sept. 30,


2013

2012


(Unaudited)


(in thousands)

ASSETS



CURRENT ASSETS



Cash and cash equivalents

$  320,870

$   398,118

Trade accounts receivable, net

1,759,517

1,606,297

Merchandise inventories, net

2,832,108

2,529,435

Prepaid expenses and other current assets

382,980

308,839




      TOTAL CURRENT ASSETS

5,295,475

4,842,689




Goodwill and other intangible assets, less accumulated amortization

1,280,182

504,192

Deferred tax asset

257,571

243,547

Other assets

462,172

617,737

Net property, plant and equipment

648,503

560,900




TOTAL ASSETS

$7,943,903

$6,769,065


LIABILITIES AND EQUITY



CURRENT LIABILITIES



Trade accounts payable

$2,213,190

$1,754,253

Current portion of debt

583,896

-

Income taxes payable

19,176

12,496

Dividends payable

82,982

76,814

Other current liabilities

554,850

458,529




      TOTAL CURRENT LIABILITIES

3,454,094

2,302,092




Long-term debt

250,000

500,000

Retirement and other post-retirement benefit liabilities

481,333

476,108

Deferred tax liability

90,584

-

Other long-term liabilities

514,717

463,924




Common stock

154,357

155,131

Retained earnings and other

3,570,356

3,282,289

Accumulated other comprehensive loss

(581,652)

(420,845)

      TOTAL PARENT EQUITY

3,143,061

3,016,575




Noncontrolling interests in subsidiaries

10,114

10,366




      TOTAL EQUITY

3,153,175

3,026,941




TOTAL LIABILITIES AND EQUITY

$7,943,903

$6,769,065

 

 

GENUINE PARTS COMPANY and SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS




Nine Months Ended Sept. 30,


2013

2012


(Unaudited)


(in thousands)




OPERATING ACTIVITIES:



      Net income

$534,492

$487,816

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



           Depreciation and amortization

98,072

73,329

           Share-based compensation

8,932

8,098

           Excess tax benefits from share-based compensation

(12,020)

(9,239)

           Other

(50,608)

(1,011)

           Changes in operating assets and liabilities

258,617

205,827




NET CASH PROVIDED BY OPERATING ACTIVITIES

837,485

764,820




INVESTING ACTIVITIES:



      Purchases of property, plant and equipment

(84,146)

(71,627)

      Acquisitions and other investing activities

(614,109)

(545,378)




NET CASH USED IN INVESTING ACTIVITIES

(698,255)

(617,005)




FINANCING ACTIVITIES:



      Proceeds from debt

2,094,550

750,000

      Payments on debt

(1,990,204)

(750,000)

      Share-based awards exercised, net of taxes paid

(14,313)

(4,008)

      Excess tax benefits from share-based compensation

12,020

9,239

      Dividends paid

(243,262)

(224,170)

      Purchase of stock

(71,738)

(58,808)




NET CASH USED IN FINANCING ACTIVITIES

(212,947)

(277,747)




EFFECT OF EXCHANGE RATE CHANGES ON CASH

(8,508)

2,996




NET DECREASE IN CASH AND CASH EQUIVALENTS

(82,225)

(126,936)




CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD

403,095

525,054




CASH AND CASH EQUIVALENTS AT END OF PERIOD

$320,870

$398,118

 

SOURCE Genuine Parts Company



RELATED LINKS
http://www.genpt.com

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