2014

Standard Motor Products, Inc. Announces First Quarter 2013 Results and a Quarterly Dividend

NEW YORK, May 3, 2013 /PRNewswire/ -- Standard Motor Products, Inc. (NYSE: SMP), an automotive replacement parts manufacturer and distributor, reported today its consolidated financial results for the three months ending March 31, 2013.

Consolidated net sales for the first quarter of 2013 were $230.7 million, compared to consolidated net sales of $211.7 million during the comparable quarter in 2012.  Earnings from continuing operations for the first quarter of 2013 were $9.6 million or 41 cents per diluted share, compared to $5.5 million or 24 cents per diluted share in the first quarter of 2012. Excluding non-operational gains and losses identified on the attached reconciliation of GAAP and non-GAAP measures, earnings from continuing operations for the first quarter of 2013 were $9.7 million or 42 cents per diluted share, compared to $5.4 million or 23 cents per diluted share in the first quarter of 2012.

Commenting on the results, Mr. Lawrence I. Sills, Standard Motor Products' Chairman and Chief Executive Officer, stated, "We are pleased with our first quarter results. Sales, gross margin, and earnings per share all showed substantial improvement over the first quarter of 2012.

"Net sales were up 9%, which consisted of 7.7% improvement in Engine Management and 16.4% in Temperature Control. The Engine Management increase was aided by pipeline orders for several major accounts. We anticipate that for the balance of the year, our Engine Management sales increase will migrate towards the low to mid single digits, in line with our customers' anticipated results.

"The increase in Temperature Control was wholly the result of our CompressorWorks acquisition, purchased April 30, 2012. Beginning May 1, CompressorWorks sales will be included in our 2012 numbers for comparison purposes. As we have said many times, Temperature Control sales can vary significantly depending on the weather. Thus far this has been a colder than normal spring and this is likely to have a negative effect on sales in the short run.

"Our gross margin has shown a substantial improvement, increasing 2.7 percentage points compared to the first quarter of 2012. This is the result of our continuing efforts to increase in-house production, reduce purchase costs, and expand production in our low cost Mexico and Poland manufacturing operations.

"Our three recent acquisitions are all doing well. CompressorWorks is now fully integrated into our company. Their compressor manufacturing has been relocated to our compressor plant in Reynosa, Mexico and their distribution center merged with ours in Lewisville, Texas. We anticipate significant savings from these moves. Further, as we mentioned in our last press release, several key employees from CompressorWorks have agreed to stay with us and are already making important contributions.

"Our equity investment in Orange Electronic Co. Ltd., continues to look promising, as sales of their primary product, sensors for the tire pressure monitoring system, are showing substantial increases. Finally, we have fully consolidated into our Poland operation the original equipment business we acquired from our former U.K. affiliate. We believe we are now well positioned to grow this business.

"In sum, we are pleased with both our financial results and our operational achievements for the first quarter."

The Board of Directors has approved payment of a quarterly dividend of eleven cents per share on the common stock outstanding. The dividend will be paid on June 3, 2013 to stockholders of record on May 15, 2013.

Standard Motor Products, Inc. will hold a conference call at 11:00 AM, Eastern Time, on Friday May 3, 2013.  The dial in number is 866-952-1907 (domestic) or 785-424-1826 (international). The playback number is 800-723-2156 (domestic) or 402-220-2660 (international). The conference ID # is STANDARD.

Under the safe harbor provisions of the Private Securities Litigation Reform Act of 1995, Standard Motor Products cautions investors that any forward-looking statements made by the company, including those that may be made in this press release, are based on management's expectations at the time they are made, but they are subject to risks and uncertainties that may cause actual results, events or performance to differ materially from those contemplated by such forward-looking statements. Among the factors that could cause actual results, events or performance to differ materially from those risks and uncertainties discussed in this press release are those detailed from time-to-time in prior press releases and in the company's filings with the Securities and Exchange Commission, including the company's annual report on Form 10-K and quarterly reports on Form 10-Q.  By making these forward-looking statements, Standard Motor Products undertakes no obligation or intention to update these statements after the date of this release.

 

STANDARD MOTOR PRODUCTS, INC.

Consolidated Statements of Operations





(In thousands, except per share amounts)









THREE MONTHS ENDED


MARCH 31,


2013


2012


(Unaudited)

NET SALES

$       230,708


$       211,711





COST OF SALES

164,880


157,161





GROSS PROFIT

65,828


54,550





SELLING, GENERAL & ADMINISTRATIVE EXPENSES

49,610


44,776

RESTRUCTURING AND INTEGRATION EXPENSES

418


124

OTHER INCOME, NET

230


53





OPERATING INCOME 

16,030


9,703





OTHER NON-OPERATING EXPENSE, NET

(196)


(42)





INTEREST EXPENSE

572


713





EARNINGS FROM CONTINUING OPERATIONS BEFORE TAXES

15,262


8,948





PROVISION FOR INCOME TAXES

5,696


3,454





EARNINGS FROM CONTINUING OPERATIONS

9,566


5,494





LOSS FROM DISCONTINUED OPERATION, NET OF INCOME TAXES

(392)


(300)





NET EARNINGS 

$           9,174


$           5,194

























NET EARNINGS PER COMMON SHARE:








   BASIC EARNINGS FROM CONTINUING OPERATIONS

$             0.42


$             0.24

   DISCONTINUED OPERATION

(0.02)


(0.01)

   NET EARNINGS PER COMMON SHARE - BASIC

$             0.40


$             0.23









   DILUTED EARNINGS FROM CONTINUING OPERATIONS

$             0.41


$             0.24

   DISCONTINUED OPERATION

(0.01)


(0.02)

   NET EARNINGS PER COMMON SHARE - DILUTED

$             0.40


$             0.22









WEIGHTED AVERAGE NUMBER OF COMMON SHARES

22,853,494


22,867,519

WEIGHTED AVERAGE NUMBER OF COMMON AND DILUTIVE SHARES

23,095,490


23,103,858

 

STANDARD MOTOR PRODUCTS, INC.

Segment Revenues and Operating Profit







(In thousands)













THREE MONTHS ENDED



March 31,



2013



2012



(Unaudited)


Revenues






Engine Management

$          175,509



$         163,015


Temperature Control

52,728



45,291


All Other

2,471



3,405



$          230,708



$         211,711








Gross Margin






Engine Management

$            51,714

29.5%


$           42,993

26.4%

Temperature Control

10,986

20.8%


8,577

18.9%

All Other

3,128



2,980



$            65,828

28.5%


$           54,550

25.8%







Selling, General & Administrative






Engine Management

$            30,561

17.4%


$           28,991

17.8%

Temperature Control

11,359

21.5%


8,510

18.8%

All Other

7,690



7,275



$            49,610

21.5%


$           44,776

21.1%













Operating Profit






Engine Management

$            21,153

12.1%


$           14,002

8.6%

Temperature Control

(373)

-0.7%


67

0.1%

All Other

(4,562)



(4,295)



16,218

7.0%


9,774

4.6%

Restructuring & Integration

(418)

-0.2%


(124)

-0.1%

Other Income, Net

230

0.1%


53

0.0%


$            16,030

6.9%


$             9,703

4.6%

 

STANDARD MOTOR PRODUCTS, INC.

Reconciliation of GAAP and Non-GAAP Measures






(In thousands, except per share amounts)







THREE MONTHS ENDED



March 31,



2013


2012



(Unaudited)

EARNINGS FROM CONTINUING OPERATIONS





GAAP EARNINGS FROM CONTINUING OPERATIONS


$                 9,566


$                 5,494






RESTRUCTURING AND INTEGRATION EXPENSES (NET OF TAX)


251


74

GAIN FROM SALE OF BUILDINGS (NET OF TAX)


(157)


(157)

NON-GAAP EARNINGS FROM CONTINUING OPERATIONS


$                 9,660


$                 5,411











DILUTED EARNINGS PER SHARE FROM CONTINUING OPERATIONS





GAAP DILUTED EARNINGS PER SHARE FROM CONTINUING OPERATIONS


$                   0.41


$                   0.24






RESTRUCTURING AND INTEGRATION EXPENSES (NET OF TAX)


0.01


-

GAIN FROM SALE OF BUILDINGS (NET OF TAX)


-


(0.01)






NON-GAAP DILUTED EARNINGS PER SHARE FROM CONTINUING OPERATIONS


$                   0.42


$                   0.23
















MANAGEMENT BELIEVES THAT EARNINGS FROM CONTINUING OPERATIONS  AND DILUTED EARNINGS PER SHARE FROM CONTINUING OPERATIONS BEFORE SPECIAL ITEMS, WHICH ARE NON-GAAP MEASUREMENTS, ARE MEANINGFUL TO INVESTORS BECAUSE THEY PROVIDE A VIEW OF THE COMPANY WITH RESPECT TO ONGOING OPERATING RESULTS. SPECIAL ITEMS REPRESENT SIGNIFICANT CHARGES OR CREDITS THAT ARE IMPORTANT TO AN UNDERSTANDING OF THE COMPANY'S OVERALL OPERATING RESULTS IN THE PERIODS PRESENTED. SUCH NON-GAAP MEASUREMENTS ARE NOT RECOGNIZED IN ACCORDANCE WITH GENERALLY ACCEPTED ACCOUNTING PRINCIPLES AND SHOULD NOT BE VIEWED AS AN ALTERNATIVE TO GAAP MEASURES OF PERFORMANCE.

 

STANDARD MOTOR PRODUCTS, INC.

Condensed Consolidated Balance Sheets





(In thousands)









March 31,


December 31,


2013


2012


(Unaudited)







ASSETS





CASH

$       9,722


$         13,074





ACCOUNTS RECEIVABLE, GROSS

134,129


104,689

ALLOWANCE FOR DOUBTFUL ACCOUNTS

7,081


6,124

ACCOUNTS RECEIVABLE, NET

127,048


98,565





INVENTORIES

293,308


267,468

OTHER CURRENT ASSETS

44,780


39,446





TOTAL CURRENT ASSETS

474,858


418,553





PROPERTY, PLANT AND EQUIPMENT, NET

64,072


64,422

GOODWILL AND OTHER INTANGIBLES, NET

76,664


72,373

OTHER ASSETS

26,005


21,246





TOTAL ASSETS

$  641,599


$       576,594









LIABILITIES AND STOCKHOLDERS' EQUITY









NOTES PAYABLE

$    75,553


$         40,453

CURRENT PORTION OF LONG TERM DEBT

122


120

ACCOUNTS PAYABLE

84,552


62,283

ACCRUED CUSTOMER RETURNS

35,721


29,033

OTHER CURRENT LIABILITIES

81,498


90,283





TOTAL CURRENT LIABILITIES

277,446


222,172





LONG-TERM DEBT

41


75

ACCRUED ASBESTOS LIABILITIES

24,597


25,110

OTHER LIABILITIES

21,860


21,650





 TOTAL LIABILITIES 

323,944


269,007





 TOTAL STOCKHOLDERS' EQUITY 

317,655


307,587





 TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY 

$  641,599


$       576,594

 

STANDARD MOTOR PRODUCTS, INC.

Condensed Consolidated Statements of Cash Flows





(In thousands)









THREE MONTHS ENDED


MARCH 31,


2013


2012


(Unaudited)





CASH FLOWS FROM OPERATING ACTIVITIES








NET EARNINGS 

$            9,174


$            5,194

ADJUSTMENTS TO RECONCILE NET EARNINGS TO NET CASH




USED IN OPERATING ACTIVITIES:




DEPRECIATION AND AMORTIZATION

4,273


3,828

OTHER

3,970


4,280

CHANGE IN ASSETS AND LIABILITIES:




ACCOUNTS RECEIVABLE

(29,051)


(18,101)

INVENTORY 

(26,726)


(13,013)

ACCOUNTS PAYABLE

14,270


16,706

OTHER

(2,739)


(7,930)

NET CASH USED IN OPERATING ACTIVTIES

(26,829)


(9,036)









CASH FLOWS FROM INVESTING ACTIVITIES








CAPITAL EXPENDITURES

(2,581)


(2,442)

ACQUISITIONS OF AND INVESTMENTS IN BUSINESSES

(12,760)


-

OTHER INVESTING ACTIVITIES

(596)


6

NET CASH USED IN INVESTING ACTIVITIES 

(15,937)


(2,436)









CASH FLOWS FROM FINANCING ACTIVITIES








NET CHANGE IN DEBT

35,069


5,979

PURCHASE OF TREASURY STOCK

(602)


-

DIVIDENDS PAID

(2,510)


(2,055)

OTHER FINANCING ACTIVITIES

8,093


5,182

NET CASH PROVIDED BY FINANCING ACTIVITIES

40,050


9,106









EFFECT OF EXCHANGE RATE CHANGES ON CASH

(636)


777

NET DECREASE IN CASH AND CASH EQUIVALENTS

(3,352)


(1,589)

CASH AND CASH EQUIVALENTS at beginning of period

13,074


10,871

CASH AND CASH EQUIVALENTS at end of period

$            9,722


$            9,282

 

SOURCE Standard Motor Products, Inc.



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