GENUINE PARTS ATLANTA, July 19, 2016 /PRNewswire/ -- Genuine Parts Company (NYSE: GPC) announced today sales and earnings for the second quarter and six months ended June 30, 2016.
http://photos.prnewswire.com/prnvar/20081002/CLTH108LOGO
Sales for the second quarter ended June 30, 2016 were $3.90 billion compared to $3.94 billion for the same period in 2015. Net income for the second quarter was $191.4 million compared to $195.4 million recorded for the same period in the previous year. Earnings per share on a diluted basis were $1.28, equal to the earnings per share for the second quarter last year.
Paul Donahue, President and Chief Executive Officer, commented, "Total sales in the second quarter were down 1% from the prior year, inclusive of a 2% contribution from acquisitions less a currency headwind of 1%. Sales for the Automotive Group were down 0.7%, consisting of a 1% core sales decline, a 1.5% currency headwind and an approximate 2% contribution from acquisitions. Sales at Motion Industries, our Industrial Group, were down 1.7%, including a 3% underlying sales decrease and an approximate 0.5% currency headwind, offset by a 2% benefit from acquisitions. Sales at EIS, our Electrical/Electronic Group, were down approximately 5%, including a 1% negative impact of copper pricing. Sales for S. P. Richards, our Office Products Group, were up 1%, consisting of a 5% contribution from acquisitions offset by a 4% underlying sales decrease."
Mr. Donahue stated, "This quarter our automotive sales along with our other distribution businesses were all impacted by the challenging sales environment. We offset some of this impact with key sales and gross margin initiatives as well as tight expense controls. Importantly, we also further improved the strength of our balance sheet and cash flows with effective working capital management. We expect the combination of these efforts to support stronger growth for the Company over the long-term."
Sales for the six months ended June 30, 2016 were $7.62 billion compared to $7.68 billion for the same period in 2015. Net income for the six months was $349.4 million, down 2% from 2015, and earnings per share on a diluted basis were $2.33, equal to the same six month period of the prior year.
2016 Outlook
For the full year 2016, the Company is maintaining its guidance for 1% to 2% total sales growth and is updating diluted earnings per share to $4.70 to $4.75 from $4.70 to $4.80.
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 888-471-3831, conference ID 2490635. A replay will also be available on the Company's website or at 877-870-5176, conference ID 2490635, two hours after the completion of the call until 12:00 a.m. Eastern time on August 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, the Company's ability to successfully implement its business initiatives in each of its four business segments; slowing demand for the Company's products; changes in general economic conditions, including, unemployment, inflation or deflation; volatile exchange rates; high energy costs; uncertain credit markets and other macro-economic conditions; competitive product, service and pricing pressures; the ability to maintain favorable vendor arrangements and relationships; disruptions in our vendors' operations; the Company's ability to successfully integrate its acquired businesses; the uncertainties and costs of litigation; disruptions caused by a failure or breach of the Company's information systems, 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 June 30, Six Months Ended June 30,
2016 2015 2016 2015
---- ---- ---- ----
(Unaudited)
(in thousands, except per share data)
Net sales $3,899,638 $3,940,401 $7,617,905 $7,676,452
Cost of goods sold 2,734,186 2,762,071 5,347,982 5,385,303
--------- --------- --------- ---------
Gross profit 1,165,452 1,178,330 2,269,923 2,291,149
Operating expenses:
Selling,
administrative &
other expenses 829,489 832,610 1,652,661 1,658,164
Depreciation and
amortization 35,911 35,603 70,565 71,487
------ ------ ------ ------
865,400 868,213 1,723,226 1,729,651
Income before
income taxes 300,052 310,117 546,697 561,498
Income taxes 108,683 114,744 197,303 205,115
------- ------- ------- -------
Net income $191,369 $195,373 $349,394 $356,383
======== ======== ======== ========
Basic net income
per common share $1.28 $1.28 $2.34 $2.34
Diluted net income
per common share $1.28 $1.28 $2.33 $2.33
Weighted average
common shares
outstanding 149,241 152,134 149,417 152,394
Dilutive effect of stock options and
non-vested
restricted stock
awards 788 855 761 880
--- --- --- ---
Weighted average
common shares
outstanding -
assuming dilution 150,029 152,989 150,178 153,274
======= ======= ======= =======
GENUINE PARTS COMPANY and SUBSIDIARIES
SEGMENT INFORMATION AND FINANCIAL HIGHLIGHTS
--------------------------------------------
Three Months Ended June Six Months Ended June
30, 30,
2016 2015 2016 2015
---- ---- ---- ----
(Unaudited)
(in thousands)
Net sales:
Automotive $2,087,978 $2,103,126 $4,020,156 $4,001,634
Industrial 1,167,395 1,188,031 2,320,022 2,369,854
Office Products 481,605 477,755 958,259 968,053
Electrical/Electronic Materials 184,508 194,701 360,355 376,747
Other (1) (21,848) (23,212) (40,887) (39,836)
------- ------- ------- -------
Total net sales $3,899,638 $3,940,401 $7,617,905 $7,676,452
========== ========== ========== ==========
Operating profit:
Automotive $203,572 $207,443 $357,282 $358,084
Industrial 88,263 88,876 170,096 176,645
Office Products 32,640 34,501 66,844 71,025
Electrical/Electronic Materials 15,987 18,568 30,828 34,031
------ ------ ------ ------
Total operating profit 340,462 349,388 625,050 639,785
Interest expense, net (4,665) (5,674) (9,487) (11,001)
Intangible amortization (9,225) (8,796) (17,985) (17,400)
Other, net (26,520) (24,801) (50,881) (49,886)
------- ------- ------- -------
Income before income taxes $300,052 $310,117 $546,697 $561,498
======== ======== ======== ========
Capital expenditures $38,041 $21,037 $49,711 $37,464
======= ======= ======= =======
Depreciation and amortization $35,911 $35,603 $70,565 $71,487
======= ======= ======= =======
(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,
2016 2015
---- ----
(Unaudited)
(in thousands)
ASSETS
CURRENT ASSETS
Cash and cash
equivalents $233,627 $223,840
Trade accounts
receivable,
net 2,031,094 2,008,445
Merchandise
inventories,
net 3,062,673 3,025,165
Prepaid
expenses and
other current
assets 538,748 506,070
------- -------
TOTAL CURRENT
ASSETS 5,866,142 5,763,520
Goodwill and
other
intangible
assets, less
accumulated
amortization 1,478,298 1,382,766
Deferred tax
assets 112,316 139,928
Other assets 491,968 486,885
Net property,
plant and
equipment 685,385 640,534
------- -------
TOTAL ASSETS $8,634,109 $8,413,633
========== ==========
LIABILITIES AND EQUITY
CURRENT LIABILITIES
Trade accounts
payable $3,075,769 $2,743,444
Current portion
of debt 525,000 350,000
Income taxes
payable 28,451 1,069
Dividends
payable 97,975 93,496
Other current
liabilities 678,975 679,613
------- -------
TOTAL CURRENT
LIABILITIES 4,406,170 3,867,622
Long-term debt 250,000 500,000
Pension and
other post-
retirement
benefit
liabilities 217,052 261,783
Deferred tax
liabilities 51,708 68,428
Other long-
term
liabilities 458,950 460,302
Common stock 148,914 151,709
Retained
earnings 3,970,870 3,901,607
Accumulated
other
comprehensive
loss (882,165) (809,501)
-------- --------
TOTAL PARENT
EQUITY 3,237,619 3,243,815
Noncontrolling
interests in
subsidiaries 12,610 11,683
------ ------
TOTAL EQUITY 3,250,229 3,255,498
--------- ---------
TOTAL
LIABILITIES
AND EQUITY $8,634,109 $8,413,633
========== ==========
GENUINE PARTS COMPANY and SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
-----------------------------------------------
Six Months Ended June
30,
2016 2015
---- ----
(Unaudited)
(in thousands)
OPERATING ACTIVITIES:
Net income $349,394 $356,383
Adjustments to reconcile net income to net cash provided by operating
activities:
Depreciation and amortization 70,565 71,487
Share-based compensation 10,002 8,646
Excess tax benefits from share-based
compensation (7,540) (5,300)
Changes in operating assets and liabilities 111,077 22,892
------- ------
NET CASH PROVIDED BY OPERATING ACTIVITIES 533,498 454,108
INVESTING ACTIVITIES:
Purchases of property, plant and equipment (49,711) (37,464)
Acquisitions and other investing activities (308,441) (80,140)
-------- -------
NET CASH USED IN INVESTING ACTIVITIES (358,152) (117,604)
FINANCING ACTIVITIES:
Proceeds from debt 1,950,000 1,634,587
Payments on debt (1,800,000) (1,552,554)
Share-based awards exercised, net of taxes
paid (8,627) (5,914)
Excess tax benefits from share-based
compensation 7,540 5,300
Dividends paid (190,934) (181,883)
Purchase of stock (119,397) (145,219)
-------- --------
NET CASH USED IN FINANCING ACTIVITIES (161,418) (245,683)
EFFECT OF EXCHANGE RATE CHANGES ON CASH 8,068 (4,711)
----- ------
NET INCREASE IN CASH AND CASH EQUIVALENTS 21,996 86,110
CASH AND CASH EQUIVALENTS AT BEGINNING OF
PERIOD 211,631 137,730
------- -------
CASH AND CASH EQUIVALENTS AT END OF PERIOD $233,627 $223,840
======== ========
Logo - http://photos.prnewswire.com/prnh/20081002/CLTH108LOGO
To view the original version on PR Newswire, visit:http://www.prnewswire.com/news-releases/genuine-parts-company-reports-sales-and-earnings-for-the-second-quarter-ended-june-30-2016-300300604.html
SOURCE Genuine Parts Company
