Genuine Parts Company Reports Increased Sales and Earnings for Third Quarter
ATLANTA, October 17, 2008: Genuine Parts Company reported increased sales and earnings for the third quarter and nine months ended September 30, 2008. Thomas C. Gallagher, Chairman, President and Chief Executive Officer, announced today that sales totaling $2.9 billion were up 3% compared to the third quarter of 2007. Net income for the quarter was $131.0 million, an increase of 2% over $128.6 million recorded in the same period of the previous year. Earnings per share on a diluted basis were 81 cents, up 7% compared to 76 cents for the third quarter last year.
For the nine months ended September 30, 2008, sales totaled $8.5 billion, up 3% compared to the same period in 2007. Net income for the nine months was $387.6 million, an increase of 2% over $380.3 million recorded in the previous year. Earnings per share on a diluted basis were $2.36, up 6% compared to $2.23 for the same period last year.
In review of the quarter, Mr. Gallagher commented, "We are pleased to report that the 3rd Quarter of 2008 was another period of steady and consistent sales and earnings growth for Genuine Parts Company. EIS, our Electrical Group, reported another excellent quarter and, once again, generated the strongest sales growth among our four business segments. They were up 13% in the quarter, following a 7% increase in the first quarter and 11% growth in the second quarter. Motion Industries, our Industrial Group, is also performing well, with their sales increasing 7% for the second consecutive quarter, following a 6% sales increase in the first quarter. We expect to see both EIS and Motion continue their positive sales trends in the fourth quarter. Our two most challenging businesses currently are Automotive and Office Products. The Automotive Group reported a 1% sales increase in the quarter and S.P. Richards, our Office Products Group, ended the quarter even with the prior year. Our results in each of these segments are reflective of the overall slowdown in their respective industries and, while we do not anticipate a quick recovery in either case, we do remain optimistic about our prospects in each of these businesses in the quarters ahead."
Mr. Gallagher added, "The Balance Sheet at September 30, 2008 remains in excellent condition and we continue to strengthen our financial position through steady and consistent earnings growth as well as working capital and asset management initiatives. The Company also continues to generate strong cash flows and our cash position remains sound. We have used cash in several key areas to maximize the total return to shareholders, including the dividends paid to shareholders, which we have increased for 52 consecutive years. Another priority for cash has been opportunistic share repurchases and as part of our share repurchase program, we have purchased approximately 6.7 million shares of our Company stock thus far in 2008. Other key uses for cash remain the ongoing reinvestment in our four business segments and strategic complimentary types of acquisitions in each of the businesses."
Mr. Gallagher concluded, "As we enter the last quarter of 2008, we are witnessing heightened levels of economic uncertainty, which are having an impact on all businesses, GPC included. Our Company remains in sound condition, however, and we believe that our continued focus on the consistent execution of our short and long term growth plans, as well as our ongoing initiatives to further strengthen our balance sheet, will pull our Company through the difficult economy. This proven strategy has allowed us to show steady and consistent progress over our 80-year history and we look forward to reporting another year of record sales and earnings in 2008."
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, GENPT, by clicking "Investor Services", or by dialing 877-422- 4780, conference ID 67330418. A replay will also be available on the Company's website or at 800-642-1687, conference ID 67330418, two hours after the completion of the conference call until 12:00 a.m. Eastern time on November 1, 2008.