Genuine Parts Company Reports First Quarter Results and Declares Regular Quarterly Dividend
ATLANTA--April 17, 2001--Genuine Parts Company reported sales and earnings for the first quarter ended March 31, 2001.Larry Prince, Chairman of the Board of Directors, announced today that sales totaling $2.0 billion were down 1% compared to the first quarter of 2000, and considering one less workday in the quarter, sales would have been up slightly over the same quarter the prior year. Net income was $89.3 million, a decrease of 2.7% over $91.7 million for the first quarter of 2000. On a per share diluted basis, net income equaled 52 cents, even with the comparable quarter of the prior year.
Mr. Prince stated: "Sales for the Automotive Group were down 2% which is about on par with the flat sales reported in the last half of 2000. While still difficult, we believe our sales picture in Automotive is stable with the prospect of gradual improvement in the months ahead. The Industrial Group's sales were also down 2% reflecting the lower levels of plant activity in the industrial sector. After several years of strong growth this Group is feeling the pinch of a slower economy, but they are extremely sound and will find a way to work toward improvement as the year progresses."
Mr. Prince further commented: "We have also seen things slow somewhat for EIS, our electrical/electronic group. Their sales declined by 11% reflecting the softness in manufacturing activity of their customer base. The Office Products Group continues to perform well and had revenue growth of 10% for the quarter. They expect to be impacted to some extent by the economy but we continue to believe they will find a way to grow in the 7% to 9% range for the year."
Mr. Prince also announced: "Today the Board of Directors of the Company declared a regular quarterly dividend of 28.5 cents per share on the Company's common stock. The dividend is payable July 2, 2001 to shareholders of record June 8, 2001."
Mr. Prince concluded: "We felt our first quarter might be a challenge and indeed it was. We completed it with a few bruises but certainly not in terrible shape and we are now moving into quarter number two and the balance of 2001. Perhaps the economy will start to turn as we move through the year but this is really an unknown to us at this time. What we do know is that we are leaner and more determined internally to find a way to complete this year with improved sales and earnings. Our balance sheet and operating structure are in excellent shape to support the many growth initiatives that will develop as we look ahead."
Conference Call
Genuine Parts Company will hold a conference call today at 2:00 p.m. EST to discuss the results of the quarter and the future outlook. Interested parties may listen by dialing 800-521-5439, conference ID 982303. A replay will also be available at 800-625-5288 until 6:00 p.m. EST on April 24, 2001.
Forward Looking Statements
Various statements in this release may constitute forward-looking statements. Actual results may differ materially from those indicated as a result of various important factors. Such factors include, but are not limited to, changes in general economic conditions, the growth rate of the market for the Company's products and services, the ability to maintain favorable supplier arrangements and relationships, competitive product and pricing pressures, the effectiveness of the Company's promotional, marketing and advertising programs, changes in laws and regulations, including changes in accounting and taxation guidance, the uncertainties of litigation, as well as other risks and uncertainties discussed from time to time in the Company's filings with the Securities and Exchange Commission.
About Genuine Parts Company
Genuine Parts Company is a distributor of automotive replacement parts in the U.S., Canada and Mexico. 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 product nationwide in the U.S. and in Canada. The Electrical/Electronic Group, EIS, Inc., distributes electrical and electronic components throughout the U.S. and Mexico.
GENUINE PARTS COMPANY and SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
(Unaudited)
Three Months Ended March 31,
-----------------------------------
2001 2000 (1)
------------- ------------- 623,159 620,052
(in thousands, except per share data)
Net Sales $ 2,054,972 $ 2,070,992
Cost of goods sold 1,431,813 1,450,940
------------- ------------- 623,159 620,052
Selling, administrative
& other expenses 474,370 467,323
------------- ------------- 623,159 620,052
Income before income taxes 148,789 152,729
Income taxes 59,516 61,000
------------- ------------- 623,159 620,052
NET INCOME $ 89,273 $ 91,729
============= =============
Basic and diluted net income
per common share $ .52 $ .52
============= =============
Average common shares outstanding 172,087 176,774
Dilutive effect of stock options
and non-vested restricted stock
awards 739 300
------------- ------------- 623,159 620,052
Average common shares outstanding
- assuming dilution 172,826 177,074
============= =============
Note (1): The financial statements for 2000 have been reclassified
in connection with the Company's fourth quarter 2000 adoption of new
accounting pronouncements related to the income statement
classification of freight billed to customers and other discounts and
incentives. These reclassifications had no effect on net income.
GENUINE PARTS COMPANY AND SUBSIDIARIES
SEGMENT INFORMATION AND FINANCIAL HIGHLIGHTS
(Unaudited)
Three month period ended March 31,
2001 2000
-----------------------------------
(In thousands)
Net sales:
Automotive $ 982,824 $ 1,005,310
Industrial 583,929 594,348
Office Products 370,719 337,584
Electrical/Electronic Materials 124,685 140,762
Other (1) (7,185) (7,012)
------------- ------------- 623,159 620,052
Total net sales $ 2,054,972 $ 2,070,992
============= =============
Operating profit (2):
Automotive $ 81,967 $ 84,991
Industrial 45,222 49,814
Office Products 43,632 38,073
Electrical/Electronic Materials 5,205 6,333
------------- ------------- 623,159 620,052
Total operating profit 176,026 179,211
Interest expense (15,685) (15,160)
Other, net (11,552) (11,322)
------------- ------------- 623,159 620,052
Income before income taxes $ 148,789 $ 152,729
============= =============
Capital expenditures $ 12,114 $ 19,897
============= =============
Depreciation and amortization $ 23,038 $ 23,824
============= =============
EBITDA $ 187,512 $ 191,713
============= =============
Current ratio 3.2 3.0
============= =============
(1) Represents the net effect of discounts, incentives and freight
billed reported as a component of net sales based on accounting
pronouncements adopted in fourth quarter 2000.
(2) In connection with a 2000 management reporting change, certain
corporate expenses were reclassified to the Automotive segment for
first quarter 2000.
GENUINE PARTS COMPANY and SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
ASSETS
Mar. 31, Mar. 31
2001 2000
-----------------------------------
(Unaudited)
(in thousands)
CURRENT ASSETS
Cash and cash equivalents $ 49,186 $ 80,459
Trade accounts receivable 1,094,723 1,108,076
Inventories 1,865,894 1,743,235
Prepaid and other current
accounts 71,219 55,532
------------- ------------- 623,159 620,052
TOTAL CURRENT ASSETS 3,081,022 2,987,302
Goodwill 444,955 436,957
Other assets 284,375 228,644
Total property, plant and
equipment, net 380,327 411,092
------------- ------------- 623,159 620,052
TOTAL ASSETS $ 4,190,679 $ 4,063,995
============= =============
LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES
Accounts payable $ 603,420 $ 626,063
Current portion long-term debt
and other borrowings 166,936 168,345
Income taxes 58,263 54,039
Dividends payable 49,082 48,410
Other current liabilities 95,075 92,722
------------- ------------- 623,159 620,052
TOTAL CURRENT LIABILITIES 972,776 989,579
Long-term debt 822,606 723,995
Deferred income taxes 77,814 96,931
Minority interests in
subsidiaries 45,074 44,358
Common stock 172,009 176,858
Retained earnings and other 2,100,400 2,032,274
------------- ------------- 623,159 620,052
TOTAL SHAREHOLDERS' EQUITY 2,272,409 2,209,132
------------- ------------- 623,159 620,052
TOTAL LIABILITIES AND
SHAREHOLDERS' EQUITY $ 4,190,679
$ 4,063,995
============= =============