Standard Motor Products, Inc. Announces First Quarter 2001 Earnings and a Quarterly Dividend
NEW YORK--April 26, 2001--Standard Motor Products, Inc. automotive replacement parts manufacturer and distributor, reported net sales for the first quarter of 2001, the three months ended March 31, 2001, were $155.5 million, 6% higher than net sales of $146.8 million during the comparable quarter a year ago.Net earnings for the first quarter of 2001 were $619,000 or 5 cents per diluted share, as compared to a net loss of $116,000 or 1 cent per diluted share in the first quarter of 2000. Excluding $501,000 in the first quarter of 2000 for a prepayment penalty and write-off of unamortized fees for the retirement of a 10.22% Senior Note, net earnings per diluted share would have been 3 cents per diluted share.
Mr. Lawrence Sills, Chief Executive Officer, said, "We were pleased with the 6% sales increase in light of the relatively soft first quarter experienced by most of the aftermarket. The increase resulted primarily from new accounts, in both Engine Management and Temperature Control."
Mr. Sills stated, "Gross margins for the quarter were negatively impacted by inventory reduction programs." Overall gross margins decreased from 32.2% in 2000 to 28.9% in 2001. The reduction in gross margins was across all product lines as the Company targets a minimum $30 million inventory reduction in 2001. Pressure will continue on gross margins throughout the second quarter and into the third quarter as we continue to bring inventory down.
"We were successful in reducing inventory by $13 million during the first quarter, at a time when inventories have historically increased. This inventory reduction program, while it will hurt margins in the short run, will make us much stronger in the months ahead."
Mr. Sills said, "Selling, general and administrative expenses (SG&A) were $40 million, $3.2 million lower than the $43.2 million in SG&A expenses a year ago. The Company continues to work on cost reduction efforts to offset the erosion in gross margins. As a percent of net sales, SG&A expenses decreased from 29.4% in 2000 to 25.7% in 2001."
The Board of Directors has approved payment of a quarterly dividend of nine cents per share on the common stock outstanding. The dividend will be paid on June 1, 2001 to stockholders of record on May 15, 2001.
Standard Motor Products will hold a conference call at 10:30 AM, Eastern Standard Time, on Friday, April 27, 2001. The dial in number is 800-540-0559. The playback number is 877-806-1920 and the ID # is J403.
STANDARD MOTOR PRODUCTS
CONDENSED CONSOLIDATING BALANCE SHEETS
(Dollars in thousands)
ASSETS
March 31, December 31,
2001 2000
----------- -----------
Cash and investments $ 4,216 $ 7,699
Accounts receivable, gross 155,908 110,838
Allowance for doubtful accounts 5,627 4,577
----------- ----------
Accounts receivable, net 150,281 106,261
Inventories 220,888 234,257
Other current assets 25,873 24,542
----------- ----------
Total current assets 401,258 372,759
----------- ----------
Property, plant and equipment, net 103,729 104,536
Goodwill 40,516 40,685
Other assets 31,317 31,416
----------- ----------
Total assets $576,820 $549,396
----------- ----------
LIABILITIES AND STOCKHOLDERS' EQUITY
Notes payable $89,081 $38,930
Current portion of long term debt 13,481 13,643
Accounts payable trade 49,871 56,612
Accrued customer returns 17,566 17,693
Other current liabilities 53,665 57,790
----------- ----------
Total current liabilities 223,664 184,668
----------- ----------
Long-term debt 138,665 150,018
Postretirement & other liabilities 20,846 20,405
----------- ----------
Total liabilities 383,175 355,091
----------- ----------
Total stockholders' equity 193,645 194,305
----------- ----------
Total liabilities and
stockholders' equity $576,820 $549,396
----------- ----------
STANDARD MOTOR PRODUCTS, INC.
Consolidated Statements of Earnings
(Dollars in thousands, except per share amounts)
THREE MONTHS END
MARCH 31,
2001 2000
----------- ------------
NET SALES $155,545 $146,759
COST OF SALES 110,580 99,440
----------- ------------
GROSS PROFIT 44,965 47,319
SELLING, GENERAL &
ADMINISTRATIVE EXPENSES 40,012 43,183
----------- ------------
OPERATING INCOME 4,953 4,136
OTHER INCOME (EXPENSE)
- NET 80 424
INTEREST EXPENSE 4,127 3,907
----------- ------------
EARNINGS BEFORE TAXES,
MINORITY INTEREST
AND EXTRAORDINARY ITEM 906 653
INCOME TAXES 287 229
MINORITY INTEREST 0 (39)
----------- ------------
INCOME BEFORE
EXTRAORDINARY ITEM 619 385
EXTRAORDINARY LOSS ON
EARLY EXTINGUISHMENT
OF DEBT 0 501
----------- ------------
NET INCOME (LOSS) $619 ($116)
----------- ------------
NET EARNINGS PER
COMMON SHARE:
BASIC EARNINGS PER
SHARE BEFORE
EXTRAORDINARY ITEM $0.05 $0.03
EXTRAORDINARY LOSS
ON EARLY RETIREMENT
OF DEBT - (0.04)
----------- ------------
NET EARNINGS PER
COMMON SHARE
- BASIC $0.05 ($0.01)
----------- ------------
DILUTED EARNINGS PER
SHARE BEFORE
EXTRAORDINARY ITEM $0.05 $0.03
EXTRAORDINARY LOSS
ON EARLY RETIREMENT
OF DEBT - (0.04)
----------- ------------
NET EARNINGS PER
COMMON SHARE
- DILUTED $0.05 ($0.01)
----------- ------------
Weighted Average Number
of Common Shares 11,714,346 12,409,547
Weighted Average Number
of Common and Dilutive
Shares 11,728,569 12,409,547
This news release contains certain forward-looking statements that involve risks and uncertainties. Actual results, events and performance could differ materially from those contemplated by these forward looking statements. Among the factors that could cause actual results, events and performance to differ materially are risks and uncertainties discussed in this release and those detailed from time-to-time in prior public statements and the Company's filings with the Securities and Exchange Commission, including the Company's annual report on Form 10-K and the Company's quarterly reports on Form 10-Q.