Genuine Parts Company Reports Third Quarter Results
ATLANTA--Oct. 17, 2001--Genuine Parts Company reported sales and earnings for the third quarter ended September 30, 2001.Larry Prince, Chairman of the Board of Directors, announced today that sales totaling $2.1 billion were down 2% as compared to the third quarter of 2000. Net income was $88.2 million, a decrease of 4% from $91.7 million for the third quarter of 2000. On a per share diluted basis, net income equaled 51 cents, as compared to 53 cents in the third quarter of 2000.
During the nine months ended September 30, 2001, sales totaled $6.3 billion, down 1% over the same period in 2000. Net income for the nine months was $272.2 million compared to $280.1 million for the same period in the prior year. On a per share diluted basis, net income for the period equaled $1.57, a decrease of 1% as compared to $1.59 reported in 2000.
Mr. Prince stated: "As we examine our results by business segment it again becomes apparent that our diversity gives us long-term strength and balance. The current economic environment, particularly the reduction in industrial activity, presents a real challenge to our non-automotive operations. Sales for S.P. Richards, our Office Products Group, were down 1% for the quarter, and industrial sales at Motion Industries and EIS were down 7% and 38%, respectively. On a positive note our Automotive Group, which was 53% of our revenue for the quarter, was up 4% and is continuing to show strength."
Mr. Prince further commented: "The fourth quarter may continue to present the same sort of environment we have seen now for several months and we indeed face an uncertain time. Our current feeling is that we will find a way to slightly improve our sales in the final quarter largely driven by the continued improvement we see in the Automotive Group. This will certainly be our goal."
Mr. Prince concluded: "Our balance sheet remains in excellent shape and expenses are being tightly managed by our GPC team. We especially appreciate this effort as we move into the final quarter of 2001."
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 by dialing 800-482-5547, conference ID 1263467. A replay will also be available at 800-625-5288, ID 1263467, until 6:00 p.m. EDT on October 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 Nine Months Ended
Sept. 30, Sept. 30,
2001 2000 (1) 2001 2000 (1)
---- ---- ---- ----
(in thousands, except per share data)
Net Sales $2,099,191 $2,150,572 $6,273,139 $6,350,941
Cost of goods sold 1,468,879 1,494,775 4,376,691 4,425,421
--------- ---------- ---------- ---------
630,312 655,797 1,896,448 1,925,520
Selling, administrative
& other expenses 483,286 502,403 1,442,820 1,458,570
--------- ---------- ---------- ---------
Income before income
taxes 147,026 153,394 453,628 466,950
Income taxes 58,810 61,665 181,451 186,899
--------- ---------- ---------- ---------
NET INCOME $88,216 $91,729 $272,177 $280,051
======= ======= ======= ========
Basic net income per
common share $ .51 $ .53 $1.58 $1.59
======= ======= ======= ========
Diluted net income
per common share $ .51 $ .53 $1.57 $1.59
======= ======= ======= ========
Average common shares
outstanding 173,081 174,192 172,554 175,763
Dilutive effect of stock
options and non-vested
restricted stock awards 901 267 847 331
--------- ---------- ---------- ---------
Average common shares
outstanding - assuming
dilution 173,982 174,459 173,401 176,094
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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 Nine month period ended
Sept. 30, Sept. 30,
2001 2000 2001 2000
-------- --------- -------- --------
(In thousands)
Net sales:
Automotive $1,121,211 $1,078,221 $3,226,016 $3,169,367
Industrial 554,401 594,589 1,710,444 1,779,353
Office Products 343,989 345,893 1,047,851 1,002,927
Electrical/Electronic
Materials 87,614 141,237 309,261 421,799
Other(1) (8,024) (9,368) (20,433) (22,505)
---------- ----------- ----------- ---------
Total net sales $2,099,191 $2,150,572 $6,273,139 $6,350,941
========== =========== =========== =========
Operating profit(2):
Automotive $105,250 $103,157 $297,023 $292,603
Industrial 35,558 41,105 124,827 138,947
Office Products 29,590 29,979 103,295 96,092
Electrical/Electronic
Materials 25 7,426 6,869 20,697
---------- ----------- ----------- ---------
Total operating
profit 170,423 181,667 532,014 548,339
Interest expense (13,956) (16,123) (44,737) (47,306)
Other, net (9,441) (12,150) (33,649) (34,083)
---------- ----------- ----------- ---------
Income before
income taxes $147,026 $153,394 $453,628 $466,950
========== =========== =========== =========
Capital
expenditures $11,871 $17,655 $35,441 $52,043
========== =========== =========== =========
Depreciation and
amortization $21,776 $22,386 $68,918 $69,760
========== =========== =========== =========
EBITDA $182,758 $191,903 $567,283 $584,015
========== =========== =========== =========
Current ratio 3.0 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
third quarter 2000.
GENUINE PARTS COMPANY and SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
ASSETS
Sept. 30, Sept. 30,
2001 2000
------------------------------
(Unaudited)
(in thousands)
CURRENT ASSETS
Cash and cash equivalents $108,914 40,928
Trade accounts receivable 1,085,419 1,087,834
Inventories 1,763,518 1,758,566
Prepaid and other current accounts 53,016 51,391
------ ------
TOTAL CURRENT ASSETS 3,010,867 2,938,719
Goodwill 451,191 430,277
Other assets 281,694 230,598
Total property, plant and equipment,
net 359,872 404,518
------- -------
TOTAL ASSETS $4,103,624 $4,004,112
========= =========
LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES
Accounts payable $606,129 $650,894
Current portion long-term debt and
other borrowings 163,883 158,650
Income taxes 91,164 22,428
Dividends payable 49,345 47,823
Other current liabilities 94,370 99,839
------ ------
TOTAL CURRENT LIABILITIES 1,004,891 979,634
Long-term debt 627,259 676,438
Deferred income taxes 58,176 87,466
Minority interests in subsidiaries 46,305 44,282
Common stock 173,213 173,077
Retained earnings and other 2,193,780 2,043,215
--------- ---------
TOTAL SHAREHOLDERS' EQUITY 2,366,993 2,216,292
--------- ---------
TOTAL LIABILITIES AND SHAREHOLDERS'
EQUITY $4,103,624 $4,004,112
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