Standard Motor Products, Inc. Announces Second Quarter 2003 Earnings and a Quarterly Dividend
NEW YORK--July 24, 2003--Standard Motor Products, Inc. , an automotive replacement parts manufacturer and distributor, reported consolidated net sales for the second quarter of 2003, the three months ended June 30, 2003, of $166.1 million, compared to consolidated net sales of $180.6 million during the comparable quarter in 2002. Earnings from continuing operations for the second quarter of 2003 were $4.3 million or 34 cents per diluted share, compared to $6.3 million or 48 cents per diluted share, in the second quarter of 2002.Consolidated net sales for the six month period ended June 30, 2003 were $301.9 million, compared to consolidated net sales of $307 million during the comparable period in 2002. Earnings from continuing operations for the six month period ended June 30, 2003 were $3.7 million, or 30 cents per diluted share, compared to $4.3 million, or 36 cents per diluted share, for the comparable period in 2002. The results for the six month period ended June 30, 2003 were negatively impacted by $0.8 million in currency exchange loss.
Mr. James Burke, Standard Motor Products, Chief Financial Officer, said, "The consolidated balance sheet reflected the previously announced acquisition of Dana Corporation's Engine Management Division (DEM), effective as of June 30, 2003. DEM's results of operations will begin to be reflected in our statement of operations for the third quarter 2003."
Commenting on the results, Mr. Lawrence Sills, Standard Motor Products' Chief Executive Officer, said, "Though Engine Management net sales were down $6.7 million in the second quarter, they are ahead over $4 million for the year. Temperature Control net sales decreased nearly $10 million for the quarter and $13.4 million for the first half, because of the previously announced loss of sales to AutoZone and the very cool and wet weather conditions existing in spring and early summer."
Mr. Sills added, "We are pleased with the continued improvement in gross margins. We are ahead of last year by 0.4 points for the quarter and 0.6 points year to date. The improvement in the second quarter was significant, considering the reduction in net sales."
Regarding the acquisition of DEM, Mr. Sills stated, "Thus far we are proceeding on schedule. We have publicly announced that seven of the nine Dana facilities will be closed over the next 18 months and their operations merged with existing Standard Motor Products plants. We are comfortable with our original estimates of $30-35 million for restructuring and integration costs over this period and $55 million in annual savings by 2005."
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 September 2, 2003 to stockholders of record on August 15, 2003.
Standard Motor Products, Inc. will hold a conference call at 11:00 AM, Eastern Time, on Friday, July 25, 2003. The dial in number is 800-362-0571. The playback number is 800-839-3734 (domestic) 402-220-2976 (international) and the ID # is J405.
Under the safe harbor provisions of the Private Securities Litigation Reform Act of 1995, Standard Motor Products cautions investors that any forward-looking statements made by the company, including those that may be made in this press release, are based on management's expectations at the time they are made, but they are subject to risks and uncertainties that may cause actual results, events or performance to differ materially from those contemplated by such forward looking statements. Among the factors that could cause actual results, events or performance to differ materially from those risks and uncertainties discussed in this press release, and detailed from time-to-time in prior press releases and in the company's filings with the Securities and Exchange Commission, including the company's annual report on Form 10-K and quarterly reports on Form 10-Q. By making these forward looking statements, Standard Motor Products undertakes no obligation or intention to update these statements after the date of this release.
STANDARD MOTOR PRODUCTS, INC.
Consolidated Statements of Operations
(Dollars in thousands, except per share amounts)
THREE-MONTHS ENDED SIX-MONTHS ENDED
JUNE 30, JUNE 30,
2003 2002 2003 2002
----------- ----------- ----------- -----------
NET SALES $ 166,125 $ 180,629 $ 301,850 $ 306,950
COST OF SALES 122,306 133,729 223,491 228,880
----------- ----------- ----------- -----------
GROSS PROFIT 43,819 46,900 78,359 78,070
SELLING, GENERAL &
ADMINISTRATIVE
EXPENSES 33,279 34,519 65,491 65,582
----------- ----------- ----------- -----------
OPERATING INCOME 10,540 12,381 12,868 12,488
OTHER INCOME
(EXPENSE), NET (129) 88 (403) 756
INTEREST EXPENSE 3,188 3,809 6,206 7,271
----------- ----------- ----------- -----------
EARNINGS FROM
CONTINUING
OPERATIONS BEFORE
TAXES 7,223 8,660 6,259 5,973
INCOME TAX EXPENSE 2,923 2,393 2,566 1,627
----------- ----------- ----------- -----------
EARNINGS FROM
CONTINUING
OPERATIONS 4,300 6,267 3,693 4,346
LOSS FROM
DISCONTINUED
OPERATION, NET OF
TAX (433) (806) (781) (1,125)
----------- ----------- ----------- -----------
EARNINGS BEFORE
CUMULATIVE EFFECT
OF ACCOUNTING
CHANGE 3,867 5,461 2,912 3,221
CUMULATIVE EFFECT
OF ACCOUNTING
CHANGE, NET OF TAX - - - (18,350)
----------- ----------- ----------- -----------
NET EARNINGS
(LOSS) $ 3,867 $ 5,461 $ 2,912 $ (15,129)
=========== =========== =========== ===========
NET EARNING (LOSS)
PER COMMON SHARE:
BASIC EARNINGS
(LOSS) FROM
CONTINUING
OPERATIONS $ 0.34 $ 0.53 $ 0.30 $ 0.36
DISCONTINUED
OPERATION (0.03) (0.07) (0.06) (0.09)
CUMULATIVE
EFFECT OF
ACCOUNTING
CHANGE - - - (1.54)
----------- ----------- ----------- -----------
NET EARNINGS
(LOSS) PER
COMMON SHARE -
BASIC $ 0.31 $ 0.46 $ 0.24 $ (1.27)
=========== =========== =========== ===========
DILUTED EARNINGS
(LOSS) FROM
CONTINUING
OPERATIONS $ 0.34 $ 0.48 $ 0.30 $ 0.36
DISCONTINUED
OPERATION (0.03) (0.05) (0.06) (0.09)
CUMULATIVE
EFFECT OF
ACCOUNTING
CHANGE - - - (1.53)
----------- ----------- ----------- -----------
NET EARNINGS
(LOSS) PER
COMMON SHARE -
DILUTED $ 0.31 $ 0.43 $ 0.24 $ (1.26)
=========== =========== =========== ===========
WEIGHTED AVERAGE
NUMBER OF COMMON
SHARES 12,493,796 11,918,439 12,234,764 11,873,288
WEIGHTED AVERAGE
NUMBER OF COMMON
SHARES AND
DILUTIVE SHARES 15,334,225 14,840,360 12,305,907 11,984,935
STANDARD MOTOR PRODUCTS
CONDENSED CONSOLIDATING BALANCE SHEETS
(Dollars in thousands)
ASSETS
June 30, December 31,
2003 2002
---------- ---------
Cash $ 7,404 $ 9,690
Marketable securities 5,700 7,200
Accounts receivable, gross 266,832 122,526
Allowance for doubtful accounts 9,268 4,882
---------- ---------
Accounts receivable, net 257,564 117,644
Inventories 264,311 174,785
Other current assets 19,013 19,041
---------- ---------
Total current assets 553,992 328,360
---------- ---------
Property, plant and equipment, net 116,911 103,822
Goodwill 79,867 16,683
Other assets 40,649 41,893
---------- ---------
Total assets $ 791,419 $490,758
========== =========
LIABILITIES AND STOCKHOLDERS' EQUITY
Notes payable $3,643 $3,369
Current portion of long term debt 3,958 4,108
Accounts payable trade 78,277 35,744
Accrued customer returns 35,607 16,341
Other current liabilities 87,795 51,866
---------- ---------
Total current liabilities 209,280 111,428
---------- ---------
Long-term debt 272,931 169,440
Accrued asbestos liabilities 25,287 25,595
Postretirement & other liabilities 53,056 30,414
---------- ---------
Total liabilities 560,554 336,877
---------- ---------
Total stockholders' equity 230,865 153,881
---------- ---------
Total liabilities and stockholders' equity $791,419 $490,758
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