Standard Motor Products, Inc. Announces First Quarter 2004 Results and a Quarterly Dividend
NEW YORK--April 26, 2004--Standard Motor Products, Inc. , an automotive replacement parts manufacturer and distributor, reported today its financial results for the three months ended March 31, 2004.Consolidated net sales for the first quarter of 2004 were $204.8 million, compared to consolidated net sales of $135.7 million during the comparable quarter in 2003. Losses from continuing operations for the first quarter of 2004 were $545,000 or 3 cents per diluted share, compared to $607,000 or 5 cents per diluted share in the first quarter of 2003.
Mr. Lawrence Sills, Standard Motor Products' Chief Executive Officer, commented that "The net sales increase in the first quarter of 2004 was primarily related to the previously announced acquisition of Dana Corporation's Engine Management Division (DEM), effective as of June 30, 2003. Net sales generated in the first quarter from DEM were approximately $60 million. Excluding DEM net sales, our core Engine Management net sales were up $2.9 million or 3.6% in the first quarter of 2004. In our Temperature Control business, net sales were ahead of last year's comparable quarter by $5.4 million or 11.9%."
"Gross margins were down slightly at 24.9% in the first quarter of 2004 compared to 25.4% in the first quarter of 2003, primarily due to the DEM transition. However, we were able to recover the gross margin slippage with a percentage reduction in selling, general and administrative expenses, an indication that economies from the Dana integration are beginning to be felt. The net result was that operating income, excluding restructuring expenses, increased $1.1 million in the first quarter of 2004."
Mr. Sills added, "We continue to make very good progress with our DEM integration. At this point, all planned moves for manufacturing facilities are expected to be completed by the end of the second quarter of 2004. Distribution and administrative facility moves are in varying stages and are expected to be complete by the early part of the third quarter of 2004."
Mr. Sills concluded, "As previously stated, we believe the DEM integration will enable us to generate incremental profits throughout 2004 and an ongoing $40-45 million operating income from the acquisition beginning in 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 June 1, 2004 to stockholders of record on May 14, 2004.
STANDARD MOTOR PRODUCTS, INC.
Consolidated Statements of Operations
(Dollars in thousands, except per share amounts)
THREE MONTHS ENDED
MARCH 31,
2004 2003
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NET SALES $204,781 $135,725
COST OF SALES 153,821 101,185
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GROSS PROFIT 50,960 34,540
SELLING, GENERAL & ADMINISTRATIVE EXPENSES 47,328 31,990
RESTRUCTURING EXPENSES 1,367 222
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OPERATING INCOME 2,265 2,328
OTHER INCOME (EXPENSE), NET 243 (274)
INTEREST EXPENSE 3,234 3,018
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LOSS FROM CONTINUING OPERATIONS BEFORE TAXES (726) (964)
INCOME TAX BENEFIT (181) (357)
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LOSS FROM CONTINUING OPERATIONS (545) (607)
LOSS FROM DISCONTINUED OPERATION, NET OF TAX (425) (348)
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NET LOSS $(970) $(955)
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NET LOSS PER COMMON SHARE:
BASIC LOSS FROM CONTINUING OPERATIONS $(0.03) $(0.05)
DISCONTINUED OPERATION (0.02) (0.03)
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NET LOSS PER COMMON SHARE - BASIC $(0.05) $(0.08)
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DILUTED LOSS FROM CONTINUING OPERATIONS $(0.03) $(0.05)
DISCONTINUED OPERATION (0.02) (0.03)
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NET LOSS PER COMMON SHARE - DILUTED $(0.05) $(0.08)
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WEIGHTED AVERAGE NUMBER OF COMMON SHARES 19,233,543 11,972,853
WEIGHTED AVERAGE NUMBER OF COMMON SHARES AND
DILUTIVE SHARES 19,233,543 11,972,853
STANDARD MOTOR PRODUCTS
CONDENSED CONSOLIDATING BALANCE SHEETS
(Dollars in thousands)
ASSETS
March 31, Dec. 31,
2004 2003
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Cash $17,880 $19,647
Accounts receivable, gross 215,086 179,232
Allowance for doubtful accounts 5,646 5,009
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Accounts receivable, net 209,440 174,223
Inventories 253,520 253,754
Other current assets 23,899 20,547
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Total current assets 504,739 468,171
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Property, plant and equipment, net 109,959 112,549
Goodwill 71,843 71,843
Other assets 40,777 41,962
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Total assets $727,318 $694,525
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LIABILITIES AND STOCKHOLDERS' EQUITY
Notes payable $126,746 $99,699
Current portion of long term debt 3,243 3,354
Accounts payable trade 70,401 58,029
Accrued customer returns 23,394 24,115
Restructuring accrual 14,500 16,000
Other current liabilities 72,532 75,641
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Total current liabilities 310,816 276,838
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Long-term debt 114,632 114,757
Accrued asbestos liabilities 23,787 24,426
Postretirement & other liabilities 38,253 36,848
Restructuring accrual 14,890 15,615
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Total liabilities 502,378 468,484
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Total stockholders' equity 224,940 226,041
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Total liabilities and stockholders' equity $727,318 $694,525
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