Genuine Parts Company Reports Record Sales and Earnings for Second Quarter and Six Months Ended June 30, 2007

ATLANTA--Genuine Parts Company reported record sales and earnings for the second quarter and six months ended June 30, 2007. Thomas C. Gallagher, Chairman, President and Chief Executive Officer, announced today that sales totaling $2.77 billion were up 4% compared to the second quarter of 2006. Net income for the quarter was $130.1 million, an increase of 8% over $120.7 million recorded in the same period of the previous year. Earnings per share on a diluted basis were 76 cents, up 9% compared to 70 cents for the second quarter last year.

For the six months ended June 30, 2007, sales totaled $5.42 billion, up 4% compared to the same period in 2006. Net income for the six months was $251.7 million, an increase of 7% over $234.6 million recorded in the previous year. Earnings per share on a diluted basis were $1.47, up 9% compared to $1.35 for the same period last year.

Mr. Gallagher stated, “We are pleased that all four of our business segments contributed to our revenue growth in the 2^nd Quarter. Motion Industries, our Industrial Group, had the strongest performance, increasing sales by 9%. EIS, our Electrical Group, had solid results as they produced a 7% increase. The Industrial and Electrical Groups are performing well and with the current favorable conditions in each of these industries, we are encouraged by their prospects over the remainder of the year. The Automotive Group reported a 2% increase for the quarter and our Office Products Group was up 1%. Market conditions continued to be challenging for each of these businesses in the quarter but, through the combination of internal revenue initiatives and improving industry fundamentals, we anticipate a bit stronger growth in Automotive and Office Products over the 2^nd half of the year.”

Mr. Gallagher added, “The balance sheet at June 30, 2007 remains in excellent condition and we continue to strengthen our financial position and generate steady and consistent cash flows. We have used cash in several key areas, such as the dividend and share repurchase program as well as investing in our businesses, to maximize the total return to shareholders.”

Mr. Gallagher concluded, “At mid-year 2007, we continue to be optimistic about our prospects for the remainder of the year. Each of our four businesses has initiatives in place to enable them to generate solid revenue increases in the months ahead.”

Conference Call

GENUINE PARTS COMPANY and SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF INCOME

Three Months Ended
June 30,

Six Months Ended
June 30,

2007 2006 2007 2006 (Unaudited) (in thousands, except per share data) Net sales $2,769,527 $2,661,805 $5,418,370 $5,215,357 Cost of goods sold 1,899,942 1,836,623 3,716,841 3,586,698 869,585 825,182 1,701,529 1,628,659 Selling, administrative & other expenses 659,769 629,688 1,295,603 1,248,670 Income before income taxes 209,816 195,494 405,926 379,989 Income taxes 79,695 74,814 154,252 145,384 Net income $130,121 $120,680 $251,674 $234,605 Basic net income per common share $ .76 $ .70 $ 1.48 $ 1.36 Diluted net income per common share $ .76 $ .70 $ 1.47 $ 1.35 Weighted average common shares outstanding 170,318 172,186 170,392 172,478 Dilutive effect of stock options and non-vested restricted stock awards 1,062 893 1,039 925 Weighted average common shares outstanding – assuming dilution 171,380 173,079 171,431 173,403

GENUINE PARTS COMPANY and SUBSIDIARIES SEGMENT INFORMATION AND FINANCIAL HIGHLIGHTS

	Three Months Ended June 30,				Six Months Ended June 30,
	2007		2006		2007		2006
	(Unaudited)

	(in thousands, except ratio analysis)

Net sales:
Automotive	$1,395,054		$1,362,230		$2,656,561		$2,590,019
Industrial	839,652		773,553		1,673,044		1,544,780
Office Products	430,665		427,229		882,507		893,184
Electrical/Electronic Materials	110,820		104,021		217,553		199,490
Other (1)	(6,664	)	(5,228	)	(11,295	)	(12,116	)
Total net sales	$2,769,527		$2,661,805		$5,418,370		$5,215,357

Operating profit:
Automotive	$114,830		$113,399		$210,667		$209,255
Industrial	70,069		59,073		134,661		116,588
Office Products	37,652		38,523		85,869		86,219
Electrical/Electronic Materials	8,319		6,272		15,539		11,125
Total operating profit	230,870		217,267		446,736		423,187
Interest expense, net	(5,173	)	(6,415	)	(11,844	)	(13,587	)
Other, net	(15,881	)	(15,358	)	(28,966	)	(29,611	)
Income before income taxes	$209,816		$195,494		$405,926		$379,989

Capital expenditures	$29,083		$31,070		$52,766		$58,591

Depreciation and amortization	$21,318		$17,632		$42,020		$35,255

Current ratio					3.1/1		3.1/1

(1) Represents the net effect of discounts, incentives and freight billed reported as a component of net sales.

GENUINE PARTS COMPANY and SUBSIDIARIES CONDENSED CONSOLIDATED BALANCE SHEETS

	June 30,	June 30,
	2007	2006
	(Unaudited)
	(in thousands)
ASSETS
CURRENT ASSETS
Cash and cash equivalents	$ 274,560	$ 189,145
Trade accounts receivable, net	1,322,973	1,307,071
Merchandise inventories, net	2,223,066	2,162,405
Prepaid expenses and other current assets	219,688	192,477

TOTAL CURRENT ASSETS	4,040,287	3,851,098

Goodwill and other intangible assets, less accumulated amortization	61,960	62,504
Other assets	177,650	516,216
Net property, plant and equipment	445,179	416,135

TOTAL ASSETS	$4,725,076	$4,845,953

LIABILITIES AND SHAREHOLDERS’ EQUITY
CURRENT LIABILITIES
Trade accounts payable	$1,028,705	$1,018,914
Income taxes payable	21,535	30,881
Dividends payable	62,195	58,104
Other current liabilities	172,903	148,024

TOTAL CURRENT LIABILITIES	1,285,338	1,255,923

Long-term debt	500,000	500,000
Other long-term liabilities	179,056	116,765
Deferred income taxes	-0-	159,304
Minority interests in subsidiaries	63,153	58,635
Common stock	169,930	171,308
Retained earnings and other	2,527,599	2,584,018

TOTAL SHAREHOLDERS’ EQUITY	2,697,529	2,755,326

TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY	$4,725,076	$4,845,953

GENUINE PARTS COMPANY and SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

	Six Months Ended June 30,
	2007		2006
	(Unaudited)
	(in thousands)

OPERATING ACTIVITIES:
Net income	$251,674		$234,605
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization	42,020		35,255
Other	9,348		6,781
Changes in operating assets and liabilities	53,370		(30,627	)


NET CASH PROVIDED BY OPERATING ACTIVITIES	356,412		246,014

INVESTING ACTIVITIES:
Purchases of property, plant and equipment	(52,766	)	(58,591	)
Other	(6,329	)	2,816

NET CASH USED IN INVESTING ACTIVITIES	(59,095	)	(55,775	)

FINANCING ACTIVITIES:
Net payments on credit facilities	-0-		(881	)
Stock options exercised	9,214		5,157
Excess tax benefits from share-based compensation	3,784		1,620
Dividends paid	(119,719	)	(112,426	)
Purchase of stock	(52,009	)	(83,475	)

NET CASH USED IN FINANCING ACTIVITIES	(158,730	)	(190,005	)

NET INCREASE IN CASH AND CASH EQUIVALENTS	138,587		234

CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD	135,973		188,911

CASH AND CASH EQUIVALENTS AT END OF PERIOD	$274,560		$189,145