NEW YORK, Aug. 4, 2021 /PRNewswire/ -- Standard Motor Products, Inc. (NYSE: SMP), a leading automotive parts manufacturer and distributor, reported today its consolidated financial results for the three months and six months ended June 30, 2021.

Consolidated net sales for the second quarter of 2021 were $342.1 million, compared to consolidated net sales of $247.9 million during the comparable quarter in 2020. Earnings from continuing operations for the second quarter of 2021 were $28.0 million or $1.23 per diluted share, compared to $11.8 million or 52 cents per diluted share in the second quarter of 2020. Excluding non-operational gains and losses identified on the attached reconciliation of GAAP and non-GAAP measures, earnings from continuing operations for the second quarter of 2021 were $28.6 million or $1.26 per diluted share, compared to $11.8 million or 52 cents per diluted share in the second quarter of 2020.

Consolidated net sales for the six months ended June 30, 2021, were $618.6 million, compared to consolidated net sales of $502.2 million during the comparable period in 2020.  Earnings from continuing operations for the six months ended June 30, 2021, were $50.2 million or $2.21 per diluted share, compared to $21.5 million or 94 cents per diluted share in the comparable period of 2020.  Excluding non-operational gains and losses identified on the attached reconciliation of GAAP and non-GAAP measures, earnings from continuing operations for the six months ended June 30, 2021 and 2020 were $50.7 million or $2.23 per diluted share and $21.6 million or 95 cents per diluted share, respectively.

Mr. Eric Sills, Standard Motor Products' Chief Executive Officer and President stated, "We are very pleased with our second quarter results as the strong sales trends we have been experiencing for the last three quarters continued unabated. While our sales finished the quarter 38% ahead of 2020, last year's second quarter was dramatically affected by the pandemic. Yet we were also 12% favorable to the comparable quarter in 2019.

"We set records in earnings, with non-GAAP diluted earnings per share from continuing operations up 142% in the quarter, and up 37% vs. the second quarter of 2019.

"Our overall year-to-date performance was very strong, with sales and earnings up 23% and 135% respectively vs. last year. However, although market conditions remain robust, comparisons to 2020 will become more challenging. 2020 was a year of two halves – the first half was severely impacted by pandemic-related lockdowns, while the second half set records as the market surged. We believe that going forward a comparison to a more normalized 2019 is more appropriate.

"By division, Engine Management sales for the quarter were up 35% vs. last year despite the previously disclosed loss of a large account, and were up 7% vs. 2019. This strong performance reflects a combination of factors – successful customer initiatives, new business wins, contributions from acquisitions (discussed below), and generally robust demand.

"Temperature Control sales for the quarter were extremely strong, up 47% vs. last year and 26% vs. 2019. The first two months of any second quarter tend to be preseason orders, at which point the summer selling season begins. This year, it appears that customer sell-through began early, and replenishment demand remained high. Ongoing favorable weather trends bode well for a strong third quarter.

"Our gross margins held up nicely in the quarter, aided by favorable absorption in our plants from elevated production levels as we rebuilt our inventory. However, offsetting these benefits were rising costs across the board, including certain raw materials, labor, and transportation. Going forward, we anticipate margin pressures from more normalized production levels and inflationary headwinds, though we believe that the current environment permits a pass-through of these costs.

"Additionally, as we expand our sales to original equipment customers, this business tends to have lower gross margins. However, it also has lower SG&A expenses and thus generates comparable operating profit margins.

"We are excited with the progress that we have made expanding our presence in the original equipment market, with a focus on heavy duty and commercial vehicles. We announced two acquisitions in 2021, both geared towards pursuing this complementary channel.

"In March we acquired the soot sensor business from Stoneridge, Inc., a high-tech emissions control program for heavy duty vehicles that will be relocated to existing SMP facilities in the coming months. On May 31st we consummated the acquisition of Trombetta, a Wisconsin-based company selling various power management devices to a broad array of customers across multiple channels including construction, agricultural, heavy truck, lawn and garden, and power sports segments. Please see our Trombetta press release dated June 1st for more details.

"Combined, these acquisitions generate approximately $75 million in annualized revenue. But more importantly, when combined with our legacy business, this channel now represents approximately $250 million in sales on an annualized basis, which gives us the critical mass to be a significant supplier in this space. We are also pleased that many of the products we are pursuing in this adjacent channel are not powertrain dependent, and thus are well-positioned for the eventual shift to electric vehicles.

"We also strongly believe that while expansion into this market provides some important diversification from our core aftermarket business, it by no means dilutes our focus on it. We feel that it is highly complementary, as it grants access to product technologies suitable to the aftermarket, and provides more manufacturing and engineering capabilities to support our operating strategy of being a basic manufacturer.

"In closing, we are very pleased with our year thus far, posting record financial results and consummating two strategic acquisitions. The overall industry continues to perform well, our customers are enjoying very strong sell-through of our products, and we are working closely with them to ensure our mutual success.  While the substantial volume swings we have been witnessing over the last 18 months make forecasting difficult, compounded by uncertainty from the ongoing pandemic, and though the balance of the year faces challenging 2020 comparisons, we believe we are well positioned for the future.

"Finally, the Board of Directors has approved payment of a quarterly dividend of 25 cents per share on the common stock outstanding. The dividend will be paid on September 1, 2021 to stockholders of record on August 16, 2021."

Conference Call

Standard Motor Products, Inc. will hold a conference call at 11:00 AM, Eastern Time, on Wednesday, August 4, 2021.  The dial-in number is 866-342-8588 (domestic) or 203-518-9865 (international). The playback number is 800-839-5128 (domestic) or 402-220-1504 (international). The participant passcode is 85201.

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 are those 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































(In thousands, except per share amounts)















































THREE MONTHS ENDED




SIX MONTHS ENDED





JUNE 30,




JUNE 30,





2021



2020




2021



2020





(Unaudited)




(Unaudited)



NET SALES


$       342,076



$       247,939




$       618,629



$       502,241


















COST OF SALES


242,804



183,581




435,573



367,488


















GROSS PROFIT


99,272



64,358




183,056



134,753


















SELLING, GENERAL & ADMINISTRATIVE EXPENSES


62,347



48,328




116,807



104,201



RESTRUCTURING AND INTEGRATION EXPENSES


-



9




-



214



OTHER INCOME, NET


-



-




-



6


















OPERATING INCOME 


36,925



16,021




66,249



30,344


















OTHER NON-OPERATING INCOME, NET


832



602




1,467



78


















INTEREST EXPENSE


495



772




704



1,645


















EARNINGS FROM CONTINUING OPERATIONS BEFORE TAXES


37,262



15,851




67,012



28,777


















PROVISION FOR INCOME TAXES


9,248



4,009




16,834



7,314


















EARNINGS FROM CONTINUING OPERATIONS


28,014



11,842




50,178



21,463


















LOSS FROM DISCONTINUED OPERATION, NET OF INCOME TAXES


(853)



(875)




(2,017)



(1,869)


















NET EARNINGS


27,161



10,967




48,161



19,594


















NET EARNINGS ATTRIBUTABLE TO NONCONTROLLING INTEREST


19



-




19



-


















NET EARNINGS ATTRIBUTABLE TO SMP (a)


$         27,142



$         10,967




$         48,142



$         19,594

































NET EARNINGS ATTRIBUTABLE TO SMP 















EARNINGS FROM CONTINUING OPERATIONS


$         27,995



$         11,842




$         50,159



$         21,463



LOSS FROM DISCONTINUED OPERATION, NET OF INCOME TAXES


(853)



(875)




(2,017)



(1,869)



TOTAL


$         27,142



$         10,967




$         48,142



$         19,594
















































NET EARNINGS PER COMMON SHARE ATTRIBUTABLE TO SMP






























   BASIC EARNINGS FROM CONTINUING OPERATIONS


$              1.26



$              0.53




$              2.25



$              0.96



   DISCONTINUED OPERATION


(0.04)



(0.04)




(0.09)



(0.08)



   NET EARNINGS PER COMMON SHARE - BASIC


$              1.22



$              0.49




$              2.16



$              0.88

































   DILUTED EARNINGS FROM CONTINUING OPERATIONS


$              1.23



$              0.52




$              2.21



$              0.94



   DISCONTINUED OPERATION


(0.03)



(0.04)




(0.09)



(0.08)



   NET EARNINGS PER COMMON SHARE - DILUTED


$              1.20



$              0.48




$              2.12



$              0.86

































WEIGHTED AVERAGE NUMBER OF COMMON SHARES


22,198,545



22,330,476




22,257,922



22,384,281



WEIGHTED AVERAGE NUMBER OF COMMON AND DILUTIVE SHARES


22,686,384



22,718,680




22,741,171



22,793,606


















   (a) "SMP" refers to Standard Motor Products, Inc. and subsidiaries.















 

STANDARD MOTOR PRODUCTS, INC.

Segment Revenues and Operating Income



























(In thousands)









































THREE MONTHS ENDED



SIX MONTHS ENDED




JUNE 30,



JUNE 30,




2021



2020



2021



2020




(Unaudited)



(Unaudited)


Revenues













Ignition, Emission Control, Fuel & Safety













   Related System Products


$       192,486



$       142,787



$       366,152



$       307,313


Wire and Cable


40,730



30,366



79,082



66,958


        Engine Management


233,216



173,153



445,234



374,271















Compressors


69,577



44,878



102,951



70,226


Other Climate Control Parts


36,894



27,514



65,993



53,608


        Temperature Control


106,471



72,392



168,944



123,834















All Other


2,389



2,394



4,451



4,136


        Revenues


$         342,076



$         247,939



$         618,629



$         502,241















Gross Margin













Engine Management


$         67,447

28.9%


$         46,230

26.7%


$       132,517

29.8%


$       102,935

27.5%

Temperature Control


28,658

26.9%


16,520

22.8%


44,653

26.4%


28,616

23.1%

All Other


3,167



1,608



5,886



3,202


        Gross Margin


$           99,272

29.0%


$           64,358

26.0%


$         183,056

29.6%


$         134,753

26.8%














Selling, General & Administrative













Engine Management


$         37,063

15.9%


$         29,499

17.0%


$           71,019

16.0%


$           64,572

17.3%

Temperature Control


15,429

14.5%


12,553

17.3%


27,832

16.5%


24,997

20.2%

All Other


9,100



6,276



17,201



14,632


        Subtotal


$           61,592

18.0%


$           48,328

19.5%


$         116,052

18.8%


$         104,201

20.7%

One-Time Acquisition Costs


755

0.2%


-

0.0%


755

0.1%


-

0.0%

        Selling, General & Administrative


$           62,347

18.2%


$           48,328

19.5%


$         116,807

18.9%


$         104,201

20.7%



























Operating Income













Engine Management


$         30,384

13.0%


$         16,731

9.7%


$           61,498

13.8%


$           38,363

10.3%

Temperature Control


13,229

12.4%


3,967

5.5%


16,821

10.0%


3,619

2.9%

All Other


(5,933)



(4,668)



(11,315)



(11,430)


        Subtotal


37,680

11.0%


16,030

6.5%


67,004

10.8%


30,552

6.1%

One-time Acquisition Costs


(755)

-0.2%


-

0.0%


(755)

-0.1%


-

0.0%

Restructuring & Integration


-

0.0%


(9)

0.0%


-

0.0%


(214)

0.0%

Other Income (Expense), Net


-

0.0%


-

0.0%


-

0.0%


6

0.0%

        Operating Income


$           36,925

10.8%


$           16,021

6.5%


$           66,249

10.7%


$           30,344

6.0%

 

STANDARD MOTOR PRODUCTS, INC.

Reconciliation of GAAP and Non-GAAP Measures





















(In thousands, except per share amounts)












THREE MONTHS ENDED



SIX MONTHS ENDED



JUNE 30,



JUNE 30,



2021


2020



2021


2020


(Unaudited)


(Unaudited)

EARNINGS FROM CONTINUING OPERATIONS ATTRIBUTABLE TO SMP




















GAAP EARNINGS FROM CONTINUING OPERATIONS


$            27,995


$            11,842



$            50,159


$            21,463











RESTRUCTURING AND INTEGRATION EXPENSES


-


9



-


214

ONE-TIME ACQUISITION COSTS


755


-



755


-

INCOME TAX EFFECT RELATED TO RECONCILING ITEMS


(196)


(2)



(196)


(56)

NON-GAAP EARNINGS FROM CONTINUING OPERATIONS


$            28,554


$            11,849



$            50,718


$            21,621





















DILUTED EARNINGS PER SHARE FROM CONTINUING OPERATIONS ATTRIBUTABLE TO SMP



















GAAP DILUTED EARNINGS PER SHARE FROM CONTINUING OPERATIONS


$               1.23


$               0.52



$               2.21


$               0.94











RESTRUCTURING AND INTEGRATION EXPENSES


-


-



-


0.01

ONE-TIME ACQUISITION COSTS


0.03


-



0.03


-

INCOME TAX EFFECT RELATED TO RECONCILING ITEMS


-


-



(0.01)


-











NON-GAAP DILUTED EARNINGS PER SHARE FROM CONTINUING OPERATIONS


$               1.26


$               0.52



$               2.23


$               0.95





















OPERATING INCOME




















GAAP OPERATING INCOME


$            36,925


$            16,021



$            66,249


$            30,344











ONE-TIME ACQUISITION COSTS


755


-



755


-

RESTRUCTURING AND INTEGRATION EXPENSES


-


9



-


214

OTHER (INCOME) EXPENSE, NET


-


-



-


(6)











NON-GAAP OPERATING INCOME


$            37,680


$            16,030



$            67,004


$            30,552































MANAGEMENT BELIEVES THAT EARNINGS FROM CONTINUING OPERATIONS AND DILUTED EARNINGS PER SHARE FROM CONTINUING OPERATIONS WHICH ARE ATTRIBUTABLE TO SMP, AND OPERATING INCOME, AS ADJUSTED FOR SPECIAL ITEMS, ARE NON-GAAP MEASUREMENTS AND ARE MEANINGFUL TO INVESTORS BECAUSE THEY PROVIDE A VIEW OF THE COMPANY WITH RESPECT TO ONGOING OPERATING RESULTS.  SPECIAL ITEMS REPRESENT SIGNIFICANT CHARGES OR CREDITS THAT ARE IMPORTANT TO AN UNDERSTANDING OF THE COMPANY'S OVERALL OPERATING RESULTS IN THE PERIODS PRESENTED. SUCH NON-GAAP MEASUREMENTS ARE NOT RECOGNIZED IN ACCORDANCE WITH GENERALLY ACCEPTED ACCOUNTING PRINCIPLES AND SHOULD NOT BE VIEWED AS AN ALTERNATIVE TO GAAP MEASURES OF PERFORMANCE.

 

STANDARD MOTOR PRODUCTS, INC.

Condensed Consolidated Balance Sheets















(In thousands)























JUNE 30,




DECEMBER 31,



2021




2020



(Unaudited)












ASSETS








CASH


$            27,453




$            19,488








ACCOUNTS RECEIVABLE, GROSS


217,996




203,861

ALLOWANCE FOR DOUBTFUL ACCOUNTS


6,218




5,822

ACCOUNTS RECEIVABLE, NET


211,778




198,039








INVENTORIES


404,876




345,502

UNRETURNED CUSTOMER INVENTORY


22,070




19,632

OTHER CURRENT ASSETS


14,492




15,875








TOTAL CURRENT ASSETS


680,669




598,536








PROPERTY, PLANT AND EQUIPMENT, NET


96,762




89,105

OPERATING LEASE RIGHT-OF-USE ASSETS


39,095




29,958

GOODWILL


126,893




77,837

OTHER INTANGIBLES, NET


105,462




54,004

DEFERRED INCOME TAXES


38,915




44,770

INVESTMENT IN UNCONSOLIDATED AFFILIATES


42,070




40,507

OTHER ASSETS


25,409




21,823








TOTAL ASSETS


$       1,155,275




$          956,540















LIABILITIES AND STOCKHOLDERS' EQUITY















NOTES PAYABLE


$          135,000




$            10,000

CURRENT PORTION OF OTHER DEBT


2,397




135

ACCOUNTS PAYABLE


119,632




100,018

ACCRUED CUSTOMER RETURNS


53,062




40,982

ACCRUED CORE LIABILITY


23,318




22,014

ACCRUED REBATES


41,885




46,437

PAYROLL AND COMMISSIONS


29,363




35,938

SUNDRY PAYABLES AND ACCRUED EXPENSES


42,410




47,078








TOTAL CURRENT LIABILITIES


447,067




302,602








OTHER LONG-TERM DEBT


80




97

NONCURRENT OPERATING LEASE LIABILITIES


30,495




22,450

ACCRUED ASBESTOS LIABILITIES


54,035




55,226

OTHER LIABILITIES


28,481




25,929








 TOTAL LIABILITIES 


560,158




406,304








TOTAL SMP STOCKHOLDERS' EQUITY


583,616




550,236

NONCONTROLLING INTEREST


11,501




-

TOTAL STOCKHOLDERS' EQUITY


595,117




550,236








 TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY 


$       1,155,275




$          956,540

 

STANDARD MOTOR PRODUCTS, INC.

Condensed Consolidated Statements of Cash Flows














(In thousands)



















SIX MONTHS ENDED



JUNE 30,



2021



2020



(Unaudited)








CASH FLOWS FROM OPERATING ACTIVITIES












NET EARNINGS 

$        48,161



$        19,594


ADJUSTMENTS TO RECONCILE NET EARNINGS TO NET CASH






PROVIDED BY (USED IN) OPERATING ACTIVITIES:






DEPRECIATION AND AMORTIZATION

13,100



12,877


OTHER

4,127



9,666


CHANGE IN ASSETS AND LIABILITIES:






ACCOUNTS RECEIVABLE

(4,715)



(38,623)


INVENTORIES

(46,682)



12,725


ACCOUNTS PAYABLE

16,097



(21,804)


PREPAID EXPENSES AND OTHER CURRENT ASSETS

3,220



5,664


SUNDRY PAYABLES AND ACCRUED EXPENSES 

(6,491)



2,085


OTHER

(3,664)



(3,069)


NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES

23,153



(885)














CASH FLOWS FROM INVESTING ACTIVITIES












ACQUISITIONS OF AND INVESTMENTS IN BUSINESSES

(109,267)



-


CAPITAL EXPENDITURES

(11,709)



(9,026)


OTHER INVESTING ACTIVITIES

2



6


NET CASH USED IN INVESTING ACTIVITIES 

(120,974)



(9,020)














CASH FLOWS FROM FINANCING ACTIVITIES












NET CHANGE IN DEBT

127,250



34,349


PURCHASE OF TREASURY STOCK

(11,096)



(8,726)


DIVIDENDS PAID

(11,134)



(5,615)


OTHER FINANCING ACTIVITIES

694



1,818


NET CASH PROVIDED BY FINANCING ACTIVITIES

105,714



21,826














EFFECT OF EXCHANGE RATE CHANGES ON CASH

72



217


NET INCREASE IN CASH AND CASH EQUIVALENTS

7,965



12,138


CASH AND CASH EQUIVALENTS at beginning of Period

19,488



10,372


CASH AND CASH EQUIVALENTS at end of Period

$        27,453



$        22,510

 

Cision View original content:https://www.prnewswire.com/news-releases/standard-motor-products-inc-announces-second-quarter-2021-results-and-a-quarterly-dividend-301347795.html

SOURCE Standard Motor Products, Inc.

Copyright 2021 PR Newswire

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