- Record Sales of $5.6 billion,
Up 17.1%
- Diluted EPS of $2.62, Up
92.6%
- Adjusted Diluted EPS of $2.20,
Up 26.4%
- Significant Progress on Integration of Kaman Distribution
Group
- Raises 2022 Outlook for Revenue Growth and Diluted and
Adjusted Diluted EPS
ATLANTA, July 27,
2022 /PRNewswire/ -- Genuine Parts Company
(NYSE: GPC) announced today its results for the second quarter
ended June 30, 2022.
"GPC achieved another record quarter, consisting of double-digit
sales and earnings increases and a steady cadence of continued
growth," said Paul Donahue, Chairman
and Chief Executive Officer. "We are benefiting from the resiliency
of our Automotive and Industrial businesses and the strategic mix
of our operations. We want to thank our 53,000 talented GPC
teammates for their exceptional work and commitment to
excellence."
Second Quarter 2022 Results
Sales were $5.6 billion, a 17.1%
increase compared to $4.8 billion in
the same period of the prior year. The sales growth reflects an
11.5% increase in comparable sales and an 8.8% benefit from
acquisitions, partially offset by a 3.2% net unfavorable impact of
foreign currency and other.
Net income was $373 million, or
$2.62 per diluted earnings per share.
This compares to net income of $196
million, or $1.36 per diluted
share, in the prior year period.
Adjusted net income, which excludes a net benefit $59 million, or $0.42 per diluted share, in a non-recurring gain
on the sale of S.P. Richards real estate partially offset by
transaction and other costs related to the acquisition of Kaman
Distribution Group (KDG), was $313
million, an increase of 23.9% compared to adjusted net
income of $253 million for the same
period of the prior year. On a per share diluted basis, adjusted
net income was $2.20, an increase of
26.4% compared to $1.74 per diluted
share last year. Refer to the reconciliation of GAAP net income to
adjusted net income for more information.
Second Quarter 2022 Segment Highlights
Automotive Parts Group
Automotive sales were $3.5
billion, up 8.5% from the same period in 2021, improvement
from an 8.4% global increase in comparable sales and a 4.5%
contribution from acquisitions, net of a 4.4% unfavorable impact of
foreign currency and other. Segment profit of $323 million increased 10.9%, with a segment
profit margin of 9.3%, up 20 basis points from the same period of
the prior year.
Industrial Parts Group
Industrial sales were $2.1
billion, up 34.5% from the same period in 2021, and
reflecting a 17.8% increase in comparable sales and a 17.6%
contribution from the acquisition of KDG, slightly offset by a 0.9%
unfavorable impact of foreign currency. Segment profit of
$225 million increased 49.9%, with
profit margin of 10.6%, up 110 basis points from the same period of
the prior year.
Will Stengel, President, stated,
"Our second quarter results were driven by exceptional execution
from our teammates along with the continued focus on our strategic
investments, which delivered strong sales and margin expansion in
both segments. In addition, we were pleased to further strengthen
our balance sheet and generate continued strong cash flow.
"The strength in Automotive was broad-based across our global
operations. Likewise, the continued strength in Industrial led to
its fifth consecutive quarter of double-digit sales comps," said
Mr. Stengel.
Six Months 2022 Results
Sales for the six months ended June 30,
2022 were $10.9 billion,
a 17.8% increase from $9.2 billion
for the same period in 2021. Net income for the six months was
$618 million, or $4.34 per
diluted share. The Company's adjusted net income was
$579 million, or $4.06 per
diluted share, an increase of 25.3% compared to $3.24 per diluted share last year.
Balance Sheet, Cash Flow and Capital Allocation
The Company generated operating cash flow from operations of
$791 million during the first half of
2022, an increase from $704 million
in the same period last year. The increase was driven primarily by
higher net income and the effective management of our working
capital. We used $1.5 billion in cash
for investing activities, primarily in connection with the
acquisition of KDG, in addition to $153
million for capital expenditures. We also had $585 million in cash provided by financing
activities, which includes $1 billion of net proceeds from
debt, primarily related to the KDG acquisition. This was partially
offset by quarterly dividends of $243 million paid to
shareholders and $123 million of share repurchases. Free cash
flow was $638 million for the first
half of 2022.
The Company ended the quarter with $2 billion in total
liquidity, consisting of $1.5 billion
availability on the revolving credit facility and $519 million in cash and cash
equivalents.
2022 Outlook
In consideration of several factors, the Company is updating
full-year 2022 guidance previously provided in its earnings release
on April 21, 2022. The Company
considered its recent business trends and financial results,
current growth plans, strategic initiatives, global economic
outlook, geopolitical conflicts and the potential impact on results
in establishing its updated guidance, which is outlined in the
table below. The Company will continue to update full-year guidance
during 2022, as appropriate.
|
|
For the Year Ending
December 31, 2022
|
|
|
Previous
Outlook
|
|
Updated
Outlook
|
Total sales
growth
|
|
10% to 12%
|
|
12% to
14%
|
Automotive sales
growth
|
|
5% to 7%
|
|
6% to
8%
|
Industrial sales
growth
|
|
21% to 23%
|
|
26% to
28%
|
Diluted earnings per
share
|
|
$7.56 to
$7.71
|
|
$8.08 to
$8.23
|
Adjusted diluted
earnings per share
|
|
$7.70 to
$7.85
|
|
$7.80 to
$7.95
|
Effective tax
rate
|
|
Approximately
25%
|
|
Approximately
25%
|
Net cash provided by
operating activities
|
|
$1.5 billion to $1.7
billion
|
|
$1.5 billion to $1.7
billion
|
Free cash
flow
|
|
$1.2 billion to $1.4
billion
|
|
$1.2 billion to $1.4
billion
|
"We have had an exceptional first half of 2022, boosted by our
Industrial business and success of our acquisition of KDG along
with solid Automotive results. Our outlook for the full-year
reflects our ongoing confidence in our businesses to execute our
strategies despite a dynamic and uncertain external landscape," Mr.
Donahue concluded.
Non-GAAP Information
This release contains certain financial information not derived
in accordance with United States
("U.S.") generally accepted accounting principles ("GAAP"). These
items include adjusted net income from operations, adjusted diluted
net income from operations per common share and free cash flow. We
believe that the presentation of adjusted net income from
operations, adjusted diluted net income from operations per common
share and free cash flow, when considered together with the
corresponding GAAP financial measures and the reconciliations to
those measures, provide meaningful supplemental information to both
management and investors that is indicative of our core
operations. We considered these metrics useful to investors
because they provide greater transparency into management's view
and assessment of our ongoing operating performance by removing
items management believes are not representative of our operations
and may distort our longer-term operating trends. We believe these
measures are useful and enhance the comparability of our results
from period to period and with our competitors, as well as show
ongoing results from operations distinct from items that are
infrequent or not associated with our core operations. We do
not, nor do we suggest investors should, consider such non-GAAP
financial measures as superior to, in isolation from, or as a
substitute for, GAAP financial information. We have included a
reconciliation of this additional information to the most
comparable GAAP measure following the financial statements
below.
Comparable Sales
Comparable sales is a key metric that refers to
period-over-period comparisons of our sales excluding the impact of
acquisitions, foreign currency and other. We consider this metric
useful to investors because it provides greater transparency into
management's view and assessment of the our core ongoing
operations. This is a metric that is widely used by analysts,
investors and competitors in our industry, although our calculation
of the metric may not be comparable to similar measures disclosed
by other companies, because not all companies and analysts
calculate this metric in the same manner.
Conference Call
We will hold a conference call today at 11:00 a.m. Eastern time to discuss the results of
the quarter. A supplemental earnings deck will also be available
for reference. Interested parties may listen to the call and view
the supplemental earnings deck on our website at
http://genuineparts.investorroom.com. The call is also available by
dialing 888-317-6003, conference ID 0479094. A replay will also be
available on our website or at 877-344-7529, conference ID 2048254,
two hours after the completion of the call.
About Genuine Parts Company
Founded in 1928, we are a global service organization engaged in
the distribution of automotive and industrial replacement parts.
Our Automotive Parts Group distributes automotive replacement parts
in the U.S., Canada, Mexico, Australasia, France, the United
Kingdom, Ireland,
Germany, Poland, the
Netherlands, Belgium,
Spain, and Portugal. Our Industrial Parts Group
distributes industrial replacement parts in the U.S., Canada, Mexico and Australasia. In total, we serve our
global customers from an extensive network of more than 10,000
locations in 17 countries and has approximately 53,000 employees.
Further information is available at www.genpt.com.
Forward-Looking Statements
Some statements in this report, as well as in other materials we
file with the Securities and Exchange Commission (SEC), release to
the public, or make available on our website, constitute
forward-looking statements that are subject to the safe harbor
provisions of the Private Securities Litigation Reform Act of 1995.
All statements in the future tense and all statements accompanied
by words such as "expect," "likely," "outlook," "forecast,"
"preliminary," "would," "could," "should," "position," "will,"
"project," "intend," "plan," "on track," "anticipate," "to come,"
"may," "possible," "assume," or similar expressions are intended to
identify such forward-looking statements. These forward-looking
statements include our view of business and economic trends for the
remainder of the year and our expectations regarding our ability to
capitalize on these business and economic trends and to execute our
strategic priorities, and the updated full-year 2022 financial
guidance provided. Senior officers may also make verbal statements
to analysts, investors, the media and others that are
forward-looking.
We caution you that all forward-looking statements involve risks
and uncertainties, and while we believe that our expectations for
the future are reasonable in view of currently available
information, you are cautioned not to place undue reliance on our
forward-looking statements. Actual results or events may differ
materially from those indicated as a result of various important
factors. Such factors may include, among other things, changes in
general economic conditions, including unemployment, inflation
(including the impact of tariffs) or deflation and geopolitical
conflicts such as the conflict between Russia and Ukraine; volatility in oil prices; significant
cost increases, such as rising fuel and freight expenses; the
extent and duration of the disruption to our business operations
caused by the global health crisis associated with the COVID-19
pandemic, including the effects on the financial health of our
business partners and customers, on supply chains and our
suppliers, on vehicle miles driven as well as other metrics that
affect our business, and on access to capital and liquidity
provided by the financial and capital markets; our ability to
maintain compliance with our debt covenants; our ability to
successfully integrate acquired businesses into our operations and
to realize the anticipated synergies and benefits; our ability to
successfully implement our business initiatives in our two business
segments; slowing demand for our products; the ability to maintain
favorable supplier arrangements and relationships; disruptions in
global supply chains and in our suppliers operations, including as
a result of the impact of COVID-19 on our suppliers and our supply
chain; changes in national and international legislation or
government regulations or policies, including changes to import
tariffs, environmental and social policy, infrastructure programs
and privacy legislation, and their impact to us, our suppliers and
customers; changes in tax policies; volatile exchange rates; our
ability to successfully attract and retain employees in the current
labor market; uncertain credit markets and other macroeconomic
conditions; competitive product, service and pricing pressures;
failure or weakness in our disclosure controls and procedures and
internal controls over financial reporting, including as a result
of the work from home environment; the uncertainties and costs of
litigation; disruptions caused by a failure or breach of our
information systems, as well as other risks and uncertainties
discussed in our 2021 Annual Report on Form 10-K and Item 1A, Risk
Factors, in our report on Form10-Q for the quarter ended
March 31, 2022 (all of which may be
amplified by the COVID-19 pandemic and geopolitical conflicts, such
as the current conflict between Russia and Ukraine) and from time to time in our
subsequent filings with the SEC.
Forward-looking statements speak only as of the date they are
made, and we undertake no duty to update any forward-looking
statements except as required by law. You are advised, however, to
review any further disclosures we make on related subjects in our
subsequent Forms 10-K, 10-Q, 8-K and other reports filed with the
SEC.
GENUINE PARTS COMPANY
AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(UNAUDITED)
|
|
|
|
Three Months Ended June
30,
|
|
Six Months Ended June
30,
|
(in thousands, except per share data)
|
|
2022
|
|
2021
|
|
2022
|
|
2021
|
Net sales
|
|
$
5,602,414
|
|
$
4,783,738
|
|
$ 10,897,049
|
|
$ 9,248,452
|
Cost of goods
sold
|
|
3,641,615
|
|
3,094,633
|
|
7,110,303
|
|
6,018,532
|
Gross profit
|
|
1,960,799
|
|
1,689,105
|
|
3,786,746
|
|
3,229,920
|
Operating
expenses:
|
|
|
|
|
|
|
|
|
Selling,
administrative and other expenses
|
|
1,364,015
|
|
1,349,309
|
|
2,767,994
|
|
2,544,473
|
Depreciation and
amortization
|
|
85,890
|
|
73,960
|
|
173,259
|
|
146,256
|
Provision for doubtful
accounts
|
|
2,899
|
|
5,037
|
|
7,393
|
|
9,946
|
Total operating
expenses
|
|
1,452,804
|
|
1,428,306
|
|
2,948,646
|
|
2,700,675
|
Non-operating expense
(income):
|
|
|
|
|
|
|
|
|
Interest expense,
net
|
|
20,248
|
|
15,362
|
|
40,098
|
|
33,686
|
Other
|
|
(3,820)
|
|
(24,170)
|
|
(19,281)
|
|
(59,907)
|
Total non-operating
expense (income)
|
|
16,428
|
|
(8,808)
|
|
20,817
|
|
(26,221)
|
Income before income
taxes
|
|
491,567
|
|
269,607
|
|
817,283
|
|
555,466
|
Income taxes
|
|
119,038
|
|
73,111
|
|
198,916
|
|
141,260
|
Net income
|
|
$
372,529
|
|
$
196,496
|
|
$ 618,367
|
|
$
414,206
|
Dividends declared per
common share
|
|
$
0.8950
|
|
$
0.8150
|
|
$
1.7900
|
|
$ 1.6300
|
Basic earnings per
share
|
|
$
2.63
|
|
$
1.36
|
|
$
4.36
|
|
$
2.87
|
Diluted earnings per
share
|
|
$
2.62
|
|
$
1.36
|
|
$
4.34
|
|
$
2.85
|
|
|
|
|
|
|
|
|
|
Weighted average common
shares
outstanding
|
|
141,581
|
|
144,211
|
|
141,747
|
|
144,312
|
Dilutive effect of
stock options and non-
vested restricted stock awards
|
|
723
|
|
772
|
|
835
|
|
846
|
Weighted average common
shares
outstanding – assuming dilution
|
|
142,304
|
|
144,983
|
|
142,582
|
|
145,158
|
|
GENUINE PARTS COMPANY
AND SUBSIDIARIES
SEGMENT INFORMATION
(UNAUDITED)
|
|
|
|
Three Months Ended June
30,
|
|
Six Months Ended June
30,
|
(in
thousands)
|
|
2022
|
|
2021
|
|
2022
|
|
2021
|
Net sales:
|
|
|
|
|
|
|
|
|
Automotive
|
|
$ 3,467,494
|
|
$ 3,196,299
|
|
$ 6,743,115
|
|
$ 6,149,464
|
Industrial
|
|
2,134,920
|
|
1,587,439
|
|
4,153,934
|
|
3,098,988
|
Total net
sales
|
|
$ 5,602,414
|
|
$ 4,783,738
|
|
$
10,897,049
|
|
$ 9,248,452
|
Segment
profit:
|
|
|
|
|
|
|
|
|
Automotive
|
|
$
322,553
|
|
$
290,758
|
|
$
587,126
|
|
$
526,436
|
Industrial
|
|
225,472
|
|
150,413
|
|
413,825
|
|
275,705
|
Total segment
profit
|
|
548,025
|
|
441,171
|
|
1,000,951
|
|
802,141
|
Interest expense,
net
|
|
(20,248)
|
|
(15,362)
|
|
(40,098)
|
|
(33,686)
|
Intangible asset
amortization
|
|
(39,630)
|
|
(27,384)
|
|
(79,324)
|
|
(52,928)
|
Corporate
expense
|
|
(73,312)
|
|
(51,397)
|
|
(115,063)
|
|
(82,640)
|
Other unallocated costs
(1)
|
|
76,732
|
|
(77,421)
|
|
50,817
|
|
(77,421)
|
Income before income
taxes
|
|
$
491,567
|
|
$
269,607
|
|
$
817,283
|
|
$
555,466
|
|
(1) The following table
presents a summary of the other unallocated costs:
|
|
|
|
Three Months Ended June
30,
|
|
Six Months Ended June
30,
|
(in
thousands)
|
|
2022
|
|
2021
|
|
2022
|
|
2021
|
Other unallocated
costs:
|
|
|
|
|
|
|
|
|
Gain on sale of real
estate (2)
|
|
$
102,803
|
|
$
—
|
|
$
102,803
|
|
$
—
|
Gain on insurance
proceeds (3)
|
|
$
873
|
|
$
—
|
|
$
1,507
|
|
$
—
|
Product liability
damages award (4)
|
|
—
|
|
(77,421)
|
|
—
|
|
(77,421)
|
Transaction and other
costs (5)
|
|
(26,944)
|
|
—
|
|
(53,493)
|
|
—
|
Total other unallocated
costs
|
|
$
76,732
|
|
$
(77,421)
|
|
$
50,817
|
|
$
(77,421)
|
(2)
|
Adjustment reflects a
gain on the sale of real estate that had been leased to S.P.
Richards.
|
|
|
(3)
|
Adjustment reflects
insurance recoveries in excess of losses incurred on inventory,
property, plant
and equipment and other fire-related costs.
|
|
|
(4)
|
Adjustment reflects
damages reinstated by the Washington Supreme Court order on July 8,
2021
in connection with a 2017 automotive product liability
claim.
|
|
|
(5)
|
Adjustment primarily
reflects legal and professional, restructuring, lease termination
and other
costs associated with the January 3, 2022 acquisition and
subsequent integration of KDG. These
costs also include a $17 million impairment charge driven by a
decision to retire certain legacy
trade names, classified as other intangible assets, prior to the
end of their estimated useful lives
as part of executing our KDG integration and rebranding
strategy.
|
GENUINE PARTS COMPANY
AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(UNAUDITED)
|
|
(in thousands, except
share and per share data)
|
|
June 30,
2022
|
|
June 30,
2021
|
Assets
|
|
|
|
|
Current
assets:
|
|
|
|
|
Cash and cash
equivalents
|
|
$
519,131
|
|
$
987,389
|
Trade accounts
receivable, less allowance for doubtful accounts
(2022 – $57,413; 2021 – $43,751)
|
|
2,235,453
|
|
1,899,978
|
Merchandise
inventories, net
|
|
4,296,191
|
|
3,679,113
|
Prepaid expenses and
other current assets
|
|
1,475,493
|
|
1,155,114
|
Total current
assets
|
|
8,526,268
|
|
7,721,594
|
Goodwill
|
|
2,538,240
|
|
1,922,544
|
Other intangible
assets, less accumulated amortization
|
|
1,853,222
|
|
1,461,886
|
Property, plant and
equipment, less accumulated depreciation
(2022 – $1,370,095; 2021 –
$1,336,175)
|
|
1,236,859
|
|
1,175,953
|
Operating lease
assets
|
|
1,067,614
|
|
1,059,068
|
Other assets
|
|
1,015,984
|
|
744,937
|
Total assets
|
|
$ 16,238,187
|
|
$ 14,085,982
|
|
|
|
|
|
Liabilities and
equity
|
|
|
|
|
Current
liabilities:
|
|
|
|
|
Trade accounts
payable
|
|
$
5,409,587
|
|
$
4,729,240
|
Current portion of
debt
|
|
14,118
|
|
48,094
|
Dividends
payable
|
|
126,716
|
|
117,536
|
Other current
liabilities
|
|
1,743,439
|
|
1,626,325
|
Total current
liabilities
|
|
7,293,860
|
|
6,521,195
|
Long-term
debt
|
|
3,304,223
|
|
2,472,980
|
Operating lease
liabilities
|
|
800,672
|
|
798,079
|
Pension and other
post–retirement benefit liabilities
|
|
263,314
|
|
255,175
|
Deferred tax
liabilities
|
|
407,763
|
|
230,463
|
Other long-term
liabilities
|
|
514,792
|
|
562,945
|
Equity:
|
|
|
|
|
Preferred stock, par
value – $1 per share; authorized –
10,000,000 shares; none issued
|
|
—
|
|
—
|
Common stock, par value
– $1 per share; authorized –
450,000,000 shares; issued and outstanding –
2022 –
141,280,841 shares; 2021 – 143,301,673
shares
|
|
141,281
|
|
143,302
|
Additional paid-in
capital
|
|
123,388
|
|
111,972
|
Accumulated other
comprehensive loss
|
|
(953,228)
|
|
(1,003,554)
|
Retained
earnings
|
|
4,329,115
|
|
3,982,159
|
Total parent
equity
|
|
3,640,556
|
|
3,233,879
|
Noncontrolling
interests in subsidiaries
|
|
13,007
|
|
11,266
|
Total equity
|
|
3,653,563
|
|
3,245,145
|
Total liabilities and
equity
|
|
$ 16,238,187
|
|
$ 14,085,982
|
GENUINE PARTS COMPANY
AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)
|
|
|
|
Six Months Ended June
30,
|
(in
thousands)
|
|
2022
|
|
2021
|
Operating
activities:
|
|
|
|
|
Net income
|
|
$
618,367
|
|
$
414,206
|
Adjustments to
reconcile net income to net cash provided by operating
activities:
|
|
|
|
|
Depreciation and
amortization
|
|
173,259
|
|
146,256
|
Share-based
compensation
|
|
17,882
|
|
14,521
|
Gain on sale of real
estate
|
|
(102,803)
|
|
—
|
Intangible asset
impairment
|
|
17,061
|
|
—
|
Excess tax benefits
from share-based compensation
|
|
(3,137)
|
|
(6,627)
|
Changes in operating
assets and liabilities
|
|
70,356
|
|
136,074
|
Net cash provided by
operating activities
|
|
790,985
|
|
704,430
|
Investing
activities:
|
|
|
|
|
Purchases of property,
plant and equipment
|
|
(152,976)
|
|
(89,993)
|
Proceeds from sale of
property, plant and equipment
|
|
140,841
|
|
22,065
|
Proceeds from
divestitures of businesses
|
|
26,102
|
|
13,705
|
Acquisitions of
businesses and other investing activities
|
|
(1,557,420)
|
|
(97,168)
|
Net cash used in
investing activities
|
|
(1,543,453)
|
|
(151,391)
|
Financing
activities:
|
|
|
|
|
Proceeds from
debt
|
|
3,850,642
|
|
31,599
|
Payments on
debt
|
|
(2,872,124)
|
|
(142,295)
|
Share-based awards
exercised
|
|
(14,420)
|
|
(19,330)
|
Dividends
paid
|
|
(242,767)
|
|
(231,627)
|
Purchases of
stock
|
|
(122,919)
|
|
(184,365)
|
Other financing
activities
|
|
(13,901)
|
|
(2,159)
|
Net cash provided by
(used in) financing activities
|
|
584,511
|
|
(548,177)
|
Effect of exchange rate
changes on cash and cash equivalents
|
|
(27,613)
|
|
(7,639)
|
Net (decrease) increase
in cash and cash equivalents
|
|
(195,570)
|
|
(2,777)
|
Cash and cash
equivalents at beginning of period
|
|
714,701
|
|
990,166
|
Cash and cash
equivalents at end of period
|
|
$
519,131
|
|
$
987,389
|
GENUINE PARTS COMPANY
AND SUBSIDIARIES
RECONCILIATION OF GAAP NET INCOME TO ADJUSTED NET INCOME AND
GAAP
DILUTED NET INCOME PER COMMON SHARE TO ADJUSTED DILUTED NET INCOME
PER COMMON SHARE
(UNAUDITED)
|
|
|
|
Three Months Ended June
30,
|
|
Six Months Ended June
30,
|
(in
thousands)
|
|
2022
|
|
2021
|
|
2022
|
|
2021
|
GAAP net
income
|
|
$
372,529
|
|
$ 196,496
|
|
$ 618,367
|
|
$ 414,206
|
|
|
|
|
|
|
|
|
|
Adjustments:
|
|
|
|
|
|
|
|
|
Gain on sale of real
estate (1)
|
|
(102,803)
|
|
—
|
|
(102,803)
|
|
—
|
Gain on insurance
proceeds (2)
|
|
(873)
|
|
—
|
|
(1,507)
|
|
—
|
Product liability
damages award (3)
|
|
—
|
|
77,421
|
|
—
|
|
77,421
|
Transaction and other
costs (4)
|
|
26,944
|
|
—
|
|
53,493
|
|
—
|
Total
adjustments
|
|
(76,732)
|
|
77,421
|
|
(50,817)
|
|
77,421
|
Tax impact of
adjustments
|
|
17,291
|
|
(21,322)
|
|
11,187
|
|
(21,322)
|
Adjusted net
income
|
|
$
313,088
|
|
$ 252,595
|
|
$ 578,737
|
|
$ 470,305
|
|
The table below
represent amounts per common share assuming dilution:
|
|
|
|
Three Months Ended June
30,
|
|
Six Months Ended June
30,
|
(in thousands, except
per share data)
|
|
2022
|
|
2021
|
|
2022
|
|
2021
|
GAAP net
income
|
|
$
2.62
|
|
$
1.36
|
|
$
4.34
|
|
$
2.85
|
|
|
|
|
|
|
|
|
|
Adjustments:
|
|
|
|
|
|
|
|
|
Gain on sale of real
estate (1)
|
|
(0.72)
|
|
—
|
|
(0.72)
|
|
—
|
Gain on insurance
proceeds (2)
|
|
(0.01)
|
|
—
|
|
(0.02)
|
|
—
|
Product liability
damages award (3)
|
|
—
|
|
0.53
|
|
—
|
|
0.53
|
Transaction and other
costs (4)
|
|
0.19
|
|
—
|
|
0.38
|
|
—
|
Total
adjustments
|
|
(0.54)
|
|
0.53
|
|
(0.36)
|
|
0.53
|
Tax impact of
adjustments
|
|
0.12
|
|
(0.15)
|
|
0.08
|
|
(0.14)
|
Adjusted net
income
|
|
$
2.20
|
|
$
1.74
|
|
$
4.06
|
|
$
3.24
|
Weighted average common
shares
outstanding – assuming dilution
|
|
142,304
|
|
144,983
|
|
142,582
|
|
145,158
|
|
The table below
clarifies where the items that have been adjusted above to improve
comparability of the
financial information from period to period are presented in the
condensed consolidated statements of
income.
|
|
|
|
Three Months Ended June
30,
|
|
Six Months Ended June
30,
|
(in
thousands)
|
|
2022
|
|
2021
|
|
2022
|
|
2021
|
Line item:
|
|
|
|
|
|
|
|
|
Cost of goods
sold
|
|
$
—
|
|
$
—
|
|
$
5,000
|
|
$
—
|
Selling,
administrative and other expenses
|
|
(75,859)
|
|
77,421
|
|
(54,310)
|
|
77,421
|
Non-operating expense
(income): Other
|
|
(873)
|
|
—
|
|
(1,507)
|
|
—
|
Total
adjustments
|
|
$
(76,732)
|
|
$
77,421
|
|
$
(50,817)
|
|
$
77,421
|
(1)
|
Adjustment reflects a gain on the sale of real estate
that had been leased to S.P. Richards.
|
|
|
(2)
|
Adjustment reflects
insurance recoveries in excess of losses incurred on inventory,
property, plant
and equipment and other fire-related costs.
|
|
|
(3)
|
Adjustment reflects damages reinstated by the
Washington Supreme Court order on July 8, 2021
in connection with a 2017 automotive product liability
claim.
|
|
|
(4)
|
Adjustment primarily reflects legal and professional,
restructuring, lease termination and other
costs associated with the January 3, 2022 acquisition and
subsequent integration of KDG. These
costs also include a $17 million impairment charge driven by a
decision to retire certain legacy
trade names, classified as other intangible assets, prior to the
end of their estimated useful lives
as part of executing our KDG integration and rebranding
strategy.
|
GENUINE PARTS COMPANY
AND SUBSIDIARIES
CHANGE IN NET SALES SUMMARY
(UNAUDITED)
|
|
|
|
Three Months Ended June
30, 2022
|
|
|
Comparable
Sales
|
|
Acquisitions
|
|
Foreign
Currency
|
|
Other
|
|
GAAP Total
Net Sales
|
Automotive
|
|
8.4 %
|
|
4.5 %
|
|
(4.6) %
|
|
0.2 %
|
|
8.5 %
|
Industrial
|
|
17.8 %
|
|
17.6 %
|
|
(0.9) %
|
|
— %
|
|
34.5 %
|
Total Net
Sales
|
|
11.5 %
|
|
8.8 %
|
|
(3.3) %
|
|
0.1 %
|
|
17.1 %
|
|
|
|
Six months ended June
30, 2022
|
|
|
Comparable
Sales
|
|
Acquisitions
|
|
Foreign
Currency
|
|
Other
|
|
GAAP Total
Net Sales
|
Automotive
|
|
9.3 %
|
|
3.9 %
|
|
(3.5) %
|
|
— %
|
|
9.7 %
|
Industrial
|
|
17.0 %
|
|
17.7 %
|
|
(0.7) %
|
|
— %
|
|
34.0 %
|
Total Net
Sales
|
|
11.8 %
|
|
8.6 %
|
|
(2.6) %
|
|
— %
|
|
17.8 %
|
GENUINE PARTS COMPANY
AND SUBSIDIARIES
RECONCILIATION OF GAAP NET CASH PROVIDED BY OPERATING ACTIVITIES TO
FREE CASH FLOW
(UNAUDITED)
|
|
|
|
Six Months Ended June
30,
|
(in
thousands)
|
|
2022
|
|
2021
|
Net cash provided by
operating activities
|
|
$
790,985
|
|
$
704,430
|
Purchases of property,
plant and equipment
|
|
(152,976)
|
|
(89,993)
|
Free Cash
Flow
|
|
$
638,009
|
|
$
614,437
|
|
|
|
For the Year Ending
December 31, 2022
|
|
|
Previous
Outlook
|
|
Updated
Outlook
|
Net cash provided by
operating activities
|
|
$1.5 billion to $1.7
billion
|
|
$1.5 billion to $1.7
billion
|
Purchases of property,
plant and equipment
|
|
$300 million to $350
million
|
|
$300 million to $350
million
|
Free Cash
Flow
|
|
$1.2 billion to $1.4
billion
|
|
$1.2 million to $1.4
million
|
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SOURCE Genuine Parts Company