New Engineered Solutions Segment Focused on
Diverse Non-Aftermarket End Markets
Engine Management Segment Renamed Vehicle
Control to Reflect Current Product Suite
Additional Details in Today's Fourth Quarter
Financial Results Call
NEW
YORK, Feb. 22, 2023 /PRNewswire/ -- Standard
Motor Products, Inc. (NYSE: SMP) (the "Company"), a leading
automotive parts manufacturer and distributor, today announced its
new operating segment, "Engineered Solutions," along with the
intent to rename its Engine Management segment to "Vehicle
Control". These segment changes, beginning in 2023, will better
align the Company's operating categories with its strategic focus
as well as provide greater clarity into how the Company is
positioned to capture growth opportunities of the future.
Management will discuss the resegmentation in depth during the
Company's fourth quarter and full year 2022 earnings call today at
11:00 AM Eastern Time. A revised
investor presentation along with a supplementary resegmentation
presentation are available on the Company's Investor Relations
website.
Highlights of the Resegmentation
- New Engineered Solutions segment will focus on non-Aftermarket
end markets, including both on-highway (commercial and light
vehicles) and off-highway (construction, agriculture, power sports,
and other) applications
- Elevates overall growth profile and opportunity for the Company
while also diversifying revenue mix and cash flow generation
- New segment will be carved from existing two segments, Engine
Management and Temperature Control, which will now solely represent
sales to Aftermarket channels
- Supports the Company's ongoing focus as a best-in-class
supplier of premium replacement parts products to the North
American Aftermarket
- Offers clarity to the unique dynamics and margin profiles of
the markets served by each segment with detailed segment financial
reporting beginning in Q1'23
- Engine Management to be renamed "Vehicle Control" to reflect
the expanding portfolio including powertrain-neutral product
categories
"The resegmentation of Standard Motor Products marks an
important development in our company's 100-year history as a leader
in vehicle technologies," said Mr. Eric
Sills, Standard Motor Products' Chief Executive Officer and
President. "I am pleased to unveil our three complementary business
segments – Engineered Solutions, Vehicle Control, and Temperature
Control – which will let SMP's stakeholders better track the
performance and focus of our business. These segments will allow us
to penetrate diverse end markets while continuing to provide
customers with best-in-class products and services.
"The Aftermarket has been and will continue to be the heart of
our business. It is a robust industry demonstrating tremendous
stability and resiliency and has a very bright future. Our value
proposition of being the best full-line full-service supplier of
premium products continues to be very well received by our broad
customer base. We remain steadfastly committed to the Aftermarket
as a primary driver of our business.
"Meanwhile, over the past several years we have aggressively
grown our sales to non-Aftermarket customers, focusing on diverse
on-highway and off-highway end markets. We believe this has reached
the critical mass to become a standalone operating segment. Through
strategic acquisitions and organic growth, we achieved 2022 sales
of $270 million, and broadened our
market access with expanded product capabilities, collective
customer lists, and global reach. This combination will provide
significant cross-selling opportunities which are beginning to bear
fruit. As we build our presence, we expect strong growth potential
due to the diversity of the end markets and the breadth of our
offerings and capabilities.
"Concurrent with the resegmentation, we are launching a new
Engineered Solutions website,
http://www.SMPEngineeredSolutions.com, which will provide customers
with commercial and technical information, as well as a full suite
of our product capabilities across all the industries and markets
we serve."
Additional detail on the three business segments:
Engineered Solutions –This new segment focuses on
custom-engineered solutions to vehicle and equipment manufacturers
across diverse global end markets, including both on-highway and
off-highway applications such as commercial vehicles, construction
and agricultural equipment, power sports, and others. Our offerings
include product categories from both of our legacy operating
segments and provide a broad array of conventional and
future-oriented technologies, including those that are specific to
vehicle electrification and those that are powertrain-neutral.
Vehicle Control – To more accurately reflect the
evolution of the products and categories SMP offers, and the future
areas of product growth including powertrain-neutral and
electrification-specific offerings, the Company will rename its
"Engine Management" segment to "Vehicle Control". The three
subcategories are:
- "Ignition, Emissions, & Fuel" will include internal
combustion engine (ICE) related categories
- "Wire Sets & Other" will include spark plug wire sets and
other related products
- "Electrical & Safety" will include non-ICE related
conventional and evolving vehicle technologies
Temperature Control – This legacy Aftermarket business
segment is poised to benefit from the broader adoption of more
complex air conditioning systems that provide passenger comfort
regardless of the vehicle's powertrain propulsion, and from systems
being developed to manage the temperature of batteries and other
products used on electric vehicles. The two subcategories are:
- "A/C System Components" includes compressors, connecting lines,
heat exchangers, and expansion devices which comprise the parts
found in a vehicle's air conditioning system
- "Other Thermal Components" includes parts that provide engine,
transmission, electric drive motor, and battery temperature
management
Conference Call
Standard Motor Products, Inc. will hold a conference call at
11:00 AM, Eastern Time, on
Wednesday, February 22, 2023. This
call will be web cast and can be accessed on the Investor Relations
page of our website at www.smpcorp.com and clicking on the SMP
Q4'22 Earnings Call Earnings Webcast link. Investors may also
listen to the call by dialing 800-343-1703 (domestic) or
785-424-1226 (international). Our playback will be made available
for dial in immediately following the call. For those choosing to
listen to the replay by webcast, the link should be active on our
website within 24 hours after the call. The playback number is
800-723-1517 (domestic) or 402-220-2659 (international). The
participant passcode is 73005.
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.
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SOURCE Standard Motor Products, Inc.