Genuine Parts Company Reports First Quarter 2009 Results

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Gunpowder Capital Corp	CSE:GPC	CSE	Common Stock

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ATLANTA, April 16 /PRNewswire-FirstCall/ -- Genuine Parts Company (NYSE: GPC) reported sales and earnings for the first quarter ended March 31, 2009. Thomas C. Gallagher, Chairman, President and Chief Executive Officer, announced today that sales totaling $2.4 billion were down 11% compared to the first quarter of 2008. Net income for the quarter was $89.2 million, a decrease of 28% over $123.5 million recorded in the same period of the previous year. Earnings per share on a diluted basis were 56 cents, down 25% compared to 75 cents for the first quarter last year. (Logo: http://www.newscom.com/cgi-bin/prnh/20081002/CLTH108LOGO) Mr. Gallagher stated, "It was a challenging quarter for us, as the effects of the slower economy impacted each of our four business segments. The Automotive Group and S. P. Richards, our Office Products Group, both reported a 7% sales decrease, while Motion Industries, our Industrial Group, reported a 16% sales decline in the quarter, and EIS, our Electrical Group, had a 25% decrease. Our Industrial and Electrical businesses sell to the manufacturing segment of the economy, which has experienced an overall slowdown in activity over the past several quarters." Mr. Gallagher added, "While we are not pleased with our first quarter operating results, the balance sheet at March 31, 2009, remains in excellent condition and we continue to strengthen our financial position through working capital and asset management initiatives, as well as steady and strong cash flows. We believe the use of our cash in several key areas, such as the dividend, opportunistic share repurchases, the ongoing investment in each of our businesses and strategic complimentary types of acquisitions, serves to maximize the total return to shareholders." Mr. Gallagher concluded, "The effects of the economic slowdown are likely to persist for several more quarters. Clearly, these are challenging times; however, our expectation is to show gradual improvement in our overall results as the year progresses. The management teams in each of our business segments are focused on the diligent execution of their respective growth and operating strategies, the prudent management of their cost structure and the continued emphasis on further strengthening our balance sheet." Conference Call Genuine Parts Company will hold a conference call today at 11:00 a.m. EDT to discuss the results of the quarter and the future outlook. Interested parties may listen to the call on the Company's website, http://www.genpt.com/, by clicking "Investor Services," or by dialing 877-316-2549, conference ID 85284172. A replay will also be available on the Company's website or at 800-642-1687, conference ID 85284172, two hours after the completion of the call until 12:00 a.m. Eastern time on May 1, 2009. Forward Looking Statements Some statements in this release, as well as in other materials we file with the Securities and Exchange Commission ("SEC") or otherwise release to the public and in materials that we 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. Senior officers may also make verbal statements to analysts, investors, the media and others that are forward-looking. Forward-looking statements may relate, for example, to our future operations, prospects, strategies, financial condition, economic performance (including growth and earnings), industry conditions and demand for our products and services. The Company cautions that its 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 include, but are not limited to, the ability to maintain favorable supplier arrangements and relationships, changes in general economic conditions, the growth rate of the market for the Company's products and services, competitive product and pricing pressures, including internet related initiatives, the effectiveness of the Company's promotional, marketing and advertising programs, changes in financial markets, including particularly the capital and credit markets, changes in laws and regulations, including changes in accounting and taxation guidance, the uncertainties of litigation, as well as other risks and uncertainties discussed from time to time in the Company's filings with the SEC. Forward-looking statements are only as of the date they are made, and the Company undertakes no duty to update its forward-looking statements except as required by law. You are advised, however, to review any further disclosures we make on related subjects in our Form 10-Q, 10-K, 8-K and other reports to the SEC. About Genuine Parts Company Genuine Parts Company is a distributor of automotive replacement parts in the U.S., Canada and Mexico. The Company also distributes industrial replacement parts in the U.S. and Canada through its Motion Industries subsidiary. S.P. Richards Company, the Office Products Group, distributes business products nationwide in the U.S. and Canada. The Electrical/Electronic Group, EIS, Inc., distributes electrical and electronic components throughout the U.S., Canada and Mexico. GENUINE PARTS COMPANY and SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF INCOME ------------------------------------------- Three Months Ended March 31, 2009 2008 ---- ---- (Unaudited) (in thousands, except per share data) Net sales $2,444,496 $2,739,473 Cost of goods sold 1,712,295 1,919,990 --------- --------- 732,201 819,483 Selling, administrative & other expenses 587,533 627,802 ------- ------- Income before income taxes 144,668 191,681 Income taxes 55,509 68,138 ------ ------ Net income $89,159 $123,543 ======= ======== Basic net income per common share $.56 $.75 Diluted net income per common share $.56 $.75 Weighted average common shares outstanding 159,444 164,977 Dilutive effect of stock options and non-vested restricted stock awards 219 729 --- --- Weighted average common shares outstanding - assuming dilution 159,663 165,706 ======= ======= GENUINE PARTS COMPANY and SUBSIDIARIES SEGMENT INFORMATION AND FINANCIAL HIGHLIGHTS Three Months Ended March 31, 2009 2008 ---- ---- (Unaudited) (in thousands) Net sales: Automotive $1,219,128 $1,305,887 Industrial 736,501 881,213 Office Products 412,748 442,392 Electrical/Electronic Materials 86,133 114,301 Other (1) (10,014) (4,320) -------- ------- Total net sales $2,444,496 $2,739,473 ========== ========== Operating profit: Automotive $87,407 $90,644 Industrial 34,175 68,992 Office Products 38,728 43,932 Electrical/Electronic Materials 5,668 9,010 ----- ----- Total operating profit 165,978 212,578 Interest expense, net (7,096) (7,154) Other, net (14,214) (13,743) -------- -------- Income before income taxes $144,668 $191,681 ======== ======== Capital expenditures $14,097 $21,762 ======= ======= Depreciation and amortization $22,521 $22,684 ======= ======= (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 ------------------------------------- March 31, March 31, 2009 2008 ---- ---- (Unaudited) (in thousands) ASSETS CURRENT ASSETS Cash and cash equivalents $133,281 $161,519 Trade accounts receivable, net 1,211,337 1,303,787 Merchandise inventories, net 2,253,036 2,314,536 Prepaid expenses and other current assets 222,253 245,891 ------- ------- TOTAL CURRENT ASSETS 3,819,907 4,025,733 Goodwill and intangible assets, less accumulated amortization 158,427 114,489 Other assets 334,155 195,371 Net property, plant and equipment 412,366 419,825 ------- ------- TOTAL ASSETS $4,724,855 $4,755,418 ========== ========== LIABILITIES AND EQUITY CURRENT LIABILITIES Trade accounts payable $964,267 $1,002,742 Current portion of debt 0 250,000 Income taxes payable 70,883 78,994 Dividends payable 63,779 64,283 Other current liabilities 158,445 173,433 ------- ------- TOTAL CURRENT LIABILITIES 1,257,374 1,569,452 Long-term debt 500,000 250,000 Other long-term liabilities 110,207 111,064 Retirement benefits liabilities 448,844 89,766 Noncontrolling interests in subsidiaries 69,677 65,462 Common stock 159,446 163,818 Retained earnings and other 2,179,307 2,505,856 --------- --------- TOTAL EQUITY 2,408,430 2,735,136 --------- --------- TOTAL LIABILITIES AND EQUITY $4,724,855 $4,755,418 ========== ========== NOTE: Certain prior period amounts have been reclassified to conform to current year presentation. GENUINE PARTS COMPANY and SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS ----------------------------------------------- Three Months Ended March 31, 2009 2008 ---- ---- (Unaudited) (in thousands) OPERATING ACTIVITIES: Net income $89,159 $123,543 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation and amortization 22,521 22,684 Other 2,257 892 Changes in operating assets and liabilities 33,565 (2,527) ------ ------- NET CASH PROVIDED BY OPERATING ACTIVITIES 147,502 144,592 INVESTING ACTIVITIES: Purchases of property, plant and equipment (14,097) (21,762) Acquisitions and other (5,779) (39,003) ------- -------- NET CASH USED IN INVESTING ACTIVITIES (19,876) (60,765) FINANCING ACTIVITIES: Stock options exercised 142 752 Excess tax benefits from share-based compensation - 217 Dividends paid (62,148) (60,789) Purchase of stock (116) (94,325) ----- -------- NET CASH USED IN FINANCING ACTIVITIES (62,122) (154,145) -------- --------- NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS 65,504 (70,318) CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD 67,777 231,837 ------ ------- CASH AND CASH EQUIVALENTS AT END OF PERIOD $133,281 $161,519 ======== ======== http://www.newscom.com/cgi-bin/prnh/20081002/CLTH108LOGO http://photoarchive.ap.org/ DATASOURCE: Genuine Parts Company CONTACT: Jerry W. Nix, Vice Chairman and CFO, +1-770-612-2048, or Sidney G. Jones, Vice President-Investor Relations, +1-770-818-4628, both of Genuine Parts Company Web Site: http://www.genpt.com/

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GPC Gunpowder Capital Corp