Genuine Parts Company Reports Sales and Earnings for the Fourth Quarter and Year Ended December 31, 2009

Share Name	Share Symbol	Market	Type
Gunpowder Capital Corp	CSE:GPC	CSE	Common Stock

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ATLANTA, Feb. 16 /PRNewswire-FirstCall/ -- Genuine Parts Company (NYSE: GPC) reports sales and earnings for the fourth quarter and year ended December 31, 2009. (Logo: http://www.newscom.com/cgi-bin/prnh/20081002/CLTH108LOGO ) Tom Gallagher, Chairman, President and Chief Executive Officer, announced today that sales in 2009 were $10.1 billion, down 9% compared to 2008. Net income for the year was $399.6 million, a decrease of 16% compared to $475.4 million in 2008. Earnings per share on a diluted basis were $2.50, down 14% compared to $2.92 in 2008. Mr. Gallagher stated, "The effects of the economic slowdown, which we began to experience in the final quarter of 2008, adversely impacted the results in all four of the business segments throughout 2009. The Automotive Group reported a 2% sales decrease for the year and S.P. Richards, our Office Products Group, was down 5% for 2009. The difficult economy most significantly impacted our two businesses serving the manufacturing sector of the economy. Motion Industries, our Industrial Group, had an 18% sales decrease for the year, and EIS, our Electrical Group, had a 26% decrease." Mr. Gallagher added, "2009 turned out to be one of the most challenging years in the history of Genuine Parts Company. Fortunately, we were able to maintain a strong balance sheet and finish the year in excellent financial condition. In fact, the Company generated record cash flows in 2009. Additionally, we continue to have confidence in the long-term positive fundamentals for all four of our businesses and we feel that we are positioned to show improved sales and earnings as the economy turns." Fourth Quarter 2009 Sales decreased 2% to $2.47 billion in the fourth quarter ended December 31, 2009, compared to $2.52 billion for the same period in 2008. Diluted earnings per share in the fourth quarter were 62 cents, up 13% compared to 55 cents per share for the fourth quarter of 2008. In reviewing the quarter, Mr. Gallagher commented, "We are encouraged by the sequential improvement across all of our business segments during the final quarter. In the fourth quarter of 2009, our Automotive sales were up 6%, our Office Products Group was down 4%, our Industrial Group sales were down 11% and our Electrical Group was down 12%." Mr. Gallagher concluded, "We observed some early signs of improving market conditions in the latter part of 2009 and we feel this bodes well for a stronger performance in 2010. We are fortunate to operate in four good industries." Conference Call Genuine Parts Company will hold a conference call today at 11:00 a.m. EST to discuss the results of the quarter, the year 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 53858190. A replay will also be available on the Company's website or at 800-642-1687, conference ID 53858190, two hours after the completion of the call until 12:00 a.m. EST on March 3, 2010. 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, impairment of financial institutions, 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 Dec. 31, Year Ended Dec. 31, 2009 2008 2009 2008 ---- ---- ---- ---- (Unaudited) (in thousands, except per share data) Net sales $2,471,214 $2,520,190 $10,057,512 $11,015,263 Cost of goods sold 1,703,754 1,768,401 7,047,750 7,742,773 --------- --------- --------- --------- 767,460 751,789 3,009,762 3,272,490 Selling, administrative & other expenses 604,719 601,555 2,365,597 2,504,022 ------- ------- --------- --------- Income before income taxes 162,741 150,234 644,165 768,468 Income taxes 63,574 62,450 244,590 293,051 ------ ------ ------- ------- Net income $99,167 $87,784 $399,575 $475,417 ======= ======= ======== ======== Basic net income per common share $.62 $.55 $2.51 $2.93 Diluted net income per common share $.62 $.55 $2.50 $2.92 Weighted average common shares outstanding 159,144 159,452 159,410 162,351 Dilutive effect of stock options and non-vested restricted stock awards 376 457 297 635 --- --- --- --- Weighted average common shares outstanding - assuming dilution 159,520 159,909 159,707 162,986 ======= ======= ======= ======= GENUINE PARTS COMPANY and SUBSIDIARIES SEGMENT INFORMATION AND FINANCIAL HIGHLIGHTS -------------------------------------------- Three Months Ended Dec. 31, Year Ended Dec. 31, 2009 2008 2009 2008 ---- ---- ---- ---- (Unaudited) (in thousands) Net sales: Automotive $1,264,646 $1,194,018 $5,225,389 $5,321,536 Industrial 736,582 828,364 2,885,782 3,514,661 Office Products 383,849 400,347 1,639,018 1,732,514 Electrical/ Electronic Materials 89,702 102,177 345,808 465,889 Other (1) (3,565) (4,716) (38,485) (19,337) ------- ------- -------- -------- Total net sales $2,471,214 $2,520,190 $10,057,512 $11,015,263 ========== ========== =========== =========== Operating profit: Automotive $75,026 $67,468 $387,945 $385,356 Industrial 60,240 71,871 162,353 294,652 Office Products 27,023 29,406 126,104 144,127 Electrical/ Electronic Materials 7,694 7,546 25,254 36,721 ----- ----- ------ ------ Total operating profit 169,983 176,291 701,656 860,856 Interest expense, net (6,602) (7,970) (27,112) (29,847) Other, net (640) (18,087) (30,379) (62,541) ----- -------- -------- -------- Income before income taxes $162,741 $150,234 $644,165 $768,468 ======== ======== ======== ======== Capital expenditures $20,085 $44,935 $69,445 $105,026 ======= ======= ======= ======== Depreciation and amortization $22,917 $22,229 $90,411 $88,698 ======= ======= ======= ======= (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 ------------------------------------- Dec. 31, Dec. 31, 2009 2008 ---- ---- (in thousands) ASSETS CURRENT ASSETS Cash and cash equivalents $336,803 $67,777 Trade accounts receivable, net 1,187,075 1,224,525 Merchandise inventories, net 2,214,076 2,316,880 Prepaid expenses and other current assets 294,874 262,238 ------- ------- TOTAL CURRENT ASSETS 4,032,828 3,871,420 Goodwill and other intangible assets, less accumulated amortization 171,532 158,825 Deferred tax asset 167,722 218,503 Other assets 147,583 114,337 Net property, plant and equipment 485,024 423,265 ------- ------- TOTAL ASSETS $5,004,689 $4,786,350 ========== ========== LIABILITIES AND EQUITY CURRENT LIABILITIES Trade accounts payable $1,094,347 $1,009,423 Income taxes payable 42,988 24,685 Dividends payable 63,586 62,148 Other current liabilities 207,363 190,847 ------- ------- TOTAL CURRENT LIABILITIES 1,408,284 1,287,103 Long-term debt 500,000 500,000 Other long-term liabilities 166,836 103,264 Retirement and other post-retirement benefit liabilities 300,197 502,605 Noncontrolling interests in subsidiaries 8,042 69,046 Common stock 158,918 159,443 Retained earnings and other 2,462,412 2,164,889 --------- --------- TOTAL EQUITY 2,629,372 2,393,378 --------- --------- TOTAL LIABILITIES AND EQUITY $5,004,689 $4,786,350 ========== ========== NOTE: Certain prior period amounts have been reclassified to conform to the current year presentation. GENUINE PARTS COMPANY and SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS ----------------------------------------------- Year Ended Dec. 31, 2009 2008 ---- ---- (in thousands) OPERATING ACTIVITIES: Net income $399,575 $475,417 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation and amortization 90,411 88,698 Other 33,404 (28,546) Changes in operating assets and liabilities 321,908 (5,260) ------- ------ NET CASH PROVIDED BY OPERATING ACTIVITIES 845,298 530,309 INVESTING ACTIVITIES: Purchases of property, plant and equipment (69,445) (105,026) Acquisitions and other (122,161) (109,308) Purchase of properties under construction and lease agreement (72,814) - -------- --- NET CASH USED IN INVESTING ACTIVITIES (264,420) (214,334) FINANCING ACTIVITIES: Stock options exercised 1,878 821 Excess tax expense from share-based compensation (684) (586) Dividends paid (253,558) (251,808) Changes in cash overdraft position (52,000) 52,000 Purchase of stock (26,019) (273,000) -------- --------- NET CASH USED IN FINANCING ACTIVITIES (330,383) (472,573) EFFECT OF EXCHANGE RATE CHANGES ON CASH 18,531 (7,462) NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS 269,026 (164,060) CASH AND CASH EQUIVALENTS AT BEGINNING OF YEAR 67,777 231,837 ------ ------- CASH AND CASH EQUIVALENTS AT END OF YEAR $336,803 $67,777 ======== ======= http://www.newscom.com/cgi-bin/prnh/20081002/CLTH108LOGODATASOURCE: Genuine Parts Company CONTACT: Jerry W. Nix, Vice Chairman and CFO, +1-770-612-2048; Sidney G. Jones, Vice President - Investor Relations, +1-770-818-4628 Web Site: http://www.genpt.com/

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GPC Gunpowder Capital Corp