Genuine Parts Co.'s (GPC) third-quarter profit fell a less-than-expected 18% as its auto-parts business held up and the company's industrial operations continued to slump.

But shares fell 2.1% in early treading to $38.14. The stock is up about 14.7% the past 52 weeks, but just 1% in 2009.

Industrial-production declines have been canceling out the benefits the operator of NAPA parts stores has seen from consumers' patching up old vehicles instead of buying new ones. Chairman and Chief Executive Thomas C. Gallagher noted Friday that the 0.8% decrease in sales in Genuine Parts' auto group, its largest business, was smaller than the first half of the year. Profit in the unit fell 3.6%.

He added the company believes conditions are "stabilizing" in the economy's manufacturing sector. Industrial-segment profit plunged 53% on a 22% sales drop.

Companywide, earnings fell to $107.6 million, or 67 cents a share, from $131 million, or 81 cents a share, a year earlier. Net sales dropped 9.6% to $2.61 billion.

Analysts surveyed by Thomson Reuters expected earnings of 65 cents and revenue of $2.6 billion.

Gross margin slipped to 29.4% from 29.5%.

Genuine Parts is the largest member and majority owner of the National Automotive Parts Association, a voluntary trade group that distributes automotive replacement parts in North America. Genuine Parts also distributes industrial parts, business products and electrical components.

The company's latest results come three weeks after rival and U.S. leader AutoZone Inc. (AZO) posted a 3% profit drop as continued sales gains were overcome by higher costs.

-By Mike Barris, Dow Jones Newswires; 212-416-2330; mike.barris@dowjones.com