Automotive Group fourth quarter sales up 11.4%
Genuine Parts Company announced sales and earnings for the fourth quarter and twelve months ended December 31, 2018.
Sales for the fourth quarter ended December 31, 2018 were $4.6 billion, a 9.4% increase compared to $4.2 billion for the same period in 2017. Net income for the fourth quarter was $186.7 million and earnings per share on a diluted basis were $1.27. Before the impact of certain transaction and other costs incurred primarily related to the company’s acquisition of Alliance Automotive Group (“AAG”), adjusted net income was $198.4 million, or $1.35 per diluted share. Total sales for the fourth quarter included 4.6% comparable growth, approximately 6% from acquisitions and an approximate 1.2% negative impact from foreign currency translation.
Figures in USD unless otherwise stated.
Fourth quarter sales for the Automotive Group were up 11.4%, including an approximate 4% comparable sales increase, an approximate 9% benefit from acquisitions and an unfavorable foreign currency translation of approximately 2%.
Sales for the Industrial Group were up 8.7%, including an approximate 7% comparable sales increase and 2% from acquisitions. Sales for the Business Products Group were up 1.6% consisting primarily of comparable sales growth.
Paul Donahue, President and Chief Executive Officer, commented, “We are pleased to report another solid quarter of improved results at Genuine Parts Company. For the second consecutive quarter, each of our business segments grew their revenues with positive core sales comparisons and, combined with the added benefit of our accretive acquisitions which are performing well, we further improved our operating results and posted an overall increase in operating margin. We ended the fourth quarter with positive momentum and it is encouraging to see our teams execute on our plans and initiatives to drive continued sales and earnings growth.”
Sales for the twelve months ended December 31, 2018 were $18.7 billion, a 15% increase compared to $16.3 billion for the same period in 2017. Net income for the twelve months was $810.5 million and earnings per share on a diluted basis were $5.50. Before the impact of the transaction and other costs primarily related to AAG (discussed above) and the attempted transaction to spin-off the company’s Business Products Group, S.P. Richards, net of the favorable impact of a $12 million termination fee received, adjusted net income was $836.1 million, or $5.68 per diluted share, for the twelve months ended December 31, 2018.
Mr. Donahue concluded, “In 2018, we set new sales and earnings records, and our team did an excellent job of improving working capital and generating strong cash flows. We also completed our first full year of operations in Europe and successfully combined EIS into Motion Industries to form a larger and stronger industrial business. With these and other accomplishments, and our plans in place for the new year, we are well-positioned to further strengthen our global platform in 2019, driving long-term sustainable growth and significant value for our shareholders.”
The company is establishing its full year 2019 sales guidance at up 3% to 4%, or up an adjusted 4% to 5% before an expected headwind from currency translation of 1%. The Company’s guidance for diluted earnings per share is $5.75 to $5.90, or an adjusted $5.81 to $5.96 before the impact of the 1% currency headwind. The company currently expects a tax rate of approximately 25.0% in 2019.
A replay of the Genuine Parts Company 11:00 a.m. EST conference call will be available on the company’s website or at 844-512-2921, conference ID 13686721, two hours after the completion of the call until 12:00 a.m. EST on March 5, 2019.