GPC reports strong Q4 increase

by | Feb 22, 2018 | 0 comments

NAPA parent Genuine Parts Company announced sales up 11.3% for the fourth quarter ended December 31, 2017 with Automotive Group sales up strongly at 16.7% over a year earlier.

Highlights
  • Fourth Quarter Diluted EPS $0.73 and Full Year Diluted EPS of $4.18
  • Adjusted EPS including Alliance Automotive Group $1.19 in the Fourth Quarter and $4.71 for the Full Year
  • $569 Million of Capital Returned to Shareholders Through Cash Dividends and Share Repurchases in 2017

 

SALES for the fourth quarter ended December 31, 2017 were $4.2 billion, an 11.3% increase compared to $3.8 billion for the same period in 2016. Net income for the fourth quarter was $108.2 million and earnings per share on a diluted basis were $0.73.  Alliance Automotive Group (AAG), the Company’s European acquisition which closed on November 2, 2017, contributed 6.8% to sales and $0.07 in earnings per diluted share during the fourth quarter. All figures in U.S. dollars unless otherwise specified.

Before the impact of AAG’s operations as discussed above, as well as excluding fourth quarter transaction-related costs and the expense for transition tax and the revaluation of deferred taxes resulting from the U.S. Tax Cuts and Jobs Act, adjusted net income was $165.5 million, or $1.12 per diluted share. Including the $0.07 contribution from AAG’s operations, adjusted earnings per diluted share were $1.19 for the fourth quarter of 2017.

Fourth quarter sales for the Automotive Group were up 16.7% including an approximate 1% comparable sales increase and a 4% total sales increase before the additional 13% sales contribution from AAG.  Sales at Motion Industries, the Industrial Group, were up 7.4%, including a 5% comparable sales increase, and sales at EIS, the Electrical/Electronic Group, grew 8.9%, with comparable sales down 2%.  Sales for S.P. Richards, the Business Products Group, were down 2.2% for the quarter in both total and comparable sales.

Paul Donahue, president and chief executive officer, commented, “We were pleased to complete the fourth quarter with a 4.5% sales increase before the added benefit of the AAG acquisition.  Additionally, the two-month performance at AAG was in-line with our initial plan, and we remain excited for the growth prospects we see for this business across Europe. Overall, total sales for the fourth quarter included 2% organic growth, 8.5% from acquisitions and an approximate 1% foreign exchange benefit.”

Donahue added, “Importantly, our plans and initiatives to accelerate actions to improve our operating performance, which we emphasized following our third quarter results, had a positive impact on our fourth quarter. While we continue to focus on these efforts to drive further improvement, we are encouraged by our early progress.”

Sales for the twelve months ended December 31, 2017 were $16.3 billion, a 6.3% increase compared to $15.3 billion for the same period in 2016.  Net income for the twelve months was $617 million and earnings per share on a diluted basis were $4.18.  AAG contributed 1.7% to sales and $0.07 in earnings per diluted share for the year.

Before the impact of AAG, as well as transaction-related costs recorded in the third and fourth quarters of 2017 and the tax expense resulting from the Tax Cuts and Jobs Act recorded in the fourth quarter of 2017, adjusted net income was $686 million and adjusted earnings per diluted share were $4.64.  Including the $0.07 contribution from AAG’s operations, adjusted earnings per diluted share were $4.71 for the year.

Donahue concluded, “Reflecting on 2017, GPC’s 90th year, we surpassed $16 billion in revenues, a new record for us.  In addition, we better positioned the Company for sustained long-term growth, with significant investments in our existing businesses as well as new ones, both in North America and abroad. Our balance sheet is in excellent condition, our cash flows are strong and our plans are in place for the year ahead.”

2018 Outlook

The company is establishing its full year 2018 sales guidance at up 12% to 13% and diluted earnings per share is expected to be $5.60 to $5.75, including the benefit of a full year of operations with AAG and approximately $80 to $90 million in lower income taxes related to the Tax Cuts and Jobs Act.  The company currently expects a tax rate of approximately 26.0 to 27.0% in 2018.

For more information, visit www.genpt.com.

 

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