LKQ Corporation Announces Results for First Quarter 2013

LKQ Corporation Announces Results for First Quarter 2013

  *Revenue growth of 16% to a record $1.20 billion
  *Organic revenue growth for parts and services of 9.6%
  *First quarter 2013 diluted EPS of $0.28
  *Increases 2013 organic revenue growth guidance
  *Agrees to acquire European parts distributor Sator Beheer

CHICAGO, April 25, 2013 (GLOBE NEWSWIRE) -- LKQ Corporation (Nasdaq:LKQ) today
reported record revenue for the first quarter of 2013 of $1.20 billion, an
increase of 15.9% as compared to $1.03 billion in the first quarter of 2012.
Net income for the first quarter of 2013 was $84.6 million, an increase of
4.4% as compared to $81.0 million for the same period of 2012. Diluted
earnings per share of $0.28 for the first quarter ended March 31, 2013
increased 3.7% from $0.27 for the first quarter of 2012. The Company noted
that the first quarter 2013 diluted earnings per share included a loss equal
to $0.01 per share resulting from restructuring and acquisition related
expenses and the change in fair value of contingent consideration liabilities.
Earnings per share in the first quarter of 2012 included a gain equal to $0.02
per share that resulted from a favorable legal settlement.

"I was particularly pleased with our results this quarter because, adjusting
for the legal settlement in 2012 and other charges, diluted earnings per share
grew by 16% compared to the prior year quarter. We also delivered strong
organic revenue growth for parts and services of 9.6% despite the quarter
having one less selling day in the US and two less selling days in the UK,"
stated Robert L. Wagman, President and Chief Executive Officer of LKQ
Corporation. "I am also proud of our ability to deliver bottom line growth,
with the first quarter of 2013 producing record earnings."

Sator Beheer Acquisition

On April 23, 2013, the Company agreed to acquire Sator Beheer ("Sator"). Sator
is the market leading distributor of automotive aftermarket parts in the
Netherlands, Belgium, Luxembourg and Northern France. Headquartered in
Schiedam, the Netherlands, Sator is the parent company of eight operating
subsidiaries. The group has over 800 employees serving a diverse base of more
than 6,000 customers and offering a broad product line of over 150,000 SKUs
from eleven distribution centers. In 2012, Sator reported revenue of €288.0
million and EBITDA of €24.0 million.

"This strategically significant acquisition further increases LKQ's European
footprint and market share, and provides a platform for future growth on the
continent. Sator should also complement our existing Euro Car Parts operations
in the UK and allow for the realization of cost savings," added Mr. Wagman.

The purchase price is expected to be approximately €210.0 million and will be
funded by drawing on the Company's revolving credit facility. The transaction
is expected to close the first week of May 2013.

Balance Sheet and Liquidity

As of March 31, 2013, LKQ's balance sheet reflected cash and equivalents of
$63.0 million, and obligations outstanding under the Company's credit
facilities were $922.5 million ($415.0 million of term loans and $507.5
million of revolver borrowings). Total availability under the credit agreement
at March 31, 2013 was $390.8 million.

After drawing the funds for the Sator acquisition, availability under our
credit agreement will be approximately $115 million.

The Company is in discussions with certain of its lenders and other parties
concerning changes to its existing credit facility, which changes, if agreed
to by the lenders, would include, among other things, an increase in the
amounts available under the revolving credit facility and term loan borrowings
under the credit agreement. These discussions are still ongoing so there are
no assurances that these discussions will be successful or that a definitive
amendment will be executed, or that the credit facility will be increased or
extended or as to the specific terms of any amendment.

Other Events

During the first quarter of 2013, the Company acquired a distributor of
collision repair parts and products primarily for automotive climate control
systems in the United Kingdom; a paint distribution business in Ontario,
Canada; and an aftermarket radiator distributor in Florida.

Company Outlook

The Company increased its organic revenue growth guidance and reaffirmed its
guidance on diluted earnings per share, operating cash flows and capital
expenditures for 2013. The guidance does not include the effect of the pending
acquisition of Sator, which is expected to be completed in the second quarter,
or any possible changes to our credit agreement as described above.

                                Updated Guidance     Prior Guidance
Organic revenue growth           6.5% to 8.5%         5.5% to 7.5%
Net income                       $305 million to $330 $305 million to $330
                                 million              million
Diluted EPS                      $1.00 to $1.09       $1.00 to $1.09
Cash flow provided from          Approximately $300   Approximately $300
operations                       million              million
Capital expenditures             $100 million to $115 $100 million to $115
                                 million              million

Guidance for 2013 is based on current conditions and excludes the impact of
restructuring and acquisition related expenses and gains or losses (including
changes in fair value of contingent consideration liabilities) and capital
spending related to acquisitions or divestitures. Organic revenue guidance
refers only to parts and services revenue.

On August 17, 2012, the Company announced a two-for-one split of the Company's
common stock. The common stock began trading on a split-adjusted basis on
September 19, 2012. All per share information in this release is presented on
a split-adjusted basis.

Quarterly Conference Call

LKQ will host a conference call and Webcast on April 25, 2013 at 10:00 a.m.
Eastern Time (9:00 a.m. Central Time) with members of senior management to
discuss the Company's results.

To access the investor conference call, please dial (877) 407-0668.
International access to the call may be obtained by dialing (201) 689-8558.
The audio webcast can be accessed via the Company's website at
in the Investor Relations section.

A replay of the conference call will be available by telephone at (877)
660-6853 or (201) 612-7415 for international calls. The telephone replay will
require you to enter conference ID: 411459 #. An online replay of the audio
webcast will be available on the Company's website. Both formats of replay
will be available through May 25, 2013. Please allow approximately two hours
after the live presentation before attempting to access the replay.

About LKQ Corporation

LKQ Corporation is the largest nationwide provider of aftermarket, recycled,
and refurbished collision replacement parts, and a leading provider of
mechanical replacement parts including remanufactured engines, all in
connection with the repair of automobiles and other vehicles. LKQ also has
operations in the United Kingdom, Canada, Mexico and Central America. LKQ
operates more than 500 facilities, offering its customers a broad range of
replacement systems, components and parts to repair automobiles and light,
medium and heavy-duty trucks.

Forward Looking Statements

The statements in this press release that are not historical in nature are
forward-looking statements within the meaning of the Private Securities
Litigation Reform Act of 1995. These include statements regarding our
expectations, beliefs, hopes, intentions or strategies. Forward-looking
statements involve risks and uncertainties, some of which are not currently
known to us. Actual events or results may differ materially from those
expressed or implied in the forward looking statements as a result of various

These factors include:

  *uncertainty as to changes in North American and European general economic
    activity and the impact of these changes on the demand for our products
    and our ability to obtain financing for operations;
  *fluctuations in the pricing of new original equipment manufacturer ("OEM")
    replacement products;
  *the availability and cost of our inventory;
  *variations in the number of vehicles sold, vehicle accident rates, miles
    driven and the age profile of vehicles in accidents;
  *changes in state or federal laws or regulations affecting our business;
  *changes in the types of replacement parts that insurance carriers will
    accept in the repair process;
  *inaccuracies in the data relating to industry size published by
    independent sources upon which we rely;
  *changes in the level of acceptance and promotion of alternative automotive
    parts by insurance companies and auto repairers;
  *changes in the demand for our products and the supply of our inventory due
    to severity of weather and seasonality of weather patterns;
  *increasing competition in the automotive parts industry;
  *uncertainty as to the impact on our industry of any terrorist attacks or
    responses to terrorist attacks;
  *our ability to operate within the limitations imposed by financing
  *our ability to obtain financing on acceptable terms to finance our growth;
  *declines in the values of our assets;
  *fluctuations in fuel and other commodity prices;
  *fluctuations in the prices of scrap metal and other metals;
  *our ability to develop and implement the operational and financial systems
    needed to manage our operations;
  *our ability to identify sufficient acquisition candidates at reasonable
    prices to maintain our growth objectives;
  *our ability to integrate and successfully operate acquired companies and
    any companies acquired in the future and the risks associated with these
  *claims by OEMs or others that attempt to restrict or eliminate the sale of
    alternative automotive products;
  *termination of business relationships with insurance companies that
    promote the use of our products;
  *product liability claims by the end users of our products or claims by
    other parties who we have promised to indemnify for product liability
  *currency fluctuations in the U.S. dollar versus other currencies and
    currency fluctuations in the pound sterling versus other currencies;
  *periodic adjustments to estimated contingent purchase price amounts;
  *instability in regions in which we operate that can affect our supply of
    certain products;
  *interruptions, outages or breaches of our operational systems, security
    systems, or infrastructure as a result of attacks on, or malfunctions of,
    our systems; and
  *other risks that are described in our Form 10-K filed March 1, 2013 and in
    other reports filed by us from time to time with the Securities and
    Exchange Commission.

You should not place undue reliance on these forward-looking statements. All
of these forward-looking statements are based on our expectations as of the
date of this press release. We undertake no obligation to publicly update or
revise any forward-looking statements, whether as a result of new information,
future events or otherwise, except as required by law.

Unaudited Consolidated Condensed Statements of Income
(In thousands, except per share data )
                                     Three Months Ended
                                     March 31,
                                     2013               2012
Revenue                               $ 1,195,997       $ 1,031,777
Cost of goods sold ^(1)               694,048           584,394
Gross margin                          501,949           447,383
Facility and warehouse expenses       100,246           85,108
Distribution expenses                 103,857           91,813
Selling, general and administrative   137,056           121,714
Restructuring and acquisition related 1,505             247
Depreciation and amortization         17,697            14,893
Operating income                      141,588           133,608
Other expense (income):                                 
Interest expense, net                 8,595             7,367
Change in fair value of contingent    823               (1,345)
consideration liabilities
Other expense (income), net           402               (511)
Total other expense, net              9,820             5,511
Income before provision for income    131,768           128,097
Provision for income taxes           47,176            47,106
Net income                            $84,592          $80,991
Earnings per share:                                     
Basic                                 $0.28            $0.28
Diluted                               $0.28            $0.27
Weighted average common shares                          
Basic                                 298,226           294,278
Diluted                               302,937           299,342
^(1) Cost of goods sold for the three months ended March 31, 2012 included
a gain of $8.3 million resulting from certain settlements of a class        
action lawsuit against several of our suppliers.

Unaudited Consolidated Condensed Balance Sheets
( In thousands, except share and per share data )
                                                    March 31,    December 31,
                                                    2013         2012
Current Assets:                                                  
Cash and equivalents                                 $62,997    $59,770
Receivables, net                                     357,580     311,808
Inventory                                            883,443     900,803
Deferred income taxes                                52,862      53,485
Prepaid income taxes                                 2,441       29,537
Prepaid expenses and other current assets            40,239      28,948
Total Current Assets                                1,399,562   1,384,351
Property and Equipment, net                          492,479     494,379
Intangibles                                          1,776,473   1,796,999
Other Assets                                         54,185      47,727
Total Assets                                        $3,722,699 $3,723,456
Liabilities and Stockholders' Equity                             
Current Liabilities:                                             
Accounts payable                                     $202,084   $219,335
Accrued expenses                                     148,168     134,822
Income taxes payable                                 14,432      2,748
Contingent consideration liabilities                 44,625      42,255
Other current liabilities                            15,899      17,068
Current portion of long-term obligations            79,531      71,716
Total Current Liabilities                           504,739     487,944
Long-Term Obligations, Excluding Current Portion     987,979     1,046,762
Deferred Income Taxes                                101,902     102,275
Contingent Consideration Liabilities                 4,940       47,754
Other Noncurrent Liabilities                         81,910      74,627
Commitments and Contingencies                                    
Stockholders' Equity:                                            
Common stock, $0.01 par value, 500,000,000 shares
authorized, 298,477,692 and 297,810,896 shares       2,985       2,978
issued and outstanding at March 31, 2013
andDecember 31, 2012, respectively
Additional paid-in capital                           961,122     950,338
Retained earnings                                    1,094,611   1,010,019
Accumulated other comprehensive (loss) income        (17,489)    759
Total Stockholders' Equity                          2,041,229   1,964,094
Total Liabilities and Stockholders' Equity          $3,722,699 $3,723,456

Unaudited Consolidated Condensed Statements of Cash Flows
(In thousands)
                                                          Three Months Ended
                                                          March 31,
                                                          2013      2012
CASH FLOWS FROM OPERATING ACTIVITIES:                               
Net income                                                 $84,592 $80,991
Adjustments to reconcile net income to net cash provided            
by operating activities:
Depreciation and amortization                              19,040   16,257
Stock-based compensation expense                           4,949    4,010
Excess tax benefit from stock-based payments               (3,002)  (2,561)
Other                                                      1,716    (702)
Changes in operating assets and liabilities, net of                
effects from acquisitions:
Receivables                                               (47,973) (22,694)
Inventory                                                 9,580    13,000
Prepaid income taxes/income taxes payable                 41,838   41,324
Accounts payable                                          (7,911)  (2,557)
Other operating assets and liabilities                    3,604    (16,913)
Net cash provided by operating activities                 106,433  110,155
CASH FLOWS FROM INVESTING ACTIVITIES:                               
Purchases of property and equipment                        (21,461) (21,329)
Proceeds from sales of property and equipment              432      233
Cash used in acquisitions, net of cash acquired            (13,264) (24,930)
Net cash used in investing activities                      (34,293) (46,026)
CASH FLOWS FROM FINANCING ACTIVITIES:                               
Proceeds from exercise of stock options                    2,840    4,581
Excess tax benefit from stock-based payments               3,002    2,561
Net repayments of long-term obligations                    (73,755) (64,889)
Net cash used in financing activities                     (67,913) (57,747)
Effect of exchange rate changes on cash and equivalents    (1,000)  540
Net increase in cash and equivalents                       3,227    6,922
Cash and equivalents, beginning of period                  59,770   48,247
Cash and equivalents, end of period                        $62,997 $55,169

Unaudited Supplementary Data
( In thousands, except per share data )
                 Three Months Ended March 31,
Operating         2013                  2012                           
                              % of                % of              
                              Revenue             Revenue Change     %
Revenue           $1,195,997  100.0%  $1,031,777 100.0%  $164,220 15.9%
Cost of goods     694,048      58.0%   584,394     56.6%   109,654   18.8%
sold ^(1)
Gross margin      501,949      42.0%   447,383     43.4%   54,566    12.2%
Facility and
warehouse         100,246      8.4%    85,108      8.2%    15,138    17.8%
Distribution      103,857      8.7%    91,813      8.9%    12,044    13.1%
Selling, general
and               137,056      11.5%   121,714     11.8%   15,342    12.6%
Restructuring and
acquisition       1,505        0.1%    247         0.0%    1,258     n/m
related expenses
Depreciation and  17,697       1.5%    14,893      1.4%    2,804     18.8%
Operating income  141,588      11.8%   133,608     12.9%   7,980     6.0%
Other expense                                                      
Interest expense, 8,595        0.7%    7,367       0.7%    1,228     16.7%
Change in fair
value of
contingent        823          0.1%    (1,345)     -0.1%   2,168     n/m
Other expense     402          0.0%    (511)       0.0%    913       n/m
(income), net
Total other       9,820        0.8%    5,511       0.5%    4,309     78.2%
expense, net
Income before
provision for     131,768      11.0%   128,097     12.4%   3,671     2.9%
income taxes
Provision for     47,176       3.9%    47,106      4.6%    70        0.1%
income taxes
Net income        $84,592     7.1%    $80,991    7.8%    $3,601   4.4%
Earnings per                                                       
Basic             $0.28              $0.28             $--     0.0%
Diluted           $0.28              $0.27             $0.01    3.7%
Weighted average common shares                                      
Basic             298,226             294,278            3,948     1.3%
Diluted           302,937             299,342            3,595     1.2%

^(1) Cost of goods sold for the three months ended March 31, 2012 included a
gain of $8.3 million resulting from certain settlements of a class action
lawsuit against several of our suppliers.

The following unaudited table reconciles net income to EBITDA:
                                                        Three Months Ended
                                                        March 31,
                                                        2013       2012
                                                        (In thousands)
Net income                                               $84,592  $80,991
Depreciation and amortization                            19,040    16,257
Interest expense, net                                    8,595     7,367
Provision for income taxes                              47,176    47,106
Earnings before interest, taxes, depreciation and        $159,403 $151,721
amortization (EBITDA)
EBITDA as a percentage of revenue                      13.3%      14.7%

We provide a reconciliation of Net Income to EBITDA as we believe it offers
investors, securities analysts and other interested parties useful information
regarding our results of operations because it assists in analyzing our
performance and the value of our business. EBITDA provides insight into our
profitability trends, and allows management and investors to analyze our
operating results with and without the impact of depreciation, amortization,
interest and income tax expense. We believe EBITDA is used by securities
analysts, investors, and other interested parties in evaluating companies,
many of which present EBITDA when reporting their results.EBITDA should not
be construed as an alternative to operating income, net income or net cash
provided by (used in) operating activities, as determined in accordance with
accounting principles generally accepted in the United States. In addition,
not all companies that report EBITDA information calculate EBITDA in the same
manner as we do and, accordingly, our calculation is not necessarily
comparable to similarly named measures of other companies and may not be an
appropriate measure for performance relative to other companies.

The following unaudited
tables compare certain                                             
revenue categories:
                          Three Months Ended                        
                          March 31,                                 
                          2013         2012         Change           % Change
                          (In thousands)                            
Included in Unaudited                                              
Consolidated Condensed
Statements of Income of                                            
LKQ Corporation
North America              $810,257   $730,802   $79,455        10.9%
Europe                     212,135     160,246     51,889          32.4%
Parts and services         1,022,392   891,048      131,344          14.7%
Other                     173,605     140,729      32,876           23.4%
Total                      $1,195,997 $1,031,777 $164,220       15.9%
Revenue changes by category for the
three months ended March 31, 2013 vs.                               
                          Revenue Change Attributable to:            
                          Acquisition  Organic      Foreign Exchange % Change
North America              6.2%         4.7%         0.0%             10.9%
Europe                     1.7%         32.1%        (1.5%)           32.4%
Parts and services         5.4%         9.6%         (0.3%)           14.7%
Other                     24.4%        (1.0%)       (0.1%)           23.4%
Total                      8.0%         8.2%         (0.3%)           15.9%

The following unaudited table compares our revenue and EBITDA by reportable
                                Three Months Ended
                                March 31,
                                2013                   2012
                                (In thousands)
North America                    $983,388             $871,084
Europe                           212,609               160,693
Total revenue                   $1,195,997           $1,031,777
North America ^(1)               $135,335             $132,188
Europe ^(2)                      24,068                19,533
Total EBITDA                    $159,403             $151,721

^(1) For the three months ended March 31, 2012, North America EBITDA included
a gain of $8.3 million resulting from certain settlements of a class action
lawsuit against several of our suppliers.
^(2) Included within EBITDA of our European segment is a loss of $0.7 million
and a gain of $1.3 million for the three months ended March 31, 2013 and March
31, 2012, respectively, for the change in fair value of contingent
consideration liabilities related to our ECP acquisition.

CONTACT: Joseph P. Boutross
         Director, Investor Relations
         (312) 621-2793

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