Genuine Parts Company Reports Fourth Quarter And Full Year Results For 2013

 Genuine Parts Company Reports Fourth Quarter And Full Year Results For 2013

- Record Sales and Earnings for 2013 -

PR Newswire

ATLANTA, Feb. 18, 2014

ATLANTA, Feb. 18, 2014 /PRNewswire/ --Genuine Parts Company (NYSE: GPC)
reports fourth quarter results and record sales and earnings for the year
ended December 31, 2013.

(Logo: http://photos.prnewswire.com/prnh/20081002/CLTH108LOGO )

Tom Gallagher, Chairman and Chief Executive Officer, announced today that
sales in 2013 were $14.1 billion, up 8% compared to 2012. Net income for the
year was $685 million, an increase of 6% compared to $648 million in 2012.
Earnings per share on a diluted basis were $4.40, up 6% compared to $4.14 in
2012.

Included in the Company's full year 2013 results are the previously recognized
one-time positive purchase accounting adjustments of $33 million, or $0.21 net
of taxes on a per share diluted basis. These adjustments are associated with
the April 1, 2013 acquisition of GPC Asia Pacific, formerly Exego.

Additionally, the Company's pension plan was amended to freeze future benefit
accruals for all participants as of December 31, 2013. In connection with
this amendment, effective in December 2012, the Company recorded a one-time
noncash curtailment gain of $23.5 million, or $0.10 and $0.09 net of taxes on
a per share diluted basis for the fourth quarter and full year 2012,
respectively.

Mr. Gallagher stated, "We are pleased to report that 2013 was another year of
record sales and earnings for Genuine Parts Company. Our overall results
reflect the good job that was done by the GPC Team in 2013, despite the
challenging market conditions that were experienced by our non-automotive
business segments. We further strengthened our financial condition with
increased net income and a continued emphasis on effectively managing the
balance sheet. Our progress in these areas produced record cash flows for us
in 2013, with cash from operations at $1.1 billion and free cash flow of
approximately $600 million."

Mr. Gallagher added, "The Company's revenue growth in 2013 was driven by an
18.5% Automotive sales increase, offset by a combined 1% sales decrease for
our non-automotive businesses. Acquisitions for the Automotive Group drove the
high-teen revenue growth, while our underlying sales were up approximately 4%
for the year. Our strongest sales results came from our commercial business
and, in particular, solid results in NAPA AutoCare and Major Accounts, our two
primary commercial initiatives. Sales at Motion Industries, our Industrial
Group, were down slightly for the year, our Electrical/Electronic Group was
down 2% and our Office Group sales were down 3% in 2013. Weak demand patterns
challenged these three industries throughout the year."

Fourth Quarter 2013

Sales increased 13% to $3.5 billion in the fourth quarter ended December 31,
2013, compared to sales of $3.1 billion for the same period in 2012. Net
income in the fourth quarter was $150 million, or $0.97 per share on a diluted
basis, compared to $160 million, or $1.03 per diluted share, in 2012. The 2012
results include the $23.5 million one-time pension gain, or $0.10 per diluted
share, previously disclosed. Excluding the gain, diluted earnings per share in
the fourth quarter of 2013 were up 4% from 2012.

In reviewing the quarter, Mr. Gallagher commented, "Revenue growth in the
fourth quarter proved to be the strongest of the year, with acquisitions
contributing 10% to our sales growth and our underlying sales were up 4%,
which was offset by a 1% currency headwind. Automotive sales were up 25% in
the quarter, including 7% underlying growth, offset by a 1% negative
translation effect. Industrial Group sales were up 3% and sales for the
Electrical/Electronic Group increased by 6%, which includes a 10% contribution
from acquisitions. Sales for the Office business were down 4%."

Mr. Gallagher concluded, "We faced a number of challenges in each of our four
business segments in 2013 and, as previously stated, our Automotive business
fared the best with their 18.5% sales increase. In all four businesses, key
decisions were made and actions taken that position each segment for solid
performances in the year ahead, and we look forward to reporting on our
progress. We remain committed to our core objectives of growing sales and
earnings, showing continued operating margin improvement, generating solid
cash flows and maintaining a strong balance sheet. Further progress in each of
these areas will keep the Company moving ahead and help to ensure another
successful year in 2014."

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,
www.genpt.com, by clicking "Investor Services", or by dialing 877-331-5106,
conference ID 39491974. A replay will also be available on the Company's
website or at 855-859-2056, conference ID 39491974, two hours after the
completion of the call until 12:00 a.m. Eastern Time on March 5, 2014.

Forward Looking Statements

Some statements in this report, 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
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
may include, among other things, slowing demand for the Company's products,
changes in general economic conditions, including, unemployment, inflation or
deflation, high energy costs, uncertain credit markets and other
macro-economic conditions, the ability to maintain favorable vendor
arrangements and relationships, disruptions in our vendors' operations,
competitive product, service and pricing pressures, the Company's ability to
successfully implement its business initiatives in each of its four business
segments, the Company's ability to successfully integrate its acquired
businesses, including GPC Asia Pacific, the uncertainties and costs of
litigation, as well as other risks and uncertainties discussed in the
Company's Annual Report on Form 10-K for 2012 and from time to time in the
Company's subsequent 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 subsequent Forms 10-K, 10-Q, 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, Mexico and Australasia. The Company also distributes industrial
replacement parts in the U.S., Canada and Mexico 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,
                       2013          2012          2013          2012
                       (in thousands, except per share data)
Net sales              $3,517,801    $3,118,966    $14,077,843   $13,013,868
Cost of goods sold     2,425,660     2,208,308     9,857,923     9,235,777
Gross profit           1,092,141     910,658       4,219,920     3,778,091
Operating expenses:
Selling,
administrative & other 820,563       633,678       3,041,659     2,660,776
expenses
Depreciation and       35,885        25,054        133,957       98,383
amortization
                       856,448       658,732       3,175,616     2,759,159
Income before income   235,693       251,926       1,044,304     1,018,932
taxes
Income taxes           85,226        91,701        359,345       370,891
Net income             $  150,467   $  160,225   $   684,959 $   648,041
Basic net income per   $0.98         $1.03         $4.43         $4.17
common share
Diluted net income per $0.97         $1.03         $4.40         $4.14
common share
Weighted average
common shares          154,047       154,952       154,636       155,413
outstanding
Dilutive effect of
stock options and
 non-vested
restricted stock       1,075         943           1,078         1,007
awards
Weighted average
common shares
outstanding –
 assuming dilution   155,122       155,895       155,714       156,420



GENUINE PARTS COMPANY and SUBSIDIARIES

SEGMENT INFORMATION AND FINANCIAL HIGHLIGHTS
                          Three Months Ended Dec.   Year Ended Dec. 31,
                          31,
                          2013         2012         2013         2012
                          (in thousands)
Net sales:
 Automotive          $1,916,771   $1,531,624   $ 7,489,186 $ 6,320,882
 Industrial          1,085,555    1,054,773    4,429,976    4,453,574
 Office Products     385,761      402,942      1,638,618    1,686,690

Electrical/Electronic     143,899      135,387      568,872      582,820
Materials
 Other (1)           (14,185)     (5,760)      (48,809)     (30,098)
 Total net     $3,517,801   $3,118,966   $14,077,843  $13,013,868
sales
Operating profit:
 Automotive          $  153,901  $  122,491  $          $   540,678
                                                    641,492
 Industrial          73,338       78,117       320,720      352,119
 Office Products     31,438       36,373       122,492      134,441

Electrical/Electronic     12,287       12,456       47,584       50,910
Materials
 Total operating     270,964      249,437      1,132,288    1,078,148
profit
 Interest expense,   (6,094)      (4,914)      (24,330)     (19,619)
net
 Intangible          (8,500)      (3,811)      (28,987)     (12,991)
amortization
 Other, net          (20,677)     11,214       (34,667)     (26,606)
 Income before $  235,693  $  251,926  $ 1,044,304 $ 1,018,932
income taxes
Capital expenditures      $   39,917 $   30,360 $          $   101,987
                                                    124,063
Depreciation and          $   35,885 $   25,054 $          $   
amortization                                        133,957      98,383
(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,
                                                       2013        2012
                                                       (in thousands)
ASSETS
CURRENT ASSETS
Cash and cash equivalents                              $  196,893 $  403,095
Trade accounts receivable, net                         1,664,819   1,490,028
Merchandise inventories, net                           2,946,021   2,602,560
Prepaid expenses and other current assets              413,758     324,448
 TOTAL CURRENT ASSETS                             5,221,491   4,820,131
Goodwill and other intangible assets, less accumulated 1,289,356   497,839
amortization
Deferred tax assets                                    97,555      279,463
Other assets                                           401,834     643,263
Net property, plant and equipment                      670,061     566,365
TOTAL ASSETS                                           $7,680,297  $6,807,061
LIABILITIES AND EQUITY
CURRENT LIABILITIES
Trade accounts payable                                 $2,269,671  $1,681,900
Current portion of debt                                264,658     250,000
Income taxes payable                                   9,237       4,354
Dividends payable                                      82,746      76,641
Other current liabilities                              556,732     474,743
 TOTAL CURRENT LIABILITIES                        3,183,044   2,487,638
Long-term debt                                         500,000     250,000
Retirement and other post-retirement benefit           140,171     572,988
liabilities
Deferred tax liabilities                               83,316      –
Other long-term liabilities                            414,998     488,256
Common stock                                           153,773     154,841
Retained earnings and other                            3,592,956   3,344,538
Accumulated other comprehensive loss                   (397,655)   (501,492)
 TOTAL PARENT EQUITY                             3,349,074   2,997,887
Noncontrolling interests in subsidiaries               9,694       10,292
 TOTAL EQUITY                                    3,358,768   3,008,179
TOTAL LIABILITIES AND EQUITY                           $7,680,297  $6,807,061



GENUINE PARTS COMPANY and SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
                                                         Year Ended Dec. 31,
                                                         2013        2012
                                                         (in thousands)
OPERATING ACTIVITIES:
 Net income                                         $684,959    $648,041
 Adjustments to reconcile net income to net cash
provided by operating activities:
 Depreciation and amortization                      133,957     98,383
 Share-based compensation                           12,648      10,747
 Excess tax benefits from share-based compensation  (12,905)    (11,018)
 Gain on GPC Asia Pacific equity investment         (59,000)    –
 Other                                              (26,351)    10,808
 Changes in operating assets and liabilities        323,423     149,477
NET CASH PROVIDED BY OPERATING ACTIVITIES                1,056,731   906,438
INVESTING ACTIVITIES:
 Purchases of property, plant and equipment         (124,063)   (101,987)
 Acquisitions and other investing activities        (701,516)   (549,880)
NET CASH USED IN INVESTING ACTIVITIES                    (825,579)   (651,867)
FINANCING ACTIVITIES:
 Proceeds from debt                                 3,019,931   750,000
 Payments on debt                                   (2,995,335) (750,000)
 Share-based awards exercised, net of taxes paid    (15,728)    (7,043)
 Excess tax benefits from share-based compensation  12,905      11,018
 Dividends paid                                     (326,217)   (300,983)
 Purchase of stock                                  (120,673)   (81,826)
NET CASH USED IN FINANCING ACTIVITIES                    (425,117)   (378,834)
EFFECT OF EXCHANGE RATE CHANGES ON CASH                  (12,237)    2,304
NET DECREASE IN CASH AND CASH EQUIVALENTS               (206,202)   (121,959)
CASH AND CASH EQUIVALENTS AT BEGINNING OF YEAR           403,095     525,054
CASH AND CASH EQUIVALENTS AT END OF YEAR                 $196,893    $403,095





SOURCE Genuine Parts Company

Website: http://www.genpt.com
Contact: Carol B. Yancey, Executive Vice President and CFO - (770) 612-2044,
Sidney G. Jones, Vice President - Investor Relations - (770) 818-4628
 
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