Standard Motor Products, Inc. Announces First Quarter 2016 Results and a Quarterly Dividend
NEW YORK, May 4, 2016 /PRNewswire/ -- Standard Motor Products, Inc. (NYSE: SMP), an automotive replacement parts manufacturer and distributor, reported today its consolidated financial results for the three months ending March 31, 2016.
Consolidated net sales for the first quarter of 2016 were $238.9 million, compared to consolidated net sales of $227.6 million during the comparable quarter in 2015. Earnings from continuing operations for the first quarter of 2016 were $12.7 million or 55 cents per diluted share, compared to $9.3 million or 40 cents per diluted share in the first quarter of 2015. Excluding non-operational gains and losses identified on the attached reconciliation of GAAP and non-GAAP measures, earnings from continuing operations for the first quarter of 2016 were $12.6 million or 55 cents per diluted share, compared to $9.2 million or 40 cents per diluted share in the first quarter of 2015.
Eric Sills, Standard Motor Products' Chief Executive Officer and President stated, "We are very pleased with our first quarter results as we achieved a better than 35% increase in net earnings and diluted earnings per share, compared to the first quarter of 2015, on an overall sales increase of 5%.
"Engine Management sales were up about 2%, in line with our forecast of low single digit increases. Temperature Control sales achieved a 16% increase, a result of higher pre-season orders than the year before. We now await the second and third quarters when the bulk of the Temperature Control sales occur and our results tend to be weather dependent.
"The major improvement was in profitability. As we previously reported, results for the full year 2015 were burdened with roughly $10 million in one-time expenses related to startup costs in our line of remanufactured diesel fuel injectors; the carry forward of negative manufacturing variances in Temperature Control; and the costs of winding down our retiree medical program. These costs are now fully behind us and we anticipate a return to historic profitability rates."
The Board of Directors has approved payment of a quarterly dividend of seventeen cents per share on the common stock outstanding. The dividend will be paid on June 1, 2016 to stockholders of record on May 16, 2016.
Standard Motor Products, Inc. will hold a conference call at 11:00 AM, Eastern Time, on Wednesday, May 4, 2016. The dial-in number is 800-895-0198 (domestic) or 785-424-1053 (international). The playback number is 800-839-1337 (domestic) or 402-220-0489 (international). The conference ID # is STANDARD.
Under the safe harbor provisions of the Private Securities Litigation Reform Act of 1995, Standard Motor Products cautions investors that any forward-looking statements made by the company, including those that may be made in this press release, are based on management's expectations at the time they are made, but they are subject to risks and uncertainties that may cause actual results, events or performance to differ materially from those contemplated by such forward looking statements. Among the factors that could cause actual results, events or performance to differ materially from those risks and uncertainties discussed in this press release are those detailed from time-to-time in prior press releases and in the company's filings with the Securities and Exchange Commission, including the company's annual report on Form 10-K and quarterly reports on Form 10-Q. By making these forward-looking statements, Standard Motor Products undertakes no obligation or intention to update these statements after the date of this release.
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STANDARD MOTOR PRODUCTS, INC. | ||||||
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Consolidated Statements of Operations | ||||||
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(In thousands, except per share amounts) |
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THREE MONTHS ENDED |
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MARCH 31, |
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2016 |
2015 |
|||||
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(Unaudited) |
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NET SALES |
$ 238,911 |
$ 227,589 |
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COST OF SALES |
165,915 |
163,700 |
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GROSS PROFIT |
72,996 |
63,889 |
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SELLING, GENERAL & ADMINISTRATIVE EXPENSES |
52,998 |
49,198 |
||||
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RESTRUCTURING AND INTEGRATION EXPENSES |
241 |
57 |
||||
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OTHER INCOME, NET |
262 |
281 |
||||
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OPERATING INCOME |
20,019 |
14,915 |
||||
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OTHER NON-OPERATING INCOME, NET |
333 |
151 |
||||
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INTEREST EXPENSE |
311 |
426 |
||||
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EARNINGS FROM CONTINUING OPERATIONS BEFORE TAXES |
20,041 |
14,640 |
||||
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PROVISION FOR INCOME TAXES |
7,385 |
5,301 |
||||
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EARNINGS FROM CONTINUING OPERATIONS |
12,656 |
9,339 |
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LOSS FROM DISCONTINUED OPERATION, NET OF INCOME TAXES |
(452) |
(391) |
||||
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NET EARNINGS |
$ 12,204 |
$ 8,948 |
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NET EARNINGS PER COMMON SHARE: |
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BASIC EARNINGS FROM CONTINUING OPERATIONS |
$ 0.56 |
$ 0.41 |
||||
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DISCONTINUED OPERATION |
(0.02) |
(0.02) |
||||
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NET EARNINGS PER COMMON SHARE - BASIC |
$ 0.54 |
$ 0.39 |
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DILUTED EARNINGS FROM CONTINUING OPERATIONS |
$ 0.55 |
$ 0.40 |
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DISCONTINUED OPERATION |
(0.02) |
(0.01) |
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NET EARNINGS PER COMMON SHARE - DILUTED |
$ 0.53 |
$ 0.39 |
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WEIGHTED AVERAGE NUMBER OF COMMON SHARES |
22,642,312 |
22,910,889 |
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WEIGHTED AVERAGE NUMBER OF COMMON AND DILUTIVE SHARES |
22,944,947 |
23,238,050 |
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STANDARD MOTOR PRODUCTS, INC. | ||||||
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Segment Revenues and Operating Income | ||||||
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(In thousands) |
||||||
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THREE MONTHS ENDED |
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MARCH 31, |
||||||
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2016 |
2015 |
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(Unaudited) |
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Revenues |
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Engine Management |
$ 180,681 |
$ 177,071 |
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Temperature Control |
56,766 |
48,728 |
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All Other |
1,464 |
1,790 |
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$ 238,911 |
$ 227,589 |
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Gross Margin |
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Engine Management |
$ 57,276 |
31.7% |
$ 51,702 |
29.2% | ||
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Temperature Control |
14,090 |
24.8% |
9,827 |
20.2% | ||
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All Other |
1,630 |
2,360 |
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$ 72,996 |
30.6% |
$ 63,889 |
28.1% | |||
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Selling, General & Administrative |
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Engine Management |
$ 33,057 |
18.3% |
$ 30,004 |
16.9% | ||
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Temperature Control |
11,694 |
20.6% |
11,190 |
23.0% | ||
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All Other |
8,247 |
8,004 |
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$ 52,998 |
22.2% |
$ 49,198 |
21.6% | |||
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Operating Income |
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Engine Management |
$ 24,219 |
13.4% |
$ 21,698 |
12.3% | ||
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Temperature Control |
2,396 |
4.2% |
(1,363) |
-2.8% | ||
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All Other |
(6,617) |
(5,644) |
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19,998 |
8.4% |
14,691 |
6.5% | |||
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Restructuring & Integration |
(241) |
-0.1% |
(57) |
0.0% | ||
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Other Income, Net |
262 |
0.1% |
281 |
0.1% | ||
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$ 20,019 |
8.4% |
$ 14,915 |
6.6% | |||
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STANDARD MOTOR PRODUCTS, INC. |
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Reconciliation of GAAP and Non-GAAP Measures |
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(In thousands, except per share amounts) |
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THREE MONTHS ENDED |
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MARCH 31, |
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2016 |
2015 |
||||||
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(Unaudited) |
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EARNINGS FROM CONTINUING OPERATIONS |
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GAAP EARNINGS FROM CONTINUING OPERATIONS |
$ 12,656 |
$ 9,339 |
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RESTRUCTURING AND INTEGRATION EXPENSES (NET OF TAX) |
145 |
34 |
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GAIN FROM SALE OF BUILDINGS (NET OF TAX) |
(157) |
(157) |
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NON-GAAP EARNINGS FROM CONTINUING OPERATIONS |
$ 12,644 |
$ 9,216 |
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DILUTED EARNINGS PER SHARE FROM CONTINUING OPERATIONS |
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GAAP DILUTED EARNINGS PER SHARE FROM CONTINUING OPERATIONS |
$ 0.55 |
$ 0.40 |
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RESTRUCTURING AND INTEGRATION EXPENSES (NET OF TAX) |
0.01 |
- |
|||||
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GAIN FROM SALE OF BUILDINGS (NET OF TAX) |
(0.01) |
- |
|||||
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NON-GAAP DILUTED EARNINGS PER SHARE FROM CONTINUING OPERATIONS |
$ 0.55 |
$ 0.40 |
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OPERATING INCOME |
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GAAP OPERATING INCOME |
$ 20,019 |
$ 14,915 |
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RESTRUCTURING AND INTEGRATION EXPENSES |
241 |
57 |
|||||
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OTHER INCOME, NET |
(262) |
(281) |
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NON-GAAP OPERATING INCOME |
$ 19,998 |
$ 14,691 |
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MANAGEMENT BELIEVES THAT EARNINGS FROM CONTINUING OPERATIONS, DILUTED EARNINGS PER SHARE FROM CONTINUING OPERATIONS, AND OPERATING INCOME, EACH OF WHICH ARE NON-GAAP MEASUREMENTS AND ARE ADJUSTED FOR SPECIAL ITEMS, ARE MEANINGFUL TO INVESTORS BECAUSE THEY PROVIDE A VIEW OF THE COMPANY WITH RESPECT TO ONGOING OPERATING RESULTS. SPECIAL ITEMS REPRESENT SIGNIFICANT CHARGES OR CREDITS THAT ARE IMPORTANT TO AN UNDERSTANDING OF THE COMPANY'S OVERALL OPERATING RESULTS IN THE PERIODS PRESENTED. SUCH NON-GAAP MEASUREMENTS ARE NOT RECOGNIZED IN ACCORDANCE WITH GENERALLY ACCEPTED ACCOUNTING PRINCIPLES AND SHOULD NOT BE VIEWED AS AN ALTERNATIVE TO GAAP MEASURES OF PERFORMANCE. | |||||||
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STANDARD MOTOR PRODUCTS, INC. |
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Condensed Consolidated Balance Sheets |
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(In thousands) |
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March 31, |
December 31, | |||||
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2016 |
2015 | |||||
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(Unaudited) |
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ASSETS |
||||||
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CASH |
$ 13,360 |
$ 18,800 | ||||
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ACCOUNTS RECEIVABLE, GROSS |
147,870 |
128,099 | ||||
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ALLOWANCE FOR DOUBTFUL ACCOUNTS |
4,670 |
4,246 | ||||
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ACCOUNTS RECEIVABLE, NET |
143,200 |
123,853 | ||||
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INVENTORIES |
300,291 |
285,793 | ||||
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OTHER CURRENT ASSETS |
49,499 |
51,294 | ||||
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TOTAL CURRENT ASSETS |
506,350 |
479,740 | ||||
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PROPERTY, PLANT AND EQUIPMENT, NET |
70,301 |
68,882 | ||||
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GOODWILL AND OTHER INTANGIBLES, NET |
82,788 |
84,267 | ||||
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OTHER ASSETS |
45,899 |
48,175 | ||||
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TOTAL ASSETS |
$ 705,338 |
$ 681,064 | ||||
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LIABILITIES AND STOCKHOLDERS' EQUITY |
||||||
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NOTES PAYABLE |
$ 49,456 |
$ 47,427 | ||||
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CURRENT PORTION OF LONG TERM DEBT |
42 |
16 | ||||
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ACCOUNTS PAYABLE |
86,225 |
72,711 | ||||
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ACCRUED CUSTOMER RETURNS |
41,974 |
38,812 | ||||
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OTHER CURRENT LIABILITIES |
77,151 |
84,950 | ||||
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TOTAL CURRENT LIABILITIES |
254,848 |
243,916 | ||||
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LONG-TERM DEBT |
158 |
62 | ||||
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ACCRUED ASBESTOS LIABILITIES |
31,848 |
32,185 | ||||
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OTHER LIABILITIES |
13,330 |
12,922 | ||||
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TOTAL LIABILITIES |
300,184 |
289,085 | ||||
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TOTAL STOCKHOLDERS' EQUITY |
405,154 |
391,979 | ||||
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TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY |
$ 705,338 |
$ 681,064 | ||||
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STANDARD MOTOR PRODUCTS, INC. | |||||
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Condensed Consolidated Statements of Cash Flows | |||||
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(In thousands) |
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THREE MONTHS ENDED | |||||
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MARCH 31, | |||||
|
2016 |
2015 | ||||
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(Unaudited) | |||||
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CASH FLOWS FROM OPERATING ACTIVITIES |
|||||
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NET EARNINGS |
$ 12,204 |
$ 8,948 | |||
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ADJUSTMENTS TO RECONCILE NET EARNINGS TO NET CASH |
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PROVIDED BY (USED IN) OPERATING ACTIVITIES: |
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DEPRECIATION AND AMORTIZATION |
4,373 |
4,288 | |||
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OTHER |
3,323 |
2,100 | |||
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CHANGE IN ASSETS AND LIABILITIES: |
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ACCOUNTS RECEIVABLE |
(19,281) |
(25,289) | |||
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INVENTORY |
(14,621) |
(7,473) | |||
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ACCOUNTS PAYABLE |
11,431 |
5,255 | |||
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OTHER |
1,236 |
(1,992) | |||
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NET CASH USED IN OPERATING ACTIVITIES |
(1,335) |
(14,163) | |||
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CASH FLOWS FROM INVESTING ACTIVITIES |
|||||
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CAPITAL EXPENDITURES |
(4,099) |
(4,009) | |||
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OTHER INVESTING ACTIVITIES |
2 |
26 | |||
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NET CASH USED IN INVESTING ACTIVITIES |
(4,097) |
(3,983) | |||
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CASH FLOWS FROM FINANCING ACTIVITIES |
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NET CHANGE IN DEBT |
2,148 |
14,946 | |||
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PURCHASE OF TREASURY STOCK |
(377) |
- | |||
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DIVIDENDS PAID |
(3,849) |
(3,434) | |||
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OTHER FINANCING ACTIVITIES |
1,839 |
1,609 | |||
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NET CASH (USED IN) PROVIDED BY FINANCING ACTIVITIES |
(239) |
13,121 | |||
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EFFECT OF EXCHANGE RATE CHANGES ON CASH |
231 |
(584) | |||
|
NET DECREASE IN CASH AND CASH EQUIVALENTS |
(5,440) |
(5,609) | |||
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CASH AND CASH EQUIVALENTS at beginning of period |
18,800 |
13,728 | |||
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CASH AND CASH EQUIVALENTS at end of period |
$ 13,360 |
$ 8,119 | |||
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SOURCE Standard Motor Products, Inc.