LKQ Corporation (NASDAQ: LKQ) reported Q1 EPS of $0.94, $0.31 better than the analyst estimate of $0.63. Revenue for the quarter came in at $3.2 billion versus the consensus estimate of $2.96 billion.

• First quarter revenue of $3.2 billion (up 5.7% year-over-year)
• Parts and services organic revenue increased 0.6% (2.2% on a per day basis)
• Diluted EPS1 of $0.88 (up 83.3%); adjusted diluted EPS1 of $0.94 (up 64.9%)
• First quarter Segment EBITDA margin of 19.9% for North America
• Europe first quarter Segment EBITDA margin up 390 basis points to 9.6%
• First quarter Segment EBITDA margin of 13.4% for Specialty
• First quarter operating cash flow of $523 million (up 169% YoY); free cash flow of $481 million (up 220% YoY)
• Net leverage down to 1.4x EBITDA
• 2021 outlook raised

"We significantly exceeded our expectations for the quarter as our segment teams continue to embrace operational excellence and execute on our key initiatives. Our North America team delivered a 19.9% Segment EBITDA margin in the first quarter, the highest level in the Company’s history. Additionally, our Specialty team delivered its highest quarterly organic revenue growth at 30.9% and first quarter Segment EBITDA margin of 13.4%. I am also pleased with the Europe Segment EBITDA margin of 9.6% in the quarter, a year-over-year improvement of 390 basis points. This level of performance gives us confidence regarding the progress of our 1 LKQ Europe program and our team’s ability to achieve the longer-term margin targets we set forth in 2019,” noted Dominick Zarcone, President and Chief Executive Officer.

GUIDANCE:

LKQ Corporation sees FY2021 EPS of $3.00-$3.20, versus the consensus of $2.78.

Varun Laroyia, Executive Vice President and Chief Financial Officer commented, “I want to thank our team for driving our operational excellence initiatives to deliver yet another outstanding outcome in the quarter. Based on this strong start to the year and with confidence in our operating strengths and execution of our strategies, we are raising our 2021 outlook on profitability and free cash flow.”

For 2021, management is anticipating the following revised outlook:

• Full year parts and services revenue growth expected
  • Q2 growth on a light comparable period, followed by gradual recovery in the second half of the year
  • Two fewer selling days in North America, one each in Q1 and Q4
• Diluted EPS attributable to LKQ stockholders in the range of $2.68 to $2.88 (a)
• Adjusted diluted EPS attributable to LKQ stockholders in the range of $3.00 to $3.20 (a)(b)
• Free cash flow in the range of $850 million to $950 million (b)

For earnings history and earnings-related data on LKQ Corporation (LKQ) click here.