Standard Motor Products, Inc. Announces Second Quarter 2023 Results and Quarterly Dividend
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02 Aug, 2023, 08:30 ET
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NEW YORK, Aug. 2, 2023 /PRNewswire/ -- Standard Motor Products, Inc. (NYSE: SMP), a leading automotive parts manufacturer and distributor, reported today its consolidated financial results for the three and six months ended June 30, 2023.
Net sales for the second quarter of 2023 were $353.1 million, compared to consolidated net sales of $359.4 million during the comparable quarter in 2022. Earnings from continuing operations for the second quarter of 2023 were $18.4 million or $0.83 per diluted share, compared to $20.8 million or $0.93 per diluted share in the second quarter of 2022. Excluding non-operational gains and losses identified on the attached reconciliation of GAAP and non-GAAP measures, earnings from continuing operations for the second quarter of 2023 were $18.6 million or $0.84 per diluted share, compared to $20.8 million or $0.93 per diluted share in the second quarter of 2022.
Consolidated net sales for the six months ended June 30, 2023, were $681.1 million, compared to consolidated net sales of $682.2 million during the comparable period in 2022. Earnings from continuing operations for the six months ended June 30, 2023, were $31.1 million or $1.40 per diluted share, compared to $41.4 million or $1.85 per diluted share in the comparable period of 2022. Excluding non-operational gains and losses identified on the attached reconciliation of GAAP and non-GAAP measures, earnings from continuing operations for the six months ended June 30, 2023 and 2022 were $31.9 million or $1.44 per diluted share and $41.4 million or $1.85 per diluted share, respectively.
Mr. Eric Sills, Standard Motor Products' Chief Executive Officer and President stated, "Overall, sales decreased 1.8% versus last year's strong second quarter, while year-to-date we were roughly flat to 2022. The cooler and wetter conditions in the quarter had a negative impact on our aftermarket business, particularly on our Temperature Control segment. Additionally, we continue to experience the impact of a recent bankruptcy of a large aftermarket customer, negatively impacting our quarterly sales by 1.6%. While we believe in the long run that volume will return, as the business has either been acquired or will be absorbed by other accounts, in the near term it will continue to be a headwind."
By segment, Vehicle Control sales were down 1.1% in the quarter, though remain 1.5% favorable on a year-to-date basis. This segment was the most impacted by the customer bankruptcy, reflecting a 2.2% negative impact in the quarter, which again, we believe will eventually be recovered. Meanwhile, we continue to see favorable customer sell-through, suggesting general market stability.
Temperature Control sales declined 8.1% versus the strong 6.4% growth experienced during the same quarter last year, and down 5.2% in the first half. As noted above, a cooler and wetter spring negatively impacted demand for this seasonal product category against an already difficult prior year comparison. That said, after a slow start, the heat has picked up across the country, with many areas hitting record temperatures, and that should bode well for the third quarter.
Our Engineered Solutions segment sales increased 6.2% in the quarter due to strong demand from our existing customers as well as new business wins. We continue to be bullish on long-term sales growth in this segment as we gain traction with our expanded customer base, though revenue growth is not necessarily linear.
Looking at profitability, consolidated non-GAAP operating margins were 7.8% in the quarter, flat with the 7.8% in the second quarter last year. We are pleased with our ability to largely overcome the impact of inflation through a combination of pricing actions and cost reduction initiatives. While Temperature Control operating margins, down 390 basis points from last year, came under pressure due to sales performance, the Vehicle Control and Engineered Solutions segments improved operating margin by 190 basis points and 100 basis points, respectively. During the quarter, our operating income was impacted by a $4.8 million increase in customer factoring program expense over last year from elevated interest rates. On the bottom line, Adjusted EBITDA and earnings per share were down primarily due to the lower sales performance in Temp Control, lower overhead absorption from inventory reduction efforts, and the impact of interest rates both on our customer factoring programs and our borrowings.
From a cash flow perspective, we continue to make progress with respect to initiatives on reducing both our inventory and our debt. At quarter-end, our inventory was $499.1 million, down from $528.7 million at year-end 2022 and $551.4 million at last year's second quarter. Additionally, our total debt at quarter-end stood at $223.2 million as we paid down $50 million in the second quarter.
We are excited to announce our plans to open a new distribution center in Shawnee, KS, which eventually will replace our existing smaller DC in nearby Edwardsville, KS. This 575,000 sq.ft. facility, scheduled to have a phased opening beginning early 2025, will provide capacity expansion for all aftermarket product categories with improved logistics capabilities, though in the near term we will incur additional costs while we operate two facilities.
Regarding our full year expectations for 2023, we anticipate top line sales growth to be in the low single digits. We are updating our Adjusted EBITDA expectations to approximately 9.5% of revenue for the full year 2023 from our prior estimate of approximately 10%. This outlook considers higher expense related to customer factoring programs that will fall between $48-$50 million at current rates, the impact of startup costs and duplicate overhead expense associated with the new distribution center discussed above, an exchange rate headwind from the weakening of the U.S. Dollar on our international operations, and the impact from softer than expected sales in our second quarter.
The Board of Directors has approved payment of a quarterly dividend of 29 cents per share on the common stock outstanding, which will be paid on September 1, 2023 to stockholders of record on August 15, 2023.
The Company has been involved in a legal proceeding with a third party since March 2019. This lawsuit arose from a breach of contract claim associated with a discontinued operation of SMP. SMP has vigorously defended itself but, on May 11, 2023, we were found liable for approximately $11 million in damages. Although it is expected that the Court will not finalize its judgment until the end of the third quarter of 2023, we incurred a charge to SMP's discontinued operation in the second quarter of 2023.
In closing, Mr. Sills commented "As we start to look into the second half of the year, we are optimistic that the return of hotter summer weather patterns should help normalize aftermarket demand trends where fundamental industry dynamics remain favorable. Our Engineered Solutions business, which can be lumpy quarter to quarter, is on a very nice trajectory. And our initiatives of reducing inventory levels and improving working capital have us on track to return to healthy levels of operating cash flow consistent with years past. We recognize that macro pressures are lingering, but we will continue to invest in our business and people to be well-positioned to take advantage of the strength of the industries in which we operate once these near-term headwinds subside. We want to thank all our employees for our current success and helping us achieve our goals for the future."
Conference Call
Standard Motor Products, Inc. will hold a conference call at 11:00 AM, Eastern Time, on Wednesday, August 2, 2023. This call will be webcast and can be accessed on the Investor Relations page of our website at www.smpcorp.com and clicking on the SMP 2Q 2023 Earnings Webcast link. Investors may also listen to the call by dialing 800-274-8461 (domestic) or 203-518-9814 (international). Our playback will be made available for dial in immediately following the call. For those choosing to listen to the replay by webcast, the link should be active on our website within 24 hours after the call. The playback number is 888-562-0905 (domestic) or 402-220-7347 (international). The participant passcode is 94640.
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.
STANDARD MOTOR PRODUCTS, INC.
Consolidated Statements of Operations
(In thousands, except per share amounts)
THREE MONTHS ENDED
SIX MONTHS ENDED
JUNE 30,
JUNE 30,
2023
2022
2023
2022
(Unaudited)
(Unaudited)
NET SALES
$ 353,075
$ 359,412
$ 681,103
$ 682,243
COST OF SALES
251,806
263,061
488,567
496,052
GROSS PROFIT
101,269
96,351
192,536
186,191
SELLING, GENERAL & ADMINISTRATIVE EXPENSES
73,843
68,468
143,476
131,352
RESTRUCTURING AND INTEGRATION EXPENSES
294
3
1,206
44
OTHER INCOME, NET
46
13
70
13
OPERATING INCOME
27,178
27,893
47,924
54,808
OTHER NON-OPERATING INCOME, NET
802
1,927
1,027
3,376
INTEREST EXPENSE
3,283
1,821
7,145
2,626
EARNINGS FROM CONTINUING OPERATIONS BEFORE TAXES
24,697
27,999
41,806
55,558
PROVISION FOR INCOME TAXES
6,289
7,122
10,661
14,127
EARNINGS FROM CONTINUING OPERATIONS
18,408
20,877
31,145
41,431
LOSS FROM DISCONTINUED OPERATION, NET OF INCOME TAXES
(9,221)
(1,666)
(10,001)
(2,782)
NET EARNINGS
9,187
19,211
21,144
38,649
NET EARNINGS ATTRIBUTABLE TO NONCONTROLLING INTEREST
50
85
89
77
NET EARNINGS ATTRIBUTABLE TO SMP (a)
$ 9,137
$ 19,126
$ 21,055
$ 38,572
NET EARNINGS ATTRIBUTABLE TO SMP
EARNINGS FROM CONTINUING OPERATIONS
$ 18,358
$ 20,792
$ 31,056
$ 41,354
LOSS FROM DISCONTINUED OPERATION, NET OF INCOME TAXES
(9,221)
(1,666)
(10,001)
(2,782)
TOTAL
$ 9,137
$ 19,126
$ 21,055
$ 38,572
NET EARNINGS PER COMMON SHARE ATTRIBUTABLE TO SMP
BASIC EARNINGS FROM CONTINUING OPERATIONS
$ 0.85
$ 0.96
$ 1.43
$ 1.89
DISCONTINUED OPERATION
(0.43)
(0.08)
(0.46)
(0.13)
NET EARNINGS PER COMMON SHARE - BASIC
$ 0.42
$ 0.88
$ 0.97
$ 1.76
DILUTED EARNINGS FROM CONTINUING OPERATIONS
$ 0.83
$ 0.93
$ 1.40
$ 1.85
DISCONTINUED OPERATION
(0.42)
(0.07)
(0.45)
(0.13)
NET EARNINGS PER COMMON SHARE - DILUTED
$ 0.41
$ 0.86
$ 0.95
$ 1.72
WEIGHTED AVERAGE NUMBER OF COMMON SHARES
21,689,067
21,757,998
21,649,562
21,867,644
WEIGHTED AVERAGE NUMBER OF COMMON AND DILUTIVE SHARES
22,183,489
22,255,642
22,139,708
22,372,702
(a) "SMP" refers to Standard Motor Products, Inc. and subsidiaries.
STANDARD MOTOR PRODUCTS, INC.
Segment Revenues and Operating Profit
(In thousands)
THREE MONTHS ENDED
SIX MONTHS ENDED
JUNE 30,
JUNE 30,
2023
2022
2023
2022
(Unaudited)
(Unaudited)
Revenues
Engine Management (Ignition, Emissions and
Fuel Delivery)
$ 113,589
$ 111,581
$ 229,672
$ 220,730
Electrical and Safety
52,867
57,054
104,671
109,311
Wire sets and other
17,333
17,136
34,023
32,994
Vehicle Control
183,789
185,771
368,366
363,035
AC System Components
74,449
81,608
120,201
128,982
Other Thermal Components
22,625
24,029
49,279
49,713
Temperature Control
97,074
105,637
169,480
178,695
Commercial Vehicle
26,742
19,503
46,599
40,954
Construction / Agriculture
8,103
11,222
20,898
22,206
Light Vehicle
23,548
23,039
46,514
49,114
All Other
13,819
14,240
29,246
28,239
Engineered Solutions
72,212
68,004
143,257
140,513
Revenues
$ 353,075
$ 359,412
$ 681,103
$ 682,243
Gross Margin
Vehicle Control
$ 60,109
32.7 %
$ 53,728
28.9 %
$ 118,581
32.2 %
$ 109,152
30.1 %
Temperature Control
26,512
27.3 %
29,315
27.8 %
45,667
26.9 %
48,803
27.3 %
Engineered Solutions
14,648
20.3 %
13,308
19.6 %
28,288
19.7 %
28,236
20.1 %
All Other
-
-
-
-
Gross Margin
$ 101,269
28.7 %
$ 96,351
26.8 %
$ 192,536
28.3 %
$ 186,191
27.3 %
Selling, General & Administrative
Vehicle Control
$ 40,720
22.2 %
$ 37,679
20.3 %
$ 81,556
22.1 %
$ 72,718
20.0 %
Temperature Control
20,584
21.2 %
18,792
17.8 %
37,112
21.9 %
34,118
19.1 %
Engineered Solutions
8,481
11.7 %
8,199
12.1 %
16,390
11.4 %
16,839
12.0 %
All Other
4,058
3,798
8,418
7,677
Selling, General & Administrative
$ 73,843
20.9 %
$ 68,468
19.1 %
$ 143,476
21.1 %
$ 131,352
19.3 %
Operating Income
Vehicle Control
$ 19,389
10.5 %
$ 16,049
8.6 %
$ 37,025
10.1 %
$ 36,434
10.0 %
Temperature Control
5,928
6.1 %
10,523
10.0 %
8,555
5.0 %
14,685
8.2 %
Engineered Solutions
6,167
8.5 %
5,109
7.5 %
11,898
8.3 %
11,397
8.1 %
All Other
(4,058)
(3,798)
(8,418)
(7,677)
Subtotal
$ 27,426
7.8 %
$ 27,883
7.8 %
$ 49,060
7.2 %
$ 54,839
8.0 %
Restructuring & Integration
(294)
-0.1 %
(3)
0.0 %
(1,206)
-0.2 %
(44)
0.0 %
Other Income, Net
46
0.0 %
13
0.0 %
70
0.0 %
13
0.0 %
Operating Income
$ 27,178
7.7 %
$ 27,893
7.8 %
$ 47,924
7.0 %
$ 54,808
8.0 %
STANDARD MOTOR PRODUCTS, INC.
Reconciliation of GAAP and Non-GAAP Measures
(In thousands, except per share amounts)
THREE MONTHS ENDED
SIX MONTHS ENDED
JUNE 30,
JUNE 30,
2023
2022
2023
2022
(Unaudited)
(Unaudited)
EARNINGS FROM CONTINUING OPERATIONS ATTRIBUTABLE TO SMP
GAAP EARNINGS FROM CONTINUING OPERATIONS
$ 18,358
$ 20,792
$ 31,056
$ 41,354
RESTRUCTURING AND INTEGRATION EXPENSES
294
3
1,206
44
INCOME TAX EFFECT RELATED TO RECONCILING ITEMS
(77)
-
(314)
(11)
NON-GAAP EARNINGS FROM CONTINUING OPERATIONS
$ 18,575
$ 20,795
$ 31,948
$ 41,387
DILUTED EARNINGS PER SHARE FROM CONTINUING OPERATIONS ATTRIBUTABLE TO SMP
GAAP DILUTED EARNINGS PER SHARE FROM CONTINUING OPERATIONS
$ 0.83
$ 0.93
$ 1.40
$ 1.85
RESTRUCTURING AND INTEGRATION EXPENSES
0.01
-
0.05
-
INCOME TAX EFFECT RELATED TO RECONCILING ITEMS
-
-
(0.01)
-
NON-GAAP DILUTED EARNINGS PER SHARE FROM CONTINUING OPERATIONS
$ 0.84
$ 0.93
$ 1.44
$ 1.85
OPERATING INCOME
GAAP OPERATING INCOME
$ 27,178
$ 27,893
$ 47,924
$ 54,808
RESTRUCTURING AND INTEGRATION EXPENSES
294
3
1,206
44
OTHER INCOME, NET
(46)
(13)
(70)
(13)
LAST TWELVE MONTHS ENDED
YEAR ENDED
JUNE 30,
DECEMBER 31,
NON-GAAP OPERATING INCOME
$ 27,426
$ 27,883
$ 49,060
$ 54,839
2023
2022
2022
(Unaudited)
EBITDA WITHOUT SPECIAL ITEMS
GAAP EARNINGS FROM CONTINUING OPERATIONS BEFORE TAXES
$ 24,697
$ 27,999
$ 41,806
$ 55,558
$ 84,580
$ 119,011
$ 98,332
DEPRECIATION AND AMORTIZATION
7,047
6,941
14,129
13,893
28,534
28,036
28,298
INTEREST EXPENSE
3,283
1,821
7,145
2,626
15,136
3,950
10,617
EBITDA
35,027
36,761
63,080
72,077
128,250
150,997
137,247
RESTRUCTURING AND INTEGRATION EXPENSES
294
3
1,206
44
3,053
436
1,891
CUSTOMER BANKRUPTCY CHARGE
-
-
-
-
7,002
-
7,002
ONE-TIME ACQUISITION COSTS
-
-
-
-
-
956
-
SPECIAL ITEMS
294
3
1,206
44
10,055
1,392
8,893
EBITDA WITHOUT SPECIAL ITEMS
$ 35,321
$ 36,764
$ 64,286
$ 72,121
$ 138,305
$ 152,389
$ 146,140
MANAGEMENT BELIEVES THAT NON-GAAP EARNINGS FROM CONTINUING OPERATIONS AND NON-GAAP DILUTED EARNINGS PER SHARE FROM CONTINUING OPERATIONS WHICH ARE ATTRIBUTABLE TO SMP, AND NON-GAAP OPERATING INCOME AND EBITDA WITHOUT SPECIAL ITEMS, 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.
STANDARD MOTOR PRODUCTS, INC.
Reconciliation of GAAP and Non-GAAP Measures by Segments
(In thousands)
THREE MONTHS ENDED JUNE 30, 2023
Vehicle Control
Temperature Control
Engineered Solutions
All Other
Consolidated
(Unaudited)
OPERATING INCOME
GAAP OPERATING INCOME
$ 19,273
$ 5,800
$ 6,163
$ (4,058)
$ 27,178
RESTRUCTURING AND INTEGRATION EXPENSES
154
128
12
-
294
OTHER INCOME, NET
(38)
-
(8)
-
(46)
NON-GAAP OPERATING INCOME
$ 19,389
$ 5,928
$ 6,167
$ (4,058)
$ 27,426
EBITDA WITHOUT SPECIAL ITEMS
GAAP EARNINGS FROM CONTINUING OPERATIONS BEFORE TAXES
$ 17,235
$ 5,259
$ 6,247
$ (4,044)
$ 24,697
DEPRECIATION AND AMORTIZATION
3,373
768
2,486
420
7,047
INTEREST EXPENSE
2,304
842
637
(500)
3,283
EBITDA
22,912
6,869
9,370
(4,124)
35,027
RESTRUCTURING AND INTEGRATION EXPENSES
154
128
12
-
294
SPECIAL ITEMS
154
128
12
-
294
EBITDA WITHOUT SPECIAL ITEMS
$ 23,066
$ 6,997
$ 9,382
$ (4,124)
$ 35,321
% of Net Sales
12.6 %
7.2 %
13.0 %
10.0 %
(In thousands)
THREE MONTHS ENDED JUNE 30, 2022
Vehicle Control
Temperature Control
Engineered Solutions
All Other
Consolidated
(Unaudited)
OPERATING INCOME
GAAP OPERATING INCOME
$ 16,059
$ 10,523
$ 5,109
$ (3,798)
$ 27,893
RESTRUCTURING AND INTEGRATION EXPENSES
3
-
-
-
3
OTHER INCOME, NET
(13)
-
-
-
(13)
NON-GAAP OPERATING INCOME
$ 16,049
$ 10,523
$ 5,109
$ (3,798)
$ 27,883
EBITDA WITHOUT SPECIAL ITEMS
GAAP EARNINGS FROM CONTINUING OPERATIONS BEFORE TAXES
$ 14,928
$ 12,064
$ 4,950
$ (3,943)
$ 27,999
DEPRECIATION AND AMORTIZATION
3,491
742
2,295
413
6,941
INTEREST EXPENSE
1,353
406
139
(77)
1,821
EBITDA
19,772
13,212
7,384
(3,607)
36,761
RESTRUCTURING AND INTEGRATION EXPENSES
3
-
-
-
3
SPECIAL ITEMS
3
-
-
-
3
EBITDA WITHOUT SPECIAL ITEMS
$ 19,775
$ 13,212
$ 7,384
$ (3,607)
$ 36,764
% of Net Sales
10.6 %
12.5 %
10.9 %
10.2 %
MANAGEMENT BELIEVES THAT NON-GAAP OPERATING INCOME AND EBITDA WITHOUT SPECIAL ITEMS, 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.
STANDARD MOTOR PRODUCTS, INC.
Reconciliation of GAAP and Non-GAAP Measures by Segments
(In thousands)
SIX MONTHS ENDED JUNE 30, 2023
Vehicle Control
Temperature Control
Engineered Solutions
All Other
Consolidated
(Unaudited)
OPERATING INCOME
GAAP OPERATING INCOME
$ 36,648
$ 7,884
$ 11,810
$ (8,418)
$ 47,924
RESTRUCTURING AND INTEGRATION EXPENSES
439
671
96
-
1,206
OTHER INCOME, NET
(62)
-
(8)
-
(70)
NON-GAAP OPERATING INCOME
$ 37,025
$ 8,555
$ 11,898
$ (8,418)
$ 49,060
EBITDA WITHOUT SPECIAL ITEMS
GAAP EARNINGS FROM CONTINUING OPERATIONS BEFORE TAXES
$ 32,292
$ 6,364
$ 11,533
$ (8,383)
$ 41,806
DEPRECIATION AND AMORTIZATION
6,785
1,531
4,967
846
14,129
INTEREST EXPENSE
5,045
1,735
996
(631)
7,145
EBITDA
44,122
9,630
17,496
(8,168)
63,080
RESTRUCTURING AND INTEGRATION EXPENSES
439
671
96
-
1,206
SPECIAL ITEMS
439
671
96
-
1,206
EBITDA WITHOUT SPECIAL ITEMS
$ 44,561
$ 10,301
$ 17,592
$ (8,168)
$ 64,286
% of Net Sales
12.1 %
6.1 %
12.3 %
9.4 %
(In thousands)
SIX MONTHS ENDED JUNE 30, 2022
Vehicle Control
Temperature Control
Engineered Solutions
All Other
Consolidated
(Unaudited)
OPERATING INCOME
GAAP OPERATING INCOME
$ 36,403
$ 14,685
$ 11,397
$ (7,677)
$ 54,808
RESTRUCTURING AND INTEGRATION EXPENSES
44
-
-
-
44
OTHER INCOME, NET
(13)
-
-
-
(13)
NON-GAAP OPERATING INCOME
$ 36,434
$ 14,685
$ 11,397
$ (7,677)
$ 54,839
EBITDA WITHOUT SPECIAL ITEMS
GAAP EARNINGS FROM CONTINUING OPERATIONS BEFORE TAXES
$ 35,294
$ 16,544
$ 11,528
$ (7,808)
$ 55,558
DEPRECIATION AND AMORTIZATION
6,908
1,422
4,753
810
13,893
INTEREST EXPENSE
1,928
566
285
(153)
2,626
EBITDA
44,130
18,532
16,566
(7,151)
72,077
RESTRUCTURING AND INTEGRATION EXPENSES
44
-
-
-
44
SPECIAL ITEMS
44
-
-
-
44
EBITDA WITHOUT SPECIAL ITEMS
$ 44,174
$ 18,532
$ 16,566
$ (7,151)
$ 72,121
% of Net Sales
12.2 %
10.4 %
11.8 %
10.6 %
MANAGEMENT BELIEVES THAT NON-GAAP OPERATING INCOME AND EBITDA WITHOUT SPECIAL ITEMS, 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.
STANDARD MOTOR PRODUCTS, INC.
Condensed Consolidated Balance Sheets
(In thousands)
JUNE
JUNE
DECEMBER
2023
2022
2022
(Unaudited)
(Unaudited)
ASSETS
CASH
$ 23,019
$ 14,186
$ 21,150
ACCOUNTS RECEIVABLE, GROSS
223,862
235,669
173,013
ALLOWANCE FOR EXPECTED CREDIT LOSSES
5,757
6,012
5,375
ACCOUNTS RECEIVABLE, NET
218,105
229,657
167,638
INVENTORIES
499,134
551,415
528,715
UNRETURNED CUSTOMER INVENTORY
19,722
21,405
19,695
OTHER CURRENT ASSETS
27,903
26,198
25,241
TOTAL CURRENT ASSETS
787,883
842,861
762,439
PROPERTY, PLANT AND EQUIPMENT, NET
107,590
104,931
107,148
OPERATING LEASE RIGHT-OF-USE ASSETS
73,093
39,827
49,838
GOODWILL
132,391
131,125
132,087
OTHER INTANGIBLES, NET
96,291
101,649
100,504
DEFERRED INCOME TAXES
33,905
34,086
33,658
INVESTMENT IN UNCONSOLIDATED AFFILIATES
41,557
44,885
41,745
OTHER ASSETS
29,435
27,188
27,510
TOTAL ASSETS
$ 1,302,145
$ 1,326,552
$ 1,254,929
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT PORTION OF REVOLVING CREDIT FACILITY
$ 53,700
$ 56,000
$ 50,000
CURRENT PORTION OF TERM LOAN AND OTHER DEBT
5,028
7,954
5,031
ACCOUNTS PAYABLE
94,657
140,082
89,247
ACCRUED CUSTOMER RETURNS
43,664
55,725
37,169
ACCRUED CORE LIABILITY
20,187
23,117
22,952
ACCRUED REBATES
43,781
41,647
37,381
PAYROLL AND COMMISSIONS
28,346
35,985
31,361
SUNDRY PAYABLES AND ACCRUED EXPENSES
59,126
49,710
49,990
TOTAL CURRENT LIABILITIES
348,489
410,220
323,131
LONG-TERM DEBT
164,488
203,500
184,589
NONCURRENT OPERATING LEASE LIABILITY
64,271
30,039
40,709
ACCRUED ASBESTOS LIABILITIES
59,565
48,025
63,305
OTHER LIABILITIES
24,917
22,119
22,157
TOTAL LIABILITIES
661,730
713,903
633,891
TOTAL SMP STOCKHOLDERS' EQUITY
629,673
601,586
610,020
NONCONTROLLING INTEREST
10,742
11,063
11,018
TOTAL STOCKHOLDERS' EQUITY
640,415
612,649
621,038
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY
$ 1,302,145
$ 1,326,552
$ 1,254,929
STANDARD MOTOR PRODUCTS, INC.
Condensed Consolidated Statements of Cash Flows
(In thousands)
SIX MONTHS ENDED
JUNE 30,
2023
2022
(Unaudited)
CASH FLOWS FROM OPERATING ACTIVITIES
NET EARNINGS
$ 21,144
$ 38,649
ADJUSTMENTS TO RECONCILE NET EARNINGS TO NET CASH
PROVIDED BY (USED IN) OPERATING ACTIVITIES:
DEPRECIATION AND AMORTIZATION
14,129
13,893
LOSS FROM DISCONTINUED OPERATIONS, NET OF TAXES
10,001
2,782
OTHER
5,835
8,049
CHANGE IN ASSETS AND LIABILITIES:
ACCOUNTS RECEIVABLE
(48,271)
(49,659)
INVENTORY
30,924
(87,744)
ACCOUNTS PAYABLE
4,323
1,591
PREPAID EXPENSES AND OTHER CURRENT ASSETS
(468)
(7,102)
SUNDRY PAYABLES AND ACCRUED EXPENSES
2,776
(5,020)
OTHER
(1,023)
(10,772)
NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES
39,370
(95,333)
CASH FLOWS FROM INVESTING ACTIVITIES
CAPITAL EXPENDITURES
(9,507)
(13,203)
OTHER INVESTING ACTIVITIES
66
-
NET CASH USED IN INVESTING ACTIVITIES
(9,441)
(13,203)
CASH FLOWS FROM FINANCING ACTIVITIES
NET CHANGE IN DEBT
(16,547)
139,319
PURCHASE OF TREASURY STOCK
-
(25,605)
DIVIDENDS PAID
(12,544)
(11,822)
PAYMENTS OF DEBT ISSUANCE COSTS
-
(2,128)
OTHER FINANCING ACTIVITIES
3
1,903
NET CASH PROVIDED BY (USED IN) FINANCING ACTIVITIES
(29,088)
101,667
EFFECT OF EXCHANGE RATE CHANGES ON CASH
1,028
(700)
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS
1,869
(7,569)
CASH AND CASH EQUIVALENTS at beginning of period
21,150
21,755
CASH AND CASH EQUIVALENTS at end of period
$ 23,019
$ 14,186
SOURCE Standard Motor Products, Inc.
Standard Motor Products, Inc.