CHICAGO -- LKQ Corp. has announced results for its fourth quarter ended Dec. 31, 2006, with revenue of $204.5 million, net income of $10.2 million and diluted earnings per share of 18 cents. For the full year ended Dec. 31, 2006, revenue was $789.4 million, net income was $44.4 million and diluted earnings per share was 80 cents.

"We finished the year at 80 cents diluted earnings per share, which was the high end of the range of our earnings guidance. We reported record revenue for the fourth quarter, and delivered impressive revenue growth of approximately 42.1 percent, with organic revenue growth at 11.2 percent for the quarter. We are particularly pleased to announce several acquisitions that have been completed since our last earnings call, including a recycled parts operation with facilities in Maryland and Florida, an aftermarket business based in Denver, and finally, a business that refurbishes recycled OE headlights which will allow us to obtain value from lights we formerly would have discarded," said Joe Holsten, president and chief executive officer.

For the fourth quarter of 2006, revenue increased 42.1 percent to $204.5 million compared with $143.9 million for the fourth quarter of 2005. The company's organic revenue growth for the quarter was 11.2 percent. Net income for the quarter increased 23.4 percent to $10.2 million compared with $8.3 million for the fourth quarter of 2005. Diluted earnings per share was 18 cents for the quarter compared with 15 cents for the fourth quarter of 2005.

For the full year ended Dec. 31, 2006, revenue increased 44.2 percent to $789.4 million compared with $547.4 million for the same period in 2005. Organic revenue growth for the year was 11.6 percent. For the year net income increased 43.7 percent to $44.4 million compared with $30.9 million for the same period in 2005. Diluted earnings per share was 80 cents for the year compared with 63 cents for the same period a year ago.

LKQ's results for the year include approximately $2.4 million of expenses related to the expensing of stock options in accordance with Statement of Financial Accounting Standard No. 123R "Share- Based Payment" (SFAS 123R). SFAS 123R became effective for LKQ Corp. on Jan. 1, 2006. These expenses had the effect of lowering the company's net income by approximately $1.4 million and its diluted earnings per share by approximately 3 cents for the year.

The company's consolidated aftermarket collision replacement parts revenue and wheel refurbishing revenue for the fourth quarter was $53.7 million and for the year ended was $192.5 million. In addition to wheel revenue, a subsidiary operates an aluminum smelter that melts damaged and unusable wheel cores as means of product disposal. For the eleven months of 2006 that LKQ owned the smelter, the smelter's aluminum revenue was $28.2 million at a gross margin of approximately 7.1 percent.

The weighted average diluted shares outstanding for the fourth quarter was 56.2 million compared to 54.6 million for the fourth quarter of 2005 and for the year ended Dec. 31, 2006 was 55.8 million compared to 48.7 million for year ended Dec. 31, 2005. The number of weighted average diluted shares of common stock outstanding in 2006 changed from 2005 due to the issuance of 6.4 million new shares in our October 2005 public offering, exercises of stock options and warrants, and the increase in our stock price.

During the first nine months of 2006, LKQ acquired nine businesses. They consisted of seven recycle businesses, one aftermarket business and a wheel refurbishing business that also operates an aluminum smelter. These businesses had approximately $87.5 million of revenue in 2005, excluding the aluminum smelter revenue.

In addition, the company acquired three businesses during the fourth quarter of 2006 and through the date of this release: Eagle Industries, an aftermarket business; Northern Light Refinishing, a small light refurbishing business; and Potomac German Auto, a recycling business that serves the professional repair market. These three businesses had approximately $12.1 million in trailing annualized revenue prior to its acquisition of them.

Eagle Industries operated three aftermarket warehouses in Denver, CO, Gray, TN and Greensboro, NC. Since this acquisition LKQ has consolidated the Gray and Greensboro operations into two of its existing business locations.

Northern Light Refinishing is a head and tail lamp refurbishing company that operates out of a facility near Grand Rapids, MI. While currently a small business, the company said it believes its vast quantity of light cores can be refurbished back into high quality replacement lights than can be sold to LKQ's collision repair customers. This business provides us with the know-how and the technology to refurbish used lighting products.

Potomac German operates on two recycling properties totaling 13 acres. One facility is in Frederick, MD, and the other in St. Augustine, FL. These locations specialize in Mercedes Benz and BMW vehicles.

LKQ expects that 2007 organic revenue growth will be in the low double digits, with the balance of the growth being the full year impact of 2006 business acquisitions and the two acquisitions that the company has completed so far in 2007. The company expects net income to be within a range of $53.5 million to $56.5 million and diluted earnings per share to be between 95 cents and $1.

For the first quarter of 2007, LKQ expects net income to be within a range of $14.2 million to $15.2 million and diluted earnings per share to be between 25 cents and 27 cents.

The company anticipates that net cash provided by operating activities for 2007 will be more than $55 million. Full year 2007 capital expenditures related to property and equipment, excluding expenditures for acquiring businesses, will be between $45 to $50 million. This includes approximately $5 million related to capital planned in late 2006 on projects that became delayed. As of Feb. 26, the company had outstanding debt under its bank credit facility of $97 million.

The company estimates the weighted average diluted shares outstanding for the full year 2007 will be approximately 56.5 million. These share numbers are estimates and will be affected by factors such as any future stock issuances, the number of options exercised in subsequent periods, and changes in stock price.

For more information about LKQ, go to: http://www.lkqcorp.com.