NEW YORK — Standard Motor Products has reported its financial results for the three months and for the year, which ended Dec. 31, 2003.
Consolidated net sales for the fourth quarter of 2003 were $162.5 million, compared to consolidated net sales of $107.9 million during the comparable quarter in 2002. Losses from continuing operations for the fourth quarter of 2003 were $5.5 million or 29 cents per diluted share, compared to $8.1 million or 68 cents per diluted share in the fourth quarter of 2002.
Consolidated net sales for 2003 were $678.8 million, compared to consolidated net sales of $598.4 million in 2002. Earnings from continuing operations for 2003 were $224,000 or 1 cent per diluted share, compared to $6.1 million or 51 cents per diluted share in 2002.
“The net sales increase in the fourth quarter of 2003 was related to the previously announced acquisition of Dana Corp.’s Engine Management Division (DEM), effective as of June 30, 2003. Net sales generated in the fourth quarter and the second half of 2003 from DEM were $57.2 million and $115.5 million, respectively,” said Chairman and CEO Larry Sills. “Since the fourth quarter has the fewest selling days of any quarter and based on current expectations, we continue to forecast the DEM volume at approximately $250 million annually.
“Our core engine management net sales, excluding DEM, were flat in the fourth quarter and down a modest 1.4 percent for the year. This decline would have been mitigated if we had implemented normal price level increases in 2003, and in early 2004 we have begun implementing price increases. In our temperature control business, net sales were down slightly for the fourth quarter and down $35.5 million or 13.9 percent for the year, the result of the loss of AutoZone’s business and the very cool summer season.
“Our operating margins were negatively impacted in the fourth quarter and year-to-date by the lower added, margins on the DEM acquisition and certain transition costs while reducing redundancies,” Sills added. “Due to our reduced temperature control volume for the year, we provided an incremental $2 million inventory reserve in the fourth quarter based on our inventory agings. In addition, selling, general and administrative expenses in 2003 included $4.8 million of integration and restructuring costs for DEM and other SMP facilities.”
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