Dorman Products Inc. has announced sales and EPS for the second quarter.
Net sales for the second quarter ended July 1, 2017, increased $19.7 million, or 9.4 percent, to $229.3 million from $209.6 million for the second quarter ended 2016. Diluted Earnings Per Share for the second quarter increased 10.7 percent to 83 cents per share from 75 cents per share in the second quarter of 2016.
“The team delivered very solid results in the second quarter,” said Matt Barton, president and CEO. “Despite an overall challenging automotive aftermarket demand environment, our top line sales growth remained robust, driven by the continued growth of new products.”
Key highlights in the quarter included:
- Launching 1,011 unique SKUs in the second quarter, a 16 percent increase over last year
- Dorman HD Solutions sales grew 26 percent over the second quarter of 2016
- Complex Electronics lines grew 17 percent over the second quarter of 2016
“In the quarter, we also started to realize meaningful revenue from the launch of our Dorman Premium full line chassis program. We are truly excited to see the results of a lot of hard work by the team as we strive to become a market leader in this category. Overall, we continue to execute well, and although we are very pleased with our first half growth, we remain cautious entering the back half of the year given current market conditions,” said Barton. “However, our previously issued full year guidance for top and bottom line growth remains unchanged.”
Gross profit for the second quarter increased 10.6 percent to $90.9 million (or 39.6 percent of net sales) from $82.2 million (or 39.2 percent of net sales) in the second quarter of 2016. The company said product mix (higher sales concentration of higher margin products) was the main driver of the year-over-year gross margin percentage improvement. Selling, General and Administrative Expenses for the second quarter increased 11.4 percent to $45.9 million (or 20 percent of sales) from $41.2 million (or 19.6 percent of sales) in the second quarter of 2016. Continued investment in new product development, variable expenses tied to growth and general wage and benefit inflation drove the year-over-year increases.
Operating Cash Flow was $3.8 million in the quarter compared to $12.6 million in the same quarter last year. Investment in inventories (of approximately $29 million in the quarter), to ensure high customer fill rates, was the driver of the decreased operating cash flows, said Dorman. The company expects inventory to plateau in the third quarter and begin to decline slightly in the second half of the year.
Under its share repurchase program, Dorman repurchased 300.6 thousand shares of its common stock for $24 million at an average share price of $79.73 during the second quarter ended July 1, 2017, bringing year-to-date purchases to 439.5 shares at an average price of $79.64.
