Dorman Products Inc. has announced sales for the second quarter ended June 25, 2016, of $209.6 million, an increase of 5 percent from $198.7 million in the second quarter of 2015. Diluted earnings per share for the second quarter increased 15 percent to 75 cents per share from 65 cents per share in the second quarter of 2015.
“Second quarter net sales were up 5 percent despite several headwinds, including lower purchases from one of our larger customers due to its first quarter inventory build and the consolidation of another large customer,” said Matt Barton, president and CEO. “The team executed well on many fronts, which allowed us to deliver solid double-digit earnings growth. We remain optimistic about the long-term organic growth prospects for our business, and for the year we expect mid-to-high single-digit revenue growth and reported net income growth to be in the high single-digit to low double-digit range.”
For the six months ended June 25, 2016, sales increased 8 percent over the prior year to $417.7 million from $387.2 million last year. Diluted earnings per share in 2016 rose 17 percent to $1.46 from $1.25 in the prior year. Operating cash flow increased to $36.5 million for the first six months of 2016 compared to $34.9 million in the first six months of 2015.
“Our focus continues to be on delivering innovative new products to drive organic growth,” added Barton. “We introduced 871 unique SKUs during the second quarter. A total of 1,974 unique SKUs were introduced in the first six months of the year, a 15 percent improvement over the same period of 2015. Additionally, our HD Solutions business continues to impress. It was up 63 percent in the second quarter of 2016 compared to 2015 due to a customer product expansion at a large national account as well as widespread new product acceptance across the broader heavy-duty marketplace. Year-to-date revenues from our Dorman HD Solutions line are approaching 2 percent of our consolidated net sales.
“I would like to thank all of our contributors for another successful quarter, and our customers and end-users for their continued support and acceptance of our new products,” said Barton.
Dorman also announced that it has acquired a 40 percent interest in Powertrain Industries Inc. (PTI), a leading manufacturer of driveshafts and driveline related products, for approximately $6 million in July 2016. PTI is headquartered in Garden Grove, California, with four driveshaft manufacturing facilities located regionally throughout the U.S.
Dorman says this investment gives the company a unique opportunity to service the growing need for complete driveshafts, and quality aftermarket components.
A minimal 2016 impact on net income is expected as a result of the investment.
“Ron Hart, president of PTI, and his team are the aftermarket leaders in the driveline space. We are excited to be able to partner with them to continue to grow the aftermarket through the rapid introduction of new and innovative driveline repair solutions,” said Barton. “We’ve seen rapid technological change in driveline systems, and believe that this partnership provides an immediate opportunity to emerge as a leader in driveline repair parts.”
The company repurchased 122,500 shares of its common stock for $6.5 million at an average price of $52.77 per share during the second quarter of 2016, and has $57.8 million remaining under its current $150 million share repurchase program.
