Genuine Parts Company released its financial results for the fourth quarter and twelve months ended December 31, 2023. Sales for the fourth quarter of 2023 were $5.6 billion, a 1.1% increase compared to the same period in the prior year. Net income for the quarter was $317 million, a 25.8% increase compared to the previous year. Diluted earnings per share were $2.26, up 27.7% from the prior year.
“We are pleased to report that GPC delivered on our financial commitments in 2023 and finished the year with a solid fourth quarter. We reported mid-single-digit total sales growth and our third consecutive year of double-digit earnings growth,” said Paul Donahue, Chairman and CEO. “We achieved these results despite a more challenging environment and are confident we are investing in the right areas of our business to deliver long-term profitable growth. Thank you to all our teammates and vendor partners across the globe for the ongoing commitment to serving our customers.”
In the Automotive Parts Group, sales were $3.5 billion, with a 2.9% benefit from acquisitions. Segment profit decreased by 12.2%, with a profit margin of 7.5%. In the Industrial Parts Group, sales were $2.1 billion, reflecting a 1.7% increase from the same period in 2022. Segment profit increased by 19.3%, with a segment profit margin of 12.9%.
“The value and benefit of our diverse business were evident in our fourth quarter and full-year results,” said Will Stengel, president and COO. “Our industrial and international automotive businesses outperformed our expectations in 2023, offsetting softer results in our U.S. automotive business. We took accelerated action on targeted priorities during the year to improve U.S. automotive and have seen positive impacts from these efforts. Around the world, we are focused on our near- and long-term strategic initiatives to deliver value for our customers every day.”
For the twelve months ended December 31, 2023, sales were $23.1 billion, up 4.5% from the same period in 2022. Net income for the twelve months was $1.3 billion, or $9.33 per diluted share, an increase of 12.3% compared to the previous year.
The company generated cash flow from operations of $1.4 billion for the twelve months of 2023. Free cash flow was $923 million for the twelve months.
The company ended the quarter and year with $2.6 billion in total liquidity, consisting of $1.5 billion availability on the revolving credit facility and $1.1 billion in cash and cash equivalents.
In addition, GPC is introducing a global restructuring designed to better align the company’s assets and further improve the efficiency of the business. GPC expects to incur costs of approximately $100 million to $200 million related to the restructuring efforts in 2024.
“We continuously pursue initiatives to simplify and streamline our business, enhance our service proposition and align with the market environments. Our coordinated global restructuring program is designed to improve service for customers and create value for our shareholders. We are focused on what we can control and will execute with discipline to deliver on our long-term financial targets,” said Stengel.
In consideration of several factors, the company is establishing full-year 2024 guidance. The company considered its recent business trends and financial results, current growth plans, strategic initiatives, global economic outlook, geopolitical conflicts and the potential impact on results in establishing its guidance.
