Genuine Parts Company announced recently sales and earnings for the third quarter and nine months ended Sept. 30, 2019.
Sales for the third quarter ended Sept. 30, 2019, were a record $5 billion, a 6.2% increase compared to $4.7 billion for the same period in 2018. Total sales for the third quarter included the contribution of 1.2% comparable growth and 6.7% from acquisitions, offset by a 1% negative impact from foreign currency translation and 0.7% due primarily to the sale of Grupo Auto Todo in the first quarter of 2019. Net income for the third quarter was $227.5 million and earnings per share on a diluted basis were $1.56. Before the impact of certain transaction costs and other income primarily related to the acquisition of Inenco Group (Inenco) and the sale of EIS, Inc. (EIS), the Electrical Specialties Group of Motion Industries, adjusted net income was $219 million, or $1.50 per diluted share.
Third quarter sales for the Automotive Parts Group were up 5.3%, including a 1.8% comparable sales increase, a 6.5% benefit from acquisitions and an unfavorable foreign currency translation of 1.8%. In addition, automotive sales were impacted by 1.2% due primarily to the sale of Grupo Auto Todo. Sales for the Industrial Parts Group were up 9.9%, including a 0.9% comparable sales increase and 9% from acquisitions. Sales for the Business Products Group were down 0.9%, consisting primarily of the change in comparable sales growth.
Paul Donahue, chairman and CEO, commented, “Our third quarter results were highlighted by several accomplishments, including our achieving the $5 billion sales mark for the first time in the history of the company. In addition, we were pleased to report positive comparable sales in our U.S., Canadian and Australasian automotive businesses as well as our Industrial operations, and we further improved our gross margin. This translated to operating margin expansion in the Industrial and Business Products segments, an improved overall margin performance and strong cash flows for the quarter.”
Donahue added, “Our team was also active executing on our strategy to further optimize our portfolio. We closed on the Inenco industrial acquisition and the Sparesbox ecommerce investment on July 1st, and we divested of Motion’s Electrical Specialties Group on September 30th. We also made significant progress on our action plans to accelerate our ongoing cost savings efforts and develop expense reduction initiatives designed to more effectively address our cost structure, drive meaningful savings and deliver incremental value.”
Sales for the nine months ended Sept, 30, 2019, were $14.7 billion, a 3.9% increase compared to $14.1 billion for the same period in 2018. Net income for the nine months was $612.2 million and earnings per share on a diluted basis were $4.18. Before transaction costs and other income, adjusted net income was $636.5 million, or $4.34 per diluted share, for the nine months.
Donahue concluded, “We were pleased to perform in-line with our expectations for the quarter and are committed to our growth strategy and cost savings initiatives over the near and longer terms. We believe our focus in these areas will serve to deliver improved results and create significant long-term value for our shareholders.”
