Exhibit 99.1
For Immediate Release
For more information, contact:
Anthony (Tony) Cristello
Standard Motor Products, Inc.
(972) 316-8107
tony.cristello@smpcorp.com
Standard Motor Products, Inc. Announces
First Quarter 2022 Results and a Quarterly Dividend
New York, NY, May 3, 2022......Standard Motor Products, Inc. (NYSE: SMP), a leading automotive parts manufacturer and distributor, reported today its consolidated financial results for the three months ended March 31, 2022.
Net sales for the first quarter of 2022 were $322.8 million, compared to consolidated net sales of $276.6 million during the comparable quarter in 2021. Earnings from continuing operations for the first quarter of 2022 were $20.6 million or 91
cents per diluted share, compared to $22.2 million or 97 cents per diluted share in the first quarter of 2021. Excluding non-operational gains and losses identified on the attached reconciliation of GAAP and non-GAAP measures, earnings from
continuing operations for the first quarter of 2022 were $20.6 million or 92 cents per diluted share, compared to $22.2 million or 97 cents per diluted share in the first quarter of 2021.
Mr. Eric Sills, Standard Motor Products’ Chief Executive Officer and President stated, “We are quite pleased with our first quarter results. Our sales increased nearly 17% over last year’s strong first quarter, posting our seventh consecutive
record quarter, with solid performance in both divisions.
“By division, Engine Management sales were up nearly 13% in the quarter, driven by sales from acquisitions made during 2021, along with solid customer demand, price increase benefits, and phase-in of business wins.
“Turning to Temperature Control, the robust year-end demand from 2021 has continued as sales in the quarter grew 30% year over year. This strong performance was due to a combination of strong pre-season orders, ongoing customer replenishment,
and new business wins in winter-related categories.
“Looking at profitability, consolidated operating margins were in line with expectations, finishing at 8.3% in the first quarter, down from 10.6% in the first quarter of 2021. Our lower operating income was mainly the result of lower gross
margins in both divisions, partly offset by continued improvement in operating costs, which were down to 19.5% of net sales in the quarter.
“As we’ve noted before, last year’s gross margin enjoyed many non-recurring benefits from reopening after COVID, while this year was impacted by inflationary headwinds and elevated supply chain costs. While we were successful in passing through
some of these higher costs, we anticipate more pricing actions to be taken in 2022 to match our elevated expenses during this volatile inflationary environment. We expect our consolidated gross margin will be in the range of 28-29% for the full
year after taking into account more normalized production levels, pricing to offset inflation, as well as a mix shift to higher sales in our specialized non-aftermarket channels.
“These specialized business channels, which focus on custom-engineered products for niche end markets such as medium and heavy-duty vehicles, construction and agricultural equipment, power sports, and others, represented 23% of our revenue in
the first quarter of 2022, compared to 17% the prior year, with most of the growth related to our recent acquisitions. As we have stated in the past, we are quite excited about this business as it brings new customers, products and geographies and
is highly complementary to our core aftermarket business.
“As we seek to improve our transparency related to sustainability, we are pleased to have recently published our 2021 Corporate Social Responsibility and Sustainability report. In it, we announced our ambition to achieve net-zero greenhouse gas
emissions by 2050, and introduced specific reduction targets related to our scope 1 and scope 2 emissions, along with many other first-time environmental and diversity disclosures.
“Our strong operating results have allowed us to continue to return value to our shareholders. The Board of Directors has approved payment of a quarterly dividend of 27 cents per share on the common stock outstanding, which will be paid on June
1, 2022 to stockholders of record on May 16, 2022. Furthermore, we repurchased shares of our common stock in the amount of $6.9 million in the quarter, with $22.8 million remaining under our current share repurchase authorization.
“In closing, we are pleased with our momentum as we exit the first quarter, and remain cautiously optimistic for the balance of the year. We understand that there are various headwinds including ongoing inflation, increased borrowing costs,
supply chain disruption, and an eventual normalization of demand. Still, the industry is one of resiliency, with many favorable trends such as an aging fleet, constrained new car availability, and rebounding miles driven. Finally, thanks to our
people, our position in the industry has never been stronger.”
Conference Call
Standard Motor Products, Inc. will hold a conference call at 11:00 AM, Eastern Time, on Tuesday, May 3, 2022. This call will be web cast and can be accessed on the Investor Relations page of our website at www.smpcorp.com and clicking
on the SMP Q1 2022 Earnings Webcast link. Investors may also listen to the call by dialing 866-518-6930 (domestic) or 203-518-9822 (international). Our playback will be made available for dial in immediately following the call. For those
choosing to listen to the replay by webcast, the link should be active on our website within 24 hours after the call. The playback number is 800-839-4568 (domestic) or 402-220-2681 (international). The participant passcode is 94640.
Under the safe harbor provisions of the Private Securities Litigation Reform Act of 1995, Standard Motor Products cautions investors that any forward-looking statements made by the company, including those that may be
made in this press release, are based on management’s expectations at the time they are made, but they are subject to risks and uncertainties that may cause actual results, events or performance to differ materially from those contemplated by such
forward looking statements. Among the factors that could cause actual results, events or performance to differ materially from those risks and uncertainties discussed in this press release are those detailed from time-to-time in prior press
releases and in the company’s filings with the Securities and Exchange Commission, including the company’s annual report on Form 10-K and quarterly reports on Form 10-Q. By making these forward-looking statements, Standard Motor Products
undertakes no obligation or intention to update these statements after the date of this release.
STANDARD MOTOR PRODUCTS, INC.
Consolidated Statements of Operations
(In thousands, except per share amounts)
|
THREE MONTHS ENDED
MARCH 31,
|
||||||||
|
2022
|
2021
|
|||||||
|
(Unaudited)
|
||||||||
|
NET SALES
|
$
|
322,831
|
$
|
276,553
|
||||
|
COST OF SALES
|
232,991
|
192,769
|
||||||
|
GROSS PROFIT
|
89,840
|
83,784
|
||||||
|
SELLING, GENERAL & ADMINISTRATIVE EXPENSES
|
62,884
|
54,460
|
||||||
|
RESTRUCTURING AND INTEGRATION EXPENSES
|
41
|
-
|
||||||
|
OPERATING INCOME
|
26,915
|
29,324
|
||||||
|
OTHER NON-OPERATING INCOME, NET
|
1,449
|
635
|
||||||
|
INTEREST EXPENSE
|
805
|
209
|
||||||
|
EARNINGS FROM CONTINUING OPERATIONS BEFORE TAXES
|
27,559
|
29,750
|
||||||
|
PROVISION FOR INCOME TAXES
|
7,005
|
7,586
|
||||||
|
EARNINGS FROM CONTINUING OPERATIONS
|
20,554
|
22,164
|
||||||
|
LOSS FROM DISCONTINUED OPERATION, NET OF INCOME TAXES
|
(1,116
|
)
|
(1,164
|
)
|
||||
|
NET EARNINGS
|
19,438
|
21,000
|
||||||
|
NET EARNINGS (LOSS) ATTRIBUTABLE TO NONCONTROLLING INTEREST
|
(8
|
)
|
-
|
|||||
|
NET EARNINGS ATTRIBUTABLE TO SMP (a)
|
$
|
19,446
|
$
|
21,000
|
||||
|
NET EARNINGS ATTRIBUTABLE TO SMP
|
||||||||
|
EARNINGS FROM CONTINUING OPERATIONS
|
$
|
20,562
|
$
|
22,164
|
||||
|
LOSS FROM DISCONTINUED OPERATION, NET OF INCOME TAXES
|
(1,116
|
)
|
(1,164
|
)
|
||||
|
TOTAL
|
$
|
19,446
|
$
|
21,000
|
||||
|
NET EARNINGS PER COMMON SHARE ATTRIBUTABLE TO SMP
|
||||||||
|
BASIC EARNINGS FROM CONTINUING OPERATIONS
|
$
|
0.94
|
$
|
0.99
|
||||
|
DISCONTINUED OPERATION
|
(0.06
|
)
|
(0.05
|
)
|
||||
|
NET EARNINGS PER COMMON SHARE - BASIC
|
$
|
0.88
|
$
|
0.94
|
||||
|
DILUTED EARNINGS FROM CONTINUING OPERATIONS
|
$
|
0.91
|
$
|
0.97
|
||||
|
DISCONTINUED OPERATION
|
(0.04
|
)
|
(0.05
|
)
|
||||
|
NET EARNINGS PER COMMON SHARE - DILUTED
|
$
|
0.87
|
$
|
0.92
|
||||
|
WEIGHTED AVERAGE NUMBER OF COMMON SHARES
|
21,978,507
|
22,317,959
|
||||||
|
WEIGHTED AVERAGE NUMBER OF COMMON AND DILUTIVE SHARES
|
22,477,819
|
22,765,508
|
||||||
(a) "SMP" refers to Standard Motor Products, Inc. and subsidiaries.
STANDARD MOTOR PRODUCTS, INC.
Segment Revenues and Operating Income
(In thousands)
|
THREE MONTHS ENDED
MARCH 31,
|
|||||||||||||
|
2022
|
2021
|
||||||||||||
|
(Unaudited)
|
|||||||||||||
|
Revenues
|
|||||||||||||
|
Ignition, Emission Control, Fuel & Safety Related System Products
|
$
|
200,354
|
$
|
173,666
|
|||||||||
|
Wire and Cable
|
38,903
|
38,352
|
|||||||||||
|
Engine Management
|
239,257
|
212,018
|
|||||||||||
|
Compressors
|
43,277
|
33,374
|
|||||||||||
|
Other Climate Control Parts
|
38,044
|
29,099
|
|||||||||||
|
Temperature Control
|
81,321
|
62,473
|
|||||||||||
|
All Other
|
2,253
|
2,062
|
|||||||||||
|
Revenues
|
$
|
322,831
|
$
|
276,553
|
|||||||||
|
Gross Margin
|
|||||||||||||
|
Engine Management
|
$
|
65,535
|
27.4%
|
$
|
65,070
|
30.7%
|
|||||||
|
Temperature Control
|
19,986
|
24.6%
|
15,995
|
25.6%
|
|||||||||
|
All Other
|
4,319
|
2,719
|
|||||||||||
|
Gross Margin
|
$
|
89,840
|
27.8%
|
$
|
83,784
|
30.3%
|
|||||||
|
Selling, General & Administrative
|
|||||||||||||
|
Engine Management
|
$
|
38,778
|
16.2%
|
$
|
33,956
|
16.0%
|
|||||||
|
Temperature Control
|
14,768
|
18.2%
|
12,403
|
19.9%
|
|||||||||
|
All Other
|
9,338
|
8,101
|
|||||||||||
|
Selling, General & Administrative
|
$
|
62,884
|
19.5%
|
$
|
54,460
|
19.7%
|
|||||||
|
Operating Income
|
|||||||||||||
|
Engine Management
|
$
|
26,757
|
11.2%
|
$
|
31,114
|
14.7%
|
|||||||
|
Temperature Control
|
5,218
|
6.4%
|
3,592
|
5.7%
|
|||||||||
|
All Other
|
(5,019
|
)
|
(5,382
|
)
|
|||||||||
|
Subtotal
|
26,956
|
8.3%
|
29,324
|
10.6%
|
|||||||||
|
Restructuring & Integration
|
(41
|
)
|
0.0%
|
-
|
0.0%
|
||||||||
|
Operating Income
|
$
|
26,915
|
8.3%
|
$
|
29,324
|
10.6%
|
|||||||
Reconciliation of GAAP and Non-GAAP Measures
(In thousands, except per share amounts)
|
THREE MONTHS ENDED
|
||||||||||||||||
|
MARCH 31,
|
||||||||||||||||
|
2022
|
2021
|
|||||||||||||||
|
(Unaudited)
|
||||||||||||||||
|
EARNINGS FROM CONTINUING OPERATIONS ATTRIBUTABLE TO SMP
|
||||||||||||||||
|
GAAP EARNINGS FROM CONTINUING OPERATIONS
|
$
|
20,562
|
$
|
22,164
|
||||||||||||
|
RESTRUCTURING AND INTEGRATION EXPENSES
|
41
|
-
|
||||||||||||||
|
INCOME TAX EFFECT RELATED TO RECONCILING ITEMS
|
(11
|
)
|
-
|
|||||||||||||
|
NON-GAAP EARNINGS FROM CONTINUING OPERATIONS
|
$
|
20,592
|
$
|
22,164
|
||||||||||||
|
DILUTED EARNINGS PER SHARE FROM CONTINUING OPERATIONS ATTRIBUTABLE TO SMP
|
||||||||||||||||
|
GAAP DILUTED EARNINGS PER SHARE FROM CONTINUING OPERATIONS
|
$
|
0.91
|
$
|
0.97
|
||||||||||||
|
RESTRUCTURING AND INTEGRATION EXPENSES
|
0.01
|
-
|
||||||||||||||
|
INCOME TAX EFFECT RELATED TO RECONCILING ITEMS
|
-
|
-
|
||||||||||||||
|
NON-GAAP DILUTED EARNINGS PER SHARE FROM CONTINUING OPERATIONS
|
$
|
0.92
|
$
|
0.97
|
||||||||||||
|
OPERATING INCOME
|
||||||||||||||||
|
GAAP OPERATING INCOME
|
$
|
26,915
|
$
|
29,324
|
||||||||||||
|
RESTRUCTURING AND INTEGRATION EXPENSES
|
41
|
-
|
LAST TWELVE MONTHS ENDED
|
|||||||||||||
|
MARCH 31,
|
||||||||||||||||
|
NON-GAAP OPERATING INCOME
|
$
|
26,956
|
$
|
29,324
|
2022
|
2021
|
||||||||||
|
(Unaudited)
|
||||||||||||||||
|
EBITDA WITHOUT SPECIAL ITEMS
|
||||||||||||||||
|
GAAP EARNINGS FROM CONTINUING OPERATIONS BEFORE TAXES
|
$
|
27,559
|
$
|
29,750
|
$
|
128,274
|
$
|
124,203
|
||||||||
|
DEPRECIATION AND AMORTIZATION
|
6,952
|
6,514
|
27,681
|
26,298
|
||||||||||||
|
INTEREST EXPENSE
|
805
|
209
|
2,624
|
1,664
|
||||||||||||
|
EBITDA
|
35,316
|
36,473
|
158,579
|
152,165
|
||||||||||||
|
RESTRUCTURING AND INTEGRATION EXPENSES
|
41
|
-
|
433
|
259
|
||||||||||||
|
ONE-TIME ACQUISITION COSTS
|
-
|
-
|
1,711
|
-
|
||||||||||||
|
INTANGIBLE ASSET IMPAIRMENT
|
-
|
-
|
-
|
2,600
|
||||||||||||
|
SPECIAL ITEMS
|
41
|
-
|
2,144
|
2,859
|
||||||||||||
|
EBITDA WITHOUT SPECIAL ITEMS
|
$
|
35,357
|
$
|
36,473
|
$
|
160,723
|
$
|
155,024
|
||||||||
MANAGEMENT BELIEVES THAT NON-GAAP EARNINGS FROM CONTINUING OPERATIONS AND NON-GAAP DILUTED EARNINGS PER SHARE FROM CONTINUING OPERATIONS WHICH ARE ATTRIBUTABLE TO SMP, AND NON-GAAP OPERATING INCOME AND EBITDA WITHOUT SPECIAL ITEMS, EACH OF WHICH
ARE NON-GAAP MEASUREMENTS AND ARE ADJUSTED FOR SPECIAL ITEMS, ARE MEANINGFUL TO INVESTORS BECAUSE THEY PROVIDE A VIEW OF THE COMPANY WITH RESPECT TO ONGOING OPERATING RESULTS. SPECIAL ITEMS REPRESENT SIGNIFICANT CHARGES OR CREDITS THAT ARE
IMPORTANT TO AN UNDERSTANDING OF THE COMPANY'S OVERALL OPERATING RESULTS IN THE PERIODS PRESENTED. SUCH NON-GAAP MEASUREMENTS ARE NOT RECOGNIZED IN ACCORDANCE WITH GENERALLY ACCEPTED ACCOUNTING PRINCIPLES AND SHOULD NOT BE VIEWED AS AN ALTERNATIVE
TO GAAP MEASURES OF PERFORMANCE.
STANDARD MOTOR PRODUCTS, INC.
Condensed Consolidated Balance Sheets
(In thousands)
|
March 31,
2022
|
December 31,
2021
|
|||||||
|
(Unaudited)
|
||||||||
| ASSETS |
||||||||
|
CASH
|
$
|
19,999
|
$
|
21,755
|
||||
|
ACCOUNTS RECEIVABLE, GROSS
|
231,963
|
186,774
|
||||||
|
ALLOWANCE FOR EXPECTED CREDIT LOSSES
|
6,660
|
6,170
|
||||||
|
ACCOUNTS RECEIVABLE, NET
|
225,303
|
180,604
|
||||||
|
INVENTORIES
|
534,421
|
468,755
|
||||||
|
UNRETURNED CUSTOMER INVENTORY
|
22,221
|
22,268
|
||||||
|
OTHER CURRENT ASSETS
|
17,471
|
17,823
|
||||||
|
TOTAL CURRENT ASSETS
|
819,415
|
711,205
|
||||||
|
PROPERTY, PLANT AND EQUIPMENT, NET
|
102,984
|
102,786
|
||||||
|
OPERATING LEASE RIGHT-OF-USE ASSETS
|
42,116
|
40,469
|
||||||
|
GOODWILL
|
131,538
|
131,652
|
||||||
|
OTHER INTANGIBLES, NET
|
104,344
|
106,234
|
||||||
|
DEFERRED INCOME TAXES
|
35,964
|
36,126
|
||||||
|
INVESTMENT IN UNCONSOLIDATED AFFILIATES
|
45,518
|
44,087
|
||||||
|
OTHER ASSETS
|
28,530
|
25,402
|
||||||
|
TOTAL ASSETS
|
$
|
1,310,409
|
$
|
1,197,961
|
||||
| LIABILITIES AND STOCKHOLDERS' EQUITY |
||||||||
|
NOTES PAYABLE
|
$
|
245,450
|
$
|
125,298
|
||||
|
CURRENT PORTION OF OTHER DEBT
|
3,235
|
3,117
|
||||||
|
ACCOUNTS PAYABLE
|
139,392
|
137,167
|
||||||
|
ACCRUED CUSTOMER RETURNS
|
46,085
|
42,412
|
||||||
|
ACCRUED CORE LIABILITY
|
23,513
|
23,663
|
||||||
|
ACCRUED REBATES
|
42,606
|
42,472
|
||||||
|
PAYROLL AND COMMISSIONS
|
31,972
|
45,058
|
||||||
|
SUNDRY PAYABLES AND ACCRUED EXPENSES
|
45,875
|
57,182
|
||||||
|
TOTAL CURRENT LIABILITIES
|
578,128
|
476,369
|
||||||
|
OTHER LONG-TERM DEBT
|
-
|
21
|
||||||
|
NONCURRENT OPERATING LEASE LIABILITY
|
32,281
|
31,206
|
||||||
|
ACCRUED ASBESTOS LIABILITIES
|
51,909
|
52,698
|
||||||
|
OTHER LIABILITIES
|
25,178
|
25,040
|
||||||
|
TOTAL LIABILITIES
|
687,496
|
585,334
|
||||||
|
TOTAL SMP STOCKHOLDERS' EQUITY
|
611,871
|
601,580
|
||||||
|
NONCONTROLLING INTEREST
|
11,042
|
11,047
|
||||||
|
TOTAL STOCKHOLDERS' EQUITY
|
622,913
|
612,627
|
||||||
|
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY
|
$
|
1,310,409
|
$
|
1,197,961
|
||||
Condensed Consolidated Statements of Cash Flows
(In thousands)
|
THREE MONTHS ENDED
MARCH 31,
|
||||||||
|
2022
|
2021
|
|||||||
|
(Unaudited)
|
||||||||
|
CASH FLOWS FROM OPERATING ACTIVITIES
|
||||||||
|
NET EARNINGS
|
$
|
19,438
|
$
|
21,000
|
||||
|
ADJUSTMENTS TO RECONCILE NET EARNINGS TO NET CASH
|
||||||||
|
USED IN OPERATING ACTIVITIES:
|
||||||||
|
DEPRECIATION AND AMORTIZATION
|
6,952
|
6,514
|
||||||
|
OTHER
|
4,374
|
4,475
|
||||||
|
CHANGE IN ASSETS AND LIABILITIES:
|
||||||||
|
ACCOUNTS RECEIVABLE
|
(44,706
|
)
|
23,533
|
|||||
|
INVENTORY
|
(67,662
|
)
|
(46,255
|
)
|
||||
|
ACCOUNTS PAYABLE
|
1,942
|
8,419
|
||||||
|
PREPAID EXPENSES AND OTHER CURRENT ASSETS
|
2,171
|
3,753
|
||||||
|
SUNDRY PAYABLES AND ACCRUED EXPENSES
|
(21,226
|
)
|
(29,549
|
)
|
||||
|
OTHER
|
(5,245
|
)
|
(3,288
|
)
|
||||
|
NET CASH USED IN OPERATING ACTIVITIES
|
(103,962
|
)
|
(11,398
|
)
|
||||
|
CASH FLOWS FROM INVESTING ACTIVITIES
|
||||||||
|
ACQUISITIONS OF AND INVESTMENTS IN BUSINESSES
|
-
|
(2,081
|
)
|
|||||
|
CAPITAL EXPENDITURES
|
(6,449
|
)
|
(4,966
|
)
|
||||
|
OTHER INVESTING ACTIVITIES
|
-
|
2
|
||||||
|
NET CASH USED IN INVESTING ACTIVITIES
|
(6,449
|
)
|
(7,045
|
)
|
||||
|
CASH FLOWS FROM FINANCING ACTIVITIES
|
||||||||
|
NET CHANGE IN DEBT
|
120,340
|
32,408
|
||||||
|
PURCHASE OF TREASURY STOCK
|
(6,517
|
)
|
(11,096
|
)
|
||||
|
DIVIDENDS PAID
|
(5,935
|
)
|
(5,588
|
)
|
||||
|
OTHER FINANCING ACTIVITIES
|
444
|
373
|
||||||
|
NET CASH PROVIDED BY FINANCING ACTIVITIES
|
108,332
|
16,097
|
||||||
|
EFFECT OF EXCHANGE RATE CHANGES ON CASH
|
323
|
(42
|
)
|
|||||
|
NET DECREASE IN CASH AND CASH EQUIVALENTS
|
(1,756
|
)
|
(2,388
|
)
|
||||
|
CASH AND CASH EQUIVALENTS at beginning of period
|
21,755
|
19,488
|
||||||
|
CASH AND CASH EQUIVALENTS at end of period
|
$
|
19,999
|
$
|
17,100
|
||||