Standard Motor Products, Inc. Announces Second Quarter 2023 Results and Quarterly Dividend

NEW YORK, Aug. 2, 2023 /PRNewswire/ -- Standard Motor Products, Inc. (NYSE: SMP), a leading automotive parts manufacturer and distributor, reported today its consolidated financial results for the three and six months ended June 30, 2023.

Net sales for the second quarter of 2023 were $353.1 million, compared to consolidated net sales of $359.4 million during the comparable quarter in 2022. Earnings from continuing operations for the second quarter of 2023 were $18.4 million or $0.83 per diluted share, compared to $20.8 million or $0.93 per diluted share in the second quarter of 2022. Excluding non-operational gains and losses identified on the attached reconciliation of GAAP and non-GAAP measures, earnings from continuing operations for the second quarter of 2023 were $18.6 million or $0.84 per diluted share, compared to $20.8 million or $0.93 per diluted share in the second quarter of 2022.

Consolidated net sales for the six months ended June 30, 2023, were $681.1 million, compared to consolidated net sales of $682.2 million during the comparable period in 2022.  Earnings from continuing operations for the six months ended June 30, 2023, were $31.1 million or $1.40 per diluted share, compared to $41.4 million or $1.85 per diluted share in the comparable period of 2022.  Excluding non-operational gains and losses identified on the attached reconciliation of GAAP and non-GAAP measures, earnings from continuing operations for the six months ended June 30, 2023 and 2022 were $31.9 million or $1.44 per diluted share and $41.4 million or $1.85 per diluted share, respectively. 

Mr. Eric Sills, Standard Motor Products' Chief Executive Officer and President stated, "Overall, sales decreased 1.8% versus last year's strong second quarter, while year-to-date we were roughly flat to 2022. The cooler and wetter conditions in the quarter had a negative impact on our aftermarket business, particularly on our Temperature Control segment.  Additionally, we continue to experience the impact of a recent bankruptcy of a large aftermarket customer, negatively impacting our quarterly sales by 1.6%. While we believe in the long run that volume will return, as the business has either been acquired or will be absorbed by other accounts, in the near term it will continue to be a headwind."   

By segment, Vehicle Control sales were down 1.1% in the quarter, though remain 1.5% favorable on a year-to-date basis.  This segment was the most impacted by the customer bankruptcy, reflecting a 2.2% negative impact in the quarter, which again, we believe will eventually be recovered.  Meanwhile, we continue to see favorable customer sell-through, suggesting general market stability.   

Temperature Control sales declined 8.1% versus the strong 6.4% growth experienced during the same quarter last year, and down 5.2% in the first half.   As noted above, a cooler and wetter spring negatively impacted demand for this seasonal product category against an already difficult prior year comparison. That said, after a slow start, the heat has picked up across the country, with many areas hitting record temperatures, and that should bode well for the third quarter.

Our Engineered Solutions segment sales increased 6.2% in the quarter due to strong demand from our existing customers as well as new business wins. We continue to be bullish on long-term sales growth in this segment as we gain traction with our expanded customer base, though revenue growth is not necessarily linear. 

Looking at profitability, consolidated non-GAAP operating margins were 7.8% in the quarter, flat with the 7.8% in the second quarter last year.  We are pleased with our ability to largely overcome the impact of inflation through a combination of pricing actions and cost reduction initiatives. While Temperature Control operating margins, down 390 basis points from last year, came under pressure due to sales performance, the Vehicle Control and Engineered Solutions segments improved operating margin by 190 basis points and 100 basis points, respectively.   During the quarter, our operating income was impacted by a $4.8 million increase in customer factoring program expense over last year from elevated interest rates.  On the bottom line, Adjusted EBITDA and earnings per share were down primarily due to the lower sales performance in Temp Control, lower overhead absorption from inventory reduction efforts, and the impact of interest rates both on our customer factoring programs and our borrowings. 

From a cash flow perspective, we continue to make progress with respect to initiatives on reducing both our inventory and our debt.  At quarter-end, our inventory was $499.1 million, down from $528.7 million at year-end 2022 and $551.4 million at last year's second quarter.  Additionally, our total debt at quarter-end stood at $223.2 million as we paid down $50 million in the second quarter.    

We are excited to announce our plans to open a new distribution center in Shawnee, KS, which eventually will replace our existing smaller DC in nearby Edwardsville, KS.  This 575,000 sq.ft. facility, scheduled to have a phased opening beginning early 2025, will provide capacity expansion for all aftermarket product categories with improved logistics capabilities, though in the near term we will incur additional costs while we operate two facilities.

Regarding our full year expectations for 2023, we anticipate top line sales growth to be in the low single digits.  We are updating our Adjusted EBITDA expectations to approximately 9.5% of revenue for the full year 2023 from our prior estimate of approximately 10%.  This outlook considers higher expense related to customer factoring programs that will fall between $48-$50 million at current rates, the impact of startup costs and duplicate overhead expense associated with the new distribution center discussed above, an exchange rate headwind from the weakening of the U.S. Dollar on our international operations, and the impact from softer than expected sales in our second quarter.

The Board of Directors has approved payment of a quarterly dividend of 29 cents per share on the common stock outstanding, which will be paid on September 1, 2023 to stockholders of record on August 15, 2023. 

The Company has been involved in a legal proceeding with a third party since March 2019. This lawsuit arose from a breach of contract claim associated with a discontinued operation of SMP. SMP has vigorously defended itself but, on May 11, 2023, we were found liable for approximately $11 million in damages. Although it is expected that the Court will not finalize its judgment until the end of the third quarter of 2023, we incurred a charge to SMP's discontinued operation in the second quarter of 2023.

In closing, Mr. Sills commented "As we start to look into the second half of the year, we are optimistic that the return of hotter summer weather patterns should help normalize aftermarket demand trends where fundamental industry dynamics remain favorable.  Our Engineered Solutions business, which can be lumpy quarter to quarter, is on a very nice trajectory. And our initiatives of reducing inventory levels and improving working capital have us on track to return to healthy levels of operating cash flow consistent with years past.  We recognize that macro pressures are lingering, but we will continue to invest in our business and people to be well-positioned to take advantage of the strength of the industries in which we operate once these near-term headwinds subside.  We want to thank all our employees for our current success and helping us achieve our goals for the future."

Conference Call

Standard Motor Products, Inc. will hold a conference call at 11:00 AM, Eastern Time, on Wednesday, August 2, 2023.  This call will be webcast and can be accessed on the Investor Relations page of our website at www.smpcorp.com and clicking on the SMP 2Q 2023 Earnings Webcast link.  Investors may also listen to the call by dialing 800-274-8461 (domestic) or 203-518-9814 (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 888-562-0905 (domestic) or 402-220-7347 (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						SIX MONTHS ENDED
		JUNE 30,						JUNE 30,
		2023			2022			2023			2022
		(Unaudited)						(Unaudited)
NET SALES		$       353,075			$       359,412			$       681,103			$       682,243
COST OF SALES		251,806			263,061			488,567			496,052
GROSS PROFIT		101,269			96,351			192,536			186,191
SELLING, GENERAL & ADMINISTRATIVE EXPENSES		73,843			68,468			143,476			131,352
RESTRUCTURING AND INTEGRATION EXPENSES		294			3			1,206			44
OTHER INCOME, NET		46			13			70			13
OPERATING INCOME		27,178			27,893			47,924			54,808
OTHER NON-OPERATING INCOME, NET		802			1,927			1,027			3,376
INTEREST EXPENSE		3,283			1,821			7,145			2,626
EARNINGS FROM CONTINUING OPERATIONS BEFORE TAXES		24,697			27,999			41,806			55,558
PROVISION FOR INCOME TAXES		6,289			7,122			10,661			14,127
EARNINGS FROM CONTINUING OPERATIONS		18,408			20,877			31,145			41,431
LOSS FROM DISCONTINUED OPERATION, NET OF INCOME TAXES		(9,221)			(1,666)			(10,001)			(2,782)
NET EARNINGS		9,187			19,211			21,144			38,649
NET EARNINGS ATTRIBUTABLE TO NONCONTROLLING INTEREST		50			85			89			77
NET EARNINGS ATTRIBUTABLE TO SMP (a)		$           9,137			$         19,126			$         21,055			$         38,572
NET EARNINGS ATTRIBUTABLE TO SMP
EARNINGS FROM CONTINUING OPERATIONS		$         18,358			$         20,792			$         31,056			$         41,354
LOSS FROM DISCONTINUED OPERATION, NET OF INCOME TAXES		(9,221)			(1,666)			(10,001)			(2,782)
TOTAL		$           9,137			$         19,126			$         21,055			$         38,572
NET EARNINGS PER COMMON SHARE ATTRIBUTABLE TO SMP
BASIC EARNINGS FROM CONTINUING OPERATIONS		$            0.85			$            0.96			$            1.43			$            1.89
DISCONTINUED OPERATION		(0.43)			(0.08)			(0.46)			(0.13)
NET EARNINGS PER COMMON SHARE - BASIC		$            0.42			$            0.88			$            0.97			$            1.76
DILUTED EARNINGS  FROM CONTINUING OPERATIONS		$            0.83			$            0.93			$            1.40			$            1.85
DISCONTINUED OPERATION		(0.42)			(0.07)			(0.45)			(0.13)
NET EARNINGS  PER COMMON SHARE - DILUTED		$            0.41			$            0.86			$            0.95			$            1.72
WEIGHTED AVERAGE NUMBER OF COMMON SHARES		21,689,067			21,757,998			21,649,562			21,867,644
WEIGHTED AVERAGE NUMBER OF COMMON AND DILUTIVE SHARES		22,183,489			22,255,642			22,139,708			22,372,702
(a) "SMP" refers to Standard Motor Products, Inc. and subsidiaries.

 

STANDARD MOTOR PRODUCTS, INC.
Segment Revenues and Operating Profit
(In thousands)
		THREE MONTHS ENDED						SIX MONTHS ENDED
		JUNE 30,						JUNE 30,
		2023			2022			2023			2022
		(Unaudited)						(Unaudited)
Revenues
Engine Management (Ignition, Emissions and
Fuel Delivery)		$       113,589			$       111,581			$       229,672			$       220,730
Electrical and Safety		52,867			57,054			104,671			109,311
Wire sets and other		17,333			17,136			34,023			32,994
Vehicle Control		183,789			185,771			368,366			363,035
AC System Components		74,449			81,608			120,201			128,982
Other Thermal Components		22,625			24,029			49,279			49,713
Temperature Control		97,074			105,637			169,480			178,695
Commercial Vehicle		26,742			19,503			46,599			40,954
Construction / Agriculture		8,103			11,222			20,898			22,206
Light Vehicle		23,548			23,039			46,514			49,114
All Other		13,819			14,240			29,246			28,239
Engineered Solutions		72,212			68,004			143,257			140,513
Revenues		$       353,075			$       359,412			$       681,103			$       682,243
Gross Margin
Vehicle Control		$         60,109	32.7 %		$         53,728	28.9 %		$       118,581	32.2 %		$       109,152	30.1 %
Temperature Control		26,512	27.3 %		29,315	27.8 %		45,667	26.9 %		48,803	27.3 %
Engineered Solutions		14,648	20.3 %		13,308	19.6 %		28,288	19.7 %		28,236	20.1 %
All Other		-			-			-			-
Gross Margin		$       101,269	28.7 %		$         96,351	26.8 %		$       192,536	28.3 %		$       186,191	27.3 %
Selling, General & Administrative
Vehicle Control		$         40,720	22.2 %		$         37,679	20.3 %		$         81,556	22.1 %		$         72,718	20.0 %
Temperature Control		20,584	21.2 %		18,792	17.8 %		37,112	21.9 %		34,118	19.1 %
Engineered Solutions		8,481	11.7 %		8,199	12.1 %		16,390	11.4 %		16,839	12.0 %
All Other		4,058			3,798			8,418			7,677
Selling, General & Administrative		$         73,843	20.9 %		$         68,468	19.1 %		$       143,476	21.1 %		$       131,352	19.3 %
Operating Income
Vehicle Control		$         19,389	10.5 %		$         16,049	8.6 %		$         37,025	10.1 %		$         36,434	10.0 %
Temperature Control		5,928	6.1 %		10,523	10.0 %		8,555	5.0 %		14,685	8.2 %
Engineered Solutions		6,167	8.5 %		5,109	7.5 %		11,898	8.3 %		11,397	8.1 %
All Other		(4,058)			(3,798)			(8,418)			(7,677)
Subtotal		$         27,426	7.8 %		$         27,883	7.8 %		$         49,060	7.2 %		$         54,839	8.0 %
Restructuring & Integration		(294)	-0.1 %		(3)	0.0 %		(1,206)	-0.2 %		(44)	0.0 %
Other Income, Net		46	0.0 %		13	0.0 %		70	0.0 %		13	0.0 %
Operating Income		$         27,178	7.7 %		$         27,893	7.8 %		$         47,924	7.0 %		$         54,808	8.0 %

 

STANDARD MOTOR PRODUCTS, INC.
Reconciliation of GAAP and Non-GAAP Measures
(In thousands, except per share amounts)
		THREE MONTHS ENDED				SIX MONTHS ENDED
		JUNE 30,				JUNE 30,
		2023		2022		2023		2022
		(Unaudited)				(Unaudited)
EARNINGS FROM CONTINUING OPERATIONS ATTRIBUTABLE TO SMP
GAAP EARNINGS FROM CONTINUING OPERATIONS		$          18,358		$           20,792		$          31,056		$           41,354
RESTRUCTURING AND INTEGRATION EXPENSES		294		3		1,206		44
INCOME TAX EFFECT RELATED TO RECONCILING ITEMS		(77)		-		(314)		(11)
NON-GAAP EARNINGS FROM CONTINUING OPERATIONS		$          18,575		$           20,795		$          31,948		$           41,387
DILUTED EARNINGS PER SHARE FROM CONTINUING OPERATIONS ATTRIBUTABLE TO SMP
GAAP DILUTED EARNINGS PER SHARE FROM CONTINUING OPERATIONS		$              0.83		$              0.93		$              1.40		$              1.85
RESTRUCTURING AND INTEGRATION EXPENSES		0.01		-		0.05		-
INCOME TAX EFFECT RELATED TO RECONCILING ITEMS		-		-		(0.01)		-
NON-GAAP DILUTED EARNINGS PER SHARE FROM CONTINUING OPERATIONS		$              0.84		$              0.93		$              1.44		$              1.85
OPERATING INCOME
GAAP OPERATING INCOME		$          27,178		$           27,893		$          47,924		$           54,808
RESTRUCTURING AND INTEGRATION EXPENSES		294		3		1,206		44
OTHER INCOME, NET		(46)		(13)		(70)		(13)		LAST TWELVE MONTHS ENDED				YEAR ENDED
										JUNE 30,				DECEMBER 31,
NON-GAAP OPERATING INCOME		$          27,426		$           27,883		$          49,060		$           54,839		2023		2022		2022
										(Unaudited)
EBITDA WITHOUT SPECIAL ITEMS
GAAP EARNINGS FROM CONTINUING OPERATIONS BEFORE TAXES		$          24,697		$           27,999		$          41,806		$           55,558		$           84,580		$         119,011		$            98,332
DEPRECIATION AND AMORTIZATION		7,047		6,941		14,129		13,893		28,534		28,036		28,298
INTEREST EXPENSE		3,283		1,821		7,145		2,626		15,136		3,950		10,617
EBITDA		35,027		36,761		63,080		72,077		128,250		150,997		137,247
RESTRUCTURING AND INTEGRATION EXPENSES		294		3		1,206		44		3,053		436		1,891
CUSTOMER BANKRUPTCY CHARGE		-		-		-		-		7,002		-		7,002
ONE-TIME ACQUISITION COSTS		-		-		-		-		-		956		-
SPECIAL ITEMS		294		3		1,206		44		10,055		1,392		8,893
EBITDA WITHOUT SPECIAL ITEMS		$          35,321		$           36,764		$          64,286		$           72,121		$         138,305		$         152,389		$          146,140
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.
Reconciliation of GAAP and Non-GAAP Measures by Segments
(In thousands)		THREE MONTHS ENDED JUNE 30, 2023
		Vehicle Control		Temperature Control		Engineered Solutions		All Other		Consolidated
		(Unaudited)
OPERATING INCOME
GAAP OPERATING INCOME		$          19,273		$             5,800		$            6,163		$           (4,058)		$           27,178
RESTRUCTURING AND INTEGRATION EXPENSES		154		128		12		-		294
OTHER INCOME, NET		(38)		-		(8)		-		(46)
NON-GAAP OPERATING INCOME		$          19,389		$             5,928		$            6,167		$           (4,058)		$           27,426
EBITDA WITHOUT SPECIAL ITEMS
GAAP EARNINGS FROM CONTINUING OPERATIONS BEFORE TAXES		$          17,235		$             5,259		$            6,247		$           (4,044)		$           24,697
DEPRECIATION AND AMORTIZATION		3,373		768		2,486		420		7,047
INTEREST EXPENSE		2,304		842		637		(500)		3,283
EBITDA		22,912		6,869		9,370		(4,124)		35,027
RESTRUCTURING AND INTEGRATION EXPENSES		154		128		12		-		294
SPECIAL ITEMS		154		128		12		-		294
EBITDA WITHOUT SPECIAL ITEMS		$          23,066		$             6,997		$            9,382		$           (4,124)		$           35,321
% of Net Sales		12.6 %		7.2 %		13.0 %				10.0 %
(In thousands)		THREE MONTHS ENDED JUNE 30, 2022
		Vehicle Control		Temperature Control		Engineered Solutions		All Other		Consolidated
		(Unaudited)
OPERATING INCOME
GAAP OPERATING INCOME		$          16,059		$           10,523		$            5,109		$           (3,798)		$           27,893
RESTRUCTURING AND INTEGRATION EXPENSES		3		-		-		-		3
OTHER INCOME, NET		(13)		-		-		-		(13)
NON-GAAP OPERATING INCOME		$          16,049		$           10,523		$            5,109		$           (3,798)		$           27,883
EBITDA WITHOUT SPECIAL ITEMS
GAAP EARNINGS FROM CONTINUING OPERATIONS BEFORE TAXES		$          14,928		$           12,064		$            4,950		$           (3,943)		$           27,999
DEPRECIATION AND AMORTIZATION		3,491		742		2,295		413		6,941
INTEREST EXPENSE		1,353		406		139		(77)		1,821
EBITDA		19,772		13,212		7,384		(3,607)		36,761
RESTRUCTURING AND INTEGRATION EXPENSES		3		-		-		-		3
SPECIAL ITEMS		3		-		-		-		3
EBITDA WITHOUT SPECIAL ITEMS		$          19,775		$           13,212		$            7,384		$           (3,607)		$           36,764
% of Net Sales		10.6 %		12.5 %		10.9 %				10.2 %
MANAGEMENT BELIEVES THAT 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.
Reconciliation of GAAP and Non-GAAP Measures by Segments
(In thousands)		SIX MONTHS ENDED JUNE 30, 2023
		Vehicle Control		Temperature Control		Engineered Solutions		All Other		Consolidated
		(Unaudited)
OPERATING INCOME
GAAP OPERATING INCOME		$          36,648		$             7,884		$          11,810		$           (8,418)		$           47,924
RESTRUCTURING AND INTEGRATION EXPENSES		439		671		96		-		1,206
OTHER INCOME, NET		(62)		-		(8)		-		(70)
NON-GAAP OPERATING INCOME		$          37,025		$             8,555		$          11,898		$           (8,418)		$           49,060
EBITDA WITHOUT SPECIAL ITEMS
GAAP EARNINGS FROM CONTINUING OPERATIONS BEFORE TAXES		$          32,292		$             6,364		$          11,533		$           (8,383)		$           41,806
DEPRECIATION AND AMORTIZATION		6,785		1,531		4,967		846		14,129
INTEREST EXPENSE		5,045		1,735		996		(631)		7,145
EBITDA		44,122		9,630		17,496		(8,168)		63,080
RESTRUCTURING AND INTEGRATION EXPENSES		439		671		96		-		1,206
SPECIAL ITEMS		439		671		96		-		1,206
EBITDA WITHOUT SPECIAL ITEMS		$          44,561		$           10,301		$          17,592		$           (8,168)		$           64,286
% of Net Sales		12.1 %		6.1 %		12.3 %				9.4 %
(In thousands)		SIX MONTHS ENDED JUNE 30, 2022
		Vehicle Control		Temperature Control		Engineered Solutions		All Other		Consolidated
		(Unaudited)
OPERATING INCOME
GAAP OPERATING INCOME		$          36,403		$           14,685		$          11,397		$           (7,677)		$           54,808
RESTRUCTURING AND INTEGRATION EXPENSES		44		-		-		-		44
OTHER INCOME, NET		(13)		-		-		-		(13)
NON-GAAP OPERATING INCOME		$          36,434		$           14,685		$          11,397		$           (7,677)		$           54,839
EBITDA WITHOUT SPECIAL ITEMS
GAAP EARNINGS FROM CONTINUING OPERATIONS BEFORE TAXES		$          35,294		$           16,544		$          11,528		$           (7,808)		$           55,558
DEPRECIATION AND AMORTIZATION		6,908		1,422		4,753		810		13,893
INTEREST EXPENSE		1,928		566		285		(153)		2,626
EBITDA		44,130		18,532		16,566		(7,151)		72,077
RESTRUCTURING AND INTEGRATION EXPENSES		44		-		-		-		44
SPECIAL ITEMS		44		-		-		-		44
EBITDA WITHOUT SPECIAL ITEMS		$          44,174		$           18,532		$          16,566		$           (7,151)		$           72,121
% of Net Sales		12.2 %		10.4 %		11.8 %				10.6 %
MANAGEMENT BELIEVES THAT 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)
		JUNE		JUNE		DECEMBER
		2023		2022		2022
		(Unaudited)		(Unaudited)
ASSETS
CASH		$         23,019		$         14,186		$         21,150
ACCOUNTS RECEIVABLE, GROSS		223,862		235,669		173,013
ALLOWANCE FOR EXPECTED CREDIT LOSSES		5,757		6,012		5,375
ACCOUNTS RECEIVABLE, NET		218,105		229,657		167,638
INVENTORIES		499,134		551,415		528,715
UNRETURNED CUSTOMER INVENTORY		19,722		21,405		19,695
OTHER CURRENT ASSETS		27,903		26,198		25,241
TOTAL CURRENT ASSETS		787,883		842,861		762,439
PROPERTY, PLANT AND EQUIPMENT, NET		107,590		104,931		107,148
OPERATING LEASE RIGHT-OF-USE ASSETS		73,093		39,827		49,838
GOODWILL		132,391		131,125		132,087
OTHER INTANGIBLES, NET		96,291		101,649		100,504
DEFERRED INCOME TAXES		33,905		34,086		33,658
INVESTMENT IN UNCONSOLIDATED AFFILIATES		41,557		44,885		41,745
OTHER ASSETS		29,435		27,188		27,510
TOTAL ASSETS		$     1,302,145		$     1,326,552		$     1,254,929
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT PORTION OF REVOLVING CREDIT FACILITY		$         53,700		$         56,000		$         50,000
CURRENT PORTION OF TERM LOAN AND OTHER DEBT		5,028		7,954		5,031
ACCOUNTS PAYABLE		94,657		140,082		89,247
ACCRUED CUSTOMER RETURNS		43,664		55,725		37,169
ACCRUED CORE LIABILITY		20,187		23,117		22,952
ACCRUED REBATES		43,781		41,647		37,381
PAYROLL AND COMMISSIONS		28,346		35,985		31,361
SUNDRY PAYABLES AND ACCRUED EXPENSES		59,126		49,710		49,990
TOTAL CURRENT LIABILITIES		348,489		410,220		323,131
LONG-TERM DEBT		164,488		203,500		184,589
NONCURRENT OPERATING LEASE LIABILITY		64,271		30,039		40,709
ACCRUED ASBESTOS LIABILITIES		59,565		48,025		63,305
OTHER LIABILITIES		24,917		22,119		22,157
TOTAL LIABILITIES		661,730		713,903		633,891
TOTAL SMP STOCKHOLDERS' EQUITY		629,673		601,586		610,020
NONCONTROLLING INTEREST		10,742		11,063		11,018
TOTAL STOCKHOLDERS' EQUITY		640,415		612,649		621,038
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY		$     1,302,145		$     1,326,552		$     1,254,929

 

STANDARD MOTOR PRODUCTS, INC.
Condensed Consolidated Statements of Cash Flows
	(In thousands)
		SIX MONTHS ENDED
		JUNE 30,
		2023			2022
		(Unaudited)
	CASH FLOWS FROM OPERATING ACTIVITIES
	NET EARNINGS	$       21,144			$       38,649
	ADJUSTMENTS TO RECONCILE NET EARNINGS TO NET CASH
	PROVIDED BY (USED IN) OPERATING ACTIVITIES:
	DEPRECIATION AND AMORTIZATION	14,129			13,893
	LOSS FROM DISCONTINUED OPERATIONS, NET OF TAXES	10,001			2,782
	OTHER	5,835			8,049
	CHANGE IN ASSETS AND LIABILITIES:
	ACCOUNTS RECEIVABLE	(48,271)			(49,659)
	INVENTORY	30,924			(87,744)
	ACCOUNTS PAYABLE	4,323			1,591
	PREPAID EXPENSES AND OTHER CURRENT ASSETS	(468)			(7,102)
	SUNDRY PAYABLES AND ACCRUED EXPENSES	2,776			(5,020)
	OTHER	(1,023)			(10,772)
	NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES	39,370			(95,333)
	CASH FLOWS FROM INVESTING ACTIVITIES
	CAPITAL EXPENDITURES	(9,507)			(13,203)
	OTHER INVESTING ACTIVITIES	66			-
	NET CASH USED IN INVESTING ACTIVITIES	(9,441)			(13,203)
	CASH FLOWS FROM FINANCING ACTIVITIES
	NET CHANGE IN DEBT	(16,547)			139,319
	PURCHASE OF TREASURY STOCK	-			(25,605)
	DIVIDENDS PAID	(12,544)			(11,822)
	PAYMENTS OF DEBT ISSUANCE COSTS	-			(2,128)
	OTHER FINANCING ACTIVITIES	3			1,903
	NET CASH PROVIDED BY (USED IN) FINANCING ACTIVITIES	(29,088)			101,667
	EFFECT OF EXCHANGE RATE CHANGES ON CASH	1,028			(700)
	NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS	1,869			(7,569)
	CASH AND CASH EQUIVALENTS at beginning of period	21,150			21,755
	CASH AND CASH EQUIVALENTS at end of period	$       23,019			$       14,186

 

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SOURCE Standard Motor Products, Inc.