Standard Motor Products, Inc. Announces Second Quarter 2024 Results and Quarterly Dividend

Rhea-AI Summary

Standard Motor Products (NYSE: SMP) reported strong Q2 2024 results with net sales of $389.8 million, up 10.4% from Q2 2023. Earnings from continuing operations were $18.0 million or $0.81 per diluted share. Excluding non-operational items, adjusted earnings were $21.7 million or $0.98 per diluted share.

Key highlights:

• Vehicle Control sales up 2.7% in Q2
• Temperature Control sales increased 28.2%, setting an all-time quarterly record
• Engineered Solutions sales rose 6.1%
• Adjusted EBITDA margin was 10.1% (10.4% excluding start-up costs)
• Announced acquisition of Nissens for $388 million, expected to close by end of 2024
• Quarterly dividend of $0.29 per share declared

Positive

• Net sales increased 10.4% year-over-year to $389.8 million in Q2 2024
• Adjusted earnings from continuing operations rose to $21.7 million or $0.98 per diluted share in Q2 2024
• Temperature Control segment sales grew 28.2%, setting an all-time quarterly record
• Engineered Solutions segment sales increased 6.1% in Q2 2024
• Announced acquisition of Nissens for $388 million, expanding geographic presence
• Implemented early retirement program expected to yield $10 million in annualized savings

Negative

• GAAP earnings from continuing operations decreased slightly to $18.0 million in Q2 2024 from $18.4 million in Q2 2023
• Operating income impacted by $1.0 million increase in customer factoring program expense
• Expecting $6 million in one-time severance costs related to early retirement program
• Anticipating $3-4 million additional start-up costs for new distribution center in 2024

Insights

Financial Analyst

Standard Motor Products' Q2 2024 results demonstrate solid growth and resilience in a challenging market. The company reported a 10.4% increase in net sales to $389.8 million, up from $353.1 million in Q2 2023. This growth was driven by strong performance across all segments, particularly in Temperature Control, which saw a remarkable 28.2% increase due to persistent heat across much of the country.

The company's adjusted earnings per share increased to $0.98 from $0.84 year-over-year, indicating improved profitability. However, it's worth noting that the GAAP earnings per share slightly decreased to $0.81 from $0.83, primarily due to one-time costs associated with an early retirement program.

SMP's strategic initiatives, including the planned acquisition of Nissens for approximately $388 million, signal a strong focus on expansion and long-term growth. This acquisition is expected to significantly boost SMP's European presence and broaden its product portfolio.

The company's commitment to shareholder returns remains strong, with a quarterly dividend of $0.29 per share and $7.8 million in share repurchases during the quarter. However, investors should monitor the impact of ongoing cost pressures and the integration costs associated with the Nissens acquisition on future profitability.

Overall, SMP's Q2 results and strategic moves position it well for future growth, but careful execution will be key to realizing the full potential of these initiatives.

Market Research Analyst

SMP's Q2 results offer valuable insights into current aftermarket trends and consumer behavior. The standout performance of the Temperature Control segment, with a 28.2% increase, underscores the impact of extreme weather events on automotive parts demand. This trend is likely to continue as climate patterns become more erratic, potentially creating sustained demand for cooling-related components.

The Vehicle Control segment's modest 2.7% growth suggests a steady, if not spectacular, recovery in general automotive maintenance and repair activities. This could be indicative of consumers keeping older vehicles on the road longer, a trend that typically benefits aftermarket parts suppliers.

The Engineered Solutions segment's 6.1% growth highlights SMP's success in diversifying its revenue streams and capitalizing on cross-selling opportunities. This strategy could provide a buffer against fluctuations in traditional automotive markets.

The planned acquisition of Nissens is a significant move that could reshape SMP's competitive position, especially in Europe. With Nissens' annual revenues of approximately $260 million and mid-teens EBITDA margin, this acquisition has the potential to substantially boost SMP's market share and profitability in the medium to long term.

However, the persistent cost pressures mentioned by management warrant attention. The implementation of an early retirement program, while potentially saving $10 million annually, also signals ongoing challenges in maintaining profit margins. This situation is likely not unique to SMP and may reflect broader industry trends that investors should monitor closely.

NEW YORK, Aug. 1, 2024 /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, 2024.

Net sales for the second quarter of 2024 were $389.8 million, compared to consolidated net sales of $353.1 million during the comparable quarter in 2023. Earnings from continuing operations for the second quarter of 2024 were $18.0 million or $0.81 per diluted share, compared to $18.4 million or $0.83 per diluted share in the second quarter of 2023. 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 2024 were $21.7 million or $0.98 per diluted share, compared to $18.6 million or $0.84 per diluted share in the second quarter of 2023.

Consolidated net sales for the six months ended June 30, 2024, were $721.2 million, compared to consolidated net sales of $681.1 million during the comparable period in 2023.  Earnings from continuing operations for the six months ended June 30, 2024, were $27.8 million or $1.25 per diluted share, compared to $31.1 million or $1.40 per diluted share in the comparable period of 2023.  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, 2024 and 2023 were $31.7 million or $1.42 per diluted share and $31.9 million or $1.44 per diluted share, respectively. 

Mr. Eric Sills, Standard Motor Products' Chairman and Chief Executive Officer stated, "We are pleased with our second quarter results as sales increased 10.4% versus last year's second quarter, while year-to-date sales are up nearly 6% relative to 2023.  We experienced solid top line results in all segments, setting records across the board, most notably within Temperature Control."   

By segment, Vehicle Control sales improved 2.7% in the quarter, accelerating from the more modest growth seen in our first quarter.  Year-to-date sales are up 1.6%, and we are pleased with the trajectory.

Temperature Control sales increased 28.2% versus last year's second quarter, representing an all-time quarterly sales record, as elevated heat persisted across much of the country.  Year-to-date we are up nearly 16%, and temperatures remain hot, which should be positive for the third quarter. 

Our Engineered Solutions segment sales increased 6.1% in the quarter and 5.3% for the year, attributable to strong demand from our existing customers as well as new business wins. We continue to see positive results from our cross-selling efforts, and the pipeline of opportunities remains healthy.    

Looking at profitability, our Adjusted EBITDA margin was 10.1% in the quarter vs. 10.0% last year. Excluding $1.3 million of start-up costs related to our new distribution center in Shawnee, KS, Adjusted EBITDA was 10.4% in the quarter.   During the quarter, our operating income was impacted by a roughly $1.0 million increase in customer factoring program expense over last year mainly due to higher sales volumes, although it appears we are finally starting to see a leveling off from the impact of elevated interest rates. 

Mr. Sills commented, "While we are pleased with our sales results, we continue to work on our profitability, as cost pressures persist.  To address this, we chose to implement an early retirement program launched in the second quarter.  Benefits of this program will phase in over the next few quarters, and once fully realized, we anticipate achieving an estimated $10 million of annualized savings. We expect one-time severance costs of approximately $6 million related to this program, of which $2.6 million was incurred in the second quarter, and an additional $3.1 million is expected to be incurred in the second half of 2024 as people retire."

During the quarter, we announced a definitive agreement to acquire AX V Nissens III APS ("Nissens"), a leading European manufacturer and distributor of aftermarket engine cooling and air conditioning products with a growing array of vehicle control technologies, for approximately $388 million (€360 million) in cash. Nissens has annual revenues of approximately $260 million with a mid-teens EBITDA margin rate.  The transaction is expected to be completed before the end of 2024, and is subject to certain closing conditions, including receipt of applicable antitrust and other regulatory approvals. We are extremely excited about this major step forward for our company. For more details, please see our July 10, 2024 press release and investor presentation related to the Nissens acquisition located on our website www.smpcorp.com.

As part of our commitment to return value to shareholders, 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 3, 2024 to stockholders of record on August 15, 2024. Additionally, we purchased $7.8 million of common stock under our existing share repurchase authorization during the quarter, leaving our remaining authorization under the current program at $19.6 million.

Regarding our sales and profit expectations for the full year of 2024, and excluding any impact from the Nissens acquisition, we anticipate sales growth will be in the low- to mid-single digits, up from prior projections, and Adjusted EBITDA will be in a range of 9.0-9.5%, consistent with what we noted previously.  We expect to incur roughly $3-4 million of additional start-up costs in 2024 as compared to 2023 for our new distribution center in Shawnee, KS, related to increased rent as well as duplicate expenses as we transition away from our Edwardsville, KS distribution center. 

In closing, Mr. Sills commented "As we look towards the second half of the year, we are encouraged with the demand seen so far across all our segments.  Aftermarket fundamentals remain positive, and our Engineered Solutions business is performing well. Lastly, we are excited about our planned acquisition of Nissens that expands our geographic presence, and provides a meaningful global growth platform for many years to come.  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 Thursday, August 1, 2024.  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 2024 Earnings Webcast link.  Investors may also listen to the call by dialing 800-343-4136 (domestic) or 203-518-9843 (international) and using conference ID SMP2Q2024.  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 800-938-2490 (domestic) or 402-220-9028 (international).

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,
		2024		2023		2024		2023
		(Unaudited)				(Unaudited)
NET SALES		$       389,829		$       353,075		$       721,232		$       681,103
COST OF SALES		278,382		251,806		520,263		488,567
GROSS PROFIT		111,447		101,269		200,969		192,536
SELLING, GENERAL & ADMINISTRATIVE EXPENSES		83,885		73,843		158,618		143,476
RESTRUCTURING AND INTEGRATION EXPENSES		2,559		294		2,751		1,206
OTHER INCOME (EXPENSE), NET		(17)		46		5		70
OPERATING INCOME		24,986		27,178		39,605		47,924
OTHER NON-OPERATING INCOME, NET		2,199		802		3,018		1,027
INTEREST EXPENSE		2,752		3,283		4,819		7,145
EARNINGS FROM CONTINUING OPERATIONS BEFORE TAXES		24,433		24,697		37,804		41,806
PROVISION FOR INCOME TAXES		6,109		6,289		9,451		10,661
EARNINGS FROM CONTINUING OPERATIONS		18,324		18,408		28,353		31,145
LOSS FROM DISCONTINUED OPERATION, NET OF INCOME TAXES		(917)		(9,221)		(1,956)		(10,001)
NET EARNINGS		17,407		9,187		26,397		21,144
NET EARNINGS ATTRIBUTABLE TO NONCONTROLLING INTEREST		344		50		510		89
NET EARNINGS ATTRIBUTABLE TO SMP (a)		$         17,063		$           9,137		$         25,887		$         21,055
NET EARNINGS ATTRIBUTABLE TO SMP
EARNINGS FROM CONTINUING OPERATIONS		$         17,980		$         18,358		$         27,843		$         31,056
LOSS FROM DISCONTINUED OPERATION, NET OF INCOME TAXES		(917)		(9,221)		(1,956)		(10,001)
TOTAL		$         17,063		$           9,137		$         25,887		$         21,055
NET EARNINGS PER COMMON SHARE ATTRIBUTABLE TO SMP
BASIC EARNINGS FROM CONTINUING OPERATIONS		$             0.83		$             0.85		$             1.27		$             1.43
DISCONTINUED OPERATION		(0.05)		(0.43)		(0.09)		(0.46)
NET EARNINGS PER COMMON SHARE - BASIC		$             0.78		$             0.42		$             1.18		$             0.97
DILUTED EARNINGS  FROM CONTINUING OPERATIONS		$             0.81		$             0.83		$             1.25		$             1.40
DISCONTINUED OPERATION		(0.04)		(0.42)		(0.09)		(0.45)
NET EARNINGS  PER COMMON SHARE - DILUTED		$             0.77		$             0.41		$             1.16		$             0.95
WEIGHTED AVERAGE NUMBER OF COMMON SHARES		21,767,526		21,689,067		21,845,678		21,649,562
WEIGHTED AVERAGE NUMBER OF COMMON AND DILUTIVE SHARES		22,185,536		22,183,489		22,277,590		22,139,708
(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,
		2024			2023			2024			2023
		(Unaudited)						(Unaudited)
Revenues
Engine Management (Ignition, Emissions and
Fuel Delivery)		$       115,529			$       113,589			$       231,614			$       229,672
Electrical and Safety		57,128			52,867			109,535			104,671
Wire sets and other		16,084			17,333			33,116			34,023
Vehicle Control		188,741			183,789			374,265			368,366
AC System Components		99,970			72,730			149,930			123,528
Other Thermal Components		24,511			24,344			46,159			45,952
Temperature Control		124,481			97,074			196,089			169,480
Commercial Vehicle		23,483			20,225			46,391			40,457
Construction / Agriculture		9,473			11,138			19,549			22,830
Light Vehicle		24,686			23,981			46,489			47,000
All Other		18,965			16,868			38,449			32,970
Engineered Solutions		76,607			72,212			150,878			143,257
											-
Revenues		$       389,829			$       353,075			$       721,232			$       681,103
Gross Margin
Vehicle Control		$         59,969	31.8 %		$         60,109	32.7 %		$       118,868	31.8 %		$       118,581	32.2 %
Temperature Control		36,609	29.4 %		26,512	27.3 %		56,298	28.7 %		45,667	26.9 %
Engineered Solutions		14,869	19.4 %		14,648	20.3 %		25,803	17.1 %		28,288	19.7 %
All Other		-			-			-			-
Gross Margin		$       111,447	28.6 %		$       101,269	28.7 %		$       200,969	27.9 %		$       192,536	28.3 %
Selling, General & Administrative
Vehicle Control		$         43,844	23.2 %		$         40,720	22.2 %		$         87,102	23.3 %		$         81,556	22.1 %
Temperature Control		23,165	18.6 %		20,584	21.2 %		40,765	20.8 %		37,112	21.9 %
Engineered Solutions		8,676	11.3 %		8,481	11.7 %		17,367	11.5 %		16,390	11.4 %
All Other		5,789			4,058			10,973			8,418
Subtotal		$         81,474	20.9 %		$         73,843	20.9 %		$       156,207	21.7 %		$       143,476	21.1 %
Acquisition Expenses		2,411	0.6 %		-	0.0 %		2,411	0.3 %		-	0.0 %
Selling, General & Administrative		$         83,885	21.5 %		$         73,843	20.9 %		$       158,618	22.0 %		$       143,476	21.1 %
Operating Income
Vehicle Control		$         16,125	8.5 %		$         19,389	10.5 %		$         31,766	8.5 %		$         37,025	10.1 %
Temperature Control		13,444	10.8 %		5,928	6.1 %		15,533	7.9 %		8,555	5.0 %
Engineered Solutions		6,193	8.1 %		6,167	8.5 %		8,436	5.6 %		11,898	8.3 %
All Other		(5,789)			(4,058)			(10,973)			(8,418)
Subtotal		$         29,973	7.7 %		$         27,426	7.8 %		$         44,762	6.2 %		$         49,060	7.2 %
Restructuring & Integration		(2,559)	-0.7 %		(294)	-0.1 %		(2,751)	-0.4 %		(1,206)	-0.2 %
Acquisition Expenses		(2,411)	-0.6 %		-	0.0 %		(2,411)	-0.3 %		-	0.0 %
Other Income (Expense), Net		(17)	0.0 %		46	0.0 %		5	0.0 %		70	0.0 %
Operating Income		$         24,986	6.4 %		$         27,178	7.7 %		$         39,605	5.5 %		$         47,924	7.0 %

 

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,
		2024		2023		2024		2023
		(Unaudited)				(Unaudited)
EARNINGS FROM CONTINUING OPERATIONS ATTRIBUTABLE TO SMP
GAAP EARNINGS FROM CONTINUING OPERATIONS		$          17,980		$          18,358		$          27,843		$          31,056
RESTRUCTURING AND INTEGRATION EXPENSES		2,559		294		2,751		1,206
ACQUISITION EXPENSES		2,411		-		2,411		-
INCOME TAX EFFECT RELATED TO RECONCILING ITEMS		(1,292)		(77)		(1,342)		(314)
NON-GAAP EARNINGS FROM CONTINUING OPERATIONS		$          21,658		$          18,575		$          31,663		$          31,948
DILUTED EARNINGS PER SHARE FROM CONTINUING OPERATIONS ATTRIBUTABLE TO SMP
GAAP DILUTED EARNINGS PER SHARE FROM CONTINUING OPERATIONS		$             0.81		$             0.83		$             1.25		$             1.40
RESTRUCTURING AND INTEGRATION EXPENSES		0.12		0.01		0.12		0.05
ACQUISITION EXPENSES		0.11		-		0.11		-
INCOME TAX EFFECT RELATED TO RECONCILING ITEMS		(0.06)		-		(0.06)		(0.01)
NON-GAAP DILUTED EARNINGS PER SHARE FROM CONTINUING OPERATIONS		$             0.98		$             0.84		$             1.42		$             1.44
OPERATING INCOME
GAAP OPERATING INCOME		$          24,986		$          27,178		$          39,605		$          47,924
RESTRUCTURING AND INTEGRATION EXPENSES		2,559		294		2,751		1,206
ACQUISITION EXPENSES		2,411		-		2,411		-
OTHER (INCOME) EXPENSE, NET		17		(46)		(5)		(70)		LAST TWELVE MONTHS ENDED				YEAR ENDED
										JUNE 30,				DECEMBER 31,
NON-GAAP OPERATING INCOME		$          29,973		$          27,426		$          44,762		$          49,060		2024		2023		2023
										(Unaudited)
EBITDA WITHOUT SPECIAL ITEMS
GAAP EARNINGS FROM CONTINUING OPERATIONS BEFORE TAXES		$          24,433		$          24,697		$          37,804		$          41,806		$          77,714		$          84,580		$           81,716
DEPRECIATION AND AMORTIZATION		7,318		7,047		14,619		14,129		29,512		28,534		29,022
INTEREST EXPENSE		2,752		3,283		4,819		7,145		10,961		15,136		13,287
EBITDA		34,503		35,027		57,242		63,080		118,187		128,250		124,025
RESTRUCTURING AND INTEGRATION EXPENSES		2,559		294		2,751		1,206		4,187		3,053		2,642
ACQUISITION EXPENSES		2,411		-		2,411		-		2,411		-		-
CUSTOMER BANKRUPTCY CHARGE		-		-		-		-		-		7,002		-
SPECIAL ITEMS		4,970		294		5,162		1,206		6,598		10,055		2,642
EBITDA WITHOUT SPECIAL ITEMS		$          39,473		$          35,321		$          62,404		$          64,286		$        124,785		$        138,305		$         126,667

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, 2024
		Vehicle Control		Temperature Control		Engineered Solutions		All Other		Consolidated
		(Unaudited)
OPERATING INCOME
GAAP OPERATING INCOME		$          15,116		$          13,197		$           5,812		$           (9,139)		$          24,986
RESTRUCTURING AND INTEGRATION EXPENSES		1,009		247		364		939		2,559
ACQUISITION EXPENSES		-		-		-		2,411		2,411
OTHER EXPENSE, NET		-		-		17		-		17
NON-GAAP OPERATING INCOME		$          16,125		$          13,444		$           6,193		$           (5,789)		$          29,973
EBITDA WITHOUT SPECIAL ITEMS
GAAP EARNINGS FROM CONTINUING OPERATIONS BEFORE TAXES		$          13,067		$          13,978		$           6,529		$           (9,141)		$          24,433
DEPRECIATION AND AMORTIZATION		3,606		780		2,463		469		7,318
INTEREST EXPENSE		1,899		726		706		(579)		2,752
EBITDA		18,572		15,484		9,698		(9,251)		34,503
RESTRUCTURING AND INTEGRATION EXPENSES		1,009		247		364		939		2,559
ACQUISITION EXPENSES		-		-		-		2,411		2,411
SPECIAL ITEMS		1,009		247		364		3,350		4,970
EBITDA WITHOUT SPECIAL ITEMS		$          19,581		$          15,731		$          10,062		$           (5,901)		$          39,473
% of Net Sales		10.4 %		12.6 %		13.1 %				10.1 %
(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 %

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, 2024
		Vehicle Control		Temperature Control		Engineered Solutions		All Other		Consolidated
		(Unaudited)
OPERATING INCOME
GAAP OPERATING INCOME		$          30,656		$          15,228		$           8,044		$         (14,323)		$          39,605
RESTRUCTURING AND INTEGRATION EXPENSES		1,110		305		397		939		2,751
ACQUISITION EXPENSES		-		-		-		2,411		2,411
OTHER INCOME, NET		-		-		(5)		-		(5)
NON-GAAP OPERATING INCOME		$          31,766		$          15,533		$           8,436		$         (10,973)		$          44,762
EBITDA WITHOUT SPECIAL ITEMS
GAAP EARNINGS FROM CONTINUING OPERATIONS BEFORE TAXES		$          27,382		$          15,866		$           8,875		$         (14,319)		$          37,804
DEPRECIATION AND AMORTIZATION		7,131		1,678		4,932		878		14,619
INTEREST EXPENSE		3,326		1,257		1,370		(1,134)		4,819
EBITDA		37,839		18,801		15,177		(14,575)		57,242
RESTRUCTURING AND INTEGRATION EXPENSES		1,110		305		397		939		2,751
ACQUISITION EXPENSES		-		-		-		2,411		2,411
SPECIAL ITEMS		1,110		305		397		3,350		5,162
EBITDA WITHOUT SPECIAL ITEMS		$          38,949		$          19,106		$          15,574		$         (11,225)		$          62,404
% of Net Sales		10.4 %		9.7 %		10.3 %				8.7 %
(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 %

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
		2024		2023		2023
		(Unaudited)		(Unaudited)
ASSETS
CASH AND CASH EQUIVALENTS		$         26,156		$         23,019		$         32,526
ACCOUNTS RECEIVABLE, GROSS		247,989		223,862		168,327
ALLOWANCE FOR EXPECTED CREDIT LOSSES		8,672		5,757		8,045
ACCOUNTS RECEIVABLE, NET		239,317		218,105		160,282
INVENTORIES		508,183		499,134		507,075
UNRETURNED CUSTOMER INVENTORY		18,119		19,722		18,240
OTHER CURRENT ASSETS		24,880		27,903		26,100
TOTAL CURRENT ASSETS		816,655		787,883		744,223
PROPERTY, PLANT AND EQUIPMENT, NET		131,921		107,590		121,872
OPERATING LEASE RIGHT-OF-USE ASSETS		99,121		73,093		100,065
GOODWILL		134,476		132,391		134,729
OTHER INTANGIBLES, NET		87,597		96,291		92,308
DEFERRED INCOME TAXES		40,287		33,905		40,533
INVESTMENT IN UNCONSOLIDATED AFFILIATES		25,615		41,557		24,050
OTHER ASSETS		38,656		29,435		35,267
TOTAL ASSETS		$    1,374,328		$    1,302,145		$    1,293,047
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT PORTION OF REVOLVING CREDIT FACILITY		$                    -		$         53,700		$                    -
CURRENT PORTION OF TERM LOAN AND OTHER DEBT		5,030		5,028		5,029
ACCOUNTS PAYABLE		105,094		94,657		107,455
ACCRUED CUSTOMER RETURNS		53,102		43,664		38,238
ACCRUED CORE LIABILITY		16,017		20,187		18,399
ACCRUED REBATES		54,280		43,781		42,278
PAYROLL AND COMMISSIONS		32,404		28,346		29,561
SUNDRY PAYABLES AND ACCRUED EXPENSES		66,239		59,126		63,303
TOTAL CURRENT LIABILITIES		332,166		348,489		304,263
LONG-TERM DEBT		203,162		164,488		151,182
NONCURRENT OPERATING LEASE LIABILITY		88,820		64,271		88,974
ACCRUED ASBESTOS LIABILITIES		66,357		59,565		72,013
OTHER LIABILITIES		29,501		24,917		25,742
TOTAL LIABILITIES		720,006		661,730		642,174
TOTAL SMP STOCKHOLDERS' EQUITY		640,018		629,673		635,064
NONCONTROLLING INTEREST		14,304		10,742		15,809
TOTAL STOCKHOLDERS' EQUITY		654,322		640,415		650,873
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY		$    1,374,328		$    1,302,145		$    1,293,047

 

STANDARD MOTOR PRODUCTS, INC.
Condensed Consolidated Statements of Cash Flows
	(In thousands)
		SIX MONTHS ENDED
		JUNE 30,
		2024			2023
		(Unaudited)
	CASH FLOWS FROM OPERATING ACTIVITIES
	NET EARNINGS	$       26,397			$       21,144
	ADJUSTMENTS TO RECONCILE NET EARNINGS TO NET CASH
	PROVIDED BY (USED IN) OPERATING ACTIVITIES:
	DEPRECIATION AND AMORTIZATION	14,619			14,129
	LOSS FROM DISCONTINUED OPERATIONS, NET OF TAXES	1,956			10,001
	OTHER	5,560			5,835
	CHANGE IN ASSETS AND LIABILITIES:
	ACCOUNTS RECEIVABLE	(81,060)			(48,271)
	INVENTORY	(3,641)			30,924
	ACCOUNTS PAYABLE	(2,168)			4,323
	PREPAID EXPENSES AND OTHER CURRENT ASSETS	2,757			(468)
	SUNDRY PAYABLES AND ACCRUED EXPENSES	29,966			2,776
	OTHER	(4,525)			(1,023)
	NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES	(10,139)			39,370
	CASH FLOWS FROM INVESTING ACTIVITIES
	CASH ACQUIRED IN STEP ACQUISITION	-			-
	CAPITAL EXPENDITURES	(22,941)			(9,507)
	OTHER INVESTING ACTIVITIES	18			66
	NET CASH USED IN INVESTING ACTIVITIES	(22,923)			(9,441)
	CASH FLOWS FROM FINANCING ACTIVITIES
	NET CHANGE IN DEBT	51,986			(16,547)
	PURCHASE OF TREASURY STOCK	(10,409)			-
	DIVIDENDS PAID	(12,706)			(12,544)
	OTHER FINANCING ACTIVITIES	(400)			3
	NET CASH PROVIDED BY (USED IN) FINANCING ACTIVITIES	28,471			(29,088)
	EFFECT OF EXCHANGE RATE CHANGES ON CASH	(1,779)			1,028
	NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS	(6,370)			1,869
	CASH AND CASH EQUIVALENTS at beginning of period	32,526			21,150
	CASH AND CASH EQUIVALENTS at end of period	$       26,156			$       23,019

 

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SOURCE Standard Motor Products, Inc.

FAQ

What were Standard Motor Products' (SMP) Q2 2024 financial results?

SMP reported Q2 2024 net sales of $389.8 million, up 10.4% year-over-year. Earnings from continuing operations were $18.0 million or $0.81 per diluted share. Adjusted earnings were $21.7 million or $0.98 per diluted share.

How did SMP's Temperature Control segment perform in Q2 2024?

SMP's Temperature Control segment sales increased 28.2% compared to Q2 2023, setting an all-time quarterly sales record due to persistent elevated heat across much of the country.

What acquisition did Standard Motor Products (SMP) announce in Q2 2024?

SMP announced a definitive agreement to acquire Nissens, a European manufacturer and distributor of aftermarket engine cooling and air conditioning products, for approximately $388 million. The acquisition is expected to close by the end of 2024.

What is Standard Motor Products' (SMP) sales growth outlook for 2024?

Excluding the impact of the Nissens acquisition, SMP anticipates sales growth in the low- to mid-single digits for the full year 2024, up from prior projections.