Standard Motor Products (SMP) 8-K Third Quarter 2016 Results and a Quarterly Dividend

Exhibit 99.1

For Immediate Release

For more information, contact:

James J. Burke

Standard Motor Products, Inc.

(718) 392-0200

Standard Motor Products, Inc. Announces

Third Quarter 2016 Results and a Quarterly Dividend

New York, NY, October 27, 2016......Standard Motor Products, Inc. (NYSE: SMP), an automotive replacement parts manufacturer and distributor, reported today its consolidated financial results for the three months and nine months ended September 30, 2016.

Consolidated net sales for the third quarter of 2016 were $300.8 million, compared to consolidated net sales of $270 million during the comparable quarter in 2015. Earnings from continuing operations for the third quarter of 2016 were $21.1 million or 91 cents per diluted share, compared to $19.2 million or 83 cents per diluted share in the third quarter of 2015. Excluding non-operational gains and losses identified on the attached reconciliation of GAAP and non-GAAP measures, earnings from continuing operations for the third quarter of 2016 were $21.3 million or 92 cents per diluted share, compared to $18.4 million or 80 cents per diluted share in the third quarter of 2015.

37-18 Northern Blvd., Long Island City, NY  11101

(718) 392-0200

www.smpcorp.com

Consolidated net sales for the nine month period ended September 30, 2016, were $828.7 million, compared to consolidated net sales of $767 million during the comparable period in 2015.  Earnings from continuing operations for the nine month period ended September 30, 2016, were $53.6 million or $2.32 per diluted share, compared to $42.3 million or $1.82 per diluted share in the comparable period of 2015.  Excluding non-operational gains and losses identified on the attached reconciliation of GAAP and non-GAAP measures, earnings from continuing operations for the nine months ended September 30, 2016, and 2015 were $54.1 million or $2.35 per diluted share and $41.3 million or $1.78 cents per diluted share, respectively.

Mr. Eric P. Sills, Standard Motor Products’ Chief Executive Officer and President stated, “We are pleased with the results for the third quarter and year-to-date. For the quarter, consolidated net sales increased 11.4%, inclusive of $22.8 million from the acquisition of the General Cable North American ignition wire business. Excluding this, net sales were ahead 2.9% for the quarter.

“Our margins were higher as well. Gross margin increased from 30.2% to 31.8% for the quarter, while non-GAAP operating income before restructuring expenses grew roughly 16%. Some of the improvement is a function of increased sales, but much is the result of continuous operating improvement in all our locations. We compliment all our people for their efforts and achievements in this area.

“Turning to the operating divisions, Engine Management net sales increased 13.8% for the quarter. Excluding the wire acquisition, Engine Management sales were ahead approximately 1%. However, year-to-date, excluding the wire acquisition, net sales are up 3.5%, in line with our low to mid-single digit forecasts. As we have previously noted, sales can vary in any particular quarter, based on special one-time events, but over time they balance out.

“Temperature Control sales increased 6.8% for the quarter and 5.5% year-to-date. By contrast, our key customers reported POS sales increases through September of about 9% aided by the first warm summer in three years. This would indicate that our customers were able to reduce inventory during this time, much of which was carried over from the two prior cool summers. This should be a positive factor heading into 2017.

“Year-to-date results were positive for the company as a whole. Total consolidated net sales were up 8% (4% excluding the wire acquisition). Gross margin increased from 28.4% to 30.9% and non-GAAP operating income before restructuring expenses increased by approximately 33%. As you recall, we incurred approximately $10 million of one-time costs during the full year 2015 for our diesel enhancement program, unfavorable Temperature Control variances and postretirement medical expenses. Adjusting for the $9.5 million of these expenses incurred in the first nine months of 2015, our non-GAAP operating income improved roughly 16%.

“We have two major operating initiatives in progress and both are proceeding on schedule and on budget. The first is the integration of the wire acquisition. In October, we completed the consolidation of the General Cable Altoona, PA, distribution center into our existing wire distribution center in Edwardsville, KS. We are now announcing our plan to relocate all production from the acquired Nogales, Mexico, wire set assembly operation to our existing wire assembly business in Reynosa, Mexico. We anticipate completion by the end of 2017, at which point we will close the Nogales plant.

“The second initiative includes the closing of our Grapevine, TX, facility and the relocation of the production lines to Greenville, SC, and Reynosa, Mexico. We are also relocating certain production lines from Greenville, SC, to Bialystok, Poland. We anticipate that all will be complete by the end of 2017 and will result in significant synergies and cost savings.”

The Board of Directors has approved payment of a quarterly dividend of seventeen cents per share on the common stock outstanding. The dividend will be paid on December 1, 2016, to stockholders of record on November 15, 2016.

Standard Motor Products, Inc. will hold a conference call at 11:00 AM, Eastern Time, on Thursday, October 27, 2016.  The dial-in number is 800-895-1241 (domestic) or 785-424-1056 (international). The playback number is 800-727-1367 (domestic) or 402-220-2669 (international). The conference ID # is STANDARD.

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 SEPTEMBER 30,						NINE MONTHS ENDED SEPTEMBER 30,
	2016			2015			2016			2015
	(Unaudited)						(Unaudited)
NET SALES	$	300,795		$	270,037		$	828,683		$	767,008
COST OF SALES		205,151			188,484			572,967			548,806
GROSS PROFIT		95,644			81,553			255,716			218,202
SELLING, GENERAL & ADMINISTRATIVE EXPENSES		61,277			51,907			169,033			152,841
RESTRUCTURING AND INTEGRATION EXPENSES (INCOME)		1,115			(80	)		2,127			(49	)
OTHER INCOME , NET		322			231			881			774
OPERATING INCOME		33,574			29,957			85,437			66,184
OTHER NON-OPERATING INCOME (EXPENSE), NET		208			(535	)		806			164
INTEREST EXPENSE		501			332			1,206			1,238
EARNINGS FROM CONTINUING OPERATIONS BEFORE TAXES		33,281			29,090			85,037			65,110
PROVISION FOR INCOME TAXES		12,226			9,896			31,464			22,769
EARNINGS FROM CONTINUING OPERATIONS		21,055			19,194			53,573			42,341
LOSS FROM DISCONTINUED OPERATION, NET OF INCOME TAXES		(425	)		(728	)		(1,495	)		(1,549	)
NET EARNINGS	$	20,630		$	18,466		$	52,078		$	40,792
NET EARNINGS PER COMMON SHARE:
BASIC EARNINGS FROM CONTINUING OPERATIONS	$	0.93		$	0.84		$	2.36		$	1.85
DISCONTINUED OPERATION		(0.02	)		(0.03	)		(0.06	)		(0.07	)
NET EARNINGS PER COMMON SHARE - BASIC	$	0.91		$	0.81		$	2.30		$	1.78
DILUTED EARNINGS FROM CONTINUING OPERATIONS	$	0.91		$	0.83		$	2.32		$	1.82
DISCONTINUED OPERATION		(0.02	)		(0.03	)		(0.06	)		(0.06	)
NET EARNINGS PER COMMON SHARE - DILUTED	$	0.89		$	0.80		$	2.26		$	1.76
WEIGHTED AVERAGE NUMBER OF COMMON SHARES		22,716,279			22,770,865			22,688,071			22,865,978
WEIGHTED AVERAGE NUMBER OF COMMON AND DILUTIVE SHARES		23,097,699			23,133,869			23,044,604			23,220,381

STANDARD MOTOR PRODUCTS, INC.

Segment Revenues and Operating Income

(In thousands)
	THREE MONTHS ENDED SEPTEMBER 30,										NINE MONTHS ENDED SEPTEMBER 30,
	2016					2015					2016					2015
	(unaudited)										(unaudited)
Revenues
Engine Management	$	200,782				$	176,379				$	580,311				$	530,442
Temperature Control		96,819					90,625					241,088					228,432
All Other		3,194					3,033					7,284					8,134
	$	300,795				$	270,037				$	828,683				$	767,008
Gross Margin
Engine Management	$	66,849		33.3	%	$	55,258		31.3	%	$	187,956		32.4	%	$	159,227		30.0	%
Temperature Control		25,773		26.6	%		23,308		25.7	%		60,447		25.1	%		50,438		22.1	%
All Other		3,022					2,987					7,313					8,537
	$	95,644		31.8	%	$	81,553		30.2	%	$	255,716		30.9	%	$	218,202		28.4	%
Selling, General & Administrative
Engine Management	$	36,659		18.3	%	$	30,609		17.4	%	$	102,908		17.7	%	$	91,055		17.2	%
Temperature Control		15,827		16.3	%		14,293		15.8	%		41,778		17.3	%		39,621		17.3	%
All Other		8,791					7,005					24,347					22,165
	$	61,277		20.4	%	$	51,907		19.2	%	$	169,033		20.4	%	$	152,841		19.9	%
Operating Income
Engine Management	$	30,190		15.0	%	$	24,649		14.0	%	$	85,048		14.7	%	$	68,172		12.9	%
Temperature Control		9,946		10.3	%		9,015		9.9	%		18,669		7.7	%		10,817		4.7	%
All Other		(5,769	)				(4,018	)				(17,034	)				(13,628	)
		34,367		11.4	%		29,646		11.0	%		86,683		10.5	%		65,361		8.5	%
Restructuring & Integration		(1,115	)	-0.4	%		80		0.0	%		(2,127	)	-0.3	%		49		0.0	%
Other Income, Net		322		0.1	%		231		0.1	%		881		0.1	%		774		0.1	%
	$	33,574		11.2	%	$	29,957		11.1	%	$	85,437		10.3	%	$	66,184		8.6	%

STANDARD MOTOR PRODUCTS, INC.

Reconciliation of GAAP and Non-GAAP Measures

(In thousands, except per share amounts)
		THREE MONTHS ENDED SEPTEMBER 30,						NINE MONTHS ENDED SEPTEMBER 30,
		2016			2015			2016			2015
		(Unaudited)						(Unaudited)
EARNINGS FROM CONTINUING OPERATIONS
	��
GAAP EARNINGS FROM CONTINUING OPERATIONS		$	21,055		$	19,194		$	53,573		$	42,341
RESTRUCTURING AND INTEGRATION EXPENSES			1,115			(80	)		2,127			(49	)
CERTAIN TAX CREDITS AND PRODUCTION DEDUCTIONS FINALIZED IN PERIOD			(235	)		(571	)		(235	)		(571	)
GAIN FROM SALE OF BUILDINGS			(262	)		(262	)		(786	)		(786	)
INCOME TAX EFFECT RELATED TO RECONCILING ITEMS			(340	)		137			(536	)		333
NON-GAAP EARNINGS FROM CONTINUING OPERATIONS		$	21,333		$	18,418		$	54,143		$	41,268
DILUTED EARNINGS PER SHARE FROM CONTINUING OPERATIONS
GAAP DILUTED EARNINGS PER SHARE FROM CONTINUING OPERATIONS		$	0.91		$	0.83		$	2.32		$	1.82
RESTRUCTURING AND INTEGRATION EXPENSES			0.05			-			0.09			-
CERTAIN TAX CREDITS AND PRODUCTION DEDUCTIONS FINALIZED IN PERIOD			(0.01	)		(0.03	)		(0.01	)		(0.03	)
GAIN FROM SALE OF BUILDINGS			(0.01	)		(0.01	)		(0.03	)		(0.03	)
INCOME TAX EFFECT RELATED TO RECONCILING ITEMS			(0.02	)		0.01			(0.02	)		0.02
NON-GAAP DILUTED EARNINGS PER SHARE FROM CONTINUING OPERATIONS		$	0.92		$	0.80		$	2.35		$	1.78
OPERATING INCOME
GAAP OPERATING INCOME		$	33,574		$	29,957		$	85,437		$	66,184
RESTRUCTURING AND INTEGRATION EXPENSES			1,115			(80	)		2,127			(49	)
OTHER INCOME, NET			(322	)		(231	)		(881	)		(774	)
NON-GAAP OPERATING INCOME		$	34,367		$	29,646		$	86,683		$	65,361

MANAGEMENT BELIEVES THAT EARNINGS FROM CONTINUING OPERATIONS, DILUTED EARNINGS PER SHARE FROM CONTINUING OPERATIONS, AND OPERATING INCOME, 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)
	September 30, 2016		December 31, 2015
	(Unaudited)
ASSETS
CASH	$	30,537	$	18,800
ACCOUNTS RECEIVABLE, GROSS		166,349		128,099
ALLOWANCE FOR DOUBTFUL ACCOUNTS		4,623		4,246
ACCOUNTS RECEIVABLE, NET		161,726		123,853
INVENTORIES		302,598		285,793
OTHER CURRENT ASSETS		47,896		51,294
TOTAL CURRENT ASSETS		542,757		479,740
PROPERTY, PLANT AND EQUIPMENT, NET		77,081		68,882
GOODWILL AND OTHER INTANGIBLES, NET		133,469		84,267
OTHER ASSETS		44,869		48,175
TOTAL ASSETS	$	798,176	$	681,064
LIABILITIES AND STOCKHOLDERS' EQUITY
NOTES PAYABLE	$	70,000	$	47,427
CURRENT PORTION OF LONG TERM DEBT		44		16
ACCOUNTS PAYABLE		88,168		72,711
ACCRUED CUSTOMER RETURNS		46,424		38,812
OTHER CURRENT LIABILITIES		109,645		84,950
TOTAL CURRENT LIABILITIES		314,281		243,916
LONG-TERM DEBT		134		62
ACCRUED ASBESTOS LIABILITIES		31,884		32,185
OTHER LIABILITIES		13,338		12,922
TOTAL LIABILITIES		359,637		289,085
TOTAL STOCKHOLDERS' EQUITY		438,539		391,979
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY	$	798,176	$	681,064

STANDARD MOTOR PRODUCTS, INC.

Condensed Consolidated Statements of Cash Flows

(In thousands)
	NINE MONTHS ENDED SEPTEMBER 30,
	2016			2015
	(Unaudited)
CASH FLOWS FROM OPERATING ACTIVITIES
NET EARNINGS	$	52,078		$	40,792
ADJUSTMENTS TO RECONCILE NET EARNINGS TO NET CASH
PROVIDED BY OPERATING ACTIVITIES:
DEPRECIATION AND AMORTIZATION		14,829			13,042
OTHER		10,581			7,945
CHANGE IN ASSETS AND LIABILITIES:
ACCOUNTS RECEIVABLE		(35,192	)		(25,094	)
INVENTORY		(7,422	)		4,761
ACCOUNTS PAYABLE		9,900			8,383
OTHER		38,194			23,003
NET CASH PROVIDED BY OPERATING ACTIVTIES		82,968			72,832
CASH FLOWS FROM INVESTING ACTIVITIES
ACQUISITIONS OF AND INVESTMENTS IN BUSINESSES		(67,289	)		-
CAPITAL EXPENDITURES		(15,194	)		(14,612	)
OTHER INVESTING ACTIVITIES		191			32
NET CASH USED IN INVESTING ACTIVITIES		(82,292	)		(14,580	)
CASH FLOWS FROM FINANCING ACTIVITIES
NET CHANGE IN DEBT		22,672			(32,227	)
PURCHASE OF TREASURY STOCK		(377	)		(15,519	)
DIVIDENDS PAID		(11,566	)		(10,299	)
OTHER FINANCING ACTIVITIES		736			131
NET CASH PROVIDED BY (USED IN) FINANCING ACTIVITIES		11,465			(57,914	)
EFFECT OF EXCHANGE RATE CHANGES ON CASH		(404	)		(707	)
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS		11,737			(369	)
CASH AND CASH EQUIVALENTS at beginning of Period		18,800			13,728
CASH AND CASH EQUIVALENTS at end of Period	$	30,537		$	13,359