For Immediate Release
For more information, contact:
James J. Burke
Standard Motor Products, Inc.
(718) 392-0200
Jennifer Tio
Maximum Marketing Services, Inc.
(312) 226-4111 x2449
Jennifer.tio@maxmarketing.com
Standard Motor Products, Inc. Announces
Fourth Quarter 2009 Results
New York, NY, March 5, 2010......Standard Motor Products, Inc. (NYSE: SMP), an automotive replacement parts manufacturer and distributor, reports today its consolidated financial results for the three months and for the year ended December 31, 2009.
Consolidated net sales for the fourth quarter of 2009 were $160.1 million, compared to consolidated net sales of $148.9 million during the comparable quarter in 2008. Losses from continuing operations for the fourth quarter of 2009 were $5.2 million or 25 cents per diluted share, compared to losses of $34.1 million or $1.84 per diluted share in the fourth quarter of 2008. Excluding non-operational gains and losses identified on the attached reconciliation of GAAP and non-GAAP measures, earnings from continuing operations for the fourth quarter of 2009 were $398 thousand or 2 cents per diluted share, compared to losses in the comparable quarter in 2008 of $5.5 million or 29 cents per diluted share.
37-18 Northern Blvd., Long Island City, NY 11101
(718) 392-0200
www.smpcorp.com
Consolidated net sales for 2009 were $735.4 million, compared to consolidated net sales of $775.2 million during the comparable period in 2008. Earnings from continuing operations for 2009 were $5.9 million or 31 cents per diluted share, compared to losses of $21.1 million or $1.14 per diluted share in the comparable period of 2008. Excluding non-operational gains and losses identified on the attached reconciliation of GAAP and non-GAAP measures, earnings from continuing operations for 2009 were $13.5 million or 70 cents per diluted share compared to losses for 2008 of $2 million or 11 cents per diluted share.
Mr. Lawrence I. Sills, Standard Motor Products’ Chairman and Chief Executive Officer, commented, “We are pleased with our results, both for the fourth quarter and the full year 2009. For the second quarter in a row, sales were ahead of the comparable quarter in 2008.
“Fourth quarter 2009 sales were aided by new wire business to NAPA and new customers in Temperature Control. In addition, the aftermarket, which accounts for roughly 90% of our total sales, remains quite healthy. And while it is still early in the year, these trends appear to be continuing into 2010, as our volume through February is running ahead of 2009.
“Gross margins continue to improve, as a result of increased volume and savings from our low cost Mexican operations. SG&A expenses remain under control, as a result of substantial cost cutting and the reduction of nearly 10% of our salaried work force.
“Perhaps our biggest achievement in 2009 was in the area of cash flow. Over the 12 month period, we reduced our total debt by $117.8 million from $194.2 million to $76.4 million. This included the retirement of our July 2009 convertible debt obligations. Our debt to adjusted EBITDA ratio, excluding special items, went from 6.2 times to a very healthy 1.7 times. This improvement was aided by a successful equity offering in October, in which we received net proceeds of $27.5 million. All this took a tremendous effort throughout the company, and we are extremely proud of our people for what they have been able to accomplish.
“In addition, based on our 2009 performance and our outlook for 2010, we reinstated our quarterly dividend that was suspended at the end of 2008. On March 1st we paid a dividend of 5 cents per share to stockholders of record on February 15th.”
Standard Motor Products, Inc. will hold a conference call at 11:00 AM, Eastern Time, on Friday, March 5, 2010. The dial in number is 800-895-1085 (domestic) or 785-424-1055 (international). The playback number is 800-839-5131 (domestic) or 402-220-1506 (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.
###
Consolidated Statements of Operations
| (In thousands, except per share amounts) | ||||||||||||||||
| THREE MONTHS ENDED | TWELVE MONTHS ENDED | |||||||||||||||
| DECEMBER 31, | DECEMBER 31, | |||||||||||||||
| 2009 | 2008 | 2009 | 2008 | |||||||||||||
| (Unaudited) | (Unaudited) | |||||||||||||||
| NET SALES | $ | 160,127 | $ | 148,876 | $ | 735,424 | $ | 775,241 | ||||||||
| COST OF SALES | 120,005 | 113,345 | 558,200 | 591,085 | ||||||||||||
| GROSS PROFIT | 40,122 | 35,531 | 177,224 | 184,156 | ||||||||||||
| SELLING, GENERAL & ADMINISTRATIVE EXPENSES | 37,035 | 38,696 | 146,642 | 166,199 | ||||||||||||
| GOODWILL AND INTANGIBLE ASSET IMPAIRMENT | - | 39,387 | - | 39,387 | ||||||||||||
| RESTRUCTURING AND INTEGRATION EXPENSES | 1,709 | 10,741 | 7,386 | 16,858 | ||||||||||||
| OPERATING INCOME (LOSS) | 1,378 | (53,293 | ) | 23,196 | (38,288 | ) | ||||||||||
| OTHER INCOME (EXPENSE), NET | (6,291 | ) | 1,005 | (1,981 | ) | 22,670 | ||||||||||
| INTEREST EXPENSE | 1,990 | 2,580 | 9,215 | 13,585 | ||||||||||||
| EARNINGS (LOSS) FROM CONTINUING OPERATIONS BEFORE TAXES | (6,903 | ) | (54,868 | ) | 12,000 | (29,203 | ) | |||||||||
| INCOME TAX EXPENSE (BENEFIT) | (1,660 | ) | (20,798 | ) | 6,094 | (8,105 | ) | |||||||||
| EARNINGS (LOSS) FROM CONTINUING OPERATIONS | (5,243 | ) | (34,070 | ) | 5,906 | (21,098 | ) | |||||||||
| EARNINGS (LOSS) FROM DISCONTINUED OPERATION, NET OF TAX | (202 | ) | 432 | (2,423 | ) | (1,796 | ) | |||||||||
| NET EARNINGS (LOSS) | $ | (5,445 | ) | $ | (33,638 | ) | $ | 3,483 | $ | (22,894 | ) | |||||
| NET EARNINGS (LOSS) PER COMMON SHARE: | ||||||||||||||||
| BASIC EARNINGS (LOSS) FROM CONTINUING OPERATIONS | $ | (0.25 | ) | $ | (1.84 | ) | $ | 0.31 | $ | (1.14 | ) | |||||
| DISCONTINUED OPERATION | (0.01 | ) | 0.03 | (0.13 | ) | (0.10 | ) | |||||||||
| NET EARNINGS (LOSS) PER COMMON SHARE - BASIC | $ | (0.26 | ) | $ | (1.81 | ) | $ | 0.18 | $ | (1.24 | ) | |||||
| DILUTED EARNINGS (LOSS) FROM CONTINUING OPERATIONS | $ | (0.25 | ) | $ | (1.84 | ) | $ | 0.31 | $ | (1.14 | ) | |||||
| DISCONTINUED OPERATION | (0.01 | ) | 0.03 | (0.13 | ) | (0.10 | ) | |||||||||
| NET EARNINGS (LOSS) PER COMMON SHARE - DILUTED | $ | (0.26 | ) | $ | (1.81 | ) | $ | 0.18 | $ | (1.24 | ) | |||||
| WEIGHTED AVERAGE NUMBER OF COMMON SHARES | 21,034,701 | 18,560,068 | 19,340,672 | 18,500,229 | ||||||||||||
| WEIGHTED AVERAGE NUMBER OF COMMON AND DILUTIVE SHARES | 21,109,573 | 18,560,068 | 19,388,771 | 18,531,148 | ||||||||||||
STANDARD MOTOR PRODUCTS, INC.
Reconciliation of GAAP and Non-GAAP Measures
| (In thousands, except per share amounts) | ||||||||||||||||
| THREE MONTHS ENDED | TWELVE MONTHS ENDED | |||||||||||||||
| DECEMBER 31, | DECEMBER 31, | |||||||||||||||
| EARNINGS (LOSS) FROM CONTINUING OPERATIONS | 2009 | 2008 | 2009 | 2008 | ||||||||||||
| (Unaudited) | (Unaudited) | |||||||||||||||
| GAAP EARNINGS (LOSS) FROM CONTINUING OPERATIONS BEFORE TAXES | $ | (6,903 | ) | $ | (54,868 | ) | $ | 12,000 | $ | (29,203 | ) | |||||
| INCOME TAX EXPENSE (BENEFIT) | (1,660 | ) | (20,798 | ) | 6,094 | (8,105 | ) | |||||||||
| EARNINGS (LOSS) FROM CONTINUING OPERATIONS | (5,243 | ) | (34,070 | ) | 5,906 | (21,098 | ) | |||||||||
| RESTRUCTURING AND INTEGRATION EXPENSES (NET OF TAX) | 1,026 | 6,503 | 4,897 | 10,237 | ||||||||||||
| LOSS FROM EUROPE DIVESTITURE (NET OF TAX) | 4,772 | - | 4,772 | - | ||||||||||||
| GAIN FROM SALE OF PREFERRED STOCK INVESTMENT (NET OF TAX) | - | - | (1,402 | ) | - | |||||||||||
| GOODWILL AND INTANGIBLE ASSET IMPAIRMENT (NET OF TAX) | - | 23,632 | - | 23,632 | ||||||||||||
| LOSS FROM EXTINGUISHMENT OF DEBT (NET OF TAX) | - | - | - | 882 | ||||||||||||
| GAIN FROM SALE OF BUILDING (NET OF TAX) | (157 | ) | (160 | ) | (629 | ) | (13,340 | ) | ||||||||
| GAIN FROM DEBENTURE REPURCHASE (NET OF TAX) | - | (1,366 | ) | (24 | ) | (2,308 | ) | |||||||||
| NON-GAAP EARNINGS (LOSS) FROM CONTINUING OPERATIONS | $ | 398 | $ | (5,461 | ) | $ | 13,520 | $ | (1,995 | ) | ||||||
| DILUTED EARNINGS (LOSS) PER SHARE FROM CONTINUING OPERATIONS | ||||||||||||||||
| GAAP DILUTED EARNINGS (LOSS) PER SHARE FROM CONTINUING OPERATIONS | $ | (0.25 | ) | $ | (1.84 | ) | $ | 0.31 | $ | (1.14 | ) | |||||
| RESTRUCTURING AND INTEGRATION EXPENSES (NET OF TAX) | 0.05 | 0.35 | 0.25 | 0.55 | ||||||||||||
| LOSS FROM EUROPE DIVESTITURE (NET OF TAX) | 0.23 | - | 0.24 | - | ||||||||||||
| GAIN FROM SALE OF PREFERRED STOCK INVESTMENT (NET OF TAX) | - | - | (0.07 | ) | - | |||||||||||
| GOODWILL AND INTANGIBLE ASSET IMPAIRMENT (NET OF TAX) | - | 1.28 | - | 1.28 | ||||||||||||
| LOSS FROM EXTINGUISHMENT OF DEBT (NET OF TAX) | - | - | - | 0.05 | ||||||||||||
| GAIN FROM SALE OF BUILDING (NET OF TAX) | (0.01 | ) | (0.01 | ) | (0.03 | ) | (0.73 | ) | ||||||||
| GAIN FROM DEBENTURE REPURCHASE (NET OF TAX) | - | (0.07 | ) | - | (0.12 | ) | ||||||||||
| NON-GAAP DILUTED EARNINGS (LOSS) PER SHARE FROM CONTINUING OPERATIONS | $ | 0.02 | $ | (0.29 | ) | $ | 0.70 | $ | (0.11 | ) | ||||||
MANAGEMENT BELIEVES THAT EARNINGS (LOSS) FROM CONTINUING OPERATIONS AND DILUTED EARNINGS (LOSS) PER SHARE FROM CONTINUING OPERATIONS BEFORE SPECIAL ITEMS, WHICH ARE NON-GAAP MEASUREMENTS, ARE MEANINGFUL TO INVESTORS BECAUSE THEY PROVIDE A VIEW OF THE COMPANY WITH RESPECT TO ONGOING 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 (continued)
| (In thousands) | ||||||||
| TWELVE MONTHS ENDED | ||||||||
| DECEMBER 31, | ||||||||
| 2009 | 2008 | |||||||
| (Unaudited) | ||||||||
| DEBT TO EARNINGS (LOSS) BEFORE INTEREST, TAXES, DEPRECIATION & AMORTIZATION (EBITDA) | ||||||||
| GAAP OPERATING PROFIT (LOSS) | $ | 23,196 | $ | (38,288 | ) | |||
| OTHER INCOME (EXPENSE) | (1,981 | ) | 22,670 | |||||
| DEPRECIATION AND AMORTIZATION | 14,354 | 14,700 | ||||||
| EBITDA BEFORE SPECIAL ITEMS | 35,569 | (918 | ) | |||||
| RESTRUCTURING AND INTEGRATION EXPENSES | 7,386 | 16,858 | ||||||
| LOSS FROM EUROPE DIVESTITURE | 6,608 | - | ||||||
| GAIN FROM SALE OF PREFERRED STOCK INVESTMENT | (2,336 | ) | - | |||||
| GOODWILL AND INTANGIBLE ASSET IMPAIRMENT | - | 39,387 | ||||||
| LOSS FROM EXTINGUISHMENT OF DEBT | - | 1,444 | ||||||
| GAIN FROM SALE OF BUILDING | (1,048 | ) | (21,845 | ) | ||||
| GAIN FROM DEBENTURE REPURCHASE | (40 | ) | (3,847 | ) | ||||
| NON-GAAP EBITDA | $ | 46,139 | $ | 31,079 | ||||
| TOTAL DEBT | $ | 76,405 | $ | 194,157 | ||||
| DEBT TO EBITDA RATIO | 1.7 | 6.2 | ||||||
MANAGEMENT BELIEVES THAT THE DEBT TO EBITDA RATIO, WHICH IS A NON-GAAP MEASURE, IS MEANINGFUL TO INVESTORS BECAUSE IT PROVIDES A VIEW OF THE COMPANY WITH RESPECT TO ONGOING OPERATING RESULTS AND LIQUIDITY. THE DEBT TO EBITDA RATIO IS CALCULATED BEFORE SPECIAL ITEMS. 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.
Condensed Consolidated Balance Sheets
| (In thousands) | ||||||||
| December 31, | December 31, | |||||||
| 2009 | 2008 | |||||||
| (Unaudited) | ||||||||
| ASSETS | ||||||||
| CASH | $ | 10,618 | $ | 6,608 | ||||
| ACCOUNTS RECEIVABLE, GROSS | 131,785 | 184,422 | ||||||
| ALLOWANCE FOR DOUBTFUL ACCOUNTS | 6,962 | 10,021 | ||||||
| ACCOUNTS RECEIVABLE, NET | 124,823 | 174,401 | ||||||
| INVENTORIES | 199,752 | 232,435 | ||||||
| ASSETS HELD FOR SALE | 1,405 | 1,654 | ||||||
| OTHER CURRENT ASSETS | 27,616 | 32,497 | ||||||
| TOTAL CURRENT ASSETS | 364,214 | 447,595 | ||||||
| PROPERTY, PLANT AND EQUIPMENT, NET | 61,478 | 66,901 | ||||||
| GOODWILL AND OTHER INTANGIBLES | 13,805 | 16,285 | ||||||
| OTHER ASSETS | 44,962 | 44,246 | ||||||
| TOTAL ASSETS | $ | 484,459 | $ | 575,027 | ||||
| LIABILITIES AND STOCKHOLDERS' EQUITY | ||||||||
| NOTES PAYABLE | $ | 58,430 | $ | 148,931 | ||||
| CURRENT PORTION OF LONG TERM DEBT | 67 | 44,953 | ||||||
| ACCOUNTS PAYABLE TRADE | 54,381 | 68,312 | ||||||
| ACCRUED CUSTOMER RETURNS | 20,442 | 19,664 | ||||||
| OTHER CURRENT LIABILITIES | 71,303 | 61,136 | ||||||
| TOTAL CURRENT LIABILITIES | 204,623 | 342,996 | ||||||
| LONG-TERM DEBT | 17,908 | 273 | ||||||
| ACCRUED ASBESTOS LIABILITY | 24,874 | 23,758 | ||||||
| OTHER LIABILITIES | 43,176 | 44,455 | ||||||
| TOTAL LIABILITIES | 290,581 | 411,482 | ||||||
| TOTAL STOCKHOLDERS' EQUITY | 193,878 | 163,545 | ||||||
| TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY | $ | 484,459 | $ | 575,027 | ||||
STANDARD MOTOR PRODUCTS, INC.
Segment Revenues and Operating Profit
| (In thousands) | ||||||||||||||||||||||||||||||||
| THREE MONTHS ENDED | YEAR ENDED | |||||||||||||||||||||||||||||||
| DECEMBER 31, | DECEMBER 31, | |||||||||||||||||||||||||||||||
| 2009 | 2008 | 2009 | 2008 | |||||||||||||||||||||||||||||
| (Unaudited) | (Unaudited) | (Unaudited) | (Unaudited) | |||||||||||||||||||||||||||||
| Revenues | ||||||||||||||||||||||||||||||||
| Engine Management | $ | 121,039 | $ | 110,811 | $ | 501,589 | $ | 528,157 | ||||||||||||||||||||||||
| Temperature Control | 31,303 | 29,412 | 196,729 | 194,171 | ||||||||||||||||||||||||||||
| Europe | 6,629 | 8,862 | 29,984 | 44,205 | ||||||||||||||||||||||||||||
| All Other | 1,156 | (209 | ) | 7,122 | 8,708 | |||||||||||||||||||||||||||
| $ | 160,127 | $ | 148,876 | $ | 735,424 | $ | 775,241 | |||||||||||||||||||||||||
| Gross Margin | ||||||||||||||||||||||||||||||||
| Engine Management | $ | 29,226 | 24.1 | % | $ | 24,106 | 21.8 | % | $ | 123,737 | 24.7 | % | $ | 122,876 | 23.3 | % | ||||||||||||||||
| Temperature Control | 7,912 | 25.3 | % | 6,908 | 23.5 | % | 38,677 | 19.7 | % | 37,406 | 19.3 | % | ||||||||||||||||||||
| Europe | 736 | 11.1 | % | 1,853 | 20.9 | % | 6,097 | 20.3 | % | 10,796 | 24.4 | % | ||||||||||||||||||||
| All Other | 2,248 | 2,664 | 8,713 | 13,078 | ||||||||||||||||||||||||||||
| $ | 40,122 | 25.1 | % | $ | 35,531 | 23.9 | % | $ | 177,224 | 24.1 | % | $ | 184,156 | 23.8 | % | |||||||||||||||||
| Selling, General & Administrative | ||||||||||||||||||||||||||||||||
| Engine Management | $ | 23,597 | 19.5 | % | $ | 23,776 | 21.5 | % | $ | 89,914 | 17.9 | % | $ | 97,056 | 18.4 | % | ||||||||||||||||
| Temperature Control | 6,977 | 22.3 | % | 7,227 | 24.6 | % | 31,014 | 15.8 | % | 33,693 | 17.4 | % | ||||||||||||||||||||
| Europe | 1,340 | 20.2 | % | 1,955 | 22.1 | % | 6,816 | 22.7 | % | 9,980 | 22.6 | % | ||||||||||||||||||||
| All Other | 5,121 | 5,738 | 18,898 | 25,470 | ||||||||||||||||||||||||||||
| 37,035 | 23.1 | % | 38,696 | 26.0 | % | 146,642 | 19.9 | % | 166,199 | 21.4 | % | |||||||||||||||||||||
| Asset Impairments | - | 39,387 | - | 39,387 | ||||||||||||||||||||||||||||
| Restructuring & Integration | 1,709 | 1.1 | % | 10,741 | 7.1 | % | 7,386 | 1.0 | % | 16,858 | 2.2 | % | ||||||||||||||||||||
| $ | 38,744 | 24.2 | % | $ | 88,824 | 59.6 | % | $ | 154,028 | 20.9 | % | $ | 222,444 | 28.7 | % | |||||||||||||||||
| Operating Profit (Loss) | ||||||||||||||||||||||||||||||||
| Engine Management | $ | 5,629 | 4.7 | % | $ | 329 | 0.3 | % | $ | 33,823 | 6.7 | % | $ | 25,820 | 4.9 | % | ||||||||||||||||
| Temperature Control | 935 | 3.0 | % | (319 | ) | -1.1 | % | 7,662 | 3.9 | % | 3,713 | 1.9 | % | |||||||||||||||||||
| Europe | (605 | ) | -9.1 | % | (102 | ) | -1.2 | % | (719 | ) | -2.4 | % | 816 | 1.8 | % | |||||||||||||||||
| All Other | (2,872 | ) | (3,073 | ) | (10,184 | ) | (12,392 | ) | ||||||||||||||||||||||||
| 3,087 | 1.9 | % | (3,165 | ) | -2.1 | % | 30,582 | 4.2 | % | 17,957 | 2.3 | % | ||||||||||||||||||||
| Asset Impairments | - | 39,387 | - | 39,387 | ||||||||||||||||||||||||||||
| Restructuring & Integration | 1,709 | 1.0 | % | 10,741 | 7.3 | % | 7,386 | 1.0 | % | 16,858 | 2.2 | % | ||||||||||||||||||||
| $ | 1,378 | 0.9 | % | $ | (53,293 | ) | -35.8 | % | $ | 23,196 | 3.2 | % | $ | (38,288 | ) | -4.9 | % | |||||||||||||||