UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q/A
AMENDMENT NO. 1
(Mark One)
[X] QUARTERLY REPORT UNDER SECTION 13 OR 15 (D) OF THE
SECURITIES EXCHANGE ACT OF 1934.
FOR THE QUARTERLY PERIOD ENDED MARCH 31, 2002
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE
SECURITIES EXCHANGE ACT OF 1934.
COMMISSION FILE NUMBER 1-4743
STANDARD MOTOR PRODUCTS, INC.
(Exact name of registrant as specified in its charter)
NEW YORK 11-1362020
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
37-18 NORTHERN BLVD., LONG ISLAND CITY, N.Y. 11101
(Address of principal executive offices) (Zip Code)
(718) 392-0200
(Registrant's telephone number, including area code)
Indicate by check mark whether the registrant (1) has filed all
reports required to be filed by Section 13 or 15(d) of the Securities Exchange
Act of 1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days. Yes X No
--- ----
Indicate the number of shares outstanding of each of the issuer's
classes of common stock, as of the latest practicable date:
DATE CLASS SHARES
OUTSTANDING
COMMON STOCK, PAR
APRIL 30, 2002 VALUE $2.00 PER SHARE 12,524,519
-------------- --------------------- ----------
EXPLANATORY NOTE
This Amendment No. 1 to the Registrant's Quarterly Report on Form 10-Q for the
quarter ended March 31, 2002, as originally filed on May 14, 2002, is being
filed to amend and reflect the restatement of the Registrant's Consolidated
Financial Statements. See Note 15 of Notes to Consolidated Financial Statements
for further discussion. Each item of the Quarterly Report on Form 10-Q as filed
on May 14, 2002 that was affected by the restatement has been amended and
restated. No attempt has been made in this Form 10-Q/A to modify or update other
disclosures as presented in the original Form 10-Q except as required to reflect
the effects of the restatement.
STANDARD MOTOR PRODUCTS, INC. AND SUBSIDIARIES
INDEX TO FINANCIAL AND OTHER INFORMATION
MARCH 31, 2002
PART 1 - FINANCIAL INFORMATION
ITEM 1 PAGE NO.
CONSOLIDATED BALANCE SHEETS
March 31, 2002 (Unaudited) (As Restated) and December 31, 2001 4
CONSOLIDATED STATEMENTS OF OPERATIONS AND
RETAINED EARNINGS (Unaudited) for the three-month periods ended
March 31, 2002 and 2001 (As Restated) 6
CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) for the
three-month periods ended March 31, 2002 (As Restated) and 2001 7
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) 8
ITEM 2
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS 15
ITEM 3
QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK 19
2
PART II - OTHER INFORMATION
ITEM 1
LEGAL PROCEEDINGS 20
ITEM 6
EXHIBITS AND REPORTS ON FORM 8-K 21
SIGNATURE 21
CERTIFICATIONS 22
3
STANDARD MOTOR PRODUCTS, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(Dollars in thousands)
ASSETS
March 31,
2002 December 31,
(Unaudited) 2001
- ----------------------------------------------------------------------------------------
(Restated)
Current assets:
Cash and cash equivalents $ 2,520 $ 7,496
Accounts and notes receivable, net of
allowance for doubtful accounts and
discounts of $5,131 (2001 - $4,362) (Note 6) 147,580 117,965
Inventories (Notes 4 and 6) 187,391 177,291
Deferred income taxes 12,668 12,316
Prepaid expenses and other current assets 15,054 13,881
------------ ------------
Total current assets 365,213 328,949
------------ ------------
Property, plant and equipment, net of
accumulated depreciation (Notes 5 and 6) 100,224 101,646
Goodwill, net (Note 3) 20,017 38,040
Other assets 37,597 40,794
------------ ------------
Total assets $ 523,051 $ 509,429
============ ============
See accompanying notes to consolidated financial statements.
4
STANDARD MOTOR PRODUCTS, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(Dollars in thousands, except for shares and per share data)
LIABILITIES AND STOCKHOLDERS' EQUITY
March 31,
2002 December 31,
(Unaudited) 2001
- ---------------------------------------------------------------------------------------------------------------------------
(Restated)
Current liabilities:
Notes payable $ 826 $ 4,075
Current portion of long-term debt (Note 6) 1,766 1,784
Accounts payable 43,785 26,110
Sundry payables and accrued expenses 41,370 41,968
Accrued customer returns 18,486 18,167
Payroll and commissions 8,303 8,489
------------- --------------
Total current liabilities 114,536 100,593
------------- --------------
Long-term debt (Note 6) 220,260 200,066
Postretirement benefits other than pensions
and other accrued liabilities 23,369 23,083
------------- --------------
Total liabilities 358,165 323,742
------------- --------------
Commitments and contingencies (Notes 6,7,10,12 and 14)
Stockholders' equity (Notes 6,7,9,10,11 and 12 ):
Common stock - par value $2.00 per share:
Authorized - 30,000,000 shares, issued and
outstanding 11,832,015 and 11,823,650 shares
in 2002 and 2001, respectively) 26,649 26,649
Capital in excess of par value 1,830 1,877
Retained earnings 161,878 183,532
Accumulated other comprehensive loss (2,943) (3,722)
------------- --------------
187,414 208,336
Less:Treasury stock - at cost (1,492,461 and 1,500,826
shares in 2002 and 2001, respectively) 22,528 22,649
------------- --------------
Total stockholders' equity 164,886 185,687
------------- --------------
Total liabilities and stockholders' equity $ 523,051 $ 509,429
============= ==============
See accompanying notes to consolidated financial statements.
5
STANDARD MOTOR PRODUCTS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS AND RETAINED EARNINGS
(Dollars in thousands, except for shares and per share data)
(Unaudited)
For Three-Months Ended
March 31,
2002 2001
--------------- ---------------
(Restated) (Restated)
Net sales (Note 2) $ 126,321 $ 154,463
Cost of sales (Note 2) 95,345 117,032
--------------- ---------------
Gross profit 30,976 37,431
Selling, general and administrative expenses (Note 2) 30,869 32,995
--------------- ---------------
Operating income(loss) 107 4,436
Other income (expense) - net 668 597
Interest expense 3,462 4,127
--------------- ---------------
Earnings (loss) from continuing operations before taxes (2,687) 906
Income tax expense (benefit) (766) 287
--------------- ---------------
Earnings (loss) from continuing operations (1,921) 619
Loss from discontinued operation, net of tax (319) -
Earnings (loss) before cumulative effect
--------------- ---------------
of accounting change (2,240) 619
Cumulative effect of accounting change, net of tax (Note 3) (18,350) -
--------------- ---------------
Net earnings(loss) (20,590) 619
Retained earnings at beginning of period 183,532 190,253
--------------- ---------------
162,942 190,872
Less: cash dividends for period 1,064 1,052
--------------- ---------------
Retained earnings at end of period $ 161,878 $ 189,820
=============== ===============
PER SHARE DATA:
Net earnings(loss) per common share - basic:
Earnings(loss) per share from continuing operations $ (0.16) $ 0.05
Discontinued operations (0.03) -
Cumulative effect of accounting change (1.55) -
--------------- ---------------
Net earnings(loss) per common share - basic $ (1.74) $ 0.05
=============== ===============
Net earnings(loss) per common share - diluted:
Earnings(loss) per share from continuing operations $ (0.16) $ 0.05
Discontinued operations (0.03) -
Cumulative effect of accounting change (1.55) -
--------------- ---------------
Net earnings(loss) per common share - diluted $ (1.74) $ 0.05
=============== ===============
Average number of common shares 11,827,636 11,714,346
=============== ===============
Average number of common and dilutive shares 11,827,636 11,728,569
=============== ===============
See accompanying notes to consolidated financial statements.
6
STANDARD MOTOR PRODUCTS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Dollars in thousands)
(Unaudited)
For the Three-Months Ended
March 31,
--------------------------------
2002 2001
-------------- -----------
(Restated)
Cash flows from operating activities:
Net earnings (loss) $ (20,590) $ 619
Adjustments to reconcile net earnings (loss) to net cash used in operating
activities:
Depreciation and amortization 3,898 4,828
Gain on sale of property, plant & equipment (140) -
Equity income from joint ventures (113) (120)
Employee stock ownership plan allocation 163 133
Cumulative effect of accounting change, net of tax 18,350 -
Change in assets and liabilities, net of effects from acquisitions:
Increase in accounts receivable, net (29,615) (44,020)
Decrease (Increase) in inventories (6,100) 13,369
Increase in prepaid expenses and other current assets (1,335) (767)
Decrease in other assets 5,748 369
(Decrease) Increase in accounts payable 17,675 (6,741)
Decrease in sundry payables and accrued expenses (1,978) (3,351)
(Decrease) Increase in other liabilities 433 (401)
-------------- -----------
Net cash used in operating activities (13,604) (36,082)
-------------- -----------
Cash flows from investing activities:
Proceeds from the sale of property, plant & equipment 513 -
Capital expenditures (2,508) (3,430)
Payments for acquisitions, net of cash acquired (4,831) (796)
-------------- -----------
Net cash used in investing activities (6,826) (4,226)
-------------- -----------
Cash flows from financing activities:
Net borrowings under line-of-credit agreements 17,215 50,151
Principal payments and retirement of long-term debt (288) (11,515)
Proceeds from exercise of employee stock options 74 -
Dividends paid (1,064) (1,052)
-------------- -----------
Net cash provided by financing activities 15,937 37,584
-------------- -----------
Effect of exchange rate changes on cash (483) (759)
Net decrease in cash and cash equivalents (4,976) (3,483)
Cash and cash equivalents at beginning of the period 7,496 7,699
-------------- -----------
Cash and cash equivalents at end of the period $ 2,520 $4,216
============== ===========
Supplemental disclosure of cash flow information:
Cash paid during the period
for:
Interest $ 4,971 $4,640
============== ===========
Income taxes $ 121 $ 170
============== ===========
See accompanying notes to consolidated financial statements.
7
STANDARD MOTOR PRODUCTS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
NOTE 1
Standard Motor Products, Inc. (the "Company") is engaged in the manufacturing
and distribution of replacement parts for motor vehicles in the automotive
aftermarket industry.
The accompanying unaudited financial information should be read in conjunction
with the consolidated financial statements, including the notes thereto, for the
year ended December 31, 2001.
The consolidated financial statements include the accounts of the Company and
all domestic and international companies in which the Company has more than a
50% equity ownership. The Company's investments in unconsolidated affiliates are
accounted for on the equity method. All significant inter-company items have
been eliminated.
The accompanying unaudited consolidated financial statements have been prepared
in accordance with generally accepted accounting principles for interim
financial information and with the instructions to Form 10-Q and Rule 10-01 of
Regulation S-X. Accordingly, they do not include all of the information and
footnotes required by generally accepted accounting principles for complete
financial statements. In the opinion of management, all adjustments (consisting
of normal recurring adjustments) considered necessary for a fair presentation
have been included. The results of operations for the interim periods are not
necessarily indicative of the results of operations for the entire year.
Where appropriate, certain amounts in 2001 have been reclassified to conform
with the 2002 presentation.
NOTE 2 (RESTATED)
On January 1, 2002, the Company adopted the guidelines of the Emerging Issues
Task Force (EITF) entitled "Accounting for Certain Sales Incentives" and "Vendor
Income Statement Characterization of Consideration Paid to a Reseller of the
Vendors Products." These guidelines address when sales incentives and discounts
should be recognized and the accounting for certain costs incurred by a vendor
on behalf of a customer, as well as where the related revenues and expenses
should be classified in the financial statements. Historically, the Company has
provided certain consideration, including rebates, product and discounts to
customers and treated such costs as advertising, marketing and sales force
expenses. Beginning with the first quarter of 2002, such costs are now treated
as a reduction of revenue or as cost of sales. As a result, certain costs have
been reclassified in the first quarter of 2001 from selling, general and
administrative expenses, of approximately $7.0 million. These reclassifications
have no effect on net earnings.
NOTE 3 (RESTATED)
Effective January 1, 2002, the Company adopted the provisions of Statement of
Financial Accounting Standards No. 142, "Goodwill and Other Intangible Assets,"
(SFAS No. 142). In accordance with SFAS No. 142, goodwill will no longer be
amortized, but instead, will be subject to an annual review for potential
impairment. Using the discounted cash flows method, based on the Company's
weighted average cost of capital and market multiples, the Company reviewed the
fair values of each of its reporting units. The recent decline in economic and
market conditions, higher integration costs than anticipated and the general
softness in the automotive aftermarket has caused a decrease in the fair values
of certain of the Company's reporting units. As a result, the Company recorded
an impairment loss on goodwill as a cumulative effect of accounting change of
$18.3 million, net of tax, or $1.55 per diluted share during the first quarter
of 2002. The impairment loss relates to goodwill pertaining to certain of the
Company's reporting units within its European Operations (classified as "All
Other") for segment reporting and within its Temperature Control Segment and
recorded a charge of $10.9 million and $7.4 million, respectively.
8
STANDARD MOTOR PRODUCTS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
Upon adoption of SFAS No. 142, the Company's earnings (loss) before cumulative
effect of accounting change and basic and diluted earnings (loss) per share
before cumulative effect of accounting change adjusted to exclude goodwill
amortization expense (net of taxes) is as follows:
For Three-Months Ended
March 31,
(In thousands, except per share amounts) 2002 2001
(Unaudited)
-------------------------------
Reported earnings (loss) before cumulative effect of accounting change $ (2,240) $ 619
Add back: goodwill amortization expense, net of tax - 667
-------------- ------------
Adjusted earnings (loss) before cumulative effect of accounting change $ (2,240) $ 1,286
============== ============
Basic earnings (loss) per share:
Reported basic earnings (loss) per share before cumulative
effect of accounting change $ (0.19) $ 0.05
Add back: goodwill amortization expense, net of tax - 0.06
-------------- ------------
Adjusted basic earnings (loss) per share before cumulative
effect of accounting change $ (0.19) $ 0.11
============== ============
Diluted earnings (loss) per share:
Reported diluted earnings (loss) per share before cumulative
effect of accounting change $ (0.19) $ 0.05
Add back: goodwill amortization expense, net of tax - 0.06
-------------- ------------
Adjusted diluted earnings (loss) per share before cumulative
effect of accounting change $ (0.19) $ 0.11
============== ============
NOTE 4
INVENTORIES
(Dollars in Thousands)
March 31, 2002 December 31, 2001
(unaudited)
-------------- -----------------
Finished Goods $ 150,583 $ 141,799
Work in Process 2,929 3,155
Raw Materials 33,879 32,337
-------------- -----------------
Total inventories $ 187,391 $ 177,291
============== =================
NOTE 5
PROPERTY, PLANT AND EQUIPMENT
(Dollars in thousands)
March 31, 2002 December 31, 2001
(unaudited)
--------------- ------------------
Land, buildings and improvements $ 60,321 $ 60,665
Machinery and equipment 110,506 109,617
Tools, dies and auxiliary equipment 18,530 17,815
Furniture and fixtures 27,784 27,643
Computer software 10,309 10,231
Leasehold improvements 7,457 7,450
Construction in progress 7,510 6,440
--------------- ------------------
242,417 239,861
Less: accumulated depreciation and amortization 142,193 138,215
--------------- ------------------
Total property, plant and equipment - net $ 100,224 $ 101,646
=============== ==================
9
STANDARD MOTOR PRODUCTS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
NOTE 6
LONG-TERM DEBT
(Dollars in thousands)
March 31, 2002 December 31, 2001
(unaudited)
--------------- ------------------
Long Term Debt Consists of:
6.75% convertible subordinated debentures $ 90,000 $ 90,000
Revolving credit facility 127,254 106,790
Other 4,772 5,060
--------------- ------------------
222,026 201,850
Less: current portion 1,766 1,784
--------------- ------------------
Total non-current portion of
Long-term debt $ 220,260 $ 200,066
=============== ==================
The Company, effective April 27, 2001 entered into an agreement with GE Capital
Corp. and a syndicate of lenders for a new secured revolving credit facility.
The term of the new credit agreement is for a period of five years and provides
for a line of credit up to $225 million. The initial proceeds were used to
refinance approximately $97 million of the outstanding indebtedness under the
Company's former bank line of credit, a senior note of $52 million, a $25
million accounts receivable sale arrangement and a Canadian Credit Facility of
$5 million. The Company recorded an extraordinary loss of approximately $2.8
million, net of taxes, in the second quarter of 2001, for a prepayment penalty
and write-off of unamortized fees for the retirement of the above related debt.
Availability under the new credit facility is based on a formula of eligible
accounts receivable, eligible inventory and eligible fixed assets. Direct
borrowings bear interest at the Prime Rate plus the applicable margin (as
defined) or the LIBOR Rate plus the applicable margin (as defined), at the
option of the Company. Borrowings are collateralized by accounts receivable,
inventory and fixed assets of the Company and its subsidiaries. The terms of the
new revolving credit facility contain, among other provisions, requirements of
maintaining defined levels of tangible net worth and specific limits or
restrictions on additional indebtedness, capital expenditures, liens and
acquisitions.
On July 26, 1999, the Company completed a public offering of convertible
subordinated debentures amounting to $90 million. The Convertible Debentures
carry an interest rate of 6.75%, payable semi-annually, and will mature on July
15, 2009. The Debentures are convertible into 2,796,000 shares of the Company's
common stock.
NOTE 7
The Company does not enter into financial instruments for trading or speculative
purposes. The principal financial instruments used for cash flow hedging
purposes are interest rate swaps.
In July 2001, the Company entered into interest rate swap agreements to manage
its exposure to interest rate changes. The swaps effectively convert a portion
of the Company's variable rate debt under the revolving credit facility to a
fixed rate, without exchanging the notional principal amounts. At March 31,
2002, the Company had two outstanding interest rate swap agreements maturing in
January 2003 and 2004, with aggregate notional principal amounts of $75 million.
Under these agreements the Company receives a floating rate based on the LIBOR
interest rate, and pays a fixed rate of 4.92% on a notional amount of $45
million and 4.37% on a notional amount of $30 million. If, at any time, the
swaps are determined to be ineffective, in all or in part, due to changes in the
interest rate swap agreements, the fair value of the portion of the interest
rate swap determined to be ineffective will be recognized as gain or loss in the
statement of operations in the period.
NOTE 8
The Company sold certain accounts receivable to an independent financial
institution, through its wholly owned subsidiary, SMP Credit Corp., a qualifying
special-purpose corporation. In May 1999 SMP Credit Corp. entered into a three
year agreement whereby it can sell up to a $25 million undivided ownership
interest in a designated pool of certain of these eligible receivables. This
agreement was terminated in the second quarter of 2001 as part of the new credit
facility described in Note 6. At March 31, 2001, net account receivables
amounting to $25 million had been sold under this agreement. These sales were
reflected as reductions of trade accounts receivable and the related fees and
discounting expense were recorded as other expense.
10
STANDARD MOTOR PRODUCTS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
NOTE 9 (RESTATED)
Total comprehensive loss was $19,811,000 and $320,000 for the three-month
periods ended March 31, 2002 and 2001, respectively.
NOTE 10
At March 31 2002, in aggregate 1,312,276 shares of authorized but unissued
common stock were reserved for issuance under the Company's stock option plans.
NOTE 11 (RESTATED)
Following are reconciliations of the earnings available to common stockholders
and the shares used in calculating basic and dilutive net earnings (loss) per
common share:
For Three-Months Ended
March 31,
(Unaudited)
2002 2001
---------------- ----------------
Earnings (loss) from continuing operations $(1,921,000) $619,000
Loss from discontinued operation (319,000) -
Cumulative effect of accounting change (18,350,000) -
---------------- ----------------
Earnings (loss) available to common stockholders (20,590,000) 619,000
================ ================
Net earnings (loss) available to common
stockholders assuming $ (20,590,000) $619,000
dilution
================ ================
Weighted average common shares 11,827,636 11,714,346
Effect of stock options - 14,223
---------------- ----------------
Weighted average common
equivalent shares
outstanding
assuming dilution 11,827,636 11,728,569
================ ================
The average shares listed below were not included in the computation of diluted
earnings (loss) per share because to do so would have been anti-dilutive for the
periods presented.
For Three-Months Ended
March 31,
---------------------------
2002 2001
------------ ------------
Stock options 720,752 1,139,075
Convertible debentures 2,796,120 2,796,120
============ ============
NOTE 12
In fiscal 2000, the Company created an employee benefits trust to which it
contributed 750,000 shares of treasury stock. The Company is authorized to
instruct the trustees to distribute such shares toward the satisfaction of the
Company's future obligations under Employee Benefit Plans. The shares held in
trust are not considered outstanding for purposes of calculating earnings per
share until they are committed to be released. The trustees will vote the shares
in accordance with its fiduciary duties. As of March 31, 2002, 75,000 shares
have been released from the trust. During April of 2002, the Company committed
75,000 shares to be released leaving 600,000 shares remaining in the trust.
11
STANDARD MOTOR PRODUCTS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
NOTE 13 (RESTATED)
The Company's two reportable operating segments are Engine Management and
Temperature Control.
Industry Segment
(Dollars in thousands)
For the three-months ended March 31,
------------------------------------------------------------------------------------
2002 2001
-------------------------------------------- ---------------------------------------
OPERATING OPERATING INCOME
NET SALES INCOME(LOSS) NET SALES
Engine Management $ 67,979 $ 7,140 $ 72,793 $ 6,724
Temperature Control 49,325 (2,148) 72,116 599
All Other 9,017 (4,885) 9,554 (2,887)
------------------ ----------------- ----------------- -----------------
Consolidated $126,321 $ 107 $154,463 $ 4,436
================== ================= ================= =================
All other consists of items pertaining to European and Canadian operations and
the corporate headquarters function, which do not meet the criteria of a
reportable operating segment.
The carrying value of goodwill for the Company's segments as of March 31, 2002
were as follows:
(In Thousands)
Engine Management $ 10,490
Temperature Control 4,822
All Other 4,705
---------------------
Goodwill, net $ 20,017
=====================
NOTE 14
On January 28, 2000, a former significant customer of the Company currently
undergoing a Chapter 7 liquidation in U.S. Bankruptcy Court, filed claims
against a number of its former suppliers, including the Company. The claim
against the Company alleges $0.5 million (formerly $19.8 million) of
preferential payments in the 90 days prior to the related Chapter 11 bankruptcy
petition. In addition, this former customer seeks $10.5 million from the Company
for a variety of claims including antitrust, breach of contract, breach of
warranty and conversion. These latter claims arise out of allegations that this
customer was entitled to various discounts, rebates and credits after it filed
for bankruptcy. The Company has purchased insurance with respect to the two
actions. The Company believes that these matters will not have a material effect
on the Company's consolidated financial statements taken as a whole.
The Company is involved in various other litigation and product liability
matters arising in the ordinary course of business. One of the product liability
matters involves a former Brake business of the Company, which is accounted for
as a discontinued operation in the accompanying financial statements. In 1986,
the Company acquired the business resulting in the assumption by the Company of
certain liabilities relating to any alleged exposure to asbestos-containing
products manufactured by the seller. In accordance with the related purchase
agreement, the Company agreed to assume the liabilities for all new claims filed
after fifteen years from the date of the purchase. The ultimate exposure to the
Company will depend upon the extent to which future claims are filed and the
amounts paid for indemnity and defense. At March 31, 2002, approximately 240
cases were outstanding whereby the Company is now responsible for any related
liabilities. Although the final outcome of this specific matter or any other
litigation or product liability matter cannot be determined, based on the
Company's understanding and evaluation of the relevant facts and circumstances,
it is management's opinion that the final outcome of these matters will not have
a material adverse effect on the Company's financial statements taken as a
whole.
12
STANDARD MOTOR PRODUCTS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
NOTE 15 RESTATEMENT
Upon initial adoption of Statement of Financial Accounting Standards No. 142,
"Goodwill and Other Intangible Assets," (SFAS No. 142), on January 1, 2002, the
Company recorded an impairment loss on goodwill as a cumulative effect of
accounting change of $16 million, net of tax, or $1.35 per diluted share during
the first quarter of 2002. The impairment loss related to goodwill pertaining to
the Company's reporting units within its European Operations (classified as "All
Other") for segment reporting and within its Temperature Control segment and
recorded a charge of $8.6 million and $7.4 million, respectively.
In preparing the year-end 2002 financial statements, the Company performed a
subsequent review of the earlier treatment of the tax benefit associated with
the goodwill impairment loss pertaining to its European Operations. As a result
of the review, it was concluded that a tax benefit will not be realized due to
the non-deductible nature of the goodwill on the European local accounts.
Therefore, this tax benefit recorded as part of the cumulative effect of
accounting change for the goodwill impairment loss has been reversed as of
January 1, 2002. This change resulted in an additional loss of approximately
$2.4 million.
The Company reclassified $0.4 million of expenses recorded in the first quarter
of 2002 associated with the discontinued operation from selling, general and
administrative to loss from discontinued operations. The expenses were not
considered significant in the original filed Form 10-Q for the quarter ended
March 31, 2002, however, they have been reclassified to conform to the
presentation beginning with the quarterly period ended September 30, 2002. This
reclassification had no impact on net earnings (loss).
In addition, certain costs of $0.2 million and $0.5 million in 2002 and 2001,
respectively, previously treated as a reduction to gross sales have been
reclassified to selling, general and administrative. This reclassification had
no impact on net earnings (loss).
A summary of the effects of the restatement on the Company's Consolidated
Financial Statements follows:
CONSOLIDATED BALANCE SHEET
(IN THOUSANDS) March 31, 2002
-------------------------------
As Previously As
Reported Restated
------------ --------------
Sundry payables and accrued expenses $39,005 $ 41,370
Total current liabilities 112,171 114,536
Total liabilities 355,800 358,165
Retained earnings 164,243 161,878
Total stockholders' equity $167,251 $164,886
13
STANDARD MOTOR PRODUCTS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
NOTE 15 RESTATEMENT (CONTINUED)
CONSOLIDATED STATEMENT OF OPERATIONS
- ------------------------------------ For the Three Months Ended For the Three Months Ended
(IN THOUSANDS) March 31, 2002 March 31, 2001
------------------------------------- ------------------------------------
As Previously As As Previously As
Reported Restated Reported Restated
---------------- ---------------- --------------- ----------------
Net Sales $ 126,080 $ 126,321 $ 153,960 $154,463
Gross profit 30,735 30,976 36,928 37,431
Selling, general and administrative
expenses 31,053 30,869 32,492 32,995
Operating income (loss) (318) 107 4,436 4,436
Earnings (loss) before taxes (3,112) (2,687) 906 906
Income tax expense (benefit) (872) (766) 287 287
Earnings (loss) from continuing operations (2,240) (1,921) 619 619
Loss from discontinued operation - (319) - -
Cumulative effect of accounting
change, net of tax (15,985) (18,350) - -
Net earnings (loss) (18,225) (20,590) 619 619
Earnings (loss) per basic share from
continuing operations (0.19) (0.16) 0.05 0.05
Discontinued operation on a basic
loss per common share - (0.03) - -
Cumulative effect of accounting change
on a basic loss per common share (1.35) (1.55) - -
Basic net income (loss) per common share (1.54) (1.74) 0.05 0.05
Earnings (loss) per diluted share from
continuing operations (0.19) (0.16) 0.05 0.05
Discontinued operation on a diluted
loss per common share - (0.03) - -
Cumulative effect of accounting change
on a diluted loss per common share (1.35) (1.55) - -
Diluted net income (loss) per common share $ (1.54) $ (1.74) $ 0.05 $ 0.05
CONSOLIDATED STATEMENT OF CASH FLOWS
------------------------------------ For the Three Months Ended
(IN THOUSANDS) March 31, 2002
----------------------------------
As Previously As
Reported Restated
--------------- ----------------
Net earnings (loss) $ (18,225) $ (20,590)
Cumulative effect of
accounting change, net of tax 15,985 18,350
14
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
THIS REPORT ON FORM 10-Q/A CONTAINS FORWARD-LOOKING STATEMENTS. FORWARD-LOOKING
STATEMENTS IN THIS REPORT ARE INDICATED BY WORDS SUCH AS "ANTICIPATES,"
"EXPECTS," "BELIEVES," "INTENDS," "PLANS," "ESTIMATES," "PROJECTS" AND SIMILAR
EXPRESSIONS. THESE STATEMENTS REPRESENT OUR EXPECTATIONS BASED ON CURRENT
INFORMATION AND ASSUMPTIONS. FORWARD-LOOKING STATEMENTS ARE INHERENTLY SUBJECT
TO RISKS AND UNCERTAINTIES. OUR ACTUAL RESULTS COULD DIFFER MATERIALLY FROM
THOSE WHICH ARE ANTICIPATED OR PROJECTED AS A RESULT OF CERTAIN RISKS AND
UNCERTAINTIES, INCLUDING, BUT NOT LIMITED TO A NUMBER OF FACTORS, INCLUDING
ECONOMIC AND MARKET CONDITIONS; THE PERFORMANCE OF THE AFTERMARKET SECTOR;
CHANGES IN BUSINESS RELATIONSHIPS WITH OUR MAJOR CUSTOMERS AND IN THE TIMING,
SIZE AND CONTINUATION OF OUR CUSTOMERS' PROGRAMS; THE ABILITY OF OUR CUSTOMERS
TO ACHIEVE THEIR PROJECTED SALES; COMPETITIVE PRODUCT AND PRICING PRESSURES;
INCREASES IN PRODUCTION OR MATERIAL COSTS THAT CANNOT BE RECOUPED IN PRODUCT
PRICING; SUCCESSFUL INTEGRATION OF ACQUIRED BUSINESSES; PRODUCT LIABILITY
(INCLUDING, WITHOUT LIMITATION, THOSE RELATED TO ESTIMATES TO ASBESTOS-RELATED
CONTINGENT LIABILITIES) MATTERS; AS WELL AS OTHER RISKS AND UNCERTAINTIES, SUCH
AS THOSE DESCRIBED UNDER QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET
RISK AND THOSE DETAILED HEREIN AND FROM TIME TO TIME IN THE FILINGS OF THE
COMPANY WITH THE SECURITIES AND EXCHANGE COMMISSION. THOSE FORWARD-LOOKING
STATEMENTS ARE MADE ONLY AS OF THE DATE HEREOF, AND THE COMPANY UNDERTAKES NO
OBLIGATION TO UPDATE OR REVISE THE FORWARD-LOOKING STATEMENTS, WHETHER AS A
RESULT OF NEW INFORMATION, FUTURE EVENTS OR OTHERWISE. THE FOLLOWING DISCUSSION
SHOULD BE READ IN CONJUNCTION WITH THE UNAUDITED CONDENSED CONSOLIDATED
FINANCIAL STATEMENTS, INCLUDING THE NOTES THERETO, INCLUDED ELSEWHERE IN THIS
FORM 10-Q/A.
As discussed in Note 15 of Notes to the Consolidated Financial Statements, the
Company has restated its financial statements for the quarter ended March 31,
2002 and 2001. The accompanying Management's Discussion and Analysis of
Financial Condition and Results of Operations gives effect to the restatement.
LIQUIDITY AND CAPITAL RESOURCES
During the first quarter of 2002, cash used in operations amounted to $13.6
million, as compared to $36.1 million in the same period of 2001. The decrease
is primarily attributable to lower accounts receivable as a result of the
decline in net sales and an increase in accounts payable. This decrease was
partially offset by an increase in inventory in our Temperature Control Segment
due to the seasonal nature of the business.
Cash used in investing activities was $6.8 million in the first quarter of 2002,
as compared to $4.2 million in the same period of 2001. The increase is
primarily due to the acquisition of assets from Hartle Industries. Assets
acquired consist primarily of property plant and equipment, and inventory. The
purchase was financed with funds provided under the Company's line of credit.
In December 2001, the Company signed a letter of intent to acquire Carol Cable
Limited, a manufacturer and distributor of wire sets, based in England, for
approximately $1.7 million. Assets consist primarily of property plant and
equipment, and inventory. The purchase was completed in April 2002 with funds
provided under the Company's line of credit.
On March 20, 2002, the Company reached a definitive agreement to purchase the
aftermarket fuel injector business of Sagem Inc., a subsidiary of Johnson
Controls, for approximately $11.5 million. Sagem Inc. is a basic manufacturer of
fuel injectors, a product line which prior to the acquisition, the Company has
been purchasing. Assets to be acquired consist primarily of property, plant and
equipment, and inventory. The purchase which is expected to close in May will be
partially financed by the seller (approximately $7 million to be paid over a two
year period), with the remaining funds being provided under the Company's line
of credit.
Cash provided by financing activities was $15.9 million in the first quarter of
2002, as compared to $37.6 million in the same period of 2001. The change is
primarily due to decreased borrowings under the Company's line of credit which
reflects the Company's focus on reducing capital employed in the business.
The Company, effective April 27, 2001 entered into an agreement with GE Capital
Corp. and a syndicate of lenders for a new secured revolving credit facility.
The former unsecured revolving credit facility was set to expire on November 30,
2001. The term of the new credit agreement is for a period of five years and
provides for a line of credit up to $225 million. The initial proceeds have been
used to refinance approximately $97 million of the outstanding indebtedness
under the Company's former bank line of credit, the 7.56% senior note of $52
million, a $25 million accounts receivable sale arrangement and the Canadian
Credit Facility of $5 million. The Company recorded an extraordinary loss of
approximately $2.8 million, net of taxes, in the second quarter of 2001, for a
prepayment penalty and write-off of unamortized fees for the retirement of the
above related debt. Availability under the new credit facility is based on a
formula of eligible accounts receivable, eligible inventory and eligible fixed
assets.
15
LIQUIDITY AND CAPITAL RESOURCES
(CONTINUED)
Direct borrowings bear interest at the Prime Rate plus the applicable margin (as
defined) or the LIBOR Rate plus the applicable margin (as defined), at the
option of the Company. Borrowings are collateralized by accounts receivable,
inventory and fixed assets of the Company and its subsidiaries. The terms of the
new revolving credit facility contain, among other provisions, requirements of
maintaining defined levels of tangible net worth and specific limits or
restrictions on additional indebtedness, capital expenditures, liens and
acquisitions.
The Company's profitability and its working capital requirements have become
more seasonal with the sales mix of temperature control products. Working
capital requirements usually peak near the end of the second quarter, as the
inventory build-up of air conditioning products is converted to sales and
payments on the receivables associated with such sales begin to be received.
These increased working capital requirements are funded by borrowings from our
lines of credit. The Company anticipates that its present sources of funds will
continue to be adequate to meet its near term needs.
During the years 1998 through 2000, the Board of Directors authorized multiple
repurchase programs under which the Company could repurchase shares of its
common stock. During such years, $26.7 million (in the aggregate) of common
stock has been repurchased to meet present and future requirements of the
Company's stock option programs and to fund the Company's ESOP. As of March 31,
2002, the Company has Board authorization to repurchase additional shares at a
maximum cost of $1.7 million. During the first quarters of 2002 and 2001, the
Company did not repurchase any shares of its common stock.
INTERIM RESULTS OF OPERATIONS
COMPARISON OF THE THREE-MONTHS ENDED MARCH 31, 2002 TO THE THREE-MONTHS ENDED
MARCH 31, 2001
On a consolidated basis, net sales in the first quarter of 2002 were $126.3
million, a decrease of $ 28.2 million, or 18%, as compared to the first quarter
of 2001. The sales shortfall was primarily in Temperature Control products. In
the first quarter of 2001, there was a large opening order to a new retail
account not repeated in 2002; there was a partial loss of business at another
major retailer; and some shortfall in other pre-season orders as distributors
continue to work off inventories carried forward from previous cool summers.
Engine Management net sales were slightly below the first quarter of 2001 and
are anticipated to recover in the second quarter as the Company begins shipping
new business estimated between $15 to $20 million on an annualized basis.
Reported gross margins for the quarter reflected only a slight improvement from
24.2% to 24.5%. Excluding the impact of certain reclassifications required under
the guidelines of the Emerging Issues Task Force (See Note 2 in the Notes to the
Consolidated Financial Statements) gross margins improved approximately 1.3
percentage points over 2001 as a result of price increases and higher production
levels. Gross margins should continue to improve as production levels are more
closely aligned to shipping levels as compared to the significant inventory
reduction program in 2001.
Effective January 1, 2002, the Company adopted the provisions of Statement of
Financial Accounting Standards No. 142, "Goodwill and Other Intangible Assets,"
(SFAS No. 142). In accordance with SFAS No. 142, goodwill will no longer be
amortized, but instead, will be subject to an annual review for potential
impairment. Using the discounted cash flows method, based on the Company's
weighted average cost of capital and market multiples, the Company reviewed the
fair values of each of its reporting units. The recent decline in economic and
market conditions, higher integration costs than anticipated and the general
softness in the automotive aftermarket has caused a decrease in the fair values
of certain of the Company's reporting units. As a result, the Company recorded
an impairment loss on goodwill as a cumulative effect of accounting change of
$18.3 million, net of tax, or $1.55 per diluted share during the first quarter
of 2002. The impairment loss relates to goodwill pertaining to certain of the
Company's reporting units within its European Operations (classified as "All
Other") for segment reporting and within its Temperature Control Segment and
recorded a charge of $10.9 million and $7.4 million, respectively.
Selling, general and administrative expenses decreased by $2.1 million to $30.9
million in the first quarter of 2002, as compared to $33.0 million in the first
quarter of 2001. This decrease is primarily due to the elimination of goodwill
amortization expense in the first quarter of 2002 of approximately $0.9 million.
Also contributing to the decrease are reduced costs associated with lower
shipping levels and the Company's focus on cost reduction.
Operating income decreased by $4.3 million in the first quarter of 2002, as
compared to the first quarter of 2001, primarily due to the decline in net
sales, as discussed above.
Other income, net, increased slightly in the first quarter of 2002 due to the
elimination of fees related to the sale of accounts receivable agreement.
Interest expense decreased by 0.7 million in the first quarter 2002 as compared
to the same period in 2001, due to lower average borrowings and lower interest
rates.
16
COMPARISON OF THE THREE-MONTHS ENDED MARCH 31, 2002 TO THE THREE-MONTHS
ENDED MARCH 31, 2001
(CONTINUED)
The effective tax rate decreased from 32% in the first quarter of 2001 to 29% in
first quarter of 2002, due to a decrease in earnings from the Company's domestic
subsidiaries. The 29% current effective tax rate reflects the Company's
anticipated tax rate for the balance of the year.
CRITICAL ACCOUNTING POLICIES
We have identified the policies below as critical to our business operations and
the understanding of our results of operations. The impact and any associated
risks related to these policies on our business operations is discussed
throughout Management's Discussion and Analysis of Financial Condition and
Results of Operations where such policies affect our reported and expected
financial results. For a detailed discussion on the application of these and
other accounting policies, see Note 1 in the Notes to the Consolidated Financial
Statements of the Company's Annual Report on Form 10-K for the year ended
December 31, 2001. Note that our preparation of this Quarterly Report on Form
10-Q/A requires us to make estimates and assumptions that affect the reported
amount of assets and liabilities, disclosure of contingent assets and
liabilities at the date of our financial statements, and the reported amounts of
revenue and expenses during the reporting period. There can be no assurance that
actual results will not differ from those estimates.
REVENUE RECOGNITION. We derive our revenue from primarily sales which include
replacement parts for motor vehicles, from both our Engine Management and
Temperature Control Divisions. The Company recognizes revenue from product sales
upon shipment to customers. As described below, significant management judgments
and estimates must be made and used in connection with the revenue recognized in
any accounting period.
SALES RETURNS AND OTHER ALLOWANCES AND ALLOWANCE FOR DOUBTFUL ACCOUNTS. The
preparation of financial statements requires our management to make estimates
and assumptions that affect the reported amount of assets and disclosure of
contingent assets and liabilities at the date of the financial statements and
the reported amounts of revenues and expenses during the reported period.
Specifically, our management must make estimates of potential future product
returns related to current period product revenue. Management analyzes
historical returns, current economic trends, and changes in customer demand when
evaluating the adequacy of the sales returns and other allowances. Significant
management judgments and estimates must be made and used in connection with
establishing the sales returns and other allowances in any accounting period.
Similarly, our management must make estimates of the uncollectability of our
accounts receivables. Management specifically analyzes accounts receivable and
analyzes historical bad debts, customer concentrations, customer
credit-worthiness, current economic trends and changes in our customer payment
terms when evaluating the adequacy of the allowance for doubtful accounts.
ACCOUNTING FOR INCOME TAXES. As part of the process of preparing our
consolidated financial statements, we are required to estimate our income taxes
in each of the jurisdictions in which we operate. This process involves us
estimating our actual current tax exposure together with assessing temporary
differences resulting from differing treatment of items, for tax and accounting
purposes. These differences result in deferred tax assets and liabilities, which
are included within our consolidated balance sheet. We must then assess the
likelihood that our deferred tax assets will be recovered from future taxable
income and to the extent we believe that recovery is not likely, we must
establish a valuation allowance. To the extent we establish a valuation
allowance or increase this allowance in a period, we must include an expense
within the tax provision in the statement of operations.
Significant management judgment is required in determining our provision for
income taxes, our deferred tax assets and liabilities and any valuation
allowance recorded against our net deferred tax assets. At March 31, 2002, the
Company has a valuation allowance of $14.2 million, due to uncertainties related
to our ability to utilize some of our deferred tax assets. The valuation
allowance is based on our estimates of taxable income by jurisdiction in which
we operate and the period over which our deferred tax assets will be
recoverable.
In the event that actual results differ from these estimates or we adjust these
estimates in future periods we may need to establish an additional valuation
allowance which could materially impact our financial position and results of
operations.
VALUATION OF LONG-LIVED AND INTANGIBLE ASSETS AND GOODWILL. We assess the
impairment of identifiable intangibles, long-lived assets and goodwill whenever
events or changes in circumstances indicate that the carrying value may not be
recoverable. Factors we consider important which could trigger an impairment
review include the following: significant underperformance relative to expected
historical or projected future operating results; significant changes in the
manner of our use of the acquired assets or the strategy for our overall
business and significant negative industry or economic trends.
17
OTHER LOSS RESERVES. We have numerous other loss exposures, such as
environmental claims, product liability (including asbestos matters) and
litigation. Establishing loss reserves for these matters requires the use of
estimates and judgment in regards to risk exposure and ultimate liability. We
estimate losses using consistent and appropriate methods; however, changes to
our assumptions could materially affect our recorded liabilities for loss.
RECENTLY ISSUED ACCOUNTING STANDARDS
In June 2001, the Financial Accounting Standards Board issued Statement No. 143,
Accounting for Asset Retirement Obligations, which addresses financial
accounting and reporting for obligations associated with the retirement of
tangible long-lived assets and the associated asset retirement costs. The
standard applies to legal obligations associated with the retirement of
long-lived assets that result from the acquisition, construction, development
and (or) normal use of the asset.
Statement No. 143 requires that the fair value of a liability for an asset
retirement obligation be recognized in the period in which it is incurred if a
reasonable estimate of fair value can be made. The fair value of the liability
is added to the carrying amount of the associated asset and this additional
carrying amount is depreciated over the life of the asset. The liability is
accreted at the end of each period through charges to operating expense. If the
obligation is settled for other than the carrying amount of the liability, the
Company will recognize a gain or loss on settlement.
The Company is required and plans to adopt the provisions of Statement No. 143
for the quarter ending March 31, 2003. To accomplish this, the Company must
identify all legal obligations for asset retirement obligations, if any, and
determine the fair value of these obligations on the date of adoption. The
determination of fair value is complex and will require the Company to gather
market information and develop cash flow models. Additionally, the Company will
be required to develop processes to track and monitor these obligations. Because
of the effort necessary to comply with the adoption of Statement No. 143, it is
not practicable for management to estimate the impact of adopting this Statement
at the date of this report.
18
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
The Company is exposed to market risk, primarily related to foreign currency
exchange and interest rates. These exposures are actively monitored by
management. The Company has exchange rate exposure primarily with respect to the
Canadian Dollar and the British Pound. The Company's exposure to foreign
exchange rate risk is due to certain costs, revenues and borrowings being
denominated in currencies other than a subsidiary's functional currency.
Similarly, the Company is exposed to market risk as the result of changes in
interest rates which may affect the cost of its financing. It is the Company's
policy and practice to use derivative financial instruments only to the extent
necessary to manage exposures. The Company does not hold or issue derivative
financial instruments for trading or speculative purposes.
The Company manages its exposure to interest rate risk through the proportion of
fixed rate debt and variable rate debt in its debt portfolio. To manage a
portion of its exposure to interest rate changes, the Company has entered into
interest rate swap agreements, see Note 7 of Notes to Consolidated Financial
Statements. The Company invests its excess cash in highly liquid short-term
investments. As a result of the Company's refinancing agreement during the
second quarter 2001, as described in Note 6 of Notes to Consolidated Financial
Statements, the Company's percentage of variable rate debt to total debt is 56%
at December 31, 2001 and 59% at March 31, 2002.
Other than the aforementioned, there have been no significant changes to the
information presented in Item 7A (Market Risk) of the Company's Annual Report on
Form 10-K for the year ended December 31, 2001.
19
PART II - OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
On January 28, 2000, a former significant customer of the Company currently
undergoing a Chapter 7 liquidation in U.S. Bankruptcy Court, filed claims
against a number of its former suppliers, including the Company. The claim
against the Company alleges $0.5 million (formerly $19.8 million) of
preferential payments in the 90 days prior to the related Chapter 11 bankruptcy
petition. In addition, this former customer seeks $10.5 million from the Company
for a variety of claims including antitrust, breach of contract, breach of
warranty and conversion. These latter claims arise out of allegations that this
customer was entitled to various discounts, rebates and credits after it filed
for bankruptcy. The Company has purchased insurance with respect to the two
actions. The Company believes that these matters will not have a material effect
on the Company's consolidated financial statements taken as a whole.
The Company is involved in various other litigation and product liability
matters arising in the ordinary course of business. One of the product liability
matters involves a former Brake business of the Company, which is accounted for
as a discontinued operation in the accompanying financial statements. In 1986,
the Company acquired the business resulting in the assumption by the Company of
certain liabilities relating to any alleged exposure to asbestos-containing
products manufactured by the seller. In accordance with the related purchase
agreement, the Company agreed to assume the liabilities for all new claims filed
after fifteen years from the date of the purchase. The ultimate exposure to the
Company will depend upon the extent to which future claims are filed and the
amounts paid for indemnity and defense. At March 31, 2002, approximately 240
cases were outstanding whereby the Company is now responsible for any related
liabilities. Although the final outcome of this specific matter or any other
litigation or product liability matter cannot be determined, based on the
Company's understanding and evaluation of the relevant facts and circumstances,
it is management's opinion that the final outcome of these matters will not have
a material adverse effect on the Company's financial statements taken as a
whole.
20
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) EXHIBIT(S)
DESCRIPTION
99.1 Certification of Chief Executive Officer pursuant to Section 906 of the
Sarbanes-Oxley Act of 2002.
99.2 Certification of Chief Financial Officer pursuant to Section 906 of the
Sarbanes-Oxley Act of 2002.
(b) REPORTS ON FORM 8-K
There were no reports on Form 8-K filed for this period.
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
STANDARD MOTOR PRODUCTS, INC.
(Registrant)
(Date): March 18, 2003 /S/ JAMES J. BURKE
-----------------------
Vice President Finance,
Chief Financial Officer
21
CERTIFICATIONS PURSUANT TO
SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002
CERTIFICATION
I, Lawrence I. Sills, certify that:
1. I have reviewed this quarterly report on Form 10-Q/A of Standard Motor
Products, Inc.
2. Based on my knowledge, this quarterly report does not contain any untrue
statement of a material fact or omit to state a material fact necessary to make
the statements made, in light of the circumstances under which such statements
were made, not misleading with respect to the period covered by this quarterly
report; and
3. Based on my knowledge, the financial statements, and other financial
information included in this quarterly report, fairly present in all material
respects the financial condition, results of operations and cash flows of the
registrant as of, and for, the periods presented in this quarterly report.
Date: March 18, 2003
/S/ LAWRENCE I. SILLS
------------------------
Lawrence I. Sills
Chief Executive Officer
22
CERTIFICATIONS PURSUANT TO
SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002
CERTIFICATION
I, James J. Burke, certify that:
1. I have reviewed this quarterly report on Form 10-Q/A of Standard Motor
Products, Inc.
2. Based on my knowledge, this quarterly report does not contain any untrue
statement of a material fact or omit to state a material fact necessary to make
the statements made, in light of the circumstances under which such statements
were made, not misleading with respect to the period covered by this quarterly
report; and
3. Based on my knowledge, the financial statements, and other financial
information included in this quarterly report, fairly present in all material
respects the financial condition, results of operations and cash flows of the
registrant as of, and for, the periods presented in this quarterly report.
Date: March 18, 2003
/S/ JAMES J. BURKE
-----------------------
James J. Burke
Chief Financial Officer
23