SMP LOGO
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
FIRST QUARTER 2009 RESULTS
New York, NY, May 6, 2009......Standard Motor Products, Inc. (NYSE: SMP), an
automotive replacement parts manufacturer and distributor, reported today its
consolidated financial results for the three months ending March 31, 2009.
Consolidated net sales for the first quarter of 2009 were $172.2 million,
compared to consolidated net sales of $208.1 million during the comparable
quarter in 2008. Earnings from continuing operations for the first quarter of
2009 were $787 thousand or 4 cents per diluted share, compared to $13.3 million
or 68 cents per diluted share in the first 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 first
quarter of 2009 were $1.3 million or 7 cents, compared to $3.1 million or 17
cents per diluted share in the first quarter of 2008.
Commenting on the results, Mr. Lawrence I. Sills, Standard Motor Products'
Chairman and Chief Executive Officer, stated, "While our results, both in terms
of sales and profits, are below those of the comparable quarter a year ago, we
have seen a nice bounce back since the fourth quarter of 2008. For the last few
months of 2008, our aftermarket customers dramatically reduced their purchases
from us, while their sales to end users remained healthy. During the first
quarter 2009, their purchases have begun to return to more historic levels.
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37-18 Northern Blvd., Long Island City, NY 11101
(718) 392-0200
www.smpcorp.com
"However, sales remain down from a year ago. During our fourth quarter
conference call, we outlined the reasons for this decline. They include: the
divestiture of our Blue Streak Electronics joint venture; a fall in the exchange
rates in the U.K. and Canada; a significant drop in OE/OES volume (though this
business currently represents only about 12% of our total); a loss of a major
portion of Carquest's business, which occurred at the end of 2008; and, in Four
Seasons, a conscious decision not to offer a pre-season dating program.
"On the positive side, looking forward, we have gained two major retail accounts
for our Temperature Control line. Further, we recently finalized an agreement
with Federal-Mogul to acquire their wire and cable product line. The sale will
close in approximately four months and will be an excellent addition to our wire
and cable business. The operation will be fully absorbed into our existing
facilities, without assuming any Federal-Mogul employees or facilities, and will
be accretive to earnings before integration costs.
"While our gross margin percentage is slightly lower than a year ago, we
anticipate positive comparisons for the balance of the year, as we continue to
add production hours and improve efficiency in our three Mexican plants. We are
also in the process of implementing a round of price increases.
"We are pleased with our improvement in operating expenses, which are $8 million
below a year ago. While some of this is volume related, we are also seeing the
results of aggressive cost and headcount reduction. For example, we have reduced
headcount by close to 800 from a year ago, a 20% reduction.
"During this period, our number one priority has been to increase cash flow and
reduce debt. During the last 12 months, from March 2008 to March 2009, we have
reduced total debt by over $85 million. This has been accomplished through a
variety of measures, which include: sale of our Long Island City building;
substantial reductions in inventory and accounts receivable; a salary freeze;
temporarily suspending the quarterly dividend; and all the other cost reduction
measures mentioned above.
"In addition, we successfully concluded an exchange offer on May 1, 2009 for
$12.3 million of existing debentures due in July into 15% convertible debentures
maturing in April 2011. While we continue to explore other means of outside
financing, we are confident that with the steps we have taken we have sufficient
availability in place to redeem the $32.1 million remaining bonds due in July.
Standard Motor Products, Inc. will hold a conference call at 11:00 AM, Eastern
Time, on Wednesday, May 6, 2009. The dial in number is 800-895-0198 (domestic)
or 785-424-1053 (international). The playback number is 800-839-8389 (domestic)
or 402-271-9156 (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
MARCH 31,
2009 2008
------------ ------------
(Unaudited)
NET SALES $ 172,222 $ 208,084
COST OF SALES 131,329 156,860
------------ ------------
GROSS PROFIT 40,893 51,224
SELLING, GENERAL & ADMINISTRATIVE EXPENSES 36,019 43,859
RESTRUCTURING AND INTEGRATION EXPENSES 1,163 2,836
------------ ------------
OPERATING INCOME 3,711 4,529
OTHER INCOME, NET 105 20,362
INTEREST EXPENSE 2,477 4,134
------------ ------------
EARNINGS FROM CONTINUING OPERATIONS BEFORE TAXES 1,339 20,757
INCOME TAX EXPENSE 552 7,410
------------ ------------
EARNINGS FROM CONTINUING OPERATIONS 787 13,347
LOSS FROM DISCONTINUED OPERATION, NET OF TAX (260) (326)
------------ ------------
NET EARNINGS $ 527 $ 13,021
============ ============
NET EARNINGS PER COMMON SHARE:
BASIC EARNINGS FROM CONTINUING OPERATIONS $ 0.04 $ 0.73
DISCONTINUED OPERATION (0.01) (0.02)
------------ ------------
NET EARNINGS PER COMMON SHARE - BASIC $ 0.03 $ 0.71
============ ============
DILUTED EARNINGS FROM CONTINUING OPERATIONS $ 0.04 $ 0.68
DISCONTINUED OPERATION (0.01) (0.02)
------------ ------------
NET EARNINGS PER COMMON SHARE - DILUTED $ 0.03 $ 0.66
============ ============
WEIGHTED AVERAGE NUMBER OF COMMON SHARES 18,596,218 18,307,686
WEIGHTED AVERAGE NUMBER OF COMMON AND DILUTIVE SHARES 18,596,218 21,141,964
STANDARD MOTOR PRODUCTS, INC.
Reconciliation of GAAP and Non-GAAP Measures
(In thousands, except per share amounts)
EARNINGS FROM CONTINUING OPERATIONS 2009 2008
--------- ----------
GAAP EARNINGS FROM CONTINUING OPERATIONS $ 787 $ 13,347
RESTRUCTURING AND INTEGRATION EXPENSES (NET OF TAX) 707 1,702
LOSS FROM EXTINGUISHMENT OF DEBT (NET OF TAX) -- 882
GAIN FROM SALE OF BUILDING (NET OF TAX) (157) (12,875)
--------- ----------
NON-GAAP EARNINGS FROM CONTINUING OPERATIONS $ 1,337 $ 3,056
========= ==========
DILUTED EARNINGS PER SHARE FROM CONTINUING OPERATIONS
GAAP DILUTED EARNINGS PER SHARE FROM CONTINUING OPERATIONS $ 0.04 $ 0.68
RESTRUCTURING AND INTEGRATION EXPENSES (NET OF TAX) 0.04 0.09
LOSS FROM EXTINGUISHMENT OF DEBT (NET OF TAX) -- 0.05
GAIN FROM SALE OF BUILDING (NET OF TAX) (0.01) (0.65)
--------- ----------
NON-GAAP DILUTED EARNINGS PER SHARE FROM CONTINUING OPERATIONS $ 0.07 $ 0.17
========= ==========
MANAGEMENT BELIEVES THAT EARNINGS FROM CONTINUING OPERATIONS AND DILUTED
EARNINGS 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. 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)
March 31, December 31,
2009 2008
-------- --------
(Unaudited)
ASSETS
CASH $ 10,985 $ 6,608
ACCOUNTS RECEIVABLE, GROSS 192,960 184,422
ALLOWANCE FOR DOUBTFUL ACCOUNTS 11,288 10,021
-------- --------
ACCOUNTS RECEIVABLE, NET 181,672 174,401
INVENTORIES 212,251 232,435
ASSETS HELD FOR SALE 1,603 1,654
OTHER CURRENT ASSETS 31,147 32,497
-------- --------
TOTAL CURRENT ASSETS 437,658 447,595
-------- --------
PROPERTY, PLANT AND EQUIPMENT, NET 65,390 66,901
GOODWILL AND OTHER INTANGIBLES 15,736 16,285
OTHER ASSETS 39,444 44,246
-------- --------
TOTAL ASSETS $558,228 $575,027
-------- --------
LIABILITIES AND STOCKHOLDERS' EQUITY
NOTES PAYABLE $139,139 $148,931
CURRENT PORTION OF LONG TERM DEBT 44,950 44,953
ACCOUNTS PAYABLE TRADE 54,783 68,312
ACCRUED CUSTOMER RETURNS 24,411 19,664
OTHER CURRENT LIABILITIES 65,535 61,136
-------- --------
TOTAL CURRENT LIABILITIES 328,818 342,996
-------- --------
LONG-TERM DEBT 242 273
ACCRUED ASBESTOS LIABILITY 23,673 23,758
OTHER LIABILITIES 43,240 44,455
-------- --------
TOTAL LIABILITIES 395,973 411,482
-------- --------
TOTAL STOCKHOLDERS' EQUITY 162,255 163,545
-------- --------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $558,228 $575,027
======== ========
STANDARD MOTOR PRODUCTS, INC.
Segment Revenues and Operating Profit
(In thousands)
THREE MONTHS ENDED
March 31,
2009 2008
--------- ---------
(unaudited)
REVENUES
Engine Management $ 122,887 $ 143,362
Temperature Control 40,260 49,573
Europe 7,539 11,244
All Other 1,536 3,905
--------- ---------
$ 172,222 $ 208,084
========= =========
GROSS MARGIN
Engine Management $ 30,498 24.8% $ 36,385 25.4%
Temperature Control 6,247 15.5% 7,712 15.6%
Europe 1,855 24.6% 3,194 28.4%
All Other 2,293 3,933
--------- ---------
$ 40,893 23.7% $ 51,224 24.6%
========= =========
SELLING, GENERAL & ADMINISTRATIVE
Engine Management $ 21,912 17.8% $ 24,411 17.0%
Temperature Control 7,384 18.3% 8,456 17.1%
Europe 1,673 22.2% 2,698 24.0%
All Other 5,050 8,294
--------- ---------
36,019 20.9% 43,859 21.1%
Restructuring & Integration 1,163 0.7% 2,836 1.3%
--------- ---------
$ 37,182 21.6% $ 46,695 22.4%
========= =========
OPERATING PROFIT
Engine Management $ 8,585 7.0% $ 11,974 8.4%
Temperature Control (1,138) -2.8% (744) -1.5%
Europe 183 2.4% 496 4.4%
All Other (2,756) (4,361)
--------- ---------
4,874 2.8% 7,365 3.5%
Restructuring & Integration 1,163 0.6% 2,836 1.3%
--------- ---------
$ 3,711 2.2% $ 4,529 2.2%
========= =========