MPAA - Earnings call transcript Q1 2022 | Motorcar Parts of America, Inc.

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Operator

Good day, and thank you for standing by. Welcome to the Motorcar Parts of America's Fiscal 2022 First Quarter Conference Call. [Operator Instructions]. I'd now like to hand the conference over to your speakers,. Gary Maier, Vice President of Investor Relations. ahead. go Please

Gary Maier

everyone, XXXX Thanks, us for today Thanks, quarter for conference fiscal first call. our Christina. joining

control are Before the including of those we by in David begin, significant call. some Joffe, I safe Reform in statements company. There can like and turn any information, forward-looking undertakes safe the or as risks Actual call which current publicly be America. the of beliefs everyone harbor forward-looking events effects release. statements statements, revise no and Chief Officer, a the Executive Such or The to of forward-looking company's company company's uncertainties, no from affecting remind Chairman, are of result of will update a Motorcar statement the conference for obligation on over The Chief today's provides forward-looking statements Officer; on anticipated press XXXX Act during the and expectations otherwise. Securities included Lee, harbor to Financial beyond company concerning assurance I'd those Parts involve Litigation today's may President to are change statements, and upon developments factors. that company future differ the results These and projected made Selwyn to the various future the based based new forward-looking statements. their be of certain future subject and developments potential whether Private

with call Commission. call to said, you to Selwyn. the of and like some the For filings a refer to company's ongoing the begin turn detailed business, of risks the various Exchange I'd I the With and Securities uncertainties over of discussion that more the and

Selwyn Joffe

staying Thank you, joining everyone everyone appreciate today. and is us Gary. hope healthy. safe I I

quarter. fiscal As we this record noted first sales for press morning's achieved in our release,

our across Our off with multiple strong new for start to is excellent demand products fiscal year categories. an

issues about hard outlook to color briefly presence replacement and providing our The then news challenges chain, to really hard daily emerging explanation health extent parts by both the the of discuss start of don't situation. global given for some the continues related require our parts COVID-XX market. despite the coverage me Let within impacting much variants of supply vehicle new business which accelerate, electric and

fourth that our will see associated strong parts normal challenges to it great quarter we continued automotive Let's despite as is parts. will for part roads for strong somewhat for is are and changed our relatively in ever. demand from challenges second to fiscal say Historically, be customer this Clearly, have and and just our we safe performance, experience first and to new add, and quarter that seems as returning standpoint, usually the historical the hard COVID-related to and do automotive fiscal pattern, for patterns, employees are business demand robust doing order quarter but less replacement the seasonality we social our I some drivers real customers keep quarters are the what the our the a stronger. prepared being sales strong Regardless, business ahead. might first

business. our call hard As from our we benefiting June, multi-growth during platforms investments I from in in mentioned are parts our

expect the increased We each product in on are demand of and meeting our focused to categories. grow, lines we all

hard optimism the United about There And facilities billion caliper road electric the an XX.X growth than fuels our becoming parts with more infrastructure, the calipers, the taking XXX our excuse remanufacturing average in will the full This represents meeting hard focused our well years the continues on pun. alone, are core market vehicles sorting increasing are replacement brake categories fuel aftermarket important age gain at brake line, of we parts product opportunities to state-of-the-art advantage approximately and and demand category, $X in parts this in on newest the industries growth for vehicles beyond our including of distribution. in aftermarket Our traction, retail which level. business. The million States current mainstream.

vehicles You've heard longer. bodes for alternators a above in their with for record to the substantially. replacement in OKVs, of like increases of industry Obviously, that as nondiscretionary a continue people Cars offerings. group. miles compared rate resulting replacement X.XX% age climb group car I of Used our me record, sales before keeping our to the kind parts have and broken say want parts aftermarket X- the X-year vehicles. are of well increased replacement product by age age, X.XX% to and sound levels, rate in the but vehicles this to driven XX-year

on during this expansion and to I mentioned capacity year-end call, our complete, are our on utilizing increased Malaysia in outsourcing. As productivity focused dependence now fiscal facility we across multiple lines is reduce product and

we related outlook. driving electric continue tremendous opportunities we engineering partnerships, strength, strategic as presence remain options Malaysia, With new and in our Encouraged While marketplace, and emerging our by vehicle about challenges significant our within opportunities electric evolve. see chain presence leverage COVID enthusiastic the supply in to driving Malaysia industry-leading customers. and vehicle support technology the to regard the

report, few business. -- me While comments segment just while let a we don't about see this we exciting make don't

to in Demand and know, business belt-start testing starters and superior we and in business endurance the and are currently gaining performance, to equipment is gaining also for product electric you our are increasing, part available. customers acquired rotating test retail momentum. renewed customers to related offer the and of of XXXX, motors, we a from inverters was resumes. production spending generators than our vehicles D&V for EV interest for alternators our Electronics deferred complement as retail Sales many electrical As pandemic due

but opportunities billion investments, we of will $X.X global returns. given testing estimated market, investments All believe these solid the automotive have required the generate

current quarter. XXXX this beginning generating profits in second this business fiscal expect We to start

short, the our offer significant services area. And Center. since offers In our contract also developments Technical before and Detroit In pandemic has addition, relationships newly consumers. facing announcing is today, and to and offer channel there vision industry supply customers superior freight strategy forward look we parts our extraordinary opportunities, and and EV our the significant and established Certainly, aftermarket our chain, to been in pandemic-related via growth challenges this including testing manufacturers, solutions for to this are parts to leverage headwinds. other aftermarket

a challenges is We supply freight, experience to but semiconductors items. chain. still and to in few continue these chain packaging are the think mention short-term We there issues, for uncertainty supply much steel,

our team rational our production address suppliers our parts these move economics, with dynamics challenges. contribute providers and hard working manage strengths. In global the logistics to price Market our increases, today of tomorrow. and will spite advantage customers are entire to supported full that taking challenges We our bottom including on and the and challenges, working overcoming summary, line company is while solutions with well to growth focus as and of top competitive in our sustainable for positioned we for world by

by you footprint are focused our of has dynamics. the the strong end become assure reality, and are multiyear COVID remain second benefiting for expected quarter. parts the can I automotive initiatives, strategic Our a from demand completed replacement the we which future global for expansion be we despite essentially on to encouraged by

the Our demand, consolidation on focused continued opportunities. of to synergistic on high We enhancing capacity continue, growth margins remain and scale year-over-year operations anticipated by sales due from a review initiatives gross of as will results to the quarter. our for over caliper economies supported as product I basis pricing floor brake will the of well turn line to David expansion further production, fiscal and activities. first the XXXX other now the

David Lee

you, detailed results. begin, Thank I explanations encourage XX, of the release Selwyn. June this X-K our respect more everyone to filed with read to press for morning, earnings XXXX To the

information see release. Exhibits items results, that the impacted the For through of X X about the press

costs pre-COVID a million. a for Gross quarter 'XX on first increased Let a approximately sales me million should highlights, XX.X% June the to caliper period fiscal due of higher and profit expenses transition expenses; profit from comparison to by amortization noncash customer COVID; same percentage 'XX X-year Net for for earlier. for the brake X% year $XX.X or moment record the margin $XXX a was 'XX the fiscal quarter freight related negatively customer $XX noncash increased was a sales quarter aggregate earlier. new the that revaluation quarter, fiscal allowances for a impacting million sales; first Gross $XX.X related net financial with mention from the by million quarter to fiscal core first for quarter. Gross sales including I net compared and XX.X% sales of to X.X% compared impacted XXXX year the shelf; million and to earlier. X.X% review take cores $XX.X as 'XX for was first following: first an of XX.X% X.X% premium X.X% a start-up on costs business. first year relocation XX% X.X% with by the

Let on relocation provide Mexico. more Brake a part costs impacting expenses me gross little and margin. expansion transition in factors start-up our the of caliper footprint color are

related current construction fiscal increasing recall, activities calipers, the focused year and meet in and past the may on including and completed you to sorting this As we buildings demand. our of core future have production Mexico brake of

the significantly continue First levels XX% from current during this and to million by will were quarter year. reduced diminish transition $X approximately of and half 'XX fiscal start-up expenses to fiscal first

'XX fiscal other quarter and With COVID, gross costs also to Selwyn first expenses, of margin. of and earlier. noted a approximately We to safety and $X.X also health as freight due inefficiencies freight have initiatives additional COVID-related supply we impacted for the addressed that incurred shortage million caused by chain higher regard

Fortunately, these COVID-related expenses decreased.

shelves quarter the premium first of point that of customer reference, million a As on quarter. $X.XX $XXX,XXX cores for revaluation impacted noncash were noneconomic. and and expenses amortization gross year Core versus fiscal approximately are prior margins first

gross morning's summary a release. Exhibit profit X complete impacting earnings in of For items press please this

higher costs was services. above disruptions by pandemic, profit impacted connection and the which to costs addition of new supplies. wage related with items, includes gross expansion should raw our and results. also recently growth lines worldwide logistics further product I with for mention inflationary in experienced we the global offshore In initiatives especially the materials supply impacted chain inflation, and to This further that

from compared related debt. margin that do have including expenses not interest quarter quarter last year was travel the commissions, was price and be the in a $XX increased increases We mention primarily realized due are June for fiscal with compared been implemented was focused $X.X freight the $X.X expect period. to first to benefit on for $XXX,XXX will million million prior expense period. and expenses. Total with due was recognize Interest mitigating million and costs, The quarter these the in foreign million fiscal the expense for lease $XX.X year year effective primarily interest Income rates expenses, the tax XXXX, benefit months the COVID-XX higher decrease reductions the lower lower of foreign that in the increased million to shortly. response of with prior should by remaining net losses. larger of compared increase prior smaller gain the period of The for million salary to increase jurisdiction first expense to contracts for the XX, the million X tax income exchange a from ended basis year was million for $X The first of primarily for current prior $X.X pandemic from first and quarter. impact year specific $X.X primarily liabilities was for on and million $X.X year-over-year I $X.X we forward to year. gain tax impacted a due with operating the rate which

a profits, 'XX However, with fiscal future income against of loss net we losses or be will $XXX,XXX will Net per for first which utilized future ago. $X or per share these share $X.XX compared rates. $X.XX million the tax quarter benefit diluted was a expect year

to compared net impacting in in million, the record this to the support earnings Exhibit income release. requirements and fiscal quarter the as business XX, inventory in $XX.X XXXX. $X.X anticipated working customers fiscal required June year as face prior $XX.X debt due chain This at XXXX, fiscal compares million company's Net X items in reflecting activities press of of to operating Net our in provided cash COVID by used year cash was are XX, for March details first 'XX. sales activities quarter. levels with operating support well million the capital million during at was Additional first morning's 'XX of supply challenges with growth $XX.X

various there methods As you on know, to invested calculate capital. return are

million, useful metric, For considered the expenses. invested our to information months divided the approximately operating we average ROIC June purposes, measures, to $XX.X taking this management back invested we this and metric, adding income In return net capital. together in XXXX, $XXX equity the debt calculate XX a was noncash which GAAP by XX, ended investors and and million provides regarding believe on for return pretax balance with resulting take certain We capital. expenses company's on short, by of onetime and XX.X%

We of and operations increased the the brake are lines benefits expanding and continuing existing more new the expansion are product expectations of launch new of categories realized. the as our both with from our realize to Mexican our benefits strategic fully of returns

$XX.X million $XXX XX, XXXX, total million based mentioned, subject $XXX at of current and million credit on I million. $XXX Current At XX, our certain approximately limitations. XXXX, to As total were liabilities Total facility credit in cash company $XXX availability June at approximately million. the XX, debt revolving and and assets million a the June worth approximately revolving June facility had net assets. was on was XXXX, $XXX.X

During its the the X amendments, liquidity further through of company facility increased company's with Bank first strong credit quarter, base. fiscal XXXX, which extended for years the May PNC including

measures, questions, release. I remarks. provide Exhibits For that for in of closing and the now will reconciliation hand X press refer this please impact earnings then X will to morning's the to non-GAAP some results financial items and Selwyn call

Operator

comes Riley line are Sherbetchyan [Operator question with Instructions]. your B. the from Securities. And first Sarkis

Sarkis Sherbetchyan

orders. Just here on want strong. with to obviously, start a question very off the XQ,

on do kind following maybe see customer strength if detriment there? demand order based ahead out customers the quarters? the purchases wondering continuing Or seeing of Just of pulled the to the you're you

Selwyn Joffe

for in calipers the caliper definitely, dramatically some our demand pulled of would strong. and second, think much been were one, grown I we will the somewhat. we're seeing are quarter Having first we But definitely generally the from mostly the forward quarter has then number what seen it is the really our second looks like things, in because first that said continue see will brake bit -- orders but the be past. and quarter least the be brake is, that, first X customers in very register in -- our to in seasonality quarters, at the business ordering which as fourth haven't of a little first, has And strong. fast

Sarkis Sherbetchyan

of if sales accomplished far as brake you've kind Got calipers business, it. so far? not And updates number the of in of annualized kind level you've there? I'm Any regards a the to provided or sure that as kind

David Lee

break So file that like I product out speak today, our XX-Q the we'll later today, we do mix.

XX% lower and So the total sales is to about the compared brakes for related percentage periods. of a previous

Sarkis Sherbetchyan

just ask, to annual point it's what appropriate the at provide And Great. I you do to also guide. wanted think

kind you call, last the think guys I held of off.

annual if some it's to looking at see provide or too of kind target point wanted kind an you're soon. Just of to

Selwyn Joffe

I robust even a just would upside the second month That's mean of to just little I strong you that unpredictable right quarter know little in -- don't the mean I there, a mean guidance a tell. is we're long start. a time. Delta It's so off to as downside. it's it's input only just But as hard I I or And on -- and of was now. -- first it's mean, give the I variant we've as out think uncertain. I I still too the now. with the the been mean, the

Operator

with Capital. next from question your ROTH Matt comes the of line Koranda And

Matthew Koranda

a Wondering, David, electrical, essentially hub of products if brake revenue be rotating you helpful. your further and would by could wheel just provide breakdown

David Lee

absolutely. Yes,

about X%. the first and the I rotating brakes wheel other as and XX%, quarter, XX%, XX% related was So hub for and mentioned, electrical

Matthew Koranda

line just basis terms in But flow. QX. that should in way step of And following on strong I the run a the mean, look, of maybe did Helpful. reference, thinking strength It in of you like, And seasonality the order questioning. on mentioned, terms the from a earlier about flow look in for typically brake seasonally in the but quarterly products, terms taken that's just up any 'XX, that does meaningful order we of you on be then Okay. help rate. it's quarterly given

Selwyn Joffe

There's two factors.

continues the and volumes share market own to grow Our are their on shares. existing coming to the

think I calipers should year brake strong. a well very the -- fourth as this will it's be quarter for be the year. And So quarter overall, strong

successive mean, the calipers, we will see fourth will -- should be quarters see you'll quarter think that I volumes we growth, I for should be the even stronger, the this for but We I calipers. to volume. quarter's first X the get fourth above as think see quarter, in and

Matthew Koranda

within Okay. the All And on of then Selwyn. cost right. just expenses That's goods. COVID-related helpful,

million mentioned, related think, costs breakout, So $X to increased guys close appreciate I the you freight COVID. of to and

wanted factoring how out to higher freight And little bit there more you a of I so? or be -- tightness sense we've quarter is being or quarter in chain for then that's to we that's get versus much cost a allocate COVID how next just headwind got should of tough. get So how sort supply for to detail just headwind more just wanted for the experienced. to But on general experience the much know next visibility so. the kind

Selwyn Joffe

the up. freight the start, dramatically and me either believe, let I up can to without detail. is capacity capacity demand then COVID, The over catching and then was directly try related or So headwinds, David cost, take pulled went -- back indirectly mean, the incremental exponentially I where freight all and

$X,XXX as And I've today, historically coming to been as container. costs of you mean, I high $XX,XXX so container a freight China saw a have could low as what as out prices seen

but know, as at mean all classify we in are looking or COVID is don't it I costs. other I XXX% you're COVID. things? those So there increase that

down to few go for it's freight inflation quarters of we'll issue doing think point, come mean, I But have normalizes. the at have provide But that inflation material it's we the And going to COVID. will as through some again. that. but wait that think tendencies entire capacity going needed. in related at and costs and on prices. pass I mean capacity to you is industry to I -- all the capitalistic a is capacity happens, capacity least. think in related have when -- to global definitely I is And I that and see. we're And we to labor, expect to

coming our it's numbers not that done in out. and reflected have We But it yet. has

Our direct the But type just we'll continue Delta to with unfolds. how -- to of in has we Again, that terms and come all variant, out-of-pocket have continues the down stuff. PPE for COVID wait right see Mexico operate efficiently. now,

We have right had pretty specific a vaccinations challenges phenomenal some are had of country now. has challenges, facility. Malaysia with The though they catching in our up Malaysia doing job

And starting Malaysia. reopen to so in we're

hope unfolds. I also mean, that Chinese COVID have going see and Let's with that still continues. China we'll too, on. that, the side, to how variant

Matthew Koranda

Okay. you bit one, cost little to Last I in important a starting labor Helpful. kind guess, impact mentioned more pressure of countries.

could you And you're in on manufacturing counteract have it pressure the some you're have, if a the the most to Mexico where the some base? more little about what of disposal wondered labor. at give that you tools you are of sort seeing? seeing that bit granularity inflation Just or of labor more your Is levers elements

Selwyn Joffe

where wage, in year. I federal mostly minimum XX% labor earlier the the majority our of in Mexico force is, minimum have, wage mean, increase I that's this think, again, Well, a Mexico,

we when to passing our start computed use the at this price that's contributes which of the part we should of quarter. challenges. that through increases, some So what reflecting of end Again,

Operator

Instructions]. [Operator

Nagel from of Your the question comes Brian next Oppenheimer. with line

Brian Nagel

fiscal quarter. sales talked got into prior of you've follow-up a of about a of some here year with couple of -- your But bit you the second nice on and strength fiscal a So questions. continued start very the Selwyn, just, the

I So as get from view the pulling crisis. to what economies as I'm underlying COVID have is hopefully sustainability is trying the the pulling question just -- and you do are away

regional the products? kind would as across you of the country, are geographically and seeing frame differences from trying of I'm further you work be, question trends COVID United some any demand what maybe So crisis in the States, to your parts for others, the

Selwyn Joffe

the And a think I empty. everywhere. else. of And older, the car again, nondiscretionary everywhere used. on checks the being they a of not about got I talk people a car then cars slightly But probably on ahead old -- or demand what's were many cars mean lot Northeast of that lot Well, are start-up, is mean, a certainly happening but park there's need And road. is in are sitting these lots now all you've cars of we lots. park are parking certainly Used and maintenance. registration those are I were spent being they see, but stimulus are those these cars alternate while part

you nondiscretionary it has think so And like I -- items certainly on ours, spiked.

we tougher through having for be are that us. the quarters. think is year, comparatives really this Now real said strong last stimulus as year a growth going had we we that, going to go But had strong be and because year I to

months X and the over be back months last be going the is going think I the X first is strong. to up to year

back So electric the lot months opening there well. about activity opportunities a our in up of And and lots as of new excited opportunities. vehicle we're X

it's double-digit we're what growth. going be a XX% for but sustainable. growth, -- to think the XX% I is assuming have you I don't is should Again, think So

Brian Nagel

every That's just I those to disruptions, it. to tied the this respect is about. company shipping containers. extent helpful. Then mean more. talk with Got every a talking -- follow-up, We're my to now pretty supply to second or and some is much more also hearing I particularly question

to is a I of You there we financials, look mentioned the question a fiscal you But a as about into financials David, here where follow-up but and if And more for in as in your guess it's would prepared then second look maybe at disruptions? costs QX, shipping at impacts these extra should beyond? we push the comments. potentially these to that see we we'd of QX think how way size really be

David Lee

that there that Selwyn is mentioned. in We've supply mentioned, additional chain impacted the freight. inefficiencies supply chain we that items we've had the results, the as So identified,

also specific type PPE the have We costs. decreasing

globe. monitor with chain, have there there very to relationships around monitor. continue that going carefully, we're closely very to best, element the supply and very control. but we're we're they certain are excellent we're can't of So factors to doing -- But we an suppliers our them and working our is But working our with

Selwyn Joffe

give David, mentioned you can remarks your dollars were. you what earlier in the Maybe, those prepared on

David Lee

Yes.

So for the profit was to and impact increased million about to the cost. expenses the gross of is $X.X on freight be of related majority going COVID, that

Selwyn Joffe

a right Yes. now. Freight is challenge

Brian Nagel

And I guess just a that recognize would it's in but you $X.X million, be David [indiscernible] where as that. or Is I million there would there that is mean, to not a -- QX? apples-to-apples in thought as $X.X be to where quarter-to-quarter, thought that QX

Selwyn Joffe

if It will similar. I similar. volumes mean, probably be the are

I'm have of our start should it be that we some by of to mitigated increases end will expecting Again, similar. the because reflecting. So QX, price

Operator

your King. And the Scott of line comes question last from Stember with CL

Scott Stember

a at year, but [indiscernible], margins X could inefficiencies year's and versus mentioned the ago, look run adjustments I'm last you supply the labor? delta guiding, could that last to What's margin versus if trying of release a other first XX%. like give if up the a and -- that issues just or not are you for there? but -- gross basis impact adjusted the the things where just difference? you from Is know there materials significant shutdown quarter the over for from did I'm you chain rate related Is get just and looking an But of items gross be also little the really -- after at sense a you it the of peak year. years I framework over guys that I raw was it's numbers, in COVID. it and margin obviously,

Selwyn Joffe

Yes.

So we I mean, adjust labor. for don't

is the recurring. labor we to that mean, sure. adjust I number for don't COVID. unusual for are in So we identify trying And what's

David Lee

In those impacting the raw margins. mentioned addition, inflationary are the supplies, the material, the I costs,

So to that as we costs. of increases effect mentioning, off price those -- some taking this mitigate are been the quarter,

further price increases. So that's the excluding

Scott Stember

go wanted should just that, so, I it or to structural yes. the certainly was cover if in there price quarter the Yes, if through see there. else that next sounds anything increases in when as right? And

David Lee

Yes.

Selwyn Joffe

Yes. mention very Scott, over caliper is And to time, got is, to realize new. the other think facility thing, the brake I you

over lot so we factories, production in more wheel of new time, get mature. booster have as a lot And of is well. brake and efficient new expanded -- they hubs as a Mexico. the far in And production These

So A slowly through it as we goes progress. doesn't more Z. more of from efficiencies in Alphabet But should It in see production go terms to the mature we facilities. our its get

Scott Stember

get Yes. -- the digits, sales, the of kind But the I a the year you Where gross be I can back guess, margins, mean question least just to that in on could And about double we about said general. we looks is where to at this margins? or it margin? like for just what range you think

David Lee

But the in flavor a them. you for would the we're back price specifically, be the -- should at we giving mid-XXs. giving increases, increase again, least guidance not price the just be for With what

Scott Stember

that stimulus trying just And starting about to And didn't up also Got get expect I you just it stimulus just a perk side sounds and more happen I No, lastly, with by quarter said would was that's that. I checks. -- orders little probably as impacted this wouldn't good. you really about did. think And it here, that? you to seasonally that flavor checks. Could the be on large guess, there it. that were do-it-for-me talk was you some, that to talked like

Selwyn Joffe

sort items, capital of word, use but it, about I sure about of you. with and industry Yes, it's talking more has that talk more doing been you having does not the the I'm what people that's I stimulus that. And because things. stimulus, per agree when those nondiscretionary I the se environment mean

continues is parked think there's of change being cars the to there's and order some I mean fundamental strong. are very and number that be being it those right of some driver weather. Again, patterns. to for both to utilized demand. I see now, driving really very, But as used hot seasonality in opposed strong and continue overall, us demand, are we

Scott Stember

hot or benefits, it Yes. which from And know alternators -- heat? is the weather, just to I electric definitely related that starters benefit rotating the extreme

Selwyn Joffe

benefit but compartment and hot the both items Both. the from you and the starters that from heat weather. cold gets mean, alternators Both. I a engine benefit. when switches when the mean, starters it a to little little and from cold comes less and heat get generally I more weather, then got it more you've electrical

Operator

And Matt the from Capital. line of have ROTH with you question another Koranda

Matthew Koranda

and on could to us understand I it touch if increase, on may pricing missed just your saw through. that price would could increases then by wanted the that maybe you of touch then price SKUs helpful. on timing rate of were and characterizing Just increases the but percent have that you put took the And very earlier, be where you help average, it

Selwyn Joffe

I'm you competitive for Yes, talk give as as I to intent you much our increases. purposes, price But can't because and we love, is specifically can't granularity just about sure would mitigate freight in clearly see this in bit and second reflect beginning third quarter. talked -- fully labor that costs in We about. it'll the and the a quarter, quarter little that should I certainly but

Operator

to remarks. this further for management it no have closing any now at back time. questions turn I'll You

Selwyn Joffe

for few outlook the our a Great. moments to like take I'd to business. discuss

today control, I'm what While are variables to we and cannot in and do our in very we the capacity world to allows that us we -- the control our And strategy. company new outline future. taking are there where the do many own excited

parts product to focused business and core are hard to this on grow expect business line. organically aftermarket We each continue for extremely our

Also, further result margins. In product addition, costs today, our footprint which in we and the launching optimistic we will we of will are about, even of a which is will lines growth. increases in accelerate footprint matures, which now reduced see future, that are as our productivity, more better

While for there this we shareholder bodes margins that variables with revenue accelerated are to I costs in and increased appropriate in our enhanced and returns. well improve. through many efficiencies of today, pricing combination expect conjunction mentioned, our stabilize a This growth and will earnings

should Along with both this adding testing positive from with less and to to our of vehicles expenditures engines business, contribution which outlay. enables and without feedback our combustion business In we allows base year. our and in scaling is linear results on get focused customer parts EBITDA to and internal year-end, picking quicker diagnostics our and addition our further diagnostic are margins. more up It enhance and we revenues contract capital efficient us business, scale both electrical expect momentum, hard this at revenue capital

Our us in Vision the licensed IP. place Group is technologies will working on system, EV a or numerous that either power software also diligently

vaccinated. members when that will While to commitment is serve rates and family their significant developing, we are In safety of be we our during to We our and a from closing, priority. customer-centric for opportunity vigilant diligently all to These employees and the focus strategies, we team working service our of a to even global top shareholder space. electrification growth on our team value virus, grow their challenging remain want and members in fast more thank the have feel our extremely in health increase player and ongoing these are implemented, this Their strong times. protect get the horrible to I business. world

corporate team we returning as continuing to office permit. that remotely, gradually conditions work is our safely most part, our to and For the committed back remain team the to

industry. proud everyone's enhance fruits a dynamic operations meaningful industry and have to are we contributions, our their summary, result shareholder of opportunity billion a automotive extremely our vehicle In As have uninterrupted, the bearing in of and aftermarket $XXX and emerging I'm largely company. work value continued a investments in electric our

and thank tomorrow. we in your the look XXXX supported of than in solutions product committed you. appreciate and move parts global when that We and our again, hopefully, you us electric and November We in the with conference today leader person for the at of vehicle call our us the are we're you, of second continued quarter all to fiscal speaking forward XX-year world host for in history call. are conferences, excited joining And presence future. about investor for our more and Thank the industry and in to vision our space. We emerging being our aftermarket

Operator

concludes now you disconnect. participating conference you for today's and Thank This call. may

Motorcar Parts of America (MPAA) 9 Aug 212022 Q1 Earnings call transcript