Genuine Parts pany(GPC) - 2025 Q1 - Quarterly Results

Q1 2025 Financial and Operational Highlights Overall Performance Summary Genuine Parts Company reported Q1 2025 sales of $5.9 billion, a 1.4% increase, with net and adjusted net income declining Q1 2025 Financial Summary | Metric | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Sales | $5.9 billion | $5.8 billion | | Net Income | $194 million | $249 million | | Diluted EPS | $1.40 | $1.78 | | Adjusted Net Income | $243 million | $311 million | | Adjusted Diluted EPS | $1.75 | $2.22 | - Sales grew by 1.4%, primarily due to a 3.0% benefit from acquisitions, partially offset by a 0.8% decrease in comparable sales and 0.8% unfavorable foreign currency impact[4] - One less selling day in the U.S. negatively impacted overall and comparable sales growth by approximately 1.1%[4] Segment Performance Automotive Parts Group Global Automotive sales increased by 2.5% to $3.7 billion driven by acquisitions, despite comparable sales decline, while EBITDA and margin decreased Automotive Parts Group Performance | Metric | Q1 2025 | Change (YoY) | | :--- | :--- | :--- | | Sales | $3.7 billion | +2.5% | | Comparable Sales | | -0.8% | | Acquisition Benefit | | +4.1% | | Segment EBITDA | $286 million | -10.7% | | Segment EBITDA Margin | 7.8% | -110 bps | Industrial Parts Group Industrial segment sales decreased by 0.4% to $2.2 billion, offset by acquisitions, while EBITDA remained stable and margin improved Industrial Parts Group Performance | Metric | Q1 2025 | Change (YoY) | | :--- | :--- | :--- | | Sales | $2.2 billion | -0.4% | | Comparable Sales | | -0.7% | | Acquisition Benefit | | +1.3% | | Segment EBITDA | $279 million | In-line with prior year | | Segment EBITDA Margin | 12.7% | +10 bps | Financial Condition and Cash Flow Balance Sheet and Cash Flow Analysis Operating cash flow decreased by $41 million, leading to a $161 million decline in free cash flow, while liquidity remained strong with $420 million cash and $2 billion undrawn credit - Operating cash flow decreased by $41 million in the first three months of 2025[11] - Free cash flow for the first three months of 2025 was negative, decreasing by $161 million year-over-year[11] - As of March 31, 2025, the company held $420 million in cash and $2 billion in undrawn revolving credit capacity[12] Full-Year 2025 Outlook Reaffirmed Full-Year Guidance The company reaffirmed its full-year 2025 guidance, projecting 2% to 4% sales growth and adjusted diluted EPS of $7.75 to $8.25, excluding tariff and pension termination impacts 2025 Full-Year Outlook | Metric | 2025 Full-Year Outlook | | :--- | :--- | | Total Sales Growth | 2% to 4% | | Automotive Sales Growth | 2% to 4% | | Industrial Sales Growth | 2% to 4% | | Diluted EPS | $6.95 to $7.45 | | Adjusted Diluted EPS | $7.75 to $8.25 | | Operating Cash Flow | $1.2 billion to $1.4 billion | | Free Cash Flow | $800 million to $1.0 billion | - Guidance excludes impacts from new U.S. tariffs announced in Q1 and potential reciprocal tariffs[14] - Outlook excludes a one-time, non-cash charge of approximately $735 million ($540 million net of tax) for a U.S. pension plan termination[14][16] Consolidated Financial Statements (Unaudited) Condensed Consolidated Statements of Income Q1 2025 net sales increased to $5.87 billion, but higher operating expenses and interest led to a decline in net income to $194.4 million and diluted EPS to $1.40 Condensed Consolidated Statements of Income ($ in thousands) | (in thousands) | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Net sales | $5,866,069 | $5,783,631 | | Gross profit | $2,173,684 | $2,074,655 | | Income before income taxes | $251,637 | $325,181 | | Net income | $194,392 | $248,894 | | Diluted earnings per share | $1.40 | $1.78 | Condensed Consolidated Balance Sheets As of March 31, 2025, total assets increased to $19.82 billion and total liabilities to $15.35 billion, with total equity rising to $4.46 billion Condensed Consolidated Balance Sheets ($ in thousands) | (in thousands) | March 31, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Total current assets | $10,214,388 | $9,852,584 | | Total assets | $19,817,205 | $19,282,705 | | Total current liabilities | $8,885,200 | $8,525,380 | | Total liabilities | $15,352,642 | $14,930,854 | | Total equity | $4,464,563 | $4,351,851 | Condensed Consolidated Statements of Cash Flows Q1 2025 saw a net cash outflow from operations of $40.8 million, with investing activities using $154.8 million, resulting in a $59.5 million net cash decrease Condensed Consolidated Statements of Cash Flows ($ in thousands) | (in thousands) | Three Months Ended March 31, 2025 | Three Months Ended March 31, 2024 | | :--- | :--- | :--- | | Net cash (used in) provided by operating activities | $(40,827) | $318,306 | | Net cash used in investing activities | $(154,818) | $(178,444) | | Net cash provided by (used in) financing activities | $128,742 | $(175,223) | | Net decrease in cash and cash equivalents | $(59,544) | $(52,419) | Reconciliation of Non-GAAP Financial Measures Reconciliation of Net Income and EPS Q1 2025 GAAP Net Income of $194.4 million was adjusted to $243.1 million for non-recurring costs, resulting in an Adjusted Diluted EPS of $1.75 Reconciliation of GAAP Net Income to Adjusted Net Income and EPS ($ in thousands, except per share data) | (in thousands, except per share data) | Q1 2025 | | :--- | :--- | | GAAP net income | $194,392 | | Restructuring and other costs | $54,770 | | Acquisition and integration related costs | $14,035 | | Tax impact of adjustments | $(20,124) | | Adjusted net income | $243,073 | | GAAP diluted EPS | $1.40 | | Adjusted diluted EPS | $1.75 | Reconciliation of Free Cash Flow Q1 2025 operating cash outflow of $40.8 million and capital expenditures led to a negative Free Cash Flow of $160.7 million Reconciliation of Free Cash Flow ($ in thousands) | (in thousands) | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Net cash (used in) provided by operating activities | $(40,827) | $318,306 | | Purchases of property, plant and equipment | $(119,840) | $(115,690) | | Free Cash Flow | $(160,667) | $202,616 |