Genuine Parts Company · NYSE:GPC
Genuine Parts — Q1 2021 Earnings Presentation
30 slides from Genuine Parts's earnings presentation, Apr 22, 2021
Slide 1: Genuine Parts 1Q21 Earnings Presentation
Genuine Parts 1Q21 Earnings Presentation April 22, 2021
Slide 2: Genuine Parts Company Snapshot
Genuine Parts Company Snapshot (NYSE: GPC) KEY STATISTICS1 GLOBAL FOOTPRINT TTM Revenue by Region1 Founded 1928 Headquarters Atlanta, GA Countries Served 14 Locations 10,469 • Warehouses 823 • Distribution Facilities 182 • Retail (Owned/Independent) 9,464 74% Employees ~50,000 North America 15% 11%
Slide 3: Safe Harbor Statement
Safe Harbor Statement FORWARD-LOOKING STATEMENTS: Some of the comments made during this conference call and information contained in our presentation constitute forward-looking statements that are subject to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. All stat
Slide 4: 1Q21 Highlights
1Q21 Highlights Paul Donahue Chairman & CEO GPC 1Q21 EARNINGS PRESENTATION | 4
Slide 5: Key Messages
Key Messages 01 Pleased with the strong start to 2021 02 Ongoing recovery in our Automotive and Industrial businesses 03 Focused on execution and demonstrated agility in delivering strong financial results 04 Improving sales trends, increasing operational efficiencies and enhancing customer value Op
Slide 6: 1Q21 Performance Highlights
1Q21 Performance Highlights1 • $4.5B Total Sales, increased 9.1% Monthly daily sales3 trends: +9% in January, +4% in February, +19% in March Automotive recovery associated with increase in consumer mobility, stimulus and focus on key strategic initiatives Financial Update Continued improvement
Slide 7: Automotive: Highlights, Trends and Initiatives
Automotive: Highlights, Trends and Initiatives Automotive – Total sales +14% Comp sales1 up 8% compared to a 2% decrease in 4Q; Segment Profit Margin +250 bps MACRO NORTH AMERICA EUROPE AUSTRALASIA • Tailwinds: • U.S. comp sales1 +7% • Comp sales1 +15% • Comp sales1 +15% − Continued economic recover
Slide 8: Industrial: Highlights, Trends and Initiatives
Industrial: Highlights, Trends and Initiatives Industrial – Total sales +0.1% Comp sales1 down 2% compared to a 4% decrease in 4Q; Segment Profit Margin +80 bps MACRO NORTH AMERICA AUSTRALASIA • Continued improvement in Industrial sales trends • Strengthening industrial economy and growth • Mi Asia
Slide 9: Continued Progress Towards ESG Initiatives
Continued Progress Towards ESG Initiatives Expanded training and development programs to ensure personal growth Enhanced our comprehensive wellbeing program focused on emotional, financial, physical and social health of teammates Advanced our corporate commitment to diversity and inclusion by active
Slide 10: Strategy Update
Strategy Update Will Stengel President GPC 1Q21 EARNINGS PRESENTATION | 10
Slide 11: Understanding Customer Needs to Exceed Expectations…
Understanding Customer Needs to Exceed Expectations… Executing Multi-year Plans Initiatives Simplification and Integration • Realign teams • Streamline processes Optimize facilities footprint and coverage • Consolidate facilities Simplify and integrate disparate legacy IT systems • Improve opera
Slide 12: Investing In Our Core Business…
Investing In Our Core Business… Salesforce Supply Emerging Talent Digital Effectiveness Chain Technology • Recognize high potential • Data and analytics to • A foundational priority as • Ensure we have the • Aspire to lead in emerging talent, infuse new understand our unique we deliver a best-in-cla
Slide 13: 1Q21 Financial Performance
1Q21 Financial Performance Carol Yancey EVP and CFO GPC 1Q21 EARNINGS PRESENTATION | 13
Slide 14: 1Q21 Financial Results
1Q21 Financial Results ($M, except per share data) Sales1 Gross Profit1 Adj. Op/Non-Op Expenses1 Segment Profit1 Adj. EPS1 +9.1% +11% +2.1% +40.7% +87.5% $1,600 40.0% $450 20.0% 70.0% 69.0% 68.0% $1,541 67.0% 19.0% 66.0% 65.0% 39.0% 64.0% $1,255 $361 $1,400 18.0% 63.0% $4,465 $400 $1,550 $1,229 62.0
Slide 15: 1Q21 Segment Performance
1Q21 Segment Performance ($M) Automotive Industrial Sales Segment Profit Sales Segment Profit +14.3% +65.3% +0.1% +10% $160 20.0% $300 20.0% $2,953 $1,510 $1,512 18.0% 18.0% $140 $2,583 $250 $236 $125 16.0% $114 16.0% $120 14.0% 14.0% $200 $100 12.0% 12.0% $143 +80 bps 8.3% +250 bps 8.0% $150 10.0%
Slide 16: Strong Balance Sheet and Robust Cash Generation
Strong Balance Sheet and Robust Cash Generation BALANCE SHEET HIGHLIGHTS1 ($B) LIQUIDITY PROFILE1 ($B) DEBT MATURITY SCHEDULE1 ($M) Cash / Cash Equivalents $1.1 Total Credit Capacity3 $4.1 2.65% 1Q21 Average Interest Rate $845 Accounts Receivable $1.8 Less Total Debt: ($2.6) Inventory $3.6 Unused Cr
Slide 17: Disciplined Capital Allocation
Disciplined Capital Allocation Current Priorities 2017-2020 Capital Deployment Reinvestment • Projecting 2021 CapEx of ~$300M 9% M&A 18% 37% • Targeting strategic bolt-on acquisitions for 2021 ~$4.7B1 Share Repurchases • Reinstated plan for opportunistic share repurchases Dividend 36% • 2021 cash di
Slide 18: 2021 Outlook
2021 Outlook 2021 Guidance* Total Sales Growth 5% to 7% Automotive 5% to 7% Industrial 4% to 6% EPS $5.85 to $6.05 EPS Growth 11% to 15% Cash from Operations $1.0B to $1.2B Free Cash Flow1 $700M to $900M Corporate expenses of ~$150 million Capex of ~$300 million Depreciation and amortization $
Slide 19: Closing Remarks
Closing Remarks Optimistic for strong financial results in quarters ahead Entering the second quarter with positive sales and operating momentum Excited for ongoing recovery in the global economy and future growth prospects for our Automotive and Industrial business segments Strong balance sheet pro
Slide 20: Q&A
Q&A GPC 1Q21 EARNINGS PRESENTATION | 20
Slide 21: Appendix
Appendix GPC 1Q21 EARNINGS PRESENTATION | 21
Slide 22: Consolidated Net Sales and Diluted EPS Bridge
Consolidated Net Sales and Diluted EPS Bridge Appendix A Net Sales ($M) Diluted Earnings Per Share $0.70 $1.50 $162 $4,465 ($11) $32 $189 $0.84 $0.80 $4,093 ($0.04) 1Q20 Core Sales Acquisitions FX Other 1Q21 1Q20 GAAP EPS Adjustments 1Q20 Adj. EPS Core Operations 1Q21 Adj. EPS GPC 1Q21 EARNINGS PRES
Slide 23: Other Information
Other Information Appendix B Comparable Sales: Comparable sales refer to period-over-period comparisons of our sales excluding the impact of acquisitions, divestitures and foreign currency. The Company considers this metric useful to investors because it provides greater transparency into management
Slide 24: Segment Data
Segment Data Appendix C 2021 2021 2020 (in thousands) TTM Q1 Q1 Q1 Q2 Q3 Q4 Net sales: Automotive $ 11,231,175 $ 2,953,165 $ 2,582,685 $ 2,495,799 $ 2,960,379 $ 2,821,832 Industrial 5,678,446 1,511,549 1,509,841 1,327,428 1,409,707 1,429,762 Total net sales 16,909,621 4,464,714 4,092,526 3,823,227 4
Slide 25: Reconciliation of Non-GAAP Financial Measures
Reconciliation of Non-GAAP Financial Measures Appendix D Adjusted Net Income from Continuing Operations 2021 2021 2020 (in thousands) TTM Q1 Q1 Q1 Q2 Q3 Q4 GAAP net income (loss) from continuing operations $ 258,759 $ 217,710 $ 122,346 $ (363,501) $ 232,918 $ 171,632 Adjustments: Goodwill impairment
Slide 26: Reconciliation of Non-GAAP Financial Measures (Cont.)
Reconciliation of Non-GAAP Financial Measures (Cont.) Appendix D Adjusted EBIT and Adjusted EBITDA 2021 2021 2020 (in thousands) TTM Q1 Q1 Q1 Q2 Q3 Q4 GAAP net income (loss) from continuing operations $ 258,759 $ 217,710 $ 122,346 $ (363,501) $ 232,918 $ 171,632 interest expense, net 89,504 18,324 1
Slide 27: Explanation of Adjustments
Explanation of Adjustments Appendix D (1) Goodwill Impairment Charge: Adjustment reflects a second quarter goodwill impairment charge related to our European reporting unit. (2) Restructuring Costs: Adjustment reflects restructuring costs related to the execution of the 2019 Cost Savings Plan announ
Slide 28: Reconciliation of Non-GAAP Financial Measures (Cont.)
Reconciliation of Non-GAAP Financial Measures (Cont.) Appendix D Adjusted SG&A Three Months Ended March 31, QTD Change (in thousands) 2021 2020 $ Change % Change GAAP Selling, administrative and other $ 1,195,164 $ 1,142,697 $ 52,467 4.6% Transaction and other costs - (7,549) 7,549 (100.0)% Adjusted
Slide 29: Reconciliation of Non-GAAP Financial Measures (Cont.)
Reconciliation of Non-GAAP Financial Measures (Cont.) Appendix D Adjusted Tax Rate Three Months Ended March 31, (in thousands) 2021 2019 GAAP Income before taxes $ 285,859 $ 160,593 Total adjustments (1) - (1,751) Adjusted income before taxes $ 285,859 $ 158,842 GAAP Income taxes $ 68,149 $ 38,247 T
Slide 30: Reconciliation of Non-GAAP Financial Measures
Reconciliation of Non-GAAP Financial Measures Appendix D Free Cash Flow (in thousands) TTM March 31, 2021 Net cash provided by operating activities $ 2,287,604 Less: Purchases of property, plant and equipment (162,979) Free Cash Flow $ 2,124,625 Updated Outlook YE December 31, 2021 Net cash provided
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