Genuine Parts Company · NYSE:GPC
Genuine Parts — Q4 2021 Earnings Presentation
28 slides from Genuine Parts's earnings presentation, Feb 17, 2022
Slide 1: Q4 2021 Earnings Presentation
Q4 2021 Earnings Presentation February 17, 2022
Slide 2: Genuine Parts Company Snapshot
Genuine Parts Company Snapshot (NYSE: GPC) KEY STATISTICS1 GLOBAL FOOTPRINT 2021 Revenue by Region1 Founded 1928 Headquarters Atlanta, GA Countries Served 15 Locations ~10,400 • Warehouses ~700 • Distribution Facilities ~200 • Retail (Owned/Independent) ~9,500 74% 15% North Europe Employees ~52,000
Slide 3: Safe Harbor Statement
Safe Harbor Statement FORWARD-LOOKING STATEMENTS: Some statements in this release, as well as in materials the Company files with the Securities and Exchange Commission (SEC), release to the public or make available on the Company's website, constitute forward-looking statements that are subject to
Slide 4: Q4 Highlights
Q4 Highlights Paul Donahue Chairman & CEO
Slide 5: Key Messages
Key Messages 01 The GPC team finished the year with a strong fourth quarter, further building on the positive momentum of the first nine months of 2021 02 Proud of our progress through the year and thankful to our 52,000 teammates for their hard work and commitment to excellence Execution of strateg
Slide 6: 4Q21 Performance Highlights
4Q21 Performance Highlights1 • $4.8B Total Sales, +13% from 2020, and +12% from 2019 ✓ Monthly daily sales2 trends up double-digits in all three months ✓ Automotive growth benefiting from strategic growth initiatives, strong demand and market tailwinds Financial ✓ Industrial growth due to economic r
Slide 7: Automotive: Highlights, Trends and Initiatives
Automotive: Highlights, Trends and Initiatives Automotive – Total sales +13% 4Q; +16% FY’21 4Q Comp Sales1 +11%; 2-Year Stack +9%; Segment Profit Margin 8.3%, -20 bps / +60 bps in full year MACRO NORTH AMERICA EUROPE AUSTRALASIA • Tailwinds: Total U.S. Sales +15%; +9% 2-Year Stack Total European Sal
Slide 8: Industrial: Highlights, Trends and Initiatives
Industrial: Highlights, Trends and Initiatives Industrial – Total sales +13% 4Q; +11% FY’21 4Q Comp Sales1 +12%; 2-Year Stack +8%; Segment Profit Margin 9.5%,+20 bps / +90 bps in full year MACRO NORTH AMERICA AUSTRALASIA • Continued improvement in Industrial sales trends • Strengthening industrial e
Slide 9: Strategic Initiative Update
Strategic Initiative Update Will Stengel President
Slide 10: Foundational Priorities for Investing in Our Business
Foundational Priorities for Investing in Our Business Talent & Culture Sales Effectiveness Technology Supply Chain Emerging Technology • Recognize high • Utilize data and • Enhance data and • Ensure we have the • Aspire to lead in potential talent, infuse analytics to digital capabilities to “right”
Slide 11: Momentum Highlights in Our Business
Momentum Highlights in Our Business ✓ ✓ ✓ ✓ ✓ Talent & Culture Sales Effectiveness Technology Supply Chain Emerging Technology ✓ Merchandising and ✓ Inside sales coverage ✓ Enhancements for ✓ Supply chain talent ✓ Commercial supply chain competitive pricing partnerships with ✓ Corporate account ✓ In
Slide 12: Financial Performance
Financial Performance Carol Yancey EVP & CFO
Slide 13: 4Q21 Financial Results
4Q21 Financial Results ($M, except per share data) Sales Adj. Gross Profit1 Adj. Op/Non-Op Expenses1 Segment Profit3 Adj. Diluted EPS1 +13.0% +13.8% +13.8% +12.3% 20.0% +17.8% 19.0% $1,900 40.0% $4,803 $1,693 $500 70.0% 69.0% 18.0% $1,358 $1.79 68.0% 67.0% $420 66.0% 65.0% 17.0% $1,700 64.0% 39.0% $
Slide 14: 4Q21 Segment Performance
4Q21 Segment Performance ($M) Automotive Industrial Sales Segment Profit1 Sales Segment Profit1 +13.1% +10.7% +12.8% +15.3% $180 20.0% $350 20.0% $1,613 $154 18.0% $3,190 18.0% $160 $1,430 $300 $266 16.0% $133 16.0% $2,822 $140 $250 $240 14.0% 14.0% $120 12.0% 12.0% $200 $100 9.3% +20 bps 9.5% 8.5%
Slide 15: Strong Balance Sheet and Robust Cash Generation
Strong Balance Sheet and Robust Cash Generation BALANCE SHEET HIGHLIGHTS1 ($B) LIQUIDITY PROFILE1 ($B) DEBT MATURITY SCHEDULE1 ($M) Cash / Cash Equivalents $0.7 Total Credit Capacity3 $3.9 2.35% 4Q21 Average Interest Rate $828 Accounts Receivable $1.8 Less Total Debt: ($2.4) Inventory $3.9 Unused Cr
Slide 16: Disciplined Capital Allocation
Disciplined Capital Allocation 2021 % Capital Deployment Capital Deployment Priorities Reinvestment 20% • $266M CapEx in ‘21; Projecting ‘22 CapEx of ~$300M - $350M M&A 34% • $284M spend in ‘21; KDG in early ‘22 and targeting additional acquisitions $1.35B Share Repurchases 21% • $334M spend and 2.6
Slide 17: 2022 Outlook
2022 Outlook1 FY’22* Total Sales Growth 9% to 11% • Automotive 4% to 6% • Industrial 20% to 22% Diluted EPS $7.45 to $7.60 Adjusted Diluted EPS $7.45 to $7.60 Adjusted EPS Growth 8% to 10% Cash from Operations $1.5B to $1.7B Free Cash Flow2 $1.2B to $1.4B *Growth rates and EPS assume ~2% Fx headwind
Slide 18: Recap and Thoughts for 2022
Recap and Thoughts for 2022 2021 an exceptional year for GPC Team focused on advancing strategic priorities for global automotive and industrial businesses Double-digit sales and earnings growth, improved profit margin and strong cash flow in 2021 Confident in plans for accelerated growth and profit
Slide 19: Q&A
Q&A
Slide 20: Appendix
Appendix
Slide 21: Consolidated Net Sales and Adj. Diluted EPS Bridge
Consolidated Net Sales and Adj. Diluted EPS Bridge Appendix A Net Sales ($M) Adj. Diluted Earnings Per Share $80 $4,803 $477 $1.79 $1.79 ($6) $0.27 $0.34 $1.52 $1.18 $4,252 4Q20 Core Sales Acquisitions FX & Other 4Q21 4Q20 Adjustments 4Q20 Core 4Q21 Adjustments 4Q21 GAAP EPS Adjusted EPS Operations
Slide 22: Other Information
Other Information Appendix B Comparable Sales: Comparable sales or “comp 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
Slide 23: Segment Data
Segment Data Appendix C 2021 2021 2020 (in thousands) Full Year Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Net sales: Automotive $ 12,544,131 $ 2,953,165 $ 3,196,299 $ 3,204,534 $ 3,190,133 $ 2,582,685 $ 2,495,799 $ 2,960,379 $ 2,821,832 Industrial 6,326,379 1,511,549 1,587,439 1,614,315 1,613,076 1,509,841 1,327,428
Slide 24: Explanation of Adjustments
Explanation of Adjustments Appendix D (1) Loss on software disposal: Adjustment reflects a loss on an internally developed software project that was disposed of due to a change in management strategy related to advances in alternative technologies. (2) Product liability damages award: Adjustment ref
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) Full Year Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 GAAP net income (loss) from continuing operations $ 898,790 $ 217,710 $ 196,496 $ 228,585 $ 255,999 $ 122,346 $ (363,501) $ 232,918
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) Full Year Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 GAAP net income (loss) from continuing operations $ 898,790 $ 217,710 $ 196,496 $ 228,585 $ 255,999 $ 122,346 $ (363,501) $ 232,918 $ 171
Slide 27: Reconciliation of Non-GAAP Financial Measures
Reconciliation of Non-GAAP Financial Measures Appendix D Adjusted Gross Profit Three Months Ended December 31, QTD Change (in thousands) 2021 2020 $ Change % Change GAAP Gross Profit $ 1,693,449 $ 1,448,110 $ 245,339 16.9% Adjustments: Inventory adjustment — 40,000 (40,000) (100.0)% Total Adjustment
Slide 28: Reconciliation of Non-GAAP Financial Measures (Cont.)
Reconciliation of Non-GAAP Financial Measures (Cont.) Appendix D Adjusted Tax Rate Three Months Ended December 31, (in thousands) 2021 2020 GAAP Income before taxes $ 345,906 $ 225,546 Total adjustments (1) (10,436) 69,435 Adjusted income before taxes $ 335,470 $ 294,981 GAAP Income taxes $ 89,907 $
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