Genuine Parts Company · NYSE:GPC
Genuine Parts — Q1 2022 Earnings Presentation
29 slides from Genuine Parts's earnings presentation, Apr 21, 2022
Slide 1: Q1 2022 Earnings Presentation
Q1 2022 Earnings Presentation April 21, 2022
Slide 2: Genuine Parts Company Snapshot
Genuine Parts Company Snapshot Key Statistics1 Global Footprint Founded 1928 TTM 2022 Revenue by Region1 Headquarters Atlanta, GA Countries Served2 17 Locations ~10,550 • Warehouses ~850 • Distribution Facilities ~200 • Retail (Owned/Independent) ~9,500 75% 15% North Europe America Employees ~52,000
Slide 3: Safe Harbor Statement
Safe Harbor Statement FORWARD-LOOKING STATEMENTS: Some statements in this presentation, as well as in other materials we file with the Securities and Exchange Commission (SEC), release to the public, or make available on our website, constitute forward-looking statements that are subject to the safe
Slide 4: Q1 2022 Highlights
Q1 2022 Highlights Paul Donahue Chairman & CEO
Slide 5: Key Messages
Key Messages 01 Pleased with continued strength in results and proud of the great work by all our 52,000 teammates Q1 highlighted by 1) New sales records for GPC and our Automotive and Industrial segments; 02 2) Margin expansion; 3) Double-digit earnings growth, and 4) Strengthened balance sheet and
Slide 6: Q1 2022 Performance Highlights
Q1 2022 Performance Highlights $5.3B Total Sales, +19% from 2021, and +29% from 20201 1) Monthly daily sales2 trends up mid to high teens in all three months 2) Automotive growth benefiting from strategic initiatives, strong demand, inflation and 01 market tailwinds 3) Industrial growth driven by gr
Slide 7: Automotive: Highlights, Trends and Initiatives
Automotive: Highlights, Trends and Initiatives Total sales +11% Q1 Q1 Comp Sales1 +10%; 2-Year Stack +19%; Segment Profit Margin 8.1%, +10 bps; 2-Year Stack +260 bps MACRO NORTH AMERICA EUROPE AUSTRALASIA • Strong long-term industry fundamentals • Total U.S. Sales +15%; +22% 2-Year • Total European
Slide 8: Industrial: Highlights, Trends and Initiatives
Industrial: Highlights, Trends and Initiatives Total sales +34% Q1 Q1 Comp Sales1 +16%; 2-Year Stack +14%; Segment Profit Margin 9.3%,+100 bps; 2-Year Stack +180 bps MACRO NORTH AMERICA AND AUSTRALASIA • Continued improvement in Industrial sales trends • Fourth consecutive quarter of double-digit co
Slide 9: Environmental, Social and Governance
Environmental, Social and Governance E Focus Areas for 2022 Carbon Emissions Reduction / Focus on Climate Change S Environmental • • • Global carbon footprint is measured Formalize carbon emission reduction strategy Set emission reduction targets and disclose in 2022 Sustainability Report GGovernanc
Slide 10: Strategic Initiative Update
Strategic Initiative Update Will Stengel President
Slide 11: 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 12: Momentum Highlights in Our Business
Momentum Highlights in Our Business ✓ ✓ ✓ ✓ ✓ Talent & Culture Sales Effectiveness Technology Supply Chain Emerging Technology ✓ Welcome new EVP, ✓ Market density with ✓ Gaining positive ✓ Visited with teams in ✓ Hosted our first Supply Chain Officer enhanced sales traction in our efforts Mid-Atlant
Slide 13: Financial Performance
Financial Performance Carol Yancey EVP & CFO
Slide 14: Q1 2022 Financial Results
Q1 2022 Financial Results ($M, except per share data) Sales Adj. Gross Profit1 Adj. Op/Non-Op Expenses1 Segment Profit3 Adj. Diluted EPS1 +18.6% +18.8% +17.9% +25.5% 9.5% +24.0% $453 $500 $5,295 $1,831 $1,900 40.0% $1,479 29.0% $1.86 $4,465 $1,541 $1,255 $361 $1,700 39.0% $1,400 28.8% $400 $1,500 38
Slide 15: Q1 2022 Segment Performance
Q1 2022 Segment Performance ($M) Automotive Industrial Sales Segment Profit1 Sales Segment Profit1 +10.9% +12.3% +33.6% +50.3% $350 20.0% $2,019 $200 $188 $3,276 $300 18.0% $180 9.7% $2,953 $265 9.3% 16.0% $160 $250 $236 $1,512 $125 14.0% $140 9.2% $200 12.0% $120 +100 bps 8.0% +10 bps 8.1% 10.0% $1
Slide 16: Strong Balance Sheet and Robust Cash Generation
Strong Balance Sheet and Robust Cash Generation BALANCE SHEET HIGHLIGHTS1 ($B) LIQUIDITY PROFILE1 ($B) DEBT MATURITY SCHEDULE1 ($M) Cash / Cash Equivalents $0.6 $1,310 Total Credit Capacity3 $4.9 2.31% Q1 2022 Average Interest Rate Accounts Receivable $2.1 Less Total Debt: ($3.5) Inventory $4.2 Unus
Slide 17: Effective Capital Allocation
Effective Capital Allocation YTD 2022 Capital Deployment Key Priorities Reinvestment 5% 4% 2% • $78M CapEx YTD 7% • Projecting 2022 spend of ~$300M to $350M Share Repurchases ~$1.6B • $73M spend for ~570K shares in Q1 • Plans for additional share buy-backs M&A KDG 82% • $1.4B YTD, including $1.3B fo
Slide 18: 2022 Outlook
2022 Outlook1 Current Previous Total Sales Growth 10% to 12% 9% to 11% • Automotive 5% to 7% 4% to 6% • Industrial 21% to 23% 20% to 22% Diluted EPS $7.56 to $7.71 $7.45 to $7.60 Adjusted Diluted EPS $7.70 to $7.85 $7.45 to $7.60 Adjusted EPS Growth 11% to 14% 9% to 11% Cash from Operations $1.5B to
Slide 19: Closing Messages
Closing Messages Proud of our progress in the first quarter and the strong results to start the year Pleased to report new sales records, margin expansion, double-digit earnings growth, a strengthened balance sheet and strong cash flow Kaman Distribution Group integration is progressing well and ahe
Slide 20: Q&A
Q&A
Slide 21: Appendix
Appendix 21
Slide 22: Consolidated Net Sales and Adj. Diluted EPS Bridge
Consolidated Net Sales and Adj. Diluted EPS Bridge Appendix A Net Sales ($M) Adj. Diluted Earnings Per Share $363 $5,295 ($80) $0.36 $1.86 $1.72 $547 ($0.14) $1.50 $4,465 1Q21 Core Sales Acquisitions FX & Other 1Q22 1Q21 Core 1Q22 Adjustments 1Q22 EPS Operations Adj. EPS GAAP EPS GPC Q1 2022 EARNING
Slide 23: 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 24: Segment Data
Segment Data Appendix C 2022 2022 2021 (in thousands) TTM Q1 Q1 Q2 Q3 Q4 Net sales: Automotive $ 12,866,587 $ 3,275,621 $ 2,953,165 $ 3,196,299 $ 3,204,534 $ 3,190,133 Industrial 6,833,844 2,019,014 1,511,549 1,587,439 1,614,315 1,613,076 Total net sales 19,700,431 5,294,635 4,464,714 4,783,738 4,81
Slide 25: 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 26: Reconciliation of Non-GAAP Financial Measures
Reconciliation of Non-GAAP Financial Measures Appendix D Adjusted Net Income 2022 2022 2021 (in thousands) TTM Q1 Q1 Q2 Q3 Q4 GAAP net income $ 926,918 $ 245,838 $ 217,710 $ 196,496 $ 228,585 $ 255,999 Adjustments: Loss on software disposal (1) 61,063 — — — 61,063 — Product liability damages award (
Slide 27: Reconciliation of Non-GAAP Financial Measures (Cont.)
Reconciliation of Non-GAAP Financial Measures (Cont.) Appendix D Adjusted EBIT and Adjusted EBITDA 2022 2022 2021 (in thousands) TTM Q1 Q1 Q2 Q3 Q4 GAAP net income $ 926,918 $ 245,838 $ 217,710 $ 196,496 $ 228,585 $ 255,999 Interest expense, net 63,676 19,850 18,324 15,362 14,167 14,297 Income taxes
Slide 28: Reconciliation of Non-GAAP Financial Measures
Reconciliation of Non-GAAP Financial Measures Appendix D Adjusted Gross Profit Three Months Ended March 31, QTD Change (in thousands) 2022 2021 $ Change % Change GAAP Gross Profit $ 1,825,947 $ 1,540,815 $ 285,132 18.5% Adjustments: Transaction and other costs (5) 5,000 — 5,000 100.0% Total Adjustme
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) 2022 2021 GAAP net income $ 245,838 $ 217,710 Adjustments: Gain on insurance proceeds (3) (634) — Transaction and other costs (5) 26,549 — Total adjustments 25,915 — Tax imp
Genuine Parts Company — Q1 2022 Earnings Presentation on 6ix