GPC Genuine Parts Co

Declares Dividend Increase for 69th Consecutive Year
Provides 2025 Outlook

Fourth Quarter 2024 Highlights

• Sales of $5.8 billion
• Diluted EPS of $0.96
• Adjusted Diluted EPS of $1.61

Full-Year 2024 Highlights

• Sales of $23.5 billion
• Diluted EPS of $6.47
• Adjusted Diluted EPS of $8.16
• Cash from Operations of $1.3 billion; Free Cash Flow of $684 million
• Returned $705 million to Shareholders via Cash Dividends and Share Repurchases

2025 Outlook

• Revenue Growth of 2% to 4%
• Adjusted Diluted EPS of $7.75 to $8.25
• Dividend Increase of 3%

ATLANTA, Feb. 18, 2025 /PRNewswire/ -- Genuine Parts Company (NYSE: GPC), a leading global service provider of automotive and industrial replacement parts and value-added solutions, announced today its results for the fourth quarter and twelve months ended December 31, 2024.

"I would like to thank our global GPC teammates for their hard work and dedication to serving our customers throughout 2024," said Will Stengel, President and Chief Executive Officer. "While the year presented challenges due to macroeconomic conditions and softer end-market demand, we remained focused on controlling what we could—advancing our strategic initiatives to strengthen the business and effectively managing our operations."

Fourth Quarter 2024 Results

Sales were $5.8 billion, a 3.3% increase compared to $5.6 billion in the same period of the prior year. The improvement is attributable to a 3.2% benefit from acquisitions, a net 0.6% favorable impact of foreign currency and other, partially offset by a 0.5% decrease in comparable sales. The fourth quarter included one additional selling day in the U.S. versus the same period of the prior year, which positively impacted sales growth by approximately 1.1%.

Gross profit was $2.1 billion, (or 35.9% of sales), an increase of 1.8% compared to gross profit of $2.0 billion (or 36.4% of sales) in the same period of the prior year. During the quarter, the company incurred a charge of $62 million to write down certain existing inventory associated with a new global rebranding and relaunch of a key tool and equipment offering. Adjusting for this charge, adjusted gross profit as a percentage of sales was 36.9%, an increase of 50 basis points from the same period of the prior year.

Net income was $133 million, or $0.96 per diluted earnings per share. This compares to net income of $317 million, or $2.26 per diluted share in the prior year period.

Adjusted net income was $224 million, or $1.61 per diluted earnings per share. Adjusted net income excludes a net expense of $91 million after tax adjustments, or $0.65 per diluted share, which relates to costs associated with the company's global restructuring initiative, the acquisition and integration of independent stores and a charge to write down certain existing inventory associated with a new global rebranding and relaunch of a key tool and equipment offering. This compares to net income of $317 million, or $2.26 per diluted share in the prior year period. Refer to the reconciliation of GAAP net income to adjusted net income and GAAP diluted earnings per share to adjusted diluted earnings per share for more information.

Fourth Quarter 2024 Segment Highlights

During the fourth quarter of 2024, the company changed its segment profit measure to segment earnings before interest, taxes, depreciation and amortization ("EBITDA"). The company believes that segment EBITDA and segment EBITDA margin are useful measures because they allow management, analysts, investors, and other interested parties to evaluate the profitability of the company's business operations before the effects of certain net expenses that directly arise from its capital investment decisions (depreciation, amortization), financing decisions (interest) and tax strategies (income taxes). In addition, EBITDA is a metric included in certain long-term incentive compensation plans.

Automotive Parts Group ("Automotive")

Global Automotive sales were $3.7 billion, up 6.1% from the same period in 2023, consisting of a 4.6% benefit from acquisitions, a 1.3% favorable impact of foreign currency and other and a 0.2% increase in comparable sales. The additional selling day in the U.S. positively impacted Global Automotive sales growth by approximately 0.9%. Segment EBITDA of $285 million decreased 6.2%, with segment EBITDA margin of 7.8%, down 100 basis points from the same period of the prior year.

Industrial Parts Group ("Industrial")

Industrial sales were $2.1 billion, down 1.2% from the same period in 2023, consisting of a 1.7% decrease in comparable sales and a 0.3% unfavorable impact of foreign currency, slightly offset by a 0.8% benefit from acquisitions. The additional selling day in the U.S. positively impacted Global Industrial sales growth by approximately 1.5%. Segment EBITDA of $271 million decreased 4.3% with segment EBITDA margin of 12.9%, down 40 basis points from the same period of the prior year.

Full-Year 2024 Results

Sales for the twelve months ended December 31, 2024 were $23.5 billion, up 1.7% from the same period in 2023. Net income for the twelve months was $904 million, or $6.47 per diluted share, compared to $9.33 per diluted share in 2023. Adjusted net income for 2024 was $1.1 billion, or $8.16 per diluted share, a decrease of 12.5% compared to $9.33 per diluted share in 2023.

Balance Sheet, Cash Flow and Capital Allocation

The company generated cash flow from operations of $1.3 billion for the twelve months of 2024. Net cash used in investing activities was $1.5 billion, including $1.1 billion for acquisitions and $567 million for capital expenditures. The company's investing activities also generated $122 million cash proceeds from the sale of property, plant and equipment. The company used $334 million in cash for financing activities, including $555 million used for quarterly dividends paid to shareholders, $150 million used for stock repurchases and $399 million of net proceeds from debt primarily from the August 7, 2024 Senior Notes offering. Free cash flow was $684 million for the twelve months ending December 31, 2024.

The company ended the quarter and year with $2.0 billion in total liquidity, consisting of $1.5 billion availability on the revolving credit facility and $480 million in cash and cash equivalents.

Dividend Declaration

The company's Board of Directors approved a 3% increase in its regular quarterly cash dividend for 2025. This increased the cash dividend payable to an annual rate of $4.12 per share from $4.00 per share in 2024. The quarterly cash dividend of $1.03 per share is payable April 2, 2025 to shareholders of record March 7, 2025. The company has paid a cash dividend every year since going public in 1948, and 2025 marks the 69th consecutive year of increased dividends paid to shareholders.

Global Restructuring 

In 2024, the company announced a global restructuring designed to better align the company's assets and further improve the efficiency of the business. Throughout 2024, the efforts progressed as planned, delivering cost savings at the high end of the company's expectations. During 2025, the company will expand its restructuring efforts and take additional cost actions. It expects to incur additional costs of approximately $150 million to $180 million in 2025, which will continue to be reported as a non-recurring expense. Through these efforts, the company expects to realize approximately $100 million to $125 million of additional savings in 2025. When fully annualized in 2026, the company expects 2024 and 2025 restructuring efforts and cost actions will deliver approximately $200 million of cost savings.

2025 Outlook

In consideration of several factors, the company is establishing full-year 2025 guidance. The company considered its recent business trends and financial results, current growth plans, strategic initiatives, global economic outlook, geopolitical conflicts and the potential impact on results in establishing its guidance, which is outlined in the table below.

In addition, the outlook below does not include the previously announced one-time, non-cash charge the company expects to record when its U.S. pension plan termination settles (expected to occur in late 2025 or in early 2026). This one-time, non-cash charge is not included in the 2025 outlook due to the uncertainty regarding when the termination of the plan will ultimately settle. However, to the extent the one-time, non-cash charge is recognized in 2025, diluted earnings per share in the table below will be impacted. The one-time, non-cash charge will not impact adjusted diluted earnings per share. See footnote one below for additional information.

Non-GAAP Information

This release contains certain financial information not derived in accordance with United States ("U.S.") generally accepted accounting principles ("GAAP"). These items include adjusted net income, adjusted diluted net income per common share and free cash flow. The company believes that the presentation of adjusted net income, adjusted diluted net income per common share and free cash flow, when considered together with the corresponding GAAP financial measures and the reconciliations to those measures, provide meaningful supplemental information to both management and investors that is indicative of the company's core operations. The company considers these metrics useful to investors because they provide greater transparency into management's view and assessment of the company's ongoing operating performance by removing items management believes are not representative of our continuing operations and may distort our longer-term operating trends. For example, for the three and twelve months ended December 31, 2024, certain of the non-GAAP metrics contained herein exclude costs relating to our global restructuring initiative and acquisition of Motor Parts & Equipment Corporation, which are one-time events that do not recur in the ordinary course of our business. We believe these measures are useful and enhance the comparability of our results from period to period and with our competitors, as well as show ongoing results from operations distinct from items that are infrequent or not associated with the company's core operations. The company does not, nor does it suggest investors should, consider such non-GAAP financial measures as superior to, in isolation from, or as a substitute for, GAAP financial information. The company has included a reconciliation of this additional information to the most comparable GAAP measure following the financial statements below. We do not provide forward-looking guidance for certain financial measures on a GAAP basis because we are unable to predict certain items contained in the GAAP measures without unreasonable efforts. These items may include acquisition-related costs, litigation charges or settlements, impairment charges, and certain other unusual adjustments.

Comparable Sales

Comparable sales is a key metric that refers to period-over-period comparisons of our sales excluding the impact of acquisitions, foreign currency and other. Our calculation of comparable sales is computed using total business days for the period. The company considers this metric useful to investors because it provides greater transparency into management's view and assessment of the company's core ongoing operations. This is a metric that is widely used by analysts, investors and competitors in our industry, although our calculation of the metric may not be comparable to similar measures disclosed by other companies, because not all companies and analysts calculate this metric in the same manner.

Conference Call

Genuine Parts Company will hold a conference call today at 8:30 a.m. Eastern Time to discuss the results of the quarter. A supplemental earnings deck will also be available for reference. Interested parties may listen to the call and view the supplemental earnings deck on the company's investor relations website. The call is also available by dialing 800-836-8184. A replay of the call will be available on the company's website or toll-free at 888-660-6345 conference ID 95562#, two hours after completion of the call.

About Genuine Parts Company 

Established in 1928, Genuine Parts Company is a leading global service provider of automotive and industrial replacement parts and value-added solutions. Our Automotive Parts Group operates across the U.S., Canada, Mexico, Australasia, France, the U.K., Ireland, Germany, Poland, the Netherlands, Belgium, Spain and Portugal, while our Industrial Parts Group serves customers in the U.S., Canada, Mexico and Australasia. We keep the world moving with a vast network of over 10,700 locations spanning 17 countries supported by more than 63,000 teammates. Learn more at genpt.com.

Forward Looking Statements

Some statements in this release, 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 harbor provisions of the Private Securities Litigation Reform Act of 1995. All statements in the future tense and all statements accompanied by words such as "expect," "likely," "outlook," "forecast," "preliminary," "would," "could," "should," "position," "will," "project," "intend," "plan," "on track," "anticipate," "to come," "may," "possible," "assume," or similar expressions are intended to identify such forward-looking statements. These forward-looking statements include our view of business and economic trends for the coming year and our expectations regarding our ability to capitalize on these business and economic trends; our full-year 2025 outlook and our ability to successfully execute on our strategic priorities, including our global restructuring initiative and the settling of our U.S. pension plan. Senior officers may also make verbal statements to analysts, investors, the media and others that are forward-looking.

We caution you that all forward-looking statements involve risks and uncertainties, and while we believe that our expectations for the future are reasonable in view of currently available information, you are cautioned not to place undue reliance on our forward-looking statements. Actual results or events may differ materially from those indicated as a result of various important factors. Such factors may include, among other things, changes in general economic conditions, including unemployment, persistent inflationary or deflationary pressures, financial institution disruptions and geopolitical conflicts such as the conflict between Russia and Ukraine, the conflict in the Gaza strip and other unrest in the Middle East; volatility in oil prices; significant costs, such as elevated fuel and freight expenses; public health emergencies, including the effects on the financial health of our business partners and customers, on supply chains and our suppliers, on vehicle miles driven as well as other metrics that affect our business, and on access to capital and liquidity provided by the financial and capital markets; our ability to maintain compliance with our debt covenants; our ability to successfully integrate acquired businesses into our operations and to realize the anticipated synergies and benefits; our ability to successfully implement our business initiatives in our two business segments; slowing demand for our products; the ability to maintain favorable supplier arrangements and relationships; changes in national and international legislation or government regulations or policies, including changes to import tariffs, environmental and social policy, infrastructure programs and privacy legislation, and their impact to us, our suppliers and customers; changes in tax policies; changes in fiscal and regulatory priorities as a result of the outcome of the 2024 U.S. election; volatile exchange rates; our ability to successfully attract and retain employees in the current labor market; uncertain credit markets and other macroeconomic conditions; competitive product, service and pricing pressures; failure or weakness in our disclosure controls and procedures and internal controls over financial reporting, including as a result of the work from home environment; the uncertainties and costs of litigation; disruptions caused by a failure or breach of our information systems; the success of our global restructuring efforts and the annualized cost savings arising therefrom; the timing of settling our U.S. pension plan termination and the corresponding amount of the one-time, non-cash charge we will incur in connection therewith, as well as other risks and uncertainties discussed in our Annual Report on Form 10-K and from time to time in our subsequent filings with the SEC.

Forward-looking statements speak only as of the date they are made, and we undertake no duty to update any forward-looking statements except as required by law. You are advised, however, to review any further disclosures we make on related subjects in our subsequent Forms 10-K, 10-Q, 8-K and other reports filed with the SEC.

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SOURCE Genuine Parts Company