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For full-year 2016, $GPC is maintaining its Automotive sales guidance at 1-3% and is raising its Office Products sales to 2-3% from the original amount of down 1% to up 1%. The company said that it's cutting its Industrial segment sales to flat to up 1% from 1-2% mentioned earlier. $GPC is reducing Electrical sales outlook to down 2-3% for 2016.
For FY17, $GPC is increasing its sales guidance to up 4-4.5% from the prior outlook of up 3-4%. The Company is also updating diluted EPS outlook to range from $4.47-4.52 and adjusted diluted EPS to range from $4.55-4.60 from the earlier guidance of $4.70-4.75.
Automotive replacement parts distributor $GPC reported a steep decline in earnings for 3Q17, hit by lower GM and higher OpEx. Company's profit plunged 14.5% to $158.4MM or $1.08 per share from $185.3MM or $1.24 per share in the year ago quarter. Revenue, however, increased 3.8% to $4.1Bil. On an adjusted basis, $GPC earned $1.16 per share.
$GPC announced acquisitions for both its Industrial Group, Motion Industries, and its US Automotive Parts Group. Motion Industries has agreed to acquire Apache Hose & Belting Company, Inc. The acquisition is expected to close on November 1, 2017. $GPC expects Apache to generate estimated annual revenues of $100MM.
$GPC entered into a definitive agreement to acquire Europe's Alliance Automotive Group (AAG) from private equity funds managed by Blackstone and AAG's co-founders. The transaction that is expected is close in 4Q17, is valued at a total purchase price of approx. $2Bil.
$GPC's BoD elected P. Russell Hardin as a new independent director of the Company. The Board also declared a regular quarterly cash dividend of $0.675 per share on the Company's common stock. The dividend is payable October 2, 2017 to shareholders of record on September 8, 2017.
$GPC's BoD has elected Sidney Jones to the position of SVP of Investor Relations. Jones has been with the company for 27 years and was previously VP of Investor Relations. Meanwhile, the BoD of $GPC declared a regular quarterly cash dividend of $0.675 per common share, payable on July 3, 2017 to shareholders of record on June 9, 2017.
$GPC said the declining used vehicle pricing will not have any significant impact on its business. The company does not anticipate any shift in the market due to declining used vehicle pricing and believes it will not impact the scrap rate. Scrap rate is a key metric that the company looks at to measure its automotive business.
Distributor of auto replacement parts $GPC's 1Q17 earnings rose 1.3%, helped by 5% increase in revenue. Net income during the quarter rose to $160.2MM from $158MM during 1Q16. Diluted EPS rose 3% YoY to $1.08 from $1.05 during prior year quarter. Revenue rose to $3.91Bil compared to $3.72Bil in 1Q16.
$GPC's Electrical/Electronic Materials Group acquired Empire Wire and Supply (Empire), effective April 1, 2017. Empire is an innovative provider of custom cable assemblies and distributor of network, electrical, automation and safety products. Empire is expected to generate annual revenues of approx $65MM. The deal value was not disclosed.
$GPC said in terms of its 2017 auto growth outlook of 3-4%, the growth would be stronger on the international side than the US, and this assumes core growth of 3-4%. There is a slight currency headwind built into this outlook. $GPC believes there is expansion potential in the Australia, New Zealand and Mexico markets.
$GPC expects core growth of 2-3% for 2017. In the distribution business, a core growth of 2-3% makes it difficult to leverage or have margin improvement which is why the company is giving an earnings number of plus 2-5%. The longer-term objective is to achieve a higher core growth of 4-6% going forward.
In 4Q16, $GPC’s Industrial sales were up 4% and comparable sales increased slightly. In the Electrical Distribution segment, EIS, sales were essentially flat in 4Q16. The Office Products Group reported a 4% increase in sales for 4Q16, driven by a 12% sales contribution from acquisitions.