GENUINE PARTS CO - FORM 8-K - EX-99.1

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EX-99.2 - EX-99.2 - GENUINE PARTS CO	exhibit2.htm
8-K - LIVE FILING - GENUINE PARTS CO	htm_44290.htm

FOR IMMEDIATE RELEASE

Contact: Jerry W. Nix, Vice Chairman and CFO – (770) 612-2048

Sidney G. Jones, Vice President — Investor Relations – (770) 818-4628

GENUINE PARTS COMPANY
REPORTS FOURTH QUARTER AND FULL YEAR RESULTS FOR 2011

- 4^th Quarter Sales up 7% and EPS up 15% -
- Record Sales and Earnings for 2011 -

Atlanta, Georgia, February 21, 2012 — Genuine Parts Company (NYSE: GPC) reports fourth quarter results and record sales and earnings for the year ended December 31, 2011.

Tom Gallagher, Chairman and Chief Executive Officer, announced today that sales in 2011 were $12.5 billion, up 11% compared to 2010. Net income for the year was $565 million, an increase of 19% compared to $476 million in 2010. Earnings per share on a diluted basis were $3.58, up 19% compared to $3.00 in 2010.

Mr. Gallagher stated, “Genuine Parts Company had another excellent year in 2011, highlighted by double-digit sales and earnings growth and record sales and earnings per share for the second consecutive year. We further strengthened our financial condition with increased net income, an expanded operating margin and a continued emphasis on effectively managing the balance sheet. We are very proud of the job that was done throughout our organization.”

Mr. Gallagher added, “All four of our business segments produced top line growth for the year. The Automotive Group reported an 8% sales increase for the year, and the positive sales trends for this segment in 2011 reflect the ongoing solid fundamentals in the automotive aftermarket, including the overall aging of the vehicle population. Motion Industries, our industrial distribution company, generated a 19% sales increase with the strong double-digit sales growth at Motion driven by the combination of good internal growth initiatives and the strength in the manufacturing sector of the economy. EIS, our Electrical distribution company, had another outstanding year as well, and sales were up 24%. S.P. Richards, our Office Products Group, reported a 3% increase in revenues in 2011. We were pleased to show some growth in such a difficult environment for the office products industry.”

Fourth Quarter 2011

Sales increased 7% to $3.0 billion in the fourth quarter ended December 31, 2011, compared to sales of $2.8 billion for the same period in 2010. Diluted earnings per share in the fourth quarter were 86 cents, up 15% compared to 75 cents per share for the fourth quarter of 2010.

In reviewing the quarter, Mr. Gallagher commented, “Overall, our businesses continued to perform well in the fourth quarter. Our Automotive sales were up 6%, our Industrial Group sales were up 13%, our Electrical Group sales were up 10% and our Office Products Group sales were down slightly for the quarter.”

Mr. Gallagher concluded, “We enter 2012 with a continued commitment to growing sales and earnings, generating solid cash flows and maintaining a strong balance sheet. Further progress in each of these important areas will keep the Company moving ahead and they will help to insure another successful year in 2012.”

Conference Call

Genuine Parts Company will hold a conference call today at 11:00 a.m. EST to discuss the results of the quarter, the year and the future outlook. Interested parties may listen to the call on the Company’s website, www.genpt.com, by clicking “Investor Services”, or by dialing 877-331-5106, conference ID 46254235. A replay will also be available on the Company’s website or at 855-859-2056, conference ID 46254235, two hours after the completion of the call until 12:00 a.m. EST on March 6, 2012.

Forward Looking Statements

Some statements in this report, as well as in other materials we file with the Securities and Exchange Commission (SEC) or otherwise release to the public and in materials that we 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. Senior officers may also make verbal statements to analysts, investors, the media and others that are forward-looking. Forward-looking statements may relate, for example, to future operations, prospects, strategies, financial condition, economic performance (including growth and earnings), industry conditions and demand for our products and services. The Company cautions that its 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 include, but are not limited to, the ability to maintain favorable supplier arrangements and relationships, changes in general economic conditions, the growth rate of the market demand for the Company’s products and services, competitive product, service and pricing pressures, including internet related initiatives, changes in financial markets, including particularly the capital and credit markets, impairment of financial institutions with which we do business, the effectiveness of the Company’s promotional, marketing and advertising programs, changes in laws and regulations, including changes in accounting and taxation guidance, the uncertainties of litigation, as well as other risks and uncertainties discussed in the Company’s Annual Report on Form 10-K for 2010 and from time to time in the Company’s subsequent filings with the SEC.

Forward-looking statements are only as of the date they are made, and the Company undertakes no duty to update its 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, Form 8-K and other reports to the SEC.

About Genuine Parts Company

Genuine Parts Company is a distributor of automotive replacement parts in the U.S., Canada and Mexico. The Company also distributes industrial replacement parts in the U.S., Canada and Mexico through its Motion Industries subsidiary. S.P. Richards Company, the Office Products Group, distributes business products nationwide in the U.S. and Canada. The Electrical/Electronic Group, EIS, Inc., distributes electrical and electronic components throughout the U.S., Canada and Mexico.

GENUINE PARTS COMPANY and SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF INCOME


	Three Months Ended Dec. 31,				Year Ended Dec. 31,
	2011		2010		2011		2010
	(Unaudited)
	(in thousands, except per share data)
Net sales	$	3,014,135	$	2,807,728	$	12,458,877	$	11,207,589
Cost of goods sold		2,121,535		1,990,600		8,852,837		7,954,645

Gross profit		892,600		817,128		3,606,040		3,252,944
Operating expenses:
Selling, administrative & other expenses		660,428		608,832		2,626,298		2,401,829
Depreciation and amortization		21,997		21,910		88,936		89,332

		682,425		630,742		2,715,234		2,491,161
Income before income taxes		210,175		186,386		890,806		761,783
Income taxes		75,218		67,736		325,690		286,272

Net income	$	134,957	$	118,650	$	565,116	$	475,511

Basic net income per common share	$	.87	$	.75	$	3.61	$	3.01
Diluted net income per common share	$	.86	$	.75	$	3.58	$	3.00
Weighted average common shares outstanding		155,567		157,543		156,656		158,032
Dilutive effect of stock options and
non-vested restricted stock awards		1,095		775		1,004		429

Weighted average common shares outstanding –
assuming dilution		156,662		158,318		157,660		158,461

GENUINE PARTS COMPANY and SUBSIDIARIES
SEGMENT INFORMATION AND FINANCIAL HIGHLIGHTS


	Three Months Ended Dec. 31,						Year Ended Dec. 31,
	2011			2010			2011			2010
	(Unaudited)
	(in thousands)
Net sales:
Automotive	$	1,460,152		$	1,376,734		$	6,061,424		$	5,608,101
Industrial		1,032,719			915,166			4,173,574			3,521,863
Office Products		391,403			394,979			1,689,368			1,641,963
Electrical/Electronic Materials		137,601			125,603			557,537			449,770
Other (1)		(7,740	)		(4,754	)		(23,026	)		(14,108	)

Total net sales	$	3,014,135		$	2,807,728		$	12,458,877		$	11,207,589

Operating profit:
Automotive	$	89,879		$	82,123		$	467,806		$	421,109
Industrial		89,139			73,796			337,628			255,616
Office Products		38,149			38,076			134,124			131,746
Electrical/Electronic Materials		10,283			8,754			40,663			30,910

Total operating profit		227,450			202,749			980,221			839,381
Interest expense, net		(5,628	)		(6,610	)		(24,608	)		(26,598	)
Other, net		(11,647	)		(9,753	)		(64,807	)		(51,000	)

Income before income taxes	$	210,175		$	186,386		$	890,806		$	761,783

Capital expenditures	$	39,537		$	26,448		$	103,469		$	85,379

Depreciation and amortization	$	21,997		$	21,910		$	88,936		$	89,332

(1) Represents the net effect of discounts, incentives and freight billed reported as a component of net sales.

GENUINE PARTS COMPANY and SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS


	Dec. 31,			Dec. 31,
	2011			2010
	(in thousands)
ASSETS
CURRENT ASSETS
Cash and cash equivalents	$	525,054		$	529,968
Trade accounts receivable, net		1,461,011			1,364,406
Merchandise inventories, net		2,261,997			2,224,717
Prepaid expenses and other current assets		328,534			295,796

TOTAL CURRENT ASSETS		4,576,596			4,414,887
Goodwill and other intangible assets, less accumulated amortization		279,775			209,548
Deferred tax asset		250,906			157,392
Other assets		272,110			199,087
Net property, plant and equipment		500,204			484,130

TOTAL ASSETS	$	5,879,591		$	5,465,044


LIABILITIES AND EQUITY
CURRENT LIABILITIES
Trade accounts payable	$	1,440,762		$	1,374,930
Current portion of debt		—			250,000
Income taxes payable		35,267			23,145
Dividends payable		70,021			64,600
Other current liabilities		266,023			259,139

TOTAL CURRENT LIABILITIES		1,812,073			1,971,814
Long-term debt		500,000			250,000
Retirement and other post-retirement benefit liabilities		493,721			258,807
Other long-term liabilities		280,978			181,709
Common stock		155,651			157,636
Retained earnings and other		3,109,622			2,934,535
Accumulated other comprehensive loss		(482,038	)		(298,352	)

TOTAL PARENT EQUITY		2,783,235			2,793,819
Noncontrolling interests in subsidiaries		9,584			8,895

TOTAL EQUITY		2,792,819			2,802,714

TOTAL LIABILITIES AND EQUITY	$	5,879,591		$	5,465,044

GENUINE PARTS COMPANY and SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS


	Year Ended Dec. 31,
	2011			2010
	(in thousands)
OPERATING ACTIVITIES:
Net income	$	565,116		$	475,511
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization		88,936			89,332
Share-based compensation		7,547			7,016
Excess tax benefits from share-based compensation		(5,356	)		(3,251	)
Other		(5,349	)		10,309
Changes in operating assets and liabilities		(25,967	)		99,746

NET CASH PROVIDED BY OPERATING ACTIVITIES		624,927			678,663
INVESTING ACTIVITIES:
Purchases of property, plant and equipment		(103,469	)		(85,379	)
Acquisitions and other		(128,028	)		(86,969	)

NET CASH USED IN INVESTING ACTIVITIES		(231,497	)		(172,348	)
FINANCING ACTIVITIES:
Proceeds from debt		250,000			—
Payments on debt		(250,000	)		—
Stock options exercised		(1,049	)		9,085
Excess tax benefits from share-based compensation		5,356			3,251
Dividends paid		(276,369	)		(257,898	)
Purchase of stock		(122,078	)		(75,007	)

NET CASH USED IN FINANCING ACTIVITIES		(394,140	)		(320,569	)
EFFECT OF EXCHANGE RATE CHANGES ON CASH		(4,204	)		7,419

NET (DECREASE) INCREASE IN CASH AND CASH EQUIVALENTS		(4,914	)		193,165
CASH AND CASH EQUIVALENTS AT BEGINNING OF YEAR		529,968			336,803

CASH AND CASH EQUIVALENTS AT END OF YEAR	$	525,054		$	529,968

GENUINE PARTS CO - FORM 8-K - EX-99.1 - February 21, 2012

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