-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, LPfsTqMIf/5wYKaOM6Pf8uV1Vq8QnBJ/On57OXNr8nUdo2UOuZHNirXOHQzFG3Eo 2O24QIopH518YXtdL4DmkQ== /in/edgar/work/20000731/0000950144-00-009189/0000950144-00-009189.txt : 20000921 0000950144-00-009189.hdr.sgml : 20000921 ACCESSION NUMBER: 0000950144-00-009189 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 20000630 FILED AS OF DATE: 20000731 FILER: COMPANY DATA: COMPANY CONFORMED NAME: GENUINE PARTS CO CENTRAL INDEX KEY: 0000040987 STANDARD INDUSTRIAL CLASSIFICATION: [5013 ] IRS NUMBER: 580254510 STATE OF INCORPORATION: GA FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: SEC FILE NUMBER: 001-05690 FILM NUMBER: 681981 BUSINESS ADDRESS: STREET 1: 2999 CIRCLE 75 PARKWAY CITY: ATLANTA STATE: GA ZIP: 30339 BUSINESS PHONE: 4049531700 MAIL ADDRESS: STREET 1: 2999 CIRCLE 75 PARKWAY CITY: ATLANTA STATE: GA ZIP: 30339 10-Q 1 e10-q.txt GENUINE PARTS COMPANY 1 ================================================================================ SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 ----------------------------------------- FORM 10-Q [X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the Quarterly Period Ended June 30, 2000 Commission File Number 1-5690 GENUINE PARTS COMPANY --------------------- (Exact name of registrant as specified in its charter) GEORGIA 58-0254510 ------- ---------- (State or other jurisdiction of (I.R.S. Employer incorporation or organization) Identification No.) 2999 CIRCLE 75 PARKWAY, ATLANTA, GEORGIA 30339 ---------------------------------------- ----- (Address of principal executive offices) (Zip Code) Registrant's telephone number, including area code (770)953-1700 Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes [X] No [ ] Indicate the number of shares outstanding of each of the issuer's classes of common stock, as of the latest practicable date (the close of the period covered by this report). 174,954,362 ----------- (Shares of Common Stock) 2 PART I - Financial Information Item 1 - Financial Statements GENUINE PARTS COMPANY and SUBSIDIARIES CONDENSED CONSOLIDATED BALANCE SHEETS
ASSETS June 30, Dec. 31, 2000 1999 -------- --------- (Unaudited) (in thousands) CURRENT ASSETS Cash and cash equivalents .................................................. $ 53,224 $ 45,735 Trade accounts receivable, less allowance for doubtful accounts (2000 - $12,520; 1999 - $6,929) ..................... 1,122,953 1,006,663 Inventories - at lower of cost (substantially last-in, first-out method) or market ................................................ 1,733,618 1,771,789 Prepaid and other current accounts ......................................... 42,255 71,016 ----------- ----------- TOTAL CURRENT ASSETS .............................................. 2,952,050 2,895,203 Goodwill, less accumulated amortization (2000 - $32,267; 1999 - $25,286) ... 432,200 440,299 Other assets ............................................................... 228,629 180,627 Total property, plant and equipment, less allowance for depreciation (2000 - $419,074; 1999 - $403,021) ........................ 408,754 413,543 ----------- ----------- $ 4,021,633 $ 3,929,672 =========== =========== LIABILITIES AND SHAREHOLDERS' EQUITY CURRENT LIABILITIES Accounts payable ........................................................... $ 663,024 $ 581,010 Current portion of long-term debt and other borrowings ..................... 170,304 133,056 Income taxes ............................................................... 18,553 28,032 Dividends payable .......................................................... 48,599 45,355 Other current liabilities .................................................. 76,453 128,559 ----------- ----------- TOTAL CURRENT LIABILITIES ......................................... 976,933 916,012 Long-term debt ............................................................. 699,813 702,417 Deferred income taxes ...................................................... 87,466 87,466 Minority interests in subsidiaries ......................................... 44,251 46,260 SHAREHOLDERS' EQUITY Stated capital: Preferred Stock, par value - $1 per share Authorized - 10,000,000 shares - None Issued ........................ -0- -0- Common Stock, par value - $1 per share Authorized - 450,000,000 shares Issued - 2000 - 174,954,362; 1999 - 177,275,602 ..................... 174,954 177,276 Additional paid-in capital ................................................. -0- -0- Accumulated other comprehensive income ..................................... (10,119) (6,857) Retained earnings .......................................................... 2,048,335 2,007,098 ----------- ----------- TOTAL SHAREHOLDERS' EQUITY ........................................ 2,213,170 2,177,517 ----------- ----------- $ 4,021,633 $ 3,929,672 =========== ===========
See notes to condensed consolidated financial statements. 2 3 GENUINE PARTS COMPANY AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF INCOME (Unaudited)
Three Months Ended June 30, Six Months Ended June 30, --------------------------- ------------------------- 2000 1999 2000 1999 ---------- ---------- ---------- ---------- (000 omitted except per share data) Net sales .............................. $2,135,502 $2,022,894 $4,213,506 $3,924,251 Cost of goods sold ..................... 1,518,599 1,432,837 3,008,649 2,783,304 ---------- ---------- ---------- ---------- 616,903 590,057 1,204,857 1,140,947 Selling, administrative & other expenses 456,076 436,798 891,301 845,194 ---------- ---------- ---------- ---------- Income before income taxes ............. 160,827 153,259 313,556 295,753 Income taxes ........................... 64,234 60,690 125,234 117,118 ---------- ---------- ---------- ---------- NET INCOME ............................. $ 96,593 $ 92,569 $ 188,322 $ 178,635 ========== ========== ========== ========== Basic net income per common share ...... $ .55 $ .52 $ 1.07 $ 1.00 ========== ========== ========== ========== Diluted net income per common share .... $ .55 $ .52 $ 1.06 $ .99 ========== ========== ========== ========== Dividends declared per common share .... $ .275 $ .26 $ .55 $ .52 ========== ========== ========== ========== Average common shares outstanding ...... 176,340 179,032 176,557 179,458 Dilutive effect of stock options and non-vested restricted stock awards .. 369 557 317 563 ---------- ---------- ---------- ---------- Average common shares outstanding, assuming dilution ................... 176,709 179,589 176,874 180,021 ========== ========== ========== ==========
See notes to condensed consolidated financial statements. 3 4 GENUINE PARTS COMPANY AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)
Six Months Ended June 30, --------------------------- (000 omitted) 2000 1999 --------- --------- OPERATING ACTIVITIES: Net income ............................................................................ $ 188,322 $ 178,635 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation and amortization ....................................................... 47,374 42,798 Other ............................................................................... (829) (446) Changes in operating assets and liabilities ......................................... (29,162) (19,509) --------- --------- NET CASH PROVIDED BY OPERATING ACTIVITIES ................................................ 205,705 201,478 INVESTING ACTIVITIES: Purchase of property, plant and equipment ............................................. (34,388) (38,325) Acquisitions of businesses and other investing activities ............................. (37,155) (103,858) --------- --------- NET CASH USED IN INVESTING ACTIVITIES .................................................... (71,543) (142,183) FINANCING ACTIVITIES: Proceeds from credit facilities, net of payments ...................................... 34,644 111,264 Dividends paid ........................................................................ (94,795) (91,195) Purchase of stock ..................................................................... (66,522) (51,104) --------- --------- NET CASH USED IN FINANCING ACTIVITIES .................................................... (126,673) (31,035) --------- --------- NET INCREASE IN CASH AND CASH EQUIVALENTS ................................................ 7,489 28,260 CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD ......................................... 45,735 84,972 --------- --------- CASH AND CASH EQUIVALENTS AT END OF PERIOD ............................................... $ 53,224 $ 113,232 ========= =========
See notes to condensed consolidated financial statements. 4 5 NOTES TO FINANCIAL STATEMENTS Note A - Basis of Presentation The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with the instructions to Form 10-Q and therefore do not include all information and footnotes necessary for a fair presentation of financial position, results of operations and cash flows in conformity with generally accepted accounting principles. However, in the opinion of management, all adjustments necessary to a fair statement of the operations of the interim period have been made. These adjustments are of a normal recurring nature. The results of operations for the six months ended June 30, 2000, are not necessarily indicative of results for the entire year. Note B - Segment Information
Three month period ended June 30, Six month period ended June 30, 2000 1999 2000 1999 --------------------------------- ------------------------------- Net sales: Automotive $ 1,085,836 $ 1,058,482 $ 2,091,146 $ 1,999,832 Industrial 590,416 543,792 1,184,764 1,066,295 Office Products 319,450 290,491 657,034 600,494 Electrical/Electronic Materials 139,800 130,129 280,562 257,630 ------------------------------- ------------------------------- Total net sales $ 2,135,502 $ 2,022,894 $ 4,213,506 $ 3,924,251 =============================== =============================== Operating profit: Automotive $ 107,712 $ 107,947 $ 195,982 $ 191,540 Industrial 48,028 43,797 97,842 87,652 Office Products 28,040 24,868 66,113 59,851 Electrical/Electronic Materials 6,938 5,740 13,271 11,380 ------------------------------- ------------------------------- Total operating profit 190,718 182,352 373,208 350,423 Interest expense (16,023) (13,375) (31,182) (25,818) Other, net (13,868) (15,718) (28,470) (28,852) ------------------------------- ------------------------------- Income before income taxes $ 160,827 $ 153,259 $ 313,556 $ 295,753 =============================== ===============================
Note C - Comprehensive Income Total comprehensive income was $185,060,000 and $184,951,000 for the six month periods ended June 30, 2000 and 1999, respectively. Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations Genuine Parts Company (the "Company") reported record sales and earnings in the second quarter of 2000. Sales for the quarter were $2.1 billion, up 6% over the same period in 1999. Net income in the quarter advanced 4% to $96.6 million. On a per-share diluted basis, net income in the quarter was $.55 versus $.52 in the same quarter of the prior year, an increase of 6%. For the six months ended June 30, 2000, sales totaled $4.2 billion, up 7% over the first half of 1999, while net income was $188.3 million, an increase of 5%. Diluted earnings per share were $1.06 for the first six months of 2000 and $.99 for the same period in 1999, an increase of 7%. Sales for the Automotive Parts Group increased 3% for the quarter. The sales increase is reflective of the general softness in the automotive aftermarket. Sales for the Industrial Parts Group increased 9% for the quarter reflecting continued improvement in the overall industrial market and industrial production. The Office Products Group was up 10% for the quarter reflecting unit share gain, increased product offerings and enhanced marketing programs. The Electrical/Electronic Materials Group increased sales by 7%, reflecting increased market share and continued emphasis on sales growth. Cost of goods sold increased slightly as a percentage of net sales compared to the same quarter of the prior year. Selling, administrative and 5 6 other expenses increased 4% for the quarter and the percentage of selling, administrative and other expenses to net sales decreased slightly, reflecting improved operating efficiencies. The ratio of current assets to current liabilities remains very good at 3.02 to 1 and the Company's cash position is good. Forward-Looking Statements The Private Securities Litigation Reform Act of 1995 (the Act) provides a safe harbor for forward-looking statements made by or on behalf of the Company. The Company and its representatives may from time to time make written or verbal forward-looking statements, including statements contained in our Company's filings with the Securities and Exchange Commission and in our reports to shareholders. All statements which address operating performance, events or developments that we expect or anticipate will occur in the future, including statements relating to revenue, market share and net income growth, or statements expressing general optimism about future operating results, are forward-looking statements within the meaning of the Act. The forward-looking statements are and will be based on management's then current views and assumptions regarding future events and operating performance. There are many factors which could cause actual results to differ materially from those anticipated by statements made herein. Such factors include, but are not limited to, changes in general economic conditions, the growth rate of the market for the Company's products and services, the ability to maintain favorable supplier arrangements and relationships, competitive product and pricing pressures, the effectiveness of the Company's promotional, marketing and advertising programs, electronic marketing, changes in laws and regulations, including changes in accounting and taxation guidance, the uncertainties of litigation, as well as other risks and uncertainties discussed from time to time in the Company's filings with the Securities and Exchange Commission. PART II - OTHER INFORMATION Item 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS The 2000 Annual Meeting of Shareholders of the Company was held on April 17, 2000, pursuant to notice given to shareholders of record on February 10, 2000, at which date there were 176,801,292 shares of Common Stock outstanding. At the Annual Meeting, the shareholders elected three Class II directors with terms to expire at the 2003 Annual Meeting. As to the following named individuals, the holders of 152,815,193 shares of the Company's Common Stock voted as follows:
Class II For Withhold Authority -------- --- ------------------ Richard W. Courts, II 148,940,716 3,874,477 Larry L. Prince 148,950,941 3,864,252 James B. Williams 148,305,028 4,510,165
The following individuals' term of office as a director continued after the Annual Meeting:
Class II Class III -------- --------- Bradley Currey, Jr. Jean Douville Robert P. Forrestal J. Hicks Lanier Thomas C. Gallagher Alana S. Shepherd Lawrence G. Steiner Stephen R. Kendall
The shareholders also ratified the selection of Ernst & Young LLP as independent auditors of the Company for 2000. The holders of 150,511,087 shares of Common Stock voted in favor of the ratification, holders of 1,806,439 shares voted against, holders of 497,667 shares abstained, and there were no broker non-votes. Item 6. Exhibits and Reports on Form 8-K (a) The following exhibits are filed as part of this report: Exhibit 3.1 Restated Articles of Incorporation of the Company (incorporated herein by reference from the Company's Annual Report on Form 10-K, dated March 3, 1995). 6 7 Exhibit 3.2 Bylaws of the Company, as amended (incorporated herein by reference from the Company's Annual Report on Form 10-K, dated March 5, 1993). Exhibit 27 Financial Data Schedule (for SEC use only). (b) No reports on Form 8-K were filed by the registrant during the quarter ended June 30, 2000. SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized. Genuine Parts Company ------------------------------------------- (Registrant) Date July 31, 2000 /s/ Jerry W. Nix ------------- ------------------------------------------- Jerry W. Nix Executive Vice President - Finance (Principal Financial and Accounting Officer) 7 EX-27 2 ex27.txt FINANCIAL DATA SCHEDULE
5 THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE FINANCIAL STATEMENTS OF GENUINE PARTS COMPANY FOR THE SIX MONTHS ENDED JUNE 30, 2000, AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS. 1,000 6-MOS DEC-31-2000 JAN-01-2000 JUN-30-2000 53,224 0 1,122,953 12,520 1,733,618 2,952,050 408,754 419,074 4,021,633 976,933 699,813 0 0 174,954 2,038,216 4,021,633 4,213,506 4,213,506 3,008,649 3,008,649 0 0 31,182 313,556 125,234 188,322 0 0 0 188,322 1.07 1.06
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