EX-99.1 2 dex991.htm PRESS RELEASE Press Release

 

Exhibit 99.1

NEWS RELEASE

 

LOGO

  
  
   Corporate Headquarters:
  

Dorman Products, Inc.

  

3400 East Walnut Street

  

Colmar, Pennsylvania 18915

  

Fax: (215) 997-8577

For Further Information Contact:    Visit our Home Page:

Mathias J. Barton, CFO

  

www.dormanproducts.com

(215) 997-1800 x 5132

  

E-mail: MBarton@dormanproducts.com

  

Dorman Products, Inc. Reports Sales and Earnings for the Third Quarter Ended September 25, 2010 and Announces Expansion of Warsaw, KY Facility

Colmar, Pennsylvania (October 26, 2010) – Dorman Products, Inc. (NASDAQ:DORM) today announced financial results for the third quarter ended September 25, 2010.

Revenues for the three months ended September 25, 2010 increased 22% over the prior year to $119.2 million from $98.0 million last year. Net income in the third quarter of 2010 was up 60% to $12.8 million from $8.0 million in the same period last year. Diluted earnings per share rose 61% in the third quarter of 2010 to $0.71 from $0.44 last year.

For the thirty-nine weeks ended September 25, 2010 and September 26, 2009:

 

   

Revenues in 2010 increased 18.7% over the prior year to $333.2 million from $280.7 million last year. Revenue growth was driven by strong overall demand for our products and higher new product sales.

 

   

Net income in 2010 was up 80% to $33.9 million from $18.8 million last year. Diluted earnings per share in 2010 rose 80% to $1.87 from $1.04 in 2009.

 

   

Gross profit margin was 37.9% in 2010 compared to 34.1% in 2009. The increase in margin is the result of a reduction in freight expenses and certain material costs, along with lower product return costs.

 

   

Selling, general and administrative expenses increased 9.1% in 2010 to $70.9 million from $65.0 million in 2009, but were down as a percentage of sales from 23.2% in 2009 to 21.3% in 2010. The spending increase was the result of higher variable costs related to our sales increase, increased new product development spending and higher incentive compensation expense due to higher earnings levels. These increases were partially offset by lower operating expenses in most areas due to cost reduction initiatives.

 

   

Our effective tax rate remained constant at 38.5%.

 

   

Operating cash flow for 2010 was $14.9 million compared to $14.5 million in 2009.

Mr. Richard Berman, Chairman and Chief Executive Officer, said, “Our customers’ success with our New to the Aftermarket products continues to drive Dorman’s sales growth. We continue to


make further investments in our new product development capabilities as we believe the opportunities for further growth are significant. As a result, we are planning on having the largest number of new product releases in our history in 2011, for both new and existing product lines. These investments along with the publication and distribution of our tri-annual Dorman Stocking Guide and our monthly new product alert program will help further support Dorman’s leadership position in delivering new products and revenue growth to the Aftermarket.”

We have begun an expansion of our Warsaw, Kentucky distribution facility to provide additional capacity to support current and projected future growth of the business. The addition and related equipment, which will cost approximately $9 million, will add approximately 175,000 square feet of warehouse space and is expected to be completed in the spring of 2011.

Mr. Steven Berman, President and Chief Operating Officer of Dorman Products, Inc., commented, “We are excited about the opportunity this expansion provides us to more effectively serve the needs of our customers in the automotive aftermarket. We continue to invest in the development and distribution of new products for our customers and the expansion of our Warsaw Distribution Center directly supports this objective.”

Dorman Products, Inc. is a leading supplier of OE Dealer “Exclusive” automotive replacement parts, automotive hardware, brake products, and household hardware to the Automotive Aftermarket and Mass Merchandise markets. Dorman products are marketed under the Dorman (R), OE Solutions (TM), HELP! (R), AutoGrade (TM), First Stop (TM), Conduct-Tite (R), Symmetry (R) and Scan-Tech (R) brand names.

Forward-looking statements in this release are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements are subject to certain risks and uncertainties that could cause actual results to differ materially from those projected. Readers are cautioned not to place undue reliance on these forward-looking statements which speak only as of the date hereof. Factors that could cause actual results to differ materially include, but are not limited to, those factors discussed in the Company’s 2009 Annual Report on Form 10-K under Item 1A - Risk Factors.

DORMAN PRODUCTS, INC. AND SUBSIDIARIES

Consolidated Statements of Operations

(in thousands, except per-share amounts)

 

    

13 Weeks

    

13 Weeks

 

Third Quarter (unaudited)

     9/25/10         Pct.         9/26/09         Pct.   

Net sales

     $119,212         100.0         $  98,007         100.0   

Cost of goods sold

     74,088         62.1         62,710         64.0   

Gross profit

     45,124         37.9         35,297         36.0   

Selling, general and administrative expenses

     24,628         20.7         22,318         22.8   

Income from operations

     20,496         17.2         12,979         13.2   

Interest expense, net

     57         0.1         52         -   

Income before income taxes

     20,439         17.1         12,927         13.2   

Provision for income taxes

     7,622         6.3         4,994         5.1   

Net income

     $  12,817         10.8         $    7,993         8.1   

Earnings per share

           

Basic

     $  0.72         -         $  0.45         -   

Diluted

     $  0.71         -         $  0.44         -   

Average shares outstanding

           

Basic

     17,800         -         17,657         -   

Diluted

     18,176         -         17,998         -   


 

DORMAN PRODUCTS, INC. AND SUBSIDIARIES

Consolidated Statements of Operations

(in thousands, except per-share amounts)

 

    

39 Weeks

      

39 Weeks

 

Third Quarter (unaudited)

     9/25/10         Pct.           9/26/09         Pct.   

Net sales

     $333,196         100.0           $280,680         100.0   

Cost of goods sold

     206,967         62.1           184,958         65.9   

Gross profit

     126,229         37.9           95,722         34.1   

Selling, general and administrative expenses

     70,936         21.3           65,003         23.2   

Income from operations

     55,293         16.6           30,719         10.9   

Interest expense, net

     180         0.1           204         -   

Income before income taxes

     55,113         16.5           30,515         10.9   

Provision for income taxes

     21,196         6.3           11,757         4.2   

Net income

     $  33,917         10.2           $  18,758         6.7   

Earnings per share

             

Basic

     $  1.91         -           $   1.06         -   

Diluted

     $  1.87         -           $   1.04         -   

Average shares outstanding

             

Basic

     17,749         -           17,647         -   

Diluted

     18,125         -           17,976         -   

DORMAN PRODUCTS, INC. AND SUBSIDIARIES

Condensed Consolidated Balance Sheets

(Unaudited)

(in thousands)

 

     9/25/10      12/26/09  

Assets:

     

Cash and cash equivalents

     $    18,890         $    10,626   

Accounts receivable

     113,775         88,164   

Inventories

     104,528         89,927   

Deferred income taxes

     13,351         12,620   

Prepaid expenses

     2,282         2,248   

Total current assets

     252,826         203,585   

Property & equipment

     26,499         25,218   

Goodwill

     26,553         26,553   

Other assets

     1,869         2,046   

Total assets

     $  307,747         $  257,402   

Liabilities & Shareholders’ Equity:

     

Current portion of long-term debt

     $            93         $            90   

Accounts payable

     29,971         16,098   

Accrued expenses and other

     15,284         14,244   

Total current liabilities

     45,348         30,432   

Long-term debt and other

     3,069         2,941   

Deferred income taxes

     8,762         8,694   

Shareholders’ equity

     250,568         215,335   

Total Liabilities and Equity

     $  307,747         $  257,402   

 

Selected Cash Flow Information:

  
                (in thousands)    13 Weeks (unaudited)        39 Weeks (Unaudited)  
     9/25/10         9/26/09           9/25/10         9/26/09   

Depreciation and amortization

     $2,137         $2,027           $6,016         $5,774   

Capital Expenditures

     $3,019         $2,358           $7,187         $5,926