Dorman Reports Rise in First Quarter Sales and Earnings

Dorman Products, Inc. has announced a strong increase in sales and earnings for the first quarter of 2011.
Revenues for the three months ended March 26, 2011 increased 26% over the prior year to $124.4 million from $99.0 million last year. Revenue growth was driven primarily by strong overall demand for our products and higher new product sales. All figures in U.S. dollars.
Net income in the first quarter of 2011 was up 29% to $12.4 million from $9.6 million in the same period last year. Diluted earnings per share in the first quarter of 2011 rose 28% to $0.68 from $0.53 in the same period last year.
For the thirteen weeks ended March 26, 2011 and March 27, 2010:
–Gross profit margin was 36.5% in 2011 compared to 38.2% in 2010. The decrease in margin percent is the result of an increase in transportation costs and higher provisions for excess inventory.
–Selling, general, and administrative expenses increased 19% in 2011 to $26.2 million from $22.1 million in 2010, but were down as a percentage of sales from 22.3% in 2010 to 21.1% in 2011. The spending increase was the result of higher variable costs related to Dorman’s sales increase, increased new product development spending and inflationary cost increases.
–Its effective tax rate decreased to 35.2% from 38.5% in the prior year. The decrease is primarily the result of the 2011 receipt of tax-exempt life insurance proceeds used to fund an officer’s death benefit.
–Operating cash flow for 2011 was $9.2 million compared to $7.1 million in 2010.
Steven Berman, chairman and chief executive officer, said, “Our strong first quarter sales growth was driven by the continued success of our new product development efforts. Revenues from products introduced in the last two years topped 20% for the quarter. This is a direct result of our continued investments and the efforts from our dedicated, enthusiastic and knowledgeable contributors. We continue to commit additional resources to our New to the Aftermarket initiative — during 2010 we increased the number of Dorman sales, engineering and product development professionals by 30%.”

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