Genuine Parts Exceeds Earnings Expectations

Genuine Parts Company, the largest member of the NAPA family and parent of UAP Inc., reported better than expected earnings for the second quarter.
Automotive aftermarket analysis shouldn’t rejoice just yet, however, as the increased earnings were spurred by the strength of its industrial and electrical divisions.
Genuine Parts’ stock added 24 cents to $38.09 on volume of 250,000 shares at last check. All figures in U.S. dollars.
The Atlanta-based company, which distributes its products to nearly 6,000 Napa Auto Parts stores in the United States, reported net income of $101.1 million, or 58 cents a share, compared with $90.1 million, or 52 cents a share, in the year-ago period.
Wall Street had expected a profit of 57 cents a share, according to a survey compiled by Thomson First Call.
Revenue for the second quarter came in at $2.3 billion, up from $2.2 billion a year earlier.
“We have a number of positives working for us as we move into the second half of 2004,” said chairman Larry Prince in a statement. “The diversity of our company in four sound industries gives us great balance, and we expect to see continued improvement.”
The automotive segment, the largest of the company’s four divisions, brought in about half of the overall revenue, marking a 4 percent increase from last year.
Sales for the company’s second largest division, Motion Industries, which makes industrial parts like bearings and hydraulics, grew 11 percent from a year ago.
EIS, the Genuine’s electrical-components arm, saw its revenue surge 17 percent while the office products group improved by 5 percent.
Looking ahead, the company pegged third-quarter earnings to come in between 55 cents to 57 cents a share, up from 51 cents a year earlier. Genuine Parts also raised its full year outlook from a range of $2.15 to $2.25 a share to $2.20 to $2.28 a share.