Genuine Parts Company (GPC) Q1 2022 Earnings Call Transcript

For the period ending March 31, 2022

April 21, 2022 11:00 a.m. ET

Prepared Remarks

Questions and Answers

Call Participants

Prepared Remarks:

Operator

Good day, ladies and gentlemen. Welcome to the Genuine Parts Company First Quarter 2022 Earnings Call. All participants will be in listen-only mode. After today’s presentation, there will be an opportunity to ask questions. Please note this event is being recorded.

At this time, I’d now like to turn the conference over to Sid Jones, Senior Vice President, Investor Relations. Please go ahead.

Sid Jones

Good morning, and thank you for joining us today for the Genuine Parts Company first quarter 2022 earnings conference call. With me today are Paul Donahue, our Chairman and Chief Executive Officer; Will Stengel, our President; Carol Yancey, our Executive Vice President and Chief Financial Officer; and Bert Nappier, our EVP and CFO-Elect.

As a reminder, today’s conference call and webcast includes a slide presentation that can be found on the Genuine Parts Company Investor Relations’ website. Please be advised this call may include certain non-GAAP financial measures, which may be referred to during today’s discussion of our results as reported under Generally Accepted Accounting Principles. A reconciliation of these measures is provided in the earnings press release issued this morning, which is also posted in the Investors section of our website.

Today’s call may also involve forward-looking statements regarding the company and its’ businesses. The company’s actual results could differ materially from any forward-looking statements due to several important factors described in the company’s latest SEC filings, including this morning’s press release. The company assumes no obligation to update any forward-looking statements made during this call.

Now I’ll turn the call over to Paul for his remarks.

Paul Donahue

Thank you, Sid, and good morning. Welcome to our first quarter 2022 earnings conference call. As Sid mentioned, we’re happy to have Bert Nappier on the call with us today. Bert joined us on February 28 as CFO-Elect and has been working side by side with Carol to ensure a smooth transition in this key role.

Turning to the first quarter, we were pleased with the continued strength and our results to start the year and we’re proud of the great work by all of our 52,000 GPC teammates who are at the core of our success. A few highlights in the quarter include new quarterly sales records for GPC and our automotive and industrial segment, segment margin expansion of 50 basis points, strong double-digit EPS growth and a strengthened balance sheet and strong cash flow. The GPC team is focused on key strategic priorities to sustain accelerated sales growth, improved gross margins and enhanced operational efficiencies in the face of ongoing supply chain challenges and inflationary pressures at levels we haven’t seen in 40 plus years. We also executed on our acquisition strategy and our industrial team made excellent progress on the integration of Kaman Distribution Group. And with the addition of Lausan, which we announced last week, we’ve expanded our automotive footprint in Europe, with the entry into key markets in Spain and Portugal, Europe’s fifth largest market.