Genuine Parts Company
) reported an 11% rise in profits to $168.6 million in the second
quarter of the year from $151.8 million in the year-ago quarter.
Earnings per share went up 12.5% to $1.08 from 96 cents in the
comparable quarter of 2011. It was in line with the Zacks Consensus
Revenues in the quarter grew 5% to $3.3 billion, slightly lower
than the Zacks Consensus Estimate of $3.4 billion. Operating profit
also increased 4.5% to $705.0 million from $674.6 million a year
ago, despite a 4% rise in selling, general and administrative
expenses to $680.2 million during the quarter.
Revenues in the Automotive Parts segment grew 4% to $1.6 billion
despite sluggish growth in the automotive aftermarket. Operating
profit in the segment rose 10% to $153.0 million.
Revenues in the Motion Industries or Industrial segment
increased 8% to $1.1 billion while operating profit improved 11% to
Revenues in the Electrical segment or EIS appreciated 9% to
$149.4 million while operating profit surged 41% to $12.9
The company's S. P. Richards or Office Products segment
continues to face challenging conditions in the market. Revenues in
the segment slipped 1% to $413.3 million while operating profit
slid 2% to $30.6 million.
Genuine Parts had cash and cash equivalents of $171.6 million as
of June 30, 2012, down from $516.7 million as of June 30, 2011.
Long-term debt remained unchanged at $500 million as of June 30,
2012 compared with the year-ago level.
During the first six months of 2012, Genuine Parts' net cash
flow from operations improved to $421.3 million from $250.0 million
in the prior-year period, due to higher profit and favorable
changes in operating assets and liabilities. Meanwhile, capital
expenditures increased to $51.4 million from $41.7 million in the
first half of 2011.
Genuine Parts has undertaken various initiatives to boost sales
and earnings, such as product line expansion, penetration into new
markets and cost-saving activities. The company relies on a diverse
product portfolio for top-line and bottom-line growth.
Its major competitors include
Advance Auto Parts
). Currently, the company retains a Zacks #2 Rank on its stock,
which translates to a Buy rating for the short term (1-3
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