Third Quarter 2009

Genuine Parts Company Reports Sales and Earnings for the Third Quarter and Nine Months Ended September 30, 2009

PRNewswire-FirstCall
ATLANTA
Oct 16, 2009
9:10am

Genuine Parts Company reported sales and earnings for the third quarter and nine months ended September 30, 2009. Thomas C. Gallagher, Chairman, President and Chief Executive Officer, announced today that sales totaling $2.6 billion were down 10% compared to the third quarter of 2008. Net income for the quarter was $107.6 million, a decrease of 18% from $131.0 million recorded in the same period of the previous year. Earnings per share on a diluted basis were 67 cents, down 17% compared to 81 cents for the third quarter last year.

(Logo: http://www.newscom.com/cgi-bin/prnh/20081002/CLTH108LOGO)

For the nine months ended September 30, 2009, sales totaled $7.6 billion, down 11% compared to the same period in 2008. Net income for the nine months was $300.4 million, a decrease of 23% from $387.6 million recorded in the previous year. Earnings per share on a diluted basis were $1.88, down 20% compared to $2.36 for the same period last year.

In review of the quarter, Mr. Gallagher commented, "The Automotive Group reported a 1% decrease in sales for the quarter, which is improved from the 7% and 5% sales declines reported for this group in the first and second quarters, respectively. S.P. Richards, our Office Products Group, was down 5% and this compares to a 7% sales decrease in the first quarter and a 6% decrease last quarter. Sales for the Industrial and Electrical Groups were down significantly, but they were consistent with their results for the second quarter, which we believe is a reflection of stabilizing conditions in the manufacturing segment of the economy. Motion Industries, our Industrial Group, had a 22% sales decrease in the quarter, and EIS, our Electrical Group, had a 30% decrease."

Mr. Gallagher added, "The balance sheet at September 30, 2009 remains in excellent condition and we continue to strengthen our financial position through working capital and asset management initiatives, cost reduction efforts and steady and strong cash flows. The Company's sound cash position provides us with significant financial flexibility and our priorities for cash in several key areas serve to maximize the total return to shareholders."

Mr. Gallagher concluded, "2009 has proven to be a challenging year for GPC. However, we continue to have confidence in the long-term positive fundamentals for all four of our business segments. Our primary focus currently is to keep the balance sheet strong and to position each of our businesses to show improved sales and earnings results as the economy begins to improve."

Conference Call

Genuine Parts Company will hold a conference call today at 11:00 a.m. Eastern time to discuss the results of the quarter and the future outlook. Interested parties may listen to the call on the Company's website, www.genpt.com, by clicking "Investor Services", or by dialing 877-316-2549, conference ID 85294980. A replay will also be available on the Company's website or at 800-642-1687, conference ID 85294980, two hours after the completion of the conference call until 12:00 a.m. Eastern time on October 31, 2009.

Forward Looking Statements

Some statements in this release, as well as in other materials we file with the Securities and Exchange Commission ("SEC") or otherwise release to the public and in materials that we make available on our website, constitute forward-looking statements that are subject to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Senior officers may also make verbal statements to analysts, investors, the media and others that are forward-looking. Forward-looking statements may relate, for example, to our future operations, prospects, strategies, financial condition, economic performance (including growth and earnings), industry conditions and demand for our products and services. The Company cautions that its forward-looking statements involve risks and uncertainties, and while we believe that our expectations for the future are reasonable in view of currently available information, you are cautioned not to place undue reliance on our forward-looking statements. Actual results or events may differ materially from those indicated as a result of various important factors. Such factors include, but are not limited to, the ability to maintain favorable supplier arrangements and relationships, changes in general economic conditions, the growth rate of the market for the Company's products and services, competitive product, service and pricing pressures, including internet related initiatives, the effectiveness of the Company's promotional, marketing and advertising programs, changes in financial markets, including particularly the capital and credit markets, changes in laws and regulations, including changes in accounting and taxation guidance, the uncertainties of litigation, as well as other risks and uncertainties discussed from time to time in the Company's filings with the SEC.

Forward-looking statements are only as of the date they are made, and the Company undertakes no duty to update its forward-looking statements except as required by law. You are advised, however, to review any further disclosures we make on related subjects in our Form 10-Q, 10-K, 8-K and other reports to the SEC.

About Genuine Parts Company

Genuine Parts Company is a distributor of automotive replacement parts in the U.S., Canada and Mexico. The Company also distributes industrial replacement parts in the U.S. and Canada through its Motion Industries subsidiary. S.P. Richards Company, the Office Products Group, distributes business products nationwide in the U.S. and Canada. The Electrical/Electronic Group, EIS, Inc., distributes electrical and electronic components throughout the U.S., Canada and Mexico.

                      GENUINE PARTS COMPANY and SUBSIDIARIES
                    CONDENSED CONSOLIDATED STATEMENTS OF INCOME

                           Three Months Ended           Nine Months Ended
                                 Sept. 30,                  Sept. 30,
                           2009           2008         2009          2008
                           ----           ----         ----          ----
                                             (Unaudited)
                                (in thousands, except per share data)

  Net sales             $2,606,757    $2,882,115    $7,586,298    $8,495,073
  Cost of goods sold     1,841,511     2,033,110     5,343,996     5,974,372
                         ---------     ---------     ---------     ---------
                           765,246       849,005     2,242,302     2,520,701
  Selling,
   administrative &
   other expenses          594,540       638,163     1,760,878     1,902,467
                           -------       -------     ---------     ---------

  Income before
   income taxes            170,706       210,842       481,424       618,234
  Income taxes              63,067        79,825       181,016       230,601
                            ------        ------       -------       -------

  Net income              $107,639      $131,017      $300,408      $387,633
                          ========      ========      ========      ========

  Basic net income
   per common share           $.67          $.81         $1.88         $2.37

  Diluted net income
   per common share           $.67          $.81         $1.88         $2.36

  Weighted average
   common shares
   outstanding             159,541       161,603       159,500       163,324

  Dilutive effect of
   stock options and
   Non-vested
   restricted stock
   awards                      335           673           268           689
                               ---           ---           ---           ---

  Weighted average
   common shares
   outstanding -
   assuming dilution       159,876       162,276       159,768       164,013
                           =======       =======       =======       =======




                      GENUINE PARTS COMPANY and SUBSIDIARIES
                   SEGMENT INFORMATION AND FINANCIAL HIGHLIGHTS

                      Three Months Ended         Nine Months Ended
                            Sept. 30,                Sept. 30,
                      2009          2008         2009         2008
                      ----          ----         ----         ----
                                     (Unaudited)
                                   (in thousands)
  Net sales:
   Automotive     $1,381,578    $1,393,118    $3,960,743    $4,127,518
   Industrial        711,471       907,015     2,149,200     2,686,297
   Office Products   436,287       458,968     1,255,169     1,332,167
   Electrical/
    Electronic        89,364       126,827       256,106       363,712
    Materials
   Other (1)         (11,943)       (3,813)      (34,920)      (14,621)
                    --------       -------      --------      --------
     Total net
      Sales       $2,606,757    $2,882,115    $7,586,298    $8,495,073
                  ==========    ==========    ==========    ==========

  Operating profit:
   Automotive       $107,735      $111,730      $312,919      $317,888
   Industrial         36,495        77,220       102,113       222,781
    Office Products   26,692        33,426        99,081       114,721
    Electrical/
     Electronic
     Materials         6,802        10,272        17,560        29,175
                       -----        ------        ------        ------
    Total operating
     profit          177,724       232,648       531,673       684,565
    Interest
     expense, net     (6,662)       (7,391)      (20,510)      (21,877)
    Other, net          (356)      (14,415)      (29,739)      (44,454)
                     -------       -------       -------       -------
      Income before
       income
       taxes        $170,706      $210,842      $481,424      $618,234
                    ========      ========      ========      ========

  Capital
   expenditures      $12,405       $15,761       $49,360       $60,091
                     =======       =======       =======       =======

  Depreciation and
   amortization      $22,562       $21,768       $67,494       $66,469
                     =======       =======       =======       =======


  (1) Represents the net effect of discounts, incentives and freight billed
  reported as a component of net sales.




                      GENUINE PARTS COMPANY and SUBSIDIARIES
                      CONDENSED CONSOLIDATED BALANCE SHEETS


                                                 Sept. 30,        Sept. 30,
                                                   2009             2008
                                                   ----             ----
                                                        (Unaudited)
                                                      (in thousands)
  ASSETS
  CURRENT ASSETS
  Cash and cash equivalents                      $363,133         $124,428
  Trade accounts receivable, net                1,250,575        1,350,568
  Merchandise inventories, net                  2,188,133        2,318,215
  Prepaid expenses and other current assets       232,450          279,932
                                                  -------          -------

    TOTAL CURRENT ASSETS                        4,034,291        4,073,143

  Goodwill and other intangible assets,
   less accumulated amortization                  171,573          147,940
  Other assets                                    285,730          185,420
  Net property, plant and equipment               485,647          412,755
                                                  -------          -------

    TOTAL ASSETS                               $4,977,241       $4,819,258
                                                =========        =========

  LIABILITIES AND EQUITY
  CURRENT LIABILITIES
  Trade accounts payable                       $1,124,276       $1,070,513
  Current portion of debt                               -          250,000
  Income taxes payable                             56,997           18,506
  Dividends payable                                63,819           63,003
  Other current liabilities                       199,419          223,634
                                                  -------          -------

    TOTAL CURRENT LIABILITIES                   1,444,511        1,625,656

  Long-term debt                                  500,000          250,000
  Other long-term liabilities                     128,729          115,027
  Retirement and other post-retirement
   benefit liabilities                            289,659           91,031
  Noncontrolling interests in subsidiaries          7,447           68,439
  Common stock                                    159,552          160,557
  Retained earnings and other                   2,447,343        2,508,548
                                                ---------        ---------

    TOTAL EQUITY                                2,614,342        2,737,544
                                                ---------        ---------

    TOTAL LIABILITIES AND EQUITY               $4,977,241       $4,819,258
                                                =========        =========


  NOTE:  Certain prior period amounts have been reclassified to conform to
  current year presentation.




                      GENUINE PARTS COMPANY and SUBSIDIARIES
                  CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

                                                          Nine Months Ended
                                                               Sept. 30,
                                                           2009        2008
                                                           ----        ----
                                                             (Unaudited)
                                                            (in thousands)

  OPERATING ACTIVITIES:
     Net income                                        $300,408    $387,633
     Adjustments to reconcile net income to net cash
      provided by operating activities:
     Depreciation and amortization                       67,494      66,469
     Other                                                8,563      13,067
     Changes in operating assets and liabilities        390,038       1,836
                                                        -------       -----


  NET CASH PROVIDED BY OPERATING ACTIVITIES             766,503     469,005

  INVESTING ACTIVITIES:
     Purchases of property, plant and equipment         (49,360)    (60,091)
     Acquisitions and other                            (123,047)    (98,735)
     Purchase of properties under construction and
      lease agreement                                   (72,811)          -
                                                       --------       -----

  NET CASH USED IN INVESTING ACTIVITIES                (245,218)   (158,826)

  FINANCING ACTIVITIES:
     Stock options exercised                              2,178       1,364
     Excess tax benefits from share-based compensation       63         313
     Dividends paid                                    (189,739)   (188,805)
     Changes in cash overdraft position                 (52,000)          -
     Purchase of stock                                     (159)   (228,863)
                                                          -----   ---------

  NET CASH USED IN FINANCING ACTIVITIES                (239,657)   (415,991)

  EFFECT OF EXCHANGE RATE CHANGES ON CASH                13,728      (1,597)
                                                         ------     -------

  NET INCREASE (DECREASE) IN CASH AND CASH
   EQUIVALENTS                                          295,356    (107,409)

  CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD       67,777     231,837
                                                         ------     -------

  CASH AND CASH EQUIVALENTS AT END OF PERIOD           $363,133    $124,428
                                                       ========    ========

First Call Analyst:
FCMN Contact:

Photo: http://www.newscom.com/cgi-bin/prnh/20081002/CLTH108LOGO

SOURCE: Genuine Parts Company

CONTACT: Jerry W. Nix, Vice Chairman and CFO, +1-770-612-2048; or Sidney
G. Jones, Vice President-Investor Relations, +1-770-818-4628


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