First Quarter 2009

Genuine Parts Company Reports First Quarter 2009 Results

PRNewswire-FirstCall
ATLANTA
Apr 16, 2009
9:17am

Genuine Parts Company reported sales and earnings for the first quarter ended March 31, 2009. Thomas C. Gallagher, Chairman, President and Chief Executive Officer, announced today that sales totaling $2.4 billion were down 11% compared to the first quarter of 2008. Net income for the quarter was $89.2 million, a decrease of 28% over $123.5 million recorded in the same period of the previous year. Earnings per share on a diluted basis were 56 cents, down 25% compared to 75 cents for the first quarter last year.

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

Mr. Gallagher stated, "It was a challenging quarter for us, as the effects of the slower economy impacted each of our four business segments. The Automotive Group and S. P. Richards, our Office Products Group, both reported a 7% sales decrease, while Motion Industries, our Industrial Group, reported a 16% sales decline in the quarter, and EIS, our Electrical Group, had a 25% decrease. Our Industrial and Electrical businesses sell to the manufacturing segment of the economy, which has experienced an overall slowdown in activity over the past several quarters."

Mr. Gallagher added, "While we are not pleased with our first quarter operating results, the balance sheet at March 31, 2009, remains in excellent condition and we continue to strengthen our financial position through working capital and asset management initiatives, as well as steady and strong cash flows. We believe the use of our cash in several key areas, such as the dividend, opportunistic share repurchases, the ongoing investment in each of our businesses and strategic complimentary types of acquisitions, serves to maximize the total return to shareholders."

Mr. Gallagher concluded, "The effects of the economic slowdown are likely to persist for several more quarters. Clearly, these are challenging times; however, our expectation is to show gradual improvement in our overall results as the year progresses. The management teams in each of our business segments are focused on the diligent execution of their respective growth and operating strategies, the prudent management of their cost structure and the continued emphasis on further strengthening our balance sheet."

Conference Call

Genuine Parts Company will hold a conference call today at 11:00 a.m. EDT 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 85284172. A replay will also be available on the Company's website or at 800-642-1687, conference ID 85284172, two hours after the completion of the call until 12:00 a.m. Eastern time on May 1, 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 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 March 31,
                                               2009           2008
                                               ----           ----
                                                   (Unaudited)
                                      (in thousands, except per share data)

  Net sales                                 $2,444,496     $2,739,473
  Cost of goods sold                         1,712,295      1,919,990
                                             ---------      ---------
                                               732,201        819,483
  Selling, administrative & other expenses     587,533        627,802
                                               -------        -------
  Income before income taxes                   144,668        191,681
  Income taxes                                  55,509         68,138
                                                ------         ------
  Net income                                   $89,159       $123,543
                                               =======       ========

  Basic net income per common share               $.56           $.75
  Diluted net income per common share             $.56           $.75

  Weighted average common shares outstanding   159,444        164,977
  Dilutive effect of stock options and
   non-vested restricted stock awards              219            729
                                                   ---            ---
  Weighted average common shares outstanding
   - assuming dilution                         159,663        165,706
                                               =======        =======



                           GENUINE PARTS COMPANY and SUBSIDIARIES
                          SEGMENT INFORMATION AND FINANCIAL HIGHLIGHTS

                                            Three Months Ended March 31,
                                                2009           2008
                                                ----           ----
                                                    (Unaudited)
                                                   (in thousands)

  Net sales:
     Automotive                             $1,219,128     $1,305,887
     Industrial                                736,501        881,213
     Office Products                           412,748        442,392
     Electrical/Electronic Materials            86,133        114,301
     Other (1)                                 (10,014)        (4,320)
                                              --------        -------
        Total net sales                     $2,444,496     $2,739,473
                                            ==========     ==========

  Operating profit:
     Automotive                                $87,407        $90,644
     Industrial                                 34,175         68,992
     Office Products                            38,728         43,932
     Electrical/Electronic Materials             5,668          9,010
                                                 -----          -----
     Total operating profit                    165,978        212,578
     Interest expense, net                      (7,096)        (7,154)
     Other, net                                (14,214)       (13,743)
                                              --------       --------
              Income before income taxes      $144,668       $191,681
                                              ========       ========

  Capital expenditures                         $14,097        $21,762
                                               =======        =======

  Depreciation and amortization                $22,521        $22,684
                                               =======        =======


  (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
                              -------------------------------------

                                              March 31,      March 31,
                                                2009           2008
                                                ----           ----
                                                    (Unaudited)
                                                   (in thousands)
  ASSETS
  CURRENT ASSETS
  Cash and cash equivalents                   $133,281       $161,519
  Trade accounts receivable, net             1,211,337      1,303,787
  Merchandise inventories, net               2,253,036      2,314,536
  Prepaid expenses and other current assets    222,253        245,891
                                               -------        -------

     TOTAL CURRENT ASSETS                    3,819,907      4,025,733

  Goodwill and intangible assets, less
   accumulated amortization                    158,427        114,489
  Other assets                                 334,155        195,371
  Net property, plant and equipment            412,366        419,825
                                               -------        -------

  TOTAL ASSETS                              $4,724,855     $4,755,418
                                            ==========     ==========

  LIABILITIES AND EQUITY
  CURRENT LIABILITIES
  Trade accounts payable                      $964,267     $1,002,742
  Current portion of debt                            0        250,000
  Income taxes payable                          70,883         78,994
  Dividends payable                             63,779         64,283
  Other current liabilities                    158,445        173,433
                                               -------        -------

     TOTAL CURRENT LIABILITIES               1,257,374      1,569,452

  Long-term debt                               500,000        250,000
  Other long-term liabilities                  110,207        111,064
  Retirement benefits liabilities              448,844         89,766

  Noncontrolling interests in subsidiaries      69,677         65,462
  Common stock                                 159,446        163,818
  Retained earnings and other                2,179,307      2,505,856
                                             ---------      ---------

     TOTAL EQUITY                            2,408,430      2,735,136
                                             ---------      ---------

  TOTAL LIABILITIES AND EQUITY              $4,724,855     $4,755,418
                                            ==========     ==========

  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
                         -----------------------------------------------

                                                   Three Months
                                                  Ended March 31,
                                                2009           2008
                                                ----           ----
                                                    (Unaudited)
                                                  (in thousands)

  OPERATING ACTIVITIES:
     Net income                                $89,159       $123,543
     Adjustments to reconcile net income
      to net cash provided by operating
      activities:
     Depreciation and amortization              22,521         22,684
     Other                                       2,257            892
     Changes in operating assets and
      liabilities                               33,565         (2,527)
                                                ------        -------

  NET CASH PROVIDED BY OPERATING ACTIVITIES    147,502        144,592

  INVESTING ACTIVITIES:
     Purchases of property, plant and
      equipment                                (14,097)       (21,762)
     Acquisitions and other                     (5,779)       (39,003)
                                               -------       --------

  NET CASH USED IN INVESTING ACTIVITIES        (19,876)       (60,765)

  FINANCING ACTIVITIES:
     Stock options exercised                       142            752
     Excess tax benefits from share-based
      compensation                                   -            217
     Dividends paid                            (62,148)       (60,789)
     Purchase of stock                            (116)       (94,325)
                                                 -----       --------

  NET CASH USED IN FINANCING ACTIVITIES        (62,122)      (154,145)
                                              --------      ---------

  NET INCREASE (DECREASE) IN CASH AND CASH
   EQUIVALENTS                                  65,504        (70,318)

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

  CASH AND CASH EQUIVALENTS AT END OF PERIOD  $133,281       $161,519
                                              ========       ========

First Call Analyst:
FCMN Contact:

Photo: http://www.newscom.com/cgi-bin/prnh/20081002/CLTH108LOGO
AP Archive: http://photoarchive.ap.org/
PRN Photo Desk, photodesk@prnewswire.com

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, both of Genuine
Parts Company


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