Original Parts Co (NYSE:GPC) shares fell after the company reported mixed third-quarter earnings and a gloomy outlook. Adjusted earnings per share of $1.88 missed analyst consensus of $2.42.
The supplier of replacement parts for the automotive and industrial sectors reported third-quarter revenue growth of 2.5% year-over-year to $5.97 billion, marginally beating analysts’ consensus estimate of $5.94 billion.
The company attributed the revenue growth to a 3.2% benefit from acquisitions, partially offset by a 0.8% decline in comparable sales.
Automotive Parts Group’s turnover grew by 4.8% year on year. The profit margin of this segment decreased by 200 basis points to 6.9%.
Industrial Parts Group sales fell by 1.2% and the segment’s profit margin shrank by 100 basis points to 11.9%.
Gross profit rose 4.2% year over year to $2.2 billion. Selling, administrative and other expenses were $1.7 billion, up 11.0% year over year.
Cash and equivalents totaled $1.08 billion as of September 30. Net cash generated from operating activities during the first nine months was $1.1 billion.
CEO Will Stengel: “Our results fell below our expectations, mainly due to the continued weakness of market conditions in Europe and our industrial activities.”
OutlookOriginal Parts lowered fiscal 2024 revenue growth outlook to 1%-2% or $23.32 billion-$23.55 billion (previously 1%-3% or $23.32 billion-$23.78 billion) versus $23.48 billion consensus.
It lowered the adjusted EPS outlook for fiscal 2024 to $8.00-$8.20 (previously $9.30-$9.50), compared to the consensus of $9.36.
The company still expects fiscal 2024 free cash flow of $800 million – $1.0 billion and operating cash flow of $1.3 billion – $1.5 billion.
Price promotion: GPC shares are trading 18.50% lower at $116.69 at last check on Tuesday.
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This article Original Third Quarter Earnings Parts: Industrial Weakness and Europe Hamper Earnings, Margins Shrink, Lower Full-Year Outlook originally appeared on Benzinga.com
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