gpc-20230930

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q


☒			QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 30, 2023


☐			TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

Commission file number: 1-5690

__________________________________________

GENUINE PARTS COMPANY

(Exact name of registrant as specified in its charter)

__________________________________________


GA						58-0254510
(State or other jurisdiction of incorporation or organization)						(I.R.S. Employer Identification No.)

2999 WILDWOOD PARKWAY,

30339

ATLANTA,

(Address of principal executive offices)

(Zip Code)

678-934-5000

(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:

Title of Each Class

Trading Symbol

Name of each exchange on which registered

Common Stock, $1.00 par value per share

GPC

New York Stock Exchange

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer

☒

Accelerated filer

☐

Non-accelerated filer

☐

Smaller reporting company

☐

Emerging growth company

☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

There were 140,196,631 shares of common stock outstanding as of October 16, 2023.


Table of Contents

PART I		Page

Item 1.	Financial Statements	2
	Condensed Consolidated Balance Sheets	2
	Condensed Consolidated Statements of Income	3
	Condensed Consolidated Statements of Comprehensive Income	4
	Condensed Consolidated Statements of Equity	5
	Condensed Consolidated Statements of Cash Flows	7
	Notes to Condensed Consolidated Financial Statements	8
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	15
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	24
Item 4.	Controls and Procedures	24

PART II

Item 1.	Legal Proceedings	25
Item 1A.	Risk Factors	25
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	25
Item 5.	Other Information	25
Item 6.	Exhibits	26
	Signatures	27

Table of Contents

PART I – FINANCIAL INFORMATION

Item 1. Financial Statements

GENUINE PARTS COMPANY AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

(UNAUDITED)


(in thousands, except share and per share data)	September 30, 2023		December 31, 2022
Assets
Current assets:
Cash and cash equivalents	$	654,637	$	653,463
Trade accounts receivable, less allowance for doubtful accounts (2023 – $61,499; 2022 – $53,872)	2,394,787		2,188,868
Merchandise inventories, net	4,482,773		4,441,649
Prepaid expenses and other current assets	1,497,677		1,532,759
Total current assets	9,029,874		8,816,739
Goodwill	2,637,150		2,588,113
Other intangible assets, less accumulated amortization	1,754,977		1,812,510
Property, plant and equipment, less accumulated depreciation (2023 – $1,532,480; 2022 – $1,435,677)	1,513,822		1,326,014
Operating lease assets	1,197,244		1,104,678
Other assets	888,831		847,325
Total assets	$	17,021,898	$	16,495,379

Liabilities and equity
Current liabilities:
Trade accounts payable	$	5,486,379	$	5,456,550
Current portion of debt	354,017		252,029
Dividends payable	133,254		126,191
Other current liabilities	1,826,709		1,851,340
Total current liabilities	7,800,359		7,686,110
Long-term debt	2,963,448		3,076,794
Operating lease liabilities	919,470		836,019
Pension and other post–retirement benefit liabilities	198,180		197,879
Deferred tax liabilities	411,350		391,163
Other long-term liabilities	527,816		502,967
Equity:
Preferred stock, par value – $1 per share; authorized – 10,000,000 shares; none issued	—		—
Common stock, par value – $1 per share; authorized – 450,000,000 shares; issued and outstanding – 2023 – 140,234,786 shares; 2022 – 140,941,649 shares	140,235		140,941
Additional paid-in capital	163,602		140,324
Accumulated other comprehensive loss	(1,087,262)		(1,032,542)
Retained earnings	4,969,538		4,541,640
Total parent equity	4,186,113		3,790,363
Noncontrolling interests in subsidiaries	15,162		14,084
Total equity	4,201,275		3,804,447
Total liabilities and equity	$	17,021,898	$	16,495,379

See accompanying Notes to Condensed Consolidated Financial Statements.

Table of Contents

GENUINE PARTS COMPANY AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF INCOME

(UNAUDITED)


	Three Months Ended September 30,				Nine Months Ended September 30,
(in thousands, except per share data)	2023		2022		2023		2022
Net sales	$	5,824,602	$	5,675,274	$	17,504,726	$	16,572,323
Cost of goods sold	3,715,361		3,695,607		11,247,341		10,805,910
Gross profit	2,109,241		1,979,667		6,257,385		5,766,413
Operating expenses:
Selling, administrative and other expenses	1,551,799		1,458,418		4,644,696		4,226,412
Depreciation and amortization	83,860		86,563		261,948		259,822
Provision for doubtful accounts	8,417		6,146		22,378		13,539
Total operating expenses	1,644,076		1,551,127		4,929,022		4,499,773
Non-operating expense (income):
Interest expense, net	15,827		18,220		49,146		58,318
Other	(15,722)		(7,616)		(44,338)		(26,897)
Total non-operating expense (income)	105		10,604		4,808		31,421
Income before income taxes	465,060		417,936		1,323,555		1,235,219
Income taxes	113,862		105,578		323,906		304,494
Net income	$	351,198	$	312,358	$	999,649	$	930,725
Dividends declared per common share	$	0.950	$	0.895	$	2.850	$	2.685
Basic earnings per share	$	2.50	$	2.21	$	7.11	$	6.57
Diluted earnings per share	$	2.49	$	2.20	$	7.08	$	6.53

See accompanying Notes to Condensed Consolidated Financial Statements.

Table of Contents

GENUINE PARTS COMPANY AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(UNAUDITED)


	Three Months Ended September 30,				Nine Months Ended September 30,
(in thousands)	2023		2022		2023		2022
Net income	$	351,198	$	312,358	$	999,649	$	930,725
Other comprehensive income (loss), net of income taxes:
Foreign currency translation adjustments	(77,314)		(131,811)		(63,027)		(248,757)
Cash flow hedge adjustments, net of income taxes in 2023 — $0 and $951; 2022 — $1,384 and $4,151, respectively	—		3,741		2,572		11,223
Pension and postretirement benefit adjustments, net of income taxes in 2023 — $703 and $2,108; 2022 — $2,576 and $7,736, respectively	1,909		6,982		5,735		20,957
Other comprehensive income (loss), net of income taxes	(75,405)		(121,088)		(54,720)		(216,577)
Comprehensive income	$	275,793	$	191,270	$	944,929	$	714,148

See accompanying Notes to Condensed Consolidated Financial Statements.

Table of Contents

GENUINE PARTS COMPANY AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF EQUITY

(UNAUDITED)


	Three Months Ended September 30, 2023
(in thousands, except share and per share data)	Common Stock Shares	Common Stock Amount		Additional Paid-In Capital		Accumulated Other Comprehensive Loss		Retained Earnings		Total Parent Equity		Non-controlling Interests in Subsidiaries		Total Equity
July 1, 2023	140,467,550	$	140,468	$	153,748	$	(1,011,857)	$	4,788,852	$	4,071,211	$	14,583	$	4,085,794
Net income	—	—		—		—		351,198		351,198		—		351,198
Other comprehensive loss, net of tax	—	—		—		(75,405)		—		(75,405)		—		(75,405)
Cash dividend declared, $0.9500 per share	—	—		—		—		(133,254)		(133,254)		—		(133,254)
Shares issued from employee incentive plans	5,991	6		(541)		—		—		(535)		—		(535)
Share-based compensation	—	—		10,395		—		—		10,395		—		10,395
Purchase of stock	(238,755)	(239)		—		—		(37,258)		(37,497)		—		(37,497)
Noncontrolling interest activities	—	—		—		—		—		—		579		579
September 30, 2023	140,234,786	$	140,235	$	163,602	$	(1,087,262)	$	4,969,538	$	4,186,113	$	15,162	$	4,201,275


	Nine Months Ended September 30, 2023
(in thousands, except share and per share data)	Common Stock Shares	Common Stock Amount		Additional Paid-In Capital		Accumulated Other Comprehensive Loss		Retained Earnings		Total Parent Equity		Non-controlling Interests in Subsidiaries		Total Equity
January 1, 2023	140,941,649	$	140,941	$	140,324	$	(1,032,542)	$	4,541,640	$	3,790,363	$	14,084	$	3,804,447
Net income	—	—		—		—		999,649		999,649		—		999,649
Other comprehensive loss, net of tax	—	—		—		(54,720)		—		(54,720)		—		(54,720)
Cash dividend declared, $2.8500 per share	—	—		—		—		(400,483)		(400,483)		—		(400,483)
Shares issued from employee incentive plans	372,471	373		(24,062)		—		—		(23,689)		—		(23,689)
Share-based compensation	—	—		47,340		—		—		47,340		—		47,340
Purchase of stock	(1,079,334)	(1,079)		—		—		(171,268)		(172,347)		—		(172,347)
Noncontrolling interest activities	—	—		—		—		—		—		1,078		1,078
September 30, 2023	140,234,786	$	140,235	$	163,602	$	(1,087,262)	$	4,969,538	$	4,186,113	$	15,162	$	4,201,275

SEC Form 10-Q filed by Genuine Parts Company