Motion 3Q Sales Flatten but Margin Stays Healthy - Modern Distribution Management

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Motion 3Q Sales Flatten but Margin Stays Healthy

Sales for Genuine Parts Company's industrial segment were $2.2 billion, up 0.6% from the same period in 2022.
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On Oct. 19, Genuine Parts Company reported its 2023 third-quarter earnings, which showed sales for Motion Industries — GPC’s industrial segment — were $2.2 billion, up 0.6% from the same period in 2022 but down sequentially compared to the previous two quarters.

Motion’s 2Q 2023 year-over-year sales growth was 5.9% to $2.26 billion, less than half of the 11.9% YoY growth seen in 1Q23.

For 3Q 2023, segment profit of $283 million increased 16.6%, with segment profit margin of 12.9% up 180 basis points from the same period of the prior year. The third quarter of 2023 had one less selling day in the U.S. compared to the third quarter of 2022, which negatively impacted third quarter Industrial sales growth by approximately 1.6%.

“While our Industrial and international Automotive businesses performed well during the third quarter, the results for our U.S. Automotive business were below our expectations and negatively impacted by one less selling day,” said Will Stengel, President and Chief Operating Officer. “Our third quarter results reflect continued improvement in segment margins, driven by strong team operating discipline despite the slower growth environment.”

Sales for the nine months ended September 30, 2023 were $17.5 billion, up 5.6% from the same period in 2022. Net income for the nine months was $1.0 billion, or $7.08 per diluted share, an increase of 8.4% compared to $6.53 per diluted share in 2022. Net income of $1.0 billion, or $7.08 per diluted share, compares to adjusted net income of $896 million, or adjusted diluted earnings per share of $6.29, in 2022, an increase of 12.6%.

For GPC overall, 3Q 2023 sales were $5.8 billion, a 2.6% increase compared to $5.7 billion in the same period of the prior year. The growth in sales is attributable to a 0.5% increase in comparable sales, a 1.7% benefit from acquisitions and a 0.4% net favorable impact of foreign currency and other.

Net income was $351 million, an increase of 12.4% compared to net income of $312 million in the prior year. Diluted EPS was $2.49, an increase of 13.2% compared to $2.20 in the prior year period.

“Our third quarter performance was highlighted by double digit earnings growth, driven by benefits from the mix and geographic diversity of our businesses as well continued progress on our strategic initiatives,” said Paul Donahue, Chairman and CEO. “Through our One GPC approach, we are simplifying our business while driving productivity and efficiency across our operations. We would like to thank our teams around the world for their continued dedication to serving our customers and delivering solid quarterly results.”

Motion ranks No. 2 on MDM’s 2023 Top Industrial Distributors List.

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