3Q 2001 EARNINGS AND QUARTERLY DIVIDEND
New York, NY, October 22, 2001......Standard Motor Products, Inc. (NYSE:SMP) automotive replacement parts manufacturer and distributor, reported net sales for the third quarter of 2001, the three months ended September 30, 2001, of $163.7 million, slightly lower than net sales of $166.1 million during the comparable quarter of a year ago. Net earnings for the third quarter of 2001 were $3.7 million or 32 cents per diluted share, as compared to net earnings of $4.9 million or 40 cents per diluted share, in the third quarter of 2000.
Sales for the nine months in 2001 were $506.1 million, 3.8% higher than net sales of $487.4 million in the comparable period in 2000. Net earnings for the nine months in 2001 were $3.8 million or 33 cents per diluted share, as compared to $11.8 million or 98 cents per diluted share a year ago. Excluding $2.8 million and $501,000 in 2001 and 2000, respectively, for the extraordinary losses on early retirement of debt, net earnings for the nine months would have been 56 cents and $1.02 per diluted share in 2001 and 2000, respectively.
Lawrence Sills, Chief Executive Officer, said, "Despite our slight sales decline in the third quarter, on a year-to-date basis, both Engine Management and Temperature Control are experiencing favorable net sales growth, mostly as the result of new accounts."
Mr. Sills stated, "Gross margins for the year have been negatively impacted as we implemented our $50 million inventory reduction program. Year-to-date gross margins were 28.5% as compared to 31.7% in the prior year. However, as we begin to return to normal production, we are seeing some improvement, as gross margins for the quarter reached 30.7%. We anticipate future improvement in the quarters ahead.
"Our inventory reduction efforts, across both Engine Management and Temperature Control, successfully reduced $57 million from the beginning of the year. During this same period, we have been able to maintain our high shipping fill rates to our customers, a critical performance measurement."
Mr. Sills said, "Selling, general and administrative (SG&A) expenses in the third quarter 2001 were $40.7 million, $1.2 million higher than the $39.5 million a year ago. However, year-to-date SG&A expenses were reduced $2.4 million to 24% of net sales as compared to 25.4% of sales in the comparable period a year ago. This reflects the result of our continuing cost cutting efforts."
The Board of Directors has approved payment of a quarterly dividend of nine cents per share on the common stock outstanding. The dividend will be paid on December 3, 2001 to stockholders of record on November 15, 2001.
This news release contains certain forward-looking statements that involve risks and uncertainties. Actual results, events and performance could differ materially from those contemplated by these forward looking statements. Among the factors that could cause actual results, events and performance to differ materially are risks and uncertainties discussed in this release and those detailed from time-to-time in prior public statements and the Company's filings with the Securities and Exchange Commission, including the Company's annual report on Form 10-K and the Company’s quarterly reports on Form 10-Q.
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