The slumping economy hasn't affected Genuine Parts Company, which recently reported a 3 percent increase in sales for the first quarter 2008. According to Thomas C. Gallagher, the company's chairman, president, and chief executive officer, sales totaled $2.74 billion and net income for the quarter was $123.5 million. Earnings per share on a diluted basis came out to $.75, up 6 percent when compared to the first quarter of 2007. "We are pleased to report that the first quareter of 2008 was another period of sales and earnings growth for Genuine Parts Company," says Mr. Gallagher. "As we move forward in 2008, we recognize that we are operating in an uncertain and challenging economic environment. However, our focus remains on the crisp execution of our growth and operational strategies in each of our businesses, as well as our ongoing initiatives to further strengthen the balance sheet." According to Gallagher, the company's Electrical Group (EIS), generated the strongest sales growth among its four business segments. The group was up 7 percent in the quarter and continue a trend of solid progress. Motion Industries, the company's Industrial Group, also reported strong results, with a 6 percent sales increase for the quarter. The company believes that both EIS and Motion are positioned to have another good year in 2008. The Automotive Group reported a 4 percent increase in the quarter, the highest percentage growth since the second quarter of 2006. S.P. Richards, the company's Office Products Group, was down 2 percent for the quarter, reflecting continued softness in the office products industry. Despite the decrease in the first quarter, and the ongoing industry sluggishness, the company feel that S.P. Richards has the initiatives in place to show improved performance over the remainder of the year. Gallagher adds that the company is also generating strong cash flows and that its cash position remains in good shape. The company has used cash in several key areas to maximize the total return to its shareholders. The company is first and foremost focused on the dividend paid to shareholders, and cash dividends for 2008 were increased by 7 percent to $1.56 on an annual basis, representing 52 consecutive years of increased dividends. Another priority for the company, says Gallagher, has been opportunistic share repurchases As part of its share repurchase program, the company has purchased approximately 2.4 million shares of ompany stock in 2008. This follows the purchase of 5.0 million shares in 2007. The company is also participating in ongoing reinvestment in each of its businesses and strategic complimentary types of acquisitions. During the quarter, Automotive acquired a 100 percent stake in Altrom Canada and Altrom America, effective Jan. 1. Motion Industries acquired Mill Supply Corporation in March, and S.P. Richards completed the acquisition of O'Henry, a regional office products distributor in April. For more information about the Genuine Parts Company, visit its Web site. |
