Standard Motor Products, Inc. Announces
First Quarter 2005 Results and A Quarterly Dividend
Consolidated net sales for the first quarter of 2005 were $207.3 million, compared to consolidated net sales of $204.8 million during the comparable quarter in 2004. Earnings from continuing operations for the first quarter of 2005 were $1.1 million or 5 cents per diluted share, compared to losses from continuing operations of $545,000 or 3 cents per diluted share in the first quarter of 2004.
First quarter 2005 consolidated net sales increased slightly. Consolidated gross margins were 23.4% in the first quarter of 2005 compared to 24.9% in the first quarter of 2004, reflecting a 1.5 percentage point decrease. Offsetting the gross margin decline was a 2.8 percentage point reduction in selling, general and administrative (SG&A) expenses. The net result was that operating income increased $3.6 million in the first quarter of 2005 as compared to the comparable period in the prior year.
Commenting on the results, Mr. Lawrence Sills, Standard Motor Products’ Chairman and Chief Executive Officer, said, “While we are starting to see the benefits of the Dana Engine Management (DEM) integration, we are not yet achieving the targets that we have set for ourselves. Despite only a slight increase in sales, we have made substantial reductions in SG&A. The $5 million quarterly SG&A improvement from the first quarter of 2004 was primarily a result of the synergies from the DEM integration.”
Mr. Sills added, “We have not yet achieved similar improvements in gross margin. We are still working off the high cost DEM inventory, and because we have added so many new people, we are running below pre-acquisition efficiency levels. However, our efficiencies are improving continuously; we have announced price increases for the second half of the year, which have been accepted by our customers; and we have begun placing orders for material components which will result in additional cost savings. We remain optimistic about hitting all of our planned goals.”
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 June 1, 2005 to stockholders of record on May 16, 2005.
Standard Motor Products, Inc. will hold a conference call at 11:00 AM, Eastern Time, on Tuesday, May 10, 2005. The dial in number is 800-362-0571. The playback number is 800-839-0861 (domestic) or 402-220-0661 (international), and the ID # is STANDARD.
Under the safe harbor provisions of the Private Securities Litigation Reform Act of 1995, Standard Motor Products cautions investors that any forward-looking statements made by the company, including those that may be made in this press release, are based on management’s expectations at the time they are made, but they are subject to risks and uncertainties that may cause actual results, events or performance to differ materially from those contemplated by such forward looking statements. Among the factors that could cause actual results, events or performance to differ materially from those risks and uncertainties discussed in this press release are those detailed from time-to-time in prior press releases and in the company’s filings with the Securities and Exchange Commission, including the company’s annual report on Form 10-K and quarterly reports on Form 10-Q. By making these forward-looking statements, Standard Motor Products undertakes no obligation or intention to update these statements after the date of this release.