Dorman Products, Inc 10-Q for FY2022 Q1

About this 10-Q

Headline figures

Dorman Products, Inc. (DORM)

10-Q 2022-04-25 For: 2022-03-26

Added on April 04, 2026

Dorman Products, Inc filed this 10-Q on April 25, 2022, covering the quarter ended March 26, 2022 (FY2022 Q1).

Large accelerated filer

Accelerated filer

Non-accelerated filer

Smaller reporting company

Emerging growth company

Quarter ended March 26, 2022, as reported in this filing, compared with the same period a year earlier where the filing states it.

Revenue: $401.58M; up 39.4% from $288.01M a year earlier
Net income: $35.21M; up 7.6% from net income of $32.73M a year earlier
Diluted EPS: $1.11; up 8.8% from $1.02 a year earlier

Search and read filings like this one from Claude or ChatGPT with the SEC filings MCP server →

Pennsylvania		23-2078856
(State or other jurisdiction of		(I.R.S. Employer
incorporation or organization)		Identification No.)

3400 East Walnut Street, Colmar, Pennsylvania		18915
(Address of principal executive offices)		(Zip Code)

Title of each class		Trading Symbol(s)		Name of each exchange on which registered
Common stock, par value $0.01 per share		DORM		NASDAQ Global Select Market

		Page
PART I — FINANCIAL INFORMATION

ITEM 1.	Financial Statements (unaudited)

	Condensed Consolidated Statements of Operations	3

	Condensed Consolidated Balance Sheets	4

	Condensed Consolidated Statements of Shareholders’ Equity	5

	Condensed Consolidated Statements of Cash Flows	6

	Notes to Condensed Consolidated Financial Statements	7

ITEM 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	14

ITEM 3.	Quantitative and Qualitative Disclosures About Market Risk	20

ITEM 4.	Controls and Procedures	20

PART II — OTHER INFORMATION

ITEM 1.	Legal Proceedings	22

ITEM 1A.	Risk Factors	22

ITEM 2.	Unregistered Sales of Equity Securities and Use of Proceeds	22

ITEM 3.	Defaults Upon Senior Securities	22

ITEM 4.	Mine Safety Disclosures	22

ITEM 5.	Other Information	23

ITEM 6.	Exhibits	23

Exhibit Index		24

Signatures		25

	Three Months Ended
(in thousands, except per share data)	March 26, 2022			March 27, 2021
Net sales	$	401,579		$	288,012
Cost of goods sold		268,339			183,492
Gross profit		133,240			104,520
Selling, general and administrative expenses		86,528			62,869
Income from operations		46,712			41,651
Interest expense, net		1,231			121
Other income, net		(84	)		(85	)
Income before income taxes		45,565			41,615
Provision for income taxes		10,358			8,885
Net income	$	35,207		$	32,730
Other comprehensive income:
Change in foreign currency translation adjustment	$	1,696		$	—
Comprehensive Income	$	36,903		$	32,730

Earnings per share:
Basic	$	1.12		$	1.02
Diluted	$	1.11		$	1.02
Weighted average shares outstanding:
Basic		31,499			32,048
Diluted		31,601			32,184

(in thousands, except for share data)	March 26, 2022		December 25, 2021
Assets
Current assets:
Cash and cash equivalents	$	53,427	$	58,782
Accounts receivable, less allowance for doubtful accounts of $1,357 and $1,326		456,070		472,764
Inventories		565,200		531,988
Prepaids and other current assets		13,507		13,048
Total current assets		1,088,204		1,076,582
Property, plant and equipment, net		116,225		114,864
Operating lease right-of-use assets		98,149		59,029
Goodwill		198,110		197,332
Intangible assets, net		176,088		178,809
Other assets		47,525		46,503
Total assets	$	1,724,301	$	1,673,119
Liabilities and shareholders’ equity
Current liabilities:
Accounts payable	$	165,840	$	177,389
Accrued compensation		16,616		26,636
Accrued customer rebates and returns		195,289		188,080
Revolving credit facility		229,360		239,360
Other accrued liabilities		45,513		33,583
Total current liabilities		652,618		665,048
Long-term operating lease liabilities		88,881		52,443
Other long-term liabilities		5,450		4,916
Deferred tax liabilities, net		17,952		17,976
Commitments and contingencies (Note 8)
Shareholders’ equity:
Common stock, $0.01 par value; 50,000,000 shares authorized; 31,479,916 and 31,607,509 shares issued and outstanding in 2022 and 2021, respectively		315		316
Additional paid-in capital		78,906		77,451
Retained earnings		879,923		856,409
Accumulated other comprehensive income (loss)		256		(1,440	)
Total shareholders’ equity		959,400		932,736
Total liabilities and shareholders' equity	$	1,724,301	$	1,673,119

	Three Months Ended March 26, 2022
	Common Stock
(in thousands, except share data)	Shares Issued			Par Value			Additional Paid-In Capital			Retained Earnings			Accumulated Other Comprehensive Income (Loss)			Total
Balance at December 25, 2021		31,607,509		$	316		$	77,451		$	856,409		$	(1,440	)	$	932,736
Exercise of stock options		2,478			—			—			—			—			—
Compensation expense under Incentive Stock Plan		—			—			2,152			—			—			2,152
Purchase and cancellation of common stock		(111,114	)		(1	)		(200	)		(10,716	)		—			(10,917	)
Cancellation of non-vested stock, net of issuances		(2,511	)		—			377			—			—			377
Other stock-related activity, net of tax		(16,446	)		—			(874	)		(977	)		—			(1,851	)
Other comprehensive income		—			—			—			—			1,696			1,696
Net income		—			—			—			35,207			—			35,207
Balance at March 26, 2022		31,479,916		$	315		$	78,906		$	879,923		$	256		$	959,400

	Three Months Ended March 27, 2021
	Common Stock
(in thousands, except share data)	Shares Issued			Par Value			Additional Paid-In Capital			Retained Earnings			Accumulated Other Comprehensive Income (Loss)			Total
Balance at December 26, 2020		32,168,740		$	322		$	64,085		$	789,152		$	—		$	853,559
Exercise of stock options		11,614			—			316			—			—			316
Compensation expense under Incentive Stock Plan		—			—			2,111			—			—			2,111
Purchase and cancellation of common stock		(38,160	)		(1	)		(69	)		(3,904	)		—			(3,974	)
Cancellation of non-vested stock, net of issuances		(17,599	)		—			—			—			—			—
Other stock-related activity, net of tax		(9,067	)		—			1,153			(2,084	)		—			(931	)
Net income		—			—			—			32,730			—			32,730
Balance at March 27, 2021		32,115,528		$	321		$	67,596		$	815,894		$	—		$	883,811

	Three Months Ended
(in thousands)	March 26, 2022			March 27, 2021
Cash Flows from Operating Activities:
Net income	$	35,207		$	32,730
Adjustments to reconcile net income to cash provided by operating activities:
Depreciation, amortization and accretion		9,743			7,267
Provision for doubtful accounts		29			18
Provision for stock-based compensation		2,152			2,111
Changes in assets and liabilities:
Accounts receivable		16,727			8,338
Inventories		(33,034	)		(38,978	)
Prepaids and other current assets		(853	)		(2,017	)
Other assets		(1,976	)		(1,270	)
Accounts payable		(12,392	)		737
Accrued customer rebates and returns		7,202			8,215
Accrued compensation and other liabilities		409			3,869
Cash provided by operating activities		23,214			21,020
Cash Flows from Investing Activities:
Proceeds from purchase price adjustment		595			—
Property, plant and equipment additions		(7,247	)		(6,207	)
Cash used in investing activities		(6,652	)		(6,207	)
Cash Flows from Financing Activities:
Payments of revolving credit line		(10,000	)		—
Other stock-related activity		(1,211	)		(932	)
Proceeds from exercise of stock options		—			289
Purchase and cancellation of common stock		(10,752	)		(3,143	)
Cash used in financing activities		(21,963	)		(3,786	)
Effect of exchange rate changes on Cash and Cash Equivalents		46			—
Net (Decrease) Increase in Cash and Cash Equivalents		(5,355	)		11,027
Cash and Cash Equivalents, Beginning of Period		58,782			155,576
Cash and Cash Equivalents, End of Period	$	53,427		$	166,603
Supplemental Cash Flow Information
Cash paid for interest expense	$	999		$	77
Cash paid for income taxes	$	712		$	167

(in thousands)
Accounts receivable	$	23,216
Inventories		79,625
Prepaids and other current assets		2,302
Property, plant and equipment		29,900
Goodwill		106,816
Identifiable intangible assets		160,400
Operating lease right-of-use assets		21,248
Other assets		848
Accounts payable		(11,970	)
Accrued compensation		(2,784	)
Other current liabilities		(7,604	)
Long-term operating lease liabilities		(18,444	)
Deferred tax liabilities		(38,665	)
Net cash consideration	$	344,888

(in thousands)	March 26, 2022
Remainder of 2022	$	2,321
2023		3,160
2024		3,239
2025		3,320
2026		3,403
2027 and thereafter		27,001
Total fixed lease payments	$	42,444

	March 26, 2022						December 25, 2021
Intangible assets subject to amortization	Gross Carrying Value		Accumulated Amortization		Net Carrying Value		Gross Carrying Value		Accumulated Amortization		Net Carrying Value
(in thousands)
Customer relationships	$	149,150	$	14,033	$	135,117	$	149,150	$	12,139	$	137,011
Trade names		17,760		3,019		14,741		17,760		2,592	$	15,168
Product Portfolio		25,300		777		24,523		25,300		460	$	24,840
Technology		2,167		633		1,534		2,167		571	$	1,596
Other		430		257		173		430		236	$	194
Total	$	194,807	$	18,719	$	176,088	$	194,807	$	15,998	$	178,809

	Shares			Weighted Average Fair Value
Balance at December 25, 2021		206,677		$	85.97
Granted		87,378		$	100.70
Vested		(42,107	)	$	89.20
Canceled		(23,833	)	$	108.63
Balance at March 26, 2022		228,115		$	93.09

	Shares			Weighted Average Exercise Price		Weighted Average Remaining Term (In years)		Aggregate Intrinsic Value
Balance at December 25, 2021		233,396		$	77.85
Granted		78,574		$	97.16
Exercised		(10,725	)	$	71.89
Balance at March 26, 2022		301,245		$	83.10		6.0	$	3,319,720
Options exercisable at March 26, 2022		111,232		$	75.09		4.4	$	2,116,745

	Three Months Ended*
(in thousands, except percentage data)	March 26, 2022					March 27, 2021
Net sales	$	401,579		100.0	%	$	288,012		100.0	%
Cost of goods sold		268,339		66.8	%		183,492		63.7	%
Gross profit		133,240		33.2	%		104,520		36.3	%
Selling, general and administrative expenses		86,528		21.5	%		62,869		21.8	%
Income from operations		46,712		11.6	%		41,651		14.5	%
Interest expense, net		1,231		0.3	%		121		0.0	%
Other income, net		(84	)	-0.0	%		(85	)	-0.0	%
Income before income taxes		45,565		11.3	%		41,615		14.4	%
Provision for income taxes		10,358		2.6	%		8,885		3.1	%
Net income	$	35,207		8.8	%	$	32,730		11.4	%

Period	Total Number of Shares Purchased		Average Price Paid per Share		Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs (4)		Maximum Number (or Approximate Dollar Value) of Shares that May Yet Be Purchased Under the Plans or Programs (4)
December 26, 2021 through January 22, 2022 (1)		29,406	$	108.63		19,200	$	143,515,125
January 23, 2022 through February 19, 2022 (2)		38,180	$	93.23		35,400	$	140,224,502
February 20, 2022 through March 26, 2022 (3)		53,723	$	95.85		43,750	$	136,036,866
Total		121,309				98,350	$	136,036,866

(in thousands)	March 26, 2022		December 25, 2021
Raw materials	$	16,918	$	12,746
Bulk product		203,158		225,879
Finished product		338,014		287,415
Packaging materials		7,110		5,948
Total	$	565,200	$	531,988


31.1		Certification of Chief Executive Officer pursuant to Rule 13a-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. *

31.2		Certification of Chief Financial Officer pursuant to Rule 13a-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. *

32		Certification of Chief Executive Officer and Chief Financial Officer pursuant to 18 U.S.C. Section 1350 as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (furnished with this report). **

101		The following financial statements from the Dorman Products, Inc. Quarterly Report on Form 10-Q as of and for the quarter ended March 26, 2022, formatted in Inline XBRL (eXtensible Business Reporting Language): (i) the Condensed Consolidated Statements of Operations; (ii) the Condensed Consolidated Balance Sheets; (iii) Condensed Consolidated Statements of Shareholders’ Equity; (iv) the Condensed Consolidated Statements of Cash Flows and (v) the Notes to Condensed Consolidated Financial Statements.

104		The cover page from the Company’s Quarterly Report on Form 10-Q as of and for the quarter ended March 26, 2022, formatted in Inline XBRL (included as Exhibit 101).