8-K
STANDARD MOTOR PRODUCTS, INC. (SMP)
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): February 22, 2023
STANDARD MOTOR PRODUCTS, INC.
(Exact Name of Registrant as Specified in its Charter)
| New York<br><br> <br>(State or Other Jurisdiction of Incorporation) | 001-04743<br><br> <br>(Commission File Number) | 11-1362020<br><br> <br>(I.R.S. Employee Identification Number) |
|---|
37-18 Northern Boulevard, Long Island City, New York 11101
(Address of Principal Executive Offices, including Zip Code)
Registrant’s Telephone Number, including Area Code: 718-392-0200
Not Applicable
(Former Name or Former Address, if Changed Since Last Report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
| ☐ | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425). |
|---|---|
| ☐ | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12). |
| --- | --- |
| ☐ | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)). |
| --- | --- |
| ☐ | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)). |
| --- | --- |
Securities registered pursuant to Section 12(b) of the Act:
| Title of each class | Trading Symbol(s) | Name of each exchange on which registered |
|---|---|---|
| Common Stock, par value $2.00 per share | SMP | New York Stock Exchange LLC |
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
| Emerging growth company ☐ |
|---|
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
| Item 2.02. | Results of Operations and Financial Condition. |
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On February 22, 2023, Standard Motor Products, Inc. (the “Company”) issued a press release announcing its financial results for the three months and year ended December 31, 2022. A copy of such press release is furnished as Exhibit 99.1 hereto.
Such press release shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934 (the “Exchange Act”) or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933 or the Exchange Act, except as shall be expressly set forth by specific reference in such filing.
| Item 7.01. | Regulation FD Disclosure. |
|---|
On February 22, 2023, the Company issued a press release announcing operating segment changes beginning in the first quarter of 2023. The press release references an investor presentation and a presentation of supplemental unaudited historical financial information under the new segment presentation for the years ended December 31, 2022 and 2021, and for each quarter of the years ended December 31, 2022 and 2021. The Company did not operate under this new segment structure for any of these prior periods and will begin to report results under the new segment structure with its Quarterly Report on Form 10-Q for the three months ended March 31, 2023.
The press release, investor presentation and supplemental information are being furnished as Exhibit 99.2, Exhibit 99.3, and Exhibit 99.4 respectively. Such press release, investor presentation and supplemental information shall not be deemed “filed” for purposes of Section 18 of the Exchange Act or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933 or the Exchange Act, except as shall be expressly set forth by specific reference in such filing.
| Item 9.01. | Financial Statements and Exhibits. |
|---|---|
| (d) | Exhibits. |
| --- | --- |
| 99.1 | Press release dated February 22, 2023, announcing Standard Motor Products, Inc.’s financial results for the three months and year ended December 31, 2022. |
| --- | --- |
| 99.2 | Press release dated February 22, 2023, announcing Standard Motor Products, Inc.’s operating segment changes beginning in the first quarter of 2023. |
| 99.3 | Investor presentation dated February 22, 2023. |
| 99.4 | Resegmentation announcement dated February 22, 2023, including supplemental unaudited historical financial information for the years ended December 31, 2022 and 2021, and for each quarter of the years ended<br> December 31, 2022 and 2021, recast under the new segment presentation. |
| 104 | Cover Page Interactive Data File--the cover page XBRL tags are embedded within the Inline XBRL document. |
2
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| STANDARD MOTOR PRODUCTS, INC. | ||
|---|---|---|
| By: | /s/ Nathan R. Iles | |
| Nathan R. Iles | ||
| Chief Financial Officer | ||
| Date: February 22, 2023 |
3
Exhibit Index
4
Exhibit 99.1
| For Immediate Release | |
|---|---|
| For more information, contact: | |
| Anthony (Tony) Cristello | |
| Standard Motor Products, Inc. | |
| (972) 316-8107 | |
| tony.cristello@smpcorp.com |
Standard Motor Products, Inc. Releases
Fourth Quarter and 2022 Year-End Results;
Announces Segment Reporting Changes
New York, NY, February 22, 2023......Standard Motor Products, Inc. (NYSE: SMP), a leading automotive parts manufacturer and distributor, reported today its consolidated financial results for the three and twelve months ended December 31, 2022.
Net sales for the fourth quarter of 2022 were $308.2 million, compared to consolidated net sales of $309.9 million during the same quarter in 2021. Earnings from continuing operations for the fourth quarter of 2022 were $8.5 million or $0.39 per diluted share, compared to $20.0 million or $0.89 per diluted share in the fourth quarter of 2021. Excluding non-operational gains and losses identified on the attached reconciliation of GAAP and non-GAAP measures, earnings from continuing operations for the fourth quarter of 2022 were $15.1 million or $0.69 per diluted share, compared to $20.3 million or $0.90 per diluted share in the fourth quarter of 2021.
Consolidated net sales for the twelve months ended December 31, 2022, were $1.37 billion, compared to consolidated net sales of $1.30 billion during the comparable period in 2021. Earnings from continuing operations for the twelve months ended December 31, 2022, were $73.0 million or $3.30 per diluted share, compared to $99.4 million or $4.39 per diluted share in the comparable period of 2021. Excluding non-operational gains and losses identified on the attached reconciliation of GAAP and non-GAAP measures, earnings from continuing operations for the twelve months ended December 31, 2022 and 2021 were $79.4 million or $3.59 per diluted share and $100.7 million or $4.45 per diluted share, respectively. Our earnings for both the fourth quarter and the full-year 2022 were impacted by the recent announcement of a bankruptcy filing by an Aftermarket customer. We recorded a pre-tax charge of $7.0 million in the fourth quarter related to anticipated losses from this event, which has been treated as a non-operational loss on our GAAP to non-GAAP reconciliation.
Mr. Eric Sills, Standard Motor Products’ Chief Executive Officer and President stated, “We are pleased with our full year sales results, up 5.6% from 2021, with both Engine Management and Temperature Control segments performing well. Against a challenging comparison, sales for the fourth quarter dropped a half a percentage point from the same period last year, which was up nearly 10% from 2020.”
By segment, Engine Management sales increased 4% for the full year, on top of 12% growth in 2021. However, fourth quarter sales were down slightly, just over 1%, versus a very strong 2021, which was up 6% over the prior year. Our customers’ Engine Management POS sales remained robust in the quarter, reflecting continued market strength and demand for our products.
Temperature Control sales remained strong in the fourth quarter on the strength of winter related products and from another long, hot summer. Sales grew 5.2% in the quarter versus last year, and were up nearly 10% for the full year due to a combination of favorable weather, successful pricing initiatives and overall strength in customer demand.
Consolidated operating profit for the quarter, excluding non-operational gains and losses, was 7.9%, in line with the fourth quarter of 2021. Pricing actions taken earlier in 2022, along with various cost reduction initiatives, largely offset ongoing inflationary pressures.
Consolidated operating profit for the full year, excluding non-operational gains and losses, finished at 8.2%, vs. 10.1% in 2021. As we’ve noted many times, 2021 was an anomaly year with many non-recurring benefits associated with emerging from COVID lockdowns while still operating in a very low interest rate environment. Our operating profit of 8.2% was more in line with historical trends despite incurring an additional $20.6 million of customer factoring costs, which negatively affected operating profit by 150 basis points as compared to 2021.
Mr. Sills added, “Today we are announcing our new operating segment, ‘Engineered Solutions’, along with the intent to rename the Engine Management segment to ‘Vehicle Control’. These segment changes, beginning in 2023, will better align the Company’s operating businesses with its strategic focus as well as provide greater clarity into how the Company is positioned to capture growth opportunities of the future. Please see our separate press release on these changes, also distributed today, along with a supplementary presentation available on the Company’s Investor Relations website. We will discuss in more detail on today’s call.”
As we head into 2023, our outlook for the full year includes an expectation that sales will grow in the low single digits and Adjusted EBITDA will be approximately 10%.
In closing, Mr. Sills commented, “While there still remains uncertainty as it relates to the economy and various global dynamics, we believe our end markets’ resiliency and diversification should continue to afford opportunities for new wins and stable levels of growth throughout 2023 and into the future.”
Conference Call
Standard Motor Products, Inc. will hold a conference call at 11:00 AM, Eastern Time, on Wednesday, February 22, 2023. This call will be web cast and can be accessed on the Investor Relations page of our website at www.smpcorp.com and clicking on the SMP Q4'22 Earnings Call Earnings Webcast link. Investors may also listen to the call by dialing 800-343-1703 (domestic) or 785-424-1226 (international). Our playback will be made available for dial in immediately following the call. For those choosing to listen to the replay by webcast, the link should be active on our website within 24 hours after the call. The playback number is 800-723-1517 (domestic) or 402-220-2659 (international). The participant passcode is 73005.
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.
STANDARD MOTOR PRODUCTS, INC.
Consolidated Statements of Operations
(In thousands, except per share amounts)
| THREE MONTHS ENDED<br><br> <br>DECEMBER 31, | TWELVE MONTHS ENDED<br><br> <br>DECEMBER 31, | |||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| 2022 | 2021 | 2022 | 2021 | |||||||||
| (Unaudited) | (Unaudited) | |||||||||||
| NET SALES | $ | 308,199 | $ | 309,877 | $ | 1,371,815 | $ | 1,298,816 | ||||
| COST OF SALES | 218,635 | 221,207 | 989,276 | 921,885 | ||||||||
| GROSS PROFIT | 89,564 | 88,670 | 382,539 | 376,931 | ||||||||
| SELLING, GENERAL & ADMINISTRATIVE EXPENSES | 72,075 | 64,231 | 276,626 | 247,547 | ||||||||
| RESTRUCTURING AND INTEGRATION EXPENSES | 1,847 | 226 | 1,891 | 392 | ||||||||
| OTHER INCOME (EXPENSE), NET | 70 | (1 | ) | 113 | 7 | |||||||
| OPERATING INCOME | 15,712 | 24,212 | 104,135 | 128,999 | ||||||||
| OTHER NON-OPERATING INCOME (EXPENSE), NET | (75 | ) | 1,247 | 4,814 | 3,494 | |||||||
| INTEREST EXPENSE | 4,335 | 672 | 10,617 | 2,028 | ||||||||
| EARNINGS FROM CONTINUING OPERATIONS BEFORE TAXES | 11,302 | 24,787 | 98,332 | 130,465 | ||||||||
| PROVISION FOR INCOME TAXES | 2,799 | 4,729 | 25,206 | 31,044 | ||||||||
| EARNINGS FROM CONTINUING OPERATIONS | 8,503 | 20,058 | 73,126 | 99,421 | ||||||||
| LOSS FROM DISCONTINUED OPERATION, NET OF INCOME TAXES | (615 | ) | (1,328 | ) | (17,691 | ) | (8,467 | ) | ||||
| NET EARNINGS | 7,888 | 18,730 | 55,435 | 90,954 | ||||||||
| NET EARNINGS (LOSS) ATTRIBUTABLE TO NONCONTROLLING INTEREST | (45 | ) | 36 | 84 | 68 | |||||||
| NET EARNINGS ATTRIBUTABLE TO SMP (a) | $ | 7,933 | $ | 18,694 | $ | 55,351 | $ | 90,886 | ||||
| NET EARNINGS ATTRIBUTABLE TO SMP | ||||||||||||
| EARNINGS FROM CONTINUING OPERATIONS | $ | 8,548 | $ | 20,022 | $ | 73,042 | $ | 99,353 | ||||
| LOSS FROM DISCONTINUED OPERATION, NET OF INCOME TAXES | (615 | ) | (1,328 | ) | (17,691 | ) | (8,467 | ) | ||||
| TOTAL | $ | 7,933 | $ | 18,694 | $ | 55,351 | $ | 90,886 | ||||
| NET EARNINGS PER COMMON SHARE ATTRIBUTABLE TO SMP | ||||||||||||
| BASIC EARNINGS FROM CONTINUING OPERATIONS | $ | 0.40 | $ | 0.91 | $ | 3.37 | $ | 4.49 | ||||
| DISCONTINUED OPERATION | (0.03 | ) | (0.06 | ) | (0.82 | ) | (0.39 | ) | ||||
| NET EARNINGS PER COMMON SHARE - BASIC | $ | 0.37 | $ | 0.85 | $ | 2.55 | $ | 4.10 | ||||
| DILUTED EARNINGS FROM CONTINUING OPERATIONS | $ | 0.39 | $ | 0.89 | $ | 3.30 | $ | 4.39 | ||||
| DISCONTINUED OPERATION | (0.03 | ) | (0.06 | ) | (0.80 | ) | (0.37 | ) | ||||
| NET EARNINGS PER COMMON SHARE - DILUTED | $ | 0.36 | $ | 0.83 | $ | 2.50 | $ | 4.02 | ||||
| WEIGHTED AVERAGE NUMBER OF COMMON SHARES | 21,578,194 | 21,987,480 | 21,683,719 | 22,147,479 | ||||||||
| WEIGHTED AVERAGE NUMBER OF COMMON AND DILUTIVE SHARES | 22,030,263 | 22,485,032 | 22,139,981 | 22,616,456 |
(a) "SMP" refers to Standard Motor Products, Inc. and subsidiaries.
STANDARD MOTOR PRODUCTS, INC.
Segment Revenues and Operating Profit
(In thousands)
| THREE MONTHS ENDED<br><br> <br>DECEMBER 31, | TWELVE MONTHS ENDED<br><br> <br>DECEMBER 31, | |||||||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| 2022 | 2021 | 2022 | 2021 | |||||||||||||||||
| (unaudited) | (unaudited) | |||||||||||||||||||
| Revenues | ||||||||||||||||||||
| Ignition, Emission Control, Fuel & Safety | ||||||||||||||||||||
| Related System Products | $ | 206,479 | $ | 211,919 | $ | 824,677 | $ | 786,514 | ||||||||||||
| Wire and Cable | 35,893 | 33,632 | 150,566 | 151,422 | ||||||||||||||||
| Engine Management | 242,372 | 245,551 | 975,243 | 937,936 | ||||||||||||||||
| Compressors | 28,981 | 28,666 | 222,532 | 206,697 | ||||||||||||||||
| Other Climate Control Parts | 34,560 | 31,738 | 159,753 | 141,726 | ||||||||||||||||
| Temperature Control | 63,541 | 60,404 | 382,285 | 348,423 | ||||||||||||||||
| All Other | 2,286 | 3,922 | 14,287 | 12,457 | ||||||||||||||||
| Revenues | $ | 308,199 | $ | 309,877 | $ | 1,371,815 | $ | 1,298,816 | ||||||||||||
| Gross Margin | ||||||||||||||||||||
| Engine Management | $ | 69,099 | 28.5 | % | $ | 67,776 | 27.6 | % | $ | 262,954 | 27.0 | % | $ | 267,285 | 28.5 | % | ||||
| Temperature Control | 16,675 | 26.2 | % | 16,670 | 27.6 | % | 102,640 | 26.8 | % | 95,138 | 27.3 | % | ||||||||
| All Other | 3,790 | 4,270 | 16,945 | 14,832 | ||||||||||||||||
| Subtotal | $ | 89,564 | 29.1 | % | $ | 88,716 | 28.6 | % | $ | 382,539 | 27.9 | % | $ | 377,255 | 29.0 | % | ||||
| One-Time Acquisition Costs | - | 0.0 | % | (46 | ) | 0.0 | % | - | 0.0 | % | (324 | ) | 0.0 | % | ||||||
| Gross Margin | $ | 89,564 | 29.1 | % | $ | 88,670 | 28.6 | % | $ | 382,539 | 27.9 | % | $ | 376,931 | 29.0 | % | ||||
| Selling, General & Administrative | ||||||||||||||||||||
| Engine Management | $ | 42,644 | 17.6 | % | $ | 39,485 | 16.1 | % | $ | 165,389 | 17.0 | % | $ | 149,206 | 15.9 | % | ||||
| Temperature Control | 14,436 | 22.7 | % | 13,192 | 21.8 | % | 68,666 | 18.0 | % | 58,144 | 16.7 | % | ||||||||
| All Other | 7,993 | 11,495 | 35,569 | 38,810 | ||||||||||||||||
| Subtotal | $ | 65,073 | 21.1 | % | $ | 64,172 | 20.7 | % | $ | 269,624 | 19.7 | % | $ | 246,160 | 19.0 | % | ||||
| Customer Bankruptcy Charge | 7,002 | 2.3 | % | - | 0.0 | % | 7,002 | 0.5 | % | - | 0.0 | % | ||||||||
| One-Time Acquisition Costs | - | 0.0 | % | 59 | 0.0 | % | - | 0.0 | % | 1,387 | 0.1 | % | ||||||||
| Selling, General & Administrative | $ | 72,075 | 23.4 | % | $ | 64,231 | 20.7 | % | $ | 276,626 | 20.2 | % | $ | 247,547 | 19.1 | % | ||||
| Operating Income | ||||||||||||||||||||
| Engine Management | $ | 26,455 | 10.9 | % | $ | 28,291 | 11.5 | % | $ | 97,565 | 10.0 | % | $ | 118,079 | 12.6 | % | ||||
| Temperature Control | 2,239 | 3.5 | % | 3,478 | 5.8 | % | 33,974 | 8.9 | % | 36,994 | 10.6 | % | ||||||||
| All Other | (4,203 | ) | (7,225 | ) | (18,624 | ) | (23,978 | ) | ||||||||||||
| Subtotal | $ | 24,491 | 7.9 | % | $ | 24,544 | 7.9 | % | $ | 112,915 | 8.2 | % | $ | 131,095 | 10.1 | % | ||||
| Customer Bankruptcy Charge | (7,002 | ) | -2.3 | % | - | 0.0 | % | (7,002 | ) | -0.5 | % | - | 0.0 | % | ||||||
| One-Time Acquisition Costs | - | 0.0 | % | (105 | ) | 0.0 | % | - | 0.0 | % | (1,711 | ) | -0.1 | % | ||||||
| Restructuring & Integration | (1,847 | ) | -0.6 | % | (226 | ) | -0.1 | % | (1,891 | ) | -0.1 | % | (392 | ) | 0.0 | % | ||||
| Other Income (Expense), Net | 70 | 0.0 | % | (1 | ) | 0.0 | % | 113 | 0.0 | % | 7 | 0.0 | % | |||||||
| Operating Income | $ | 15,712 | 5.1 | % | $ | 24,212 | 7.8 | % | $ | 104,135 | 7.6 | % | $ | 128,999 | 9.9 | % |
STANDARD MOTOR PRODUCTS, INC.
Reconciliation of GAAP and Non-GAAP Measures
(In thousands, except per share amounts)
| THREE MONTHS ENDED<br><br> <br>DECEMBER 31, | TWELVE MONTHS ENDED<br><br> <br>DECEMBER 31, | |||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| 2022 | 2021 | 2022 | 2021 | |||||||||
| (Unaudited) | (Unaudited) | |||||||||||
| EARNINGS FROM CONTINUING OPERATIONS ATTRIBUTABLE TO SMP | ||||||||||||
| GAAP EARNINGS FROM CONTINUING OPERATIONS | $ | 8,548 | $ | 20,022 | $ | 73,042 | $ | 99,353 | ||||
| RESTRUCTURING AND INTEGRATION EXPENSES | 1,847 | 226 | 1,891 | 392 | ||||||||
| CUSTOMER BANKRUPTCY CHARGE | 7,002 | - | 7,002 | - | ||||||||
| ONE-TIME ACQUISITION COSTS | - | 105 | - | 1,711 | ||||||||
| CERTAIN TAX CREDITS AND PRODUCTION DEDUCTIONS FINALIZED IN PERIOD | - | - | (249 | ) | (259 | ) | ||||||
| INCOME TAX EFFECT RELATED TO RECONCILING ITEMS | (2,301 | ) | (86 | ) | (2,312 | ) | (547 | ) | ||||
| NON-GAAP EARNINGS FROM CONTINUING OPERATIONS | $ | 15,096 | $ | 20,267 | $ | 79,374 | $ | 100,650 | ||||
| DILUTED EARNINGS PER SHARE FROM CONTINUING OPERATIONS ATTRIBUTABLE TO SMP | ||||||||||||
| GAAP DILUTED EARNINGS PER SHARE FROM CONTINUING OPERATIONS | $ | 0.39 | $ | 0.89 | $ | 3.30 | $ | 4.39 | ||||
| RESTRUCTURING AND INTEGRATION EXPENSES | 0.08 | 0.01 | 0.08 | 0.02 | ||||||||
| CUSTOMER BANKRUPTCY CHARGE | 0.32 | - | 0.32 | - | ||||||||
| ONE-TIME ACQUISITION COSTS | - | - | - | 0.07 | ||||||||
| CERTAIN TAX CREDITS AND PRODUCTION DEDUCTIONS FINALIZED IN PERIOD | - | - | (0.01 | ) | (0.01 | ) | ||||||
| INCOME TAX EFFECT RELATED TO RECONCILING ITEMS | (0.10 | ) | - | (0.10 | ) | (0.02 | ) | |||||
| NON-GAAP DILUTED EARNINGS PER SHARE FROM CONTINUING OPERATIONS | $ | 0.69 | $ | 0.90 | $ | 3.59 | $ | 4.45 | ||||
| OPERATING INCOME | ||||||||||||
| GAAP OPERATING INCOME | $ | 15,712 | $ | 24,212 | $ | 104,135 | $ | 128,999 | ||||
| RESTRUCTURING AND INTEGRATION EXPENSES | 1,847 | 226 | 1,891 | 392 | ||||||||
| CUSTOMER BANKRUPTCY CHARGE | 7,002 | - | 7,002 | - | ||||||||
| ONE-TIME ACQUISITION COSTS | - | 105 | - | 1,711 | ||||||||
| OTHER (INCOME) EXPENSE, NET | (70 | ) | 1 | (113 | ) | (7 | ) | |||||
| NON-GAAP OPERATING INCOME | $ | 24,491 | $ | 24,544 | $ | 112,915 | $ | 131,095 | ||||
| EBITDA WITHOUT SPECIAL ITEMS | ||||||||||||
| GAAP EARNINGS FROM CONTINUING OPERATIONS BEFORE TAXES | $ | 11,302 | $ | 24,787 | $ | 98,332 | $ | 130,465 | ||||
| DEPRECIATION AND AMORTIZATION | 7,403 | 7,083 | 28,298 | 27,243 | ||||||||
| INTEREST EXPENSE | 4,335 | 672 | 10,617 | 2,028 | ||||||||
| EBITDA | 23,040 | 32,542 | 137,247 | 159,736 | ||||||||
| RESTRUCTURING AND INTEGRATION EXPENSES | 1,847 | 226 | 1,891 | 392 | ||||||||
| CUSTOMER BANKRUPTCY CHARGE | 7,002 | - | 7,002 | - | ||||||||
| ONE-TIME ACQUISITION COSTS | - | 105 | - | 1,711 | ||||||||
| SPECIAL ITEMS | 8,849 | 331 | 8,893 | 2,103 | ||||||||
| EBITDA WITHOUT SPECIAL ITEMS | $ | 31,889 | $ | 32,873 | $ | 146,140 | $ | 161,839 |
MANAGEMENT BELIEVES THAT NON-GAAP EARNINGS FROM CONTINUING OPERATIONS AND NON-GAAP DILUTED EARNINGS PER SHARE FROM CONTINUING OPERATIONS WHICH ARE ATTRIBUTABLE TO SMP, AND NON-GAAP OPERATING INCOME AND EBITDA WITHOUT SPECIAL ITEMS, EACH OF WHICH ARE NON-GAAP MEASUREMENTS AND ARE ADJUSTED FOR SPECIAL ITEMS, ARE MEANINGFUL TO INVESTORS BECAUSE THEY PROVIDE A VIEW OF THE COMPANY WITH RESPECT TO ONGOING OPERATING RESULTS. SPECIAL ITEMS REPRESENT SIGNIFICANT CHARGES OR CREDITS THAT ARE IMPORTANT TO AN UNDERSTANDING OF THE COMPANY'S OVERALL OPERATING RESULTS IN THE PERIODS PRESENTED. SUCH NON-GAAP MEASUREMENTS ARE NOT RECOGNIZED IN ACCORDANCE WITH GENERALLY ACCEPTED ACCOUNTING PRINCIPLES AND SHOULD NOT BE VIEWED AS AN ALTERNATIVE TO GAAP MEASURES OF PERFORMANCE.
STANDARD MOTOR PRODUCTS, INC.
Condensed Consolidated Balance Sheets
(In thousands)
| December 31,<br><br> <br>2022 | December 31,<br><br> <br>2021 | |||
|---|---|---|---|---|
| (Unaudited) | ||||
| ASSETS | ||||
| CASH | $ | 21,150 | $ | 21,755 |
| ACCOUNTS RECEIVABLE, GROSS | 173,013 | 186,774 | ||
| ALLOWANCE FOR EXPECTED CREDIT LOSSES | 5,375 | 6,170 | ||
| ACCOUNTS RECEIVABLE, NET | 167,638 | 180,604 | ||
| INVENTORIES | 528,715 | 468,755 | ||
| UNRETURNED CUSTOMER INVENTORY | 19,695 | 22,268 | ||
| OTHER CURRENT ASSETS | 25,241 | 17,823 | ||
| TOTAL CURRENT ASSETS | 762,439 | 711,205 | ||
| PROPERTY, PLANT AND EQUIPMENT, NET | 107,148 | 102,786 | ||
| OPERATING LEASE RIGHT-OF-USE ASSETS | 49,838 | 40,469 | ||
| GOODWILL | 132,087 | 131,652 | ||
| OTHER INTANGIBLES, NET | 100,504 | 106,234 | ||
| DEFERRED INCOME TAXES | 33,658 | 36,126 | ||
| INVESTMENT IN UNCONSOLIDATED AFFILIATES | 41,745 | 44,087 | ||
| OTHER ASSETS | 27,510 | 25,402 | ||
| TOTAL ASSETS | $ | 1,254,929 | $ | 1,197,961 |
| LIABILITIES AND STOCKHOLDERS' EQUITY | ||||
| CURRENT PORTION OF REVOLVING CREDIT FACILITY | $ | 50,000 | $ | 125,298 |
| CURRENT PORTION OF TERM LOAN AND OTHER DEBT | 5,031 | 3,117 | ||
| ACCOUNTS PAYABLE | 89,247 | 137,167 | ||
| ACCRUED CUSTOMER RETURNS | 37,169 | 42,412 | ||
| ACCRUED CORE LIABILITY | 22,952 | 23,663 | ||
| ACCRUED REBATES | 37,381 | 42,472 | ||
| PAYROLL AND COMMISSIONS | 31,361 | 45,058 | ||
| SUNDRY PAYABLES AND ACCRUED EXPENSES | 49,990 | 57,182 | ||
| TOTAL CURRENT LIABILITIES | 323,131 | 476,369 | ||
| OTHER LONG-TERM DEBT | 184,589 | 21 | ||
| NONCURRENT OPERATING LEASE LIABILITY | 40,709 | 31,206 | ||
| ACCRUED ASBESTOS LIABILITIES | 63,305 | 52,698 | ||
| OTHER LIABILITIES | 22,157 | 25,040 | ||
| TOTAL LIABILITIES | 633,891 | 585,334 | ||
| TOTAL SMP STOCKHOLDERS' EQUITY | 610,020 | 601,580 | ||
| NONCONTROLLING INTEREST | 11,018 | 11,047 | ||
| TOTAL STOCKHOLDERS' EQUITY | 621,038 | 612,627 | ||
| TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY | $ | 1,254,929 | $ | 1,197,961 |
STANDARD MOTOR PRODUCTS, INC.
Condensed Consolidated Statements of Cash Flows
(In thousands)
| TWELVE MONTHS ENDED<br><br> <br>DECEMBER 31, | ||||||
|---|---|---|---|---|---|---|
| 2022 | 2021 | |||||
| (Unaudited) | ||||||
| CASH FLOWS FROM OPERATING ACTIVITIES | ||||||
| NET EARNINGS | $ | 55,435 | $ | 90,954 | ||
| ADJUSTMENTS TO RECONCILE NET EARNINGS TO NET CASH | ||||||
| PROVIDED BY (USED IN) OPERATING ACTIVITIES: | ||||||
| DEPRECIATION AND AMORTIZATION | 28,298 | 27,243 | ||||
| LOSS FROM DISCONTINUED OPERATIONS, NET OF TAXES | 17,691 | 8,467 | ||||
| CUSTOMER BANKRUPTCY CHARGE | 7,002 | - | ||||
| OTHER | 13,064 | 7,456 | ||||
| CHANGE IN ASSETS AND LIABILITIES: | ||||||
| ACCOUNTS RECEIVABLE | 6,916 | 28,464 | ||||
| INVENTORY | (67,495 | ) | (107,609 | ) | ||
| ACCOUNTS PAYABLE | (48,604 | ) | 33,046 | |||
| PREPAID EXPENSES AND OTHER CURRENT ASSETS | (5,509 | ) | (843 | ) | ||
| SUNDRY PAYABLES AND ACCRUED EXPENSES | (29,089 | ) | 13,430 | |||
| OTHER | (5,242 | ) | (15,044 | ) | ||
| NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES | (27,533 | ) | 85,564 | |||
| CASH FLOWS FROM INVESTING ACTIVITIES | ||||||
| ACQUISITIONS OF AND INVESTMENTS IN BUSINESSES | (1,934 | ) | (125,419 | ) | ||
| CAPITAL EXPENDITURES | (25,956 | ) | (25,875 | ) | ||
| OTHER INVESTING ACTIVITIES | 73 | 45 | ||||
| NET CASH USED IN INVESTING ACTIVITIES | (27,817 | ) | (151,249 | ) | ||
| CASH FLOWS FROM FINANCING ACTIVITIES | ||||||
| NET CHANGE IN DEBT | 111,307 | 118,346 | ||||
| PURCHASE OF TREASURY STOCK | (29,656 | ) | (26,862 | ) | ||
| DIVIDENDS PAID | (23,428 | ) | (22,179 | ) | ||
| DIVIDENDS PAID TO NONCONTROLLING INTEREST | - | (540 | ) | |||
| PAYMENTS OF DEBT ISSUANCE COSTS | (2,128 | ) | - | |||
| OTHER FINANCING ACTIVITIES | (595 | ) | 247 | |||
| NET CASH PROVIDED BY FINANCING ACTIVITIES | 55,500 | 69,012 | ||||
| EFFECT OF EXCHANGE RATE CHANGES ON CASH | (755 | ) | (1,060 | ) | ||
| NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS | (605 | ) | 2,267 | |||
| CASH AND CASH EQUIVALENTS at beginning of period | 21,755 | 19,488 | ||||
| CASH AND CASH EQUIVALENTS at end of period | $ | 21,150 | $ | 21,755 |
Exhibit 99.2
For Immediate Release
Standard Motor Products, Inc. Announces Segment Reporting Changes
New Engineered Solutions Segment Focused on Diverse Non-Aftermarket End Markets
Engine Management Segment Renamed Vehicle Control to Reflect Current Product Suite
Additional Details in Today’s Fourth Quarter Financial Results Call
New York, NY, February 22, 2023......Standard Motor Products, Inc. (NYSE: SMP) (the “Company”), a leading automotive parts manufacturer and distributor, today announced its new operating segment, “Engineered Solutions,” along with the intent to rename its Engine Management segment to “Vehicle Control”. These segment changes, beginning in 2023, will better align the Company’s operating categories with its strategic focus as well as provide greater clarity into how the Company is positioned to capture growth opportunities of the future. Management will discuss the resegmentation in depth during the Company’s fourth quarter and full year 2022 earnings call today at 11:00 AM Eastern Time. A revised investor presentation along with a supplementary resegmentation presentation are available on the Company’s Investor Relations website.
Highlights of the Resegmentation
| • | New Engineered Solutions segment will focus on non-Aftermarket end markets, including both on-highway (commercial and light vehicles) and off-highway (construction, agriculture, power<br> sports, and other) applications |
|---|---|
| • | Elevates overall growth profile and opportunity for the Company while also diversifying revenue mix and cash flow generation |
| --- | --- |
| • | New segment will be carved from existing two segments, Engine Management and Temperature Control, which will now solely represent sales to Aftermarket channels |
| --- | --- |
| • | Supports the Company’s ongoing focus as a best-in-class supplier of premium replacement parts products to the North American Aftermarket |
| --- | --- |
| • | Offers clarity to the unique dynamics and margin profiles of the markets served by each segment with detailed segment financial reporting beginning in Q1’23 |
| --- | --- |
| • | Engine Management to be renamed “Vehicle Control” to reflect the expanding portfolio including powertrain-neutral product categories |
| --- | --- |
“The resegmentation of Standard Motor Products marks an important development in our company’s 100-year history as a leader in vehicle technologies,” said Mr. Eric Sills, Standard Motor Products’ Chief Executive Officer and President. “I am pleased to unveil our three complementary business segments – Engineered Solutions, Vehicle Control, and Temperature Control – which will let SMP’s stakeholders better track the performance and focus of our business. These segments will allow us to penetrate diverse end markets while continuing to provide customers with best-in-class products and services.
“The Aftermarket has been and will continue to be the heart of our business. It is a robust industry demonstrating tremendous stability and resiliency and has a very bright future. Our value proposition of being the best full-line full-service supplier of premium products continues to be very well received by our broad customer base. We remain steadfastly committed to the Aftermarket as a primary driver of our business.
“Meanwhile, over the past several years we have aggressively grown our sales to non-Aftermarket customers, focusing on diverse on-highway and off-highway end markets. We believe this has reached the critical mass to become a standalone operating segment. Through strategic acquisitions and organic growth, we achieved 2022 sales of $270 million, and broadened our market access with expanded product capabilities, collective customer lists, and global reach. This combination will provide significant cross-selling opportunities which are beginning to bear fruit. As we build our presence, we expect strong growth potential due to the diversity of the end markets and the breadth of our offerings and capabilities.
“Concurrent with the resegmentation, we are launching a new Engineered Solutions website, http://www.SMPEngineeredSolutions.com, which will provide customers with commercial and technical information, as well as a full suite of our product capabilities across all the industries and markets we serve.”
Additional detail on the three business segments:
Engineered Solutions –This new segment focuses on custom-engineered solutions to vehicle and equipment manufacturers across diverse global end markets, including both on-highway and off-highway applications such as commercial vehicles, construction and agricultural equipment, power sports, and others. Our offerings include product categories from both of our legacy operating segments and provide a broad array of conventional and future-oriented technologies, including those that are specific to vehicle electrification and those that are powertrain-neutral.
Vehicle Control – To more accurately reflect the evolution of the products and categories SMP offers, and the future areas of product growth including powertrain-neutral and electrification-specific offerings, the Company will rename its “Engine Management” segment to “Vehicle Control”. The three subcategories are:
| • | “Ignition, Emissions, & Fuel” will include internal combustion engine (ICE) related categories |
|---|---|
| • | “Wire Sets & Other” will include spark plug wire sets and other related products |
| --- | --- |
| • | “Electrical & Safety” will include non-ICE related conventional and evolving vehicle technologies |
| --- | --- |
Temperature Control – This legacy Aftermarket business segment is poised to benefit from the broader adoption of more complex air conditioning systems that provide passenger comfort regardless of the vehicle’s powertrain propulsion, and from systems being developed to manage the temperature of batteries and other products used on electric vehicles. The two subcategories are:
| • | “A/C System Components” includes compressors, connecting lines, heat exchangers, and expansion devices which comprise the parts found in a vehicle’s air conditioning system |
|---|---|
| • | “Other Thermal Components” includes parts that provide engine, transmission, electric drive motor, and battery temperature management |
| --- | --- |
Conference Call
Standard Motor Products, Inc. will hold a conference call at 11:00 AM, Eastern Time, on Wednesday, February 22, 2023. This call will be web cast and can be accessed on the Investor Relations page of our website at www.smpcorp.com and clicking on the SMP Q4'22 Earnings Call Earnings Webcast link. Investors may also listen to the call by dialing 800-343-1703 (domestic) or 785-424-1226 (international). Our playback will be made available for dial in immediately following the call. For those choosing to listen to the replay by webcast, the link should be active on our website within 24 hours after the call. The playback number is 800-723-1517 (domestic) or 402-220-2659 (international). The participant passcode is 73005.
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.
For more information, contact:
Anthony (Tony) Cristello
Standard Motor Products, Inc.
(972) 316-8107
tony.cristello@smpcorp.com
Source: Standard Motor Products, Inc.
Exhibit 99.3
Standard Motor Products, Inc. Q4 Investor Presentation February 22, 2023 1
Standard Motor Products, Inc. Q4 Investor Presentation February 22, 2023 1
Safe Harbor – Forward Looking Statements 2 You should be aware that except for historical information, the matters discussed herein are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward looking statements, including projections and anticipated levels of future performance, are based on current information and assumptions and involve risks and uncertainties which may cause actual results to differ materially from those discussed herein. In addition, we use metrics such as Adjusted EBITDA and Income from Operations without Special Items throughout this presentation, which are non-GAAP measures. You are urged to review all of our filings with the SEC and our press releases from time to time for details of risks and uncertainties that could cause future performance to vary from the expectations expressed or implied by the forward-looking statements herein and for certain reconciliations of GAAP to non-GAAP results.
Consistent Dividend Growth Consistent Revenue Growth 2022 Sales Mix by Segment SMP Corporate Snapshot 3 Founded:1919 HQ: Long Island City, NY Locations: 32 Globally Employees: 6,100* 2022 Financial Highlights Revenue: $1.37B Aftermarket: $1.1B Vehicle Control $751M Temperature Control: $351M Engineered Solutions: $270M EBITDA**: 10.7% Dividend Yield: 2.8% 2022 EBITDA** Mix by Segment *includes JVs CAGR: 11% * Dividend paid out for two quarters only due to COVID-19 pandemic **reflects adjusted EBITDA which is a non-GAAP financial measure; see reconciliation in appendix
Global Footprint with Customer Adjacency 4
Strategy Overview 5
Automotive Aftermarket Engineered Solutions Sustainability & Continuous Improvement Capital Allocation Continued leadership in North American Aftermarket Best-in-class, full-line, full-service supplier of premium products within our categories Innovative product solutions for multiple On-Highway and Off-Highway vehicle markets Leveraging our diverse customer relationships, engineering capabilities, operational skills, and global footprint Commitment to ongoing ESG and DEI initiatives Operational excellence in manufacturing, product development, and supply chain Capital investment supports future growth Take advantage of opportunistic M&A Effectively balance our use of debt and equity Dividends and stock repurchases Strategic Objectives 6
Aftermarket Snapshot 7 Aftermarket Net Sales 2022 Aftermarket Sales Mix Nationally Recognized Brands Supplier to All Major Distributors Aftermarket EBITDA* & Margin% *reflects adjusted EBITDA which is a non-GAAP financial measure; see reconciliation in appendix
8 To be the best full-line, full-service supplier of premium vehicle control and temperature control products Value Proposition Aftermarket Strategy Our suite of products and services is designed to provide all the needed support for our customer and the technicians who install our parts
Source: 2023 Auto Care Factbook, 2022 S&P Global Mobility (formerly IHS Markit) Favorable Aftermarket Industry Trends 9 Car Parc Continues to Age U.S. Light Vehicle Parc Number of Repairable Vehicles Continue to Climb DIFM Revenue Continues to Grow Source: Auto Care Association / Modern Tire Dealer Source: Auto Care Association / IHS Markit Source: Auto Care Association / IHS Markit +3% increase “Sweet Spot” a foundation for growth over next 5-10 years Millions Years
Committed to Growing Technologies 10 DEGREE OF COMPLEXITY TECHNOLOGY EVOLUTION SMP evolves to meet the advanced automotive technology of today and tomorrow ADVANCED INTERNAL COMBUSTION ENGINE COMPONENTS ADVANCED HEV, EV, AND POWERTRAIN-NEUTRAL COMPONENTS POWER MANAGEMENT COMMUNICATIONS ADAS ALTERNATIVE ENERGY SENSORS SWITCHES IGNITION SYSTEM EMISSION CONTROLS, VVT & EVAP SYSTEMS DIESEL FUEL SYSTEM AIRFLOW MANAGEMENT OIL TEMP CONTROL VEHICLE ACTUATORS & MOTORS A/C COMPONENTS AUXILIARY COOLING ELECTRIC & HYBRID COMPRESSORS DOOR & WINDOW COMPONENTS ADVANCED A/C COMPONENTS HVAC ACTUATORS & MOTORS ENGINE COOLING
Vehicle Control Segment 11 Ignition, Emission & Fuel Electrical & Safety Wire Sets & Other Powertrain Neutral, Hybrid & EV Specific Traditional and Advanced ICE Categories Variable Valve Timing Components Ignition Coils Turbochargers Electronic Throttle Bodies Gasoline and Diesel Injection Emission Controls Air & Fuel Sensors & Switches Many other categories Growing categories used on all vehicles regardless if they are gas, diesel, hybrid or electric 165+ Powertrain Neutral Categories ADAS (Advance Driver Assist Systems) TPMS Sensors Electrical Connectors Fluid Level & Temperature Sensors Electrical Switches & Relays Door, Trunk and Hood Lock Actuators Hundreds of other categories Conventional Wire & Cable categories for ICE vehicles Ignition Wire Sets Coil-on-Plug Boots Wire Leads Wire Terminals $231M ‘22 Net Sales 31% of Segment ICE-Related1 ICE-Related $455M ‘22 Net Sales 60% of Segment $66M ‘22 Net Sales 9% of Segment 1 ICE: Internal Combustion Engine
Temperature Control Segment Favorably impacted by electrification Most product categories are powertrain-neutral or electrification-specific A/C Compressors transition to year-round operation (battery cooling) 12 Most interior heating and cooling components remain the same for ICE and Hybrid / EV vehicles Fan Clutches Electric Thermal Pumps Battery Cooling Fan Motors Liquid Cooled Heat Exchangers Other Thermal Components Provide engine, transmission, electric drive, and battery temperature management A/C Compressors Accumulators Evaporators Blend Door Actuators Expansion Devices A/C System Components $245M Net Sales (70% in 2022) $106M Net Sales (30% in 2022)
Engineered Solutions Snapshot 13 Commercial Vehicle - $80M Light Vehicle - $92M All Other - $56M Construction / Agriculture - $42M Engineered Solutions Net Sales Engineered Solutions EBITDA & Margin% *reflects adjusted EBITDA which is a non-GAAP financial measure; see reconciliation in appendix
Engineered Solutions Opportunities 14 Increasing Demand Market Expansion Growth Collaboration Broadens the Company’s target opportunities across multiple industries with new end markets Sales driver as new segment has potential for expanded long-term growth rates Supports and expands SMP’s Aftermarket position through sharing technologies and engineering expertise 2022 Global Sales Diverse Customer Mix *excludes non-controlled JV sales to third parties Diversification Diverse end markets, geographies, and customers
New Product Development Diversification Market Expansion M&A Opportunities Sales Support Customer Service Engineering Technical Resources Adaptable development and manufacturing for unique and specific requirements Advanced quality systems Committed to continuous improvement Focused Growth Global Reach with Local Support Customizable Designs World Class Manufacturing An extensive portfolio of adaptable products and a global network of resources positioned to serve a diverse customer base Engineered Solutions Strategy 15
16 Construction & Agriculture Engineered Solutions Markets Commercial Vehicle Hydraulics & Industrial Powersports Light Vehicle Outdoor Power Equipment
Engineered Solutions Products 17 Electronics SMPEngineeredSolutions.com Thermal Management Sensors Switches Power Distribution Ignition & Emission Injection & Fuel Delivery Clamping
Optimized Supply Chain Commitment to Manufacturing Basic manufacturer with 12 manufacturing facilities 13 design and development centers Diverse low-cost footprint Global sourcing and supplier development Expansive distribution network Operational Excellence Manufacturing by Geography 18
2013 2013 2014 2014 2014 2016 2017 2019 2019 2021 2021 2021 2022 Aftermarket Engineered
Solutions New Products / Technology Vertical Integration Geographic
Expansion Strategic Acquisitions 19 Target technologies, products, and processes: Align with our core competencies Diversification plays in adjacent markets or technologies Servicing common
customers and markets Consolidating competitors or suppliers Synergistic product line carve-outs that enhance our capabilities Vertical integration of key technologies
Sustainability 20 SMP is committed to ongoing ESG and DE&I initiatives We believe in being a good corporate citizen We are committed to our company, our employees, our shareholders, our business partners, and our communities Environmental Ambition to achieve net-zero by 2050 Established Scope 1 + Scope 2 GHG emission reduction targets Expanded product offering to reduce emissions and improve fuel economy Transitioning sales fleet to hybrid vehicles Social Increased diversity in hiring and promotion of our workforce Safety protocols leading to low incidence of injuries Financial support of community organizations, scholarship providers and Ukranian refugees Employee development programs Governance Board of Directors oversight of ESG strategy Increased diversity of our Board of Directors Code of Ethics enforces a culture of compliance Independently run whistle-blower hotline Stock ownership guidelines align with shareholder interests
Return to Shareholders 21 Share Repurchase Program * Dividend paid out for two quarters only due to COVID-19 pandemic 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 Period Total Spend ($000's) $4,136 $4,999 $6,864 $10,000 $19,623 $377 $24,376 $14,886 $10,738 $13,482 $26,862 $29,656 $166,000 Shares ($000's) 322 381 210 284 552 10 531 323 222 324 622 692 4,473 Avg. Price $12.85 $13.13 $32.69 $35.18 $35.56 $37.24 $45.92 $46.12 $48.43 $41.63 $43.17 $42.86 $37.11 Quarterly Dividends
SMP Cash Utilization 22 Total Utilization This is an image Cash Allocation % Capex & M&A 79% 59% 70% 35% 85% 43% 47% 66% 42% 76% 34% Dividends & Repurchases 21% 41% 30% 65% 15% 57% 53% 34% 58% 24% 66%
Engineered Solutions provides diversified and fast growth potential across new opportunities Strong financial results with healthy cash flow generation Leader in Aftermarket with significant share; generating consistent annual growth Longstanding business led by experienced management team Commitment to corporate and social responsibility Disciplined capital allocation strategy driving organic and inorganic growth with improving ROIC Why Invest in SMP 23
Full Year 2022 Financial Results 24
Year-Over-Year Performance Measures 25 Consolidated Net Sales ($M) Operating Profit EBITDA ($M & % Net Sales) ‡ Operating Profit, EBITDA and Diluted EPS shown without Special Items UP 5.6% $1,128.6 $1,298.8 Diluted EPS
Income Statement Non-GAAP 26
Condensed Balance Sheet 27
Condensed Statement of Cash Flows 28
Appendix 29
Reconciliation of GAAP and Non-GAAP Measures 30
Reconciliation of GAAP and Non-GAAP Measures (cont’d) 31
Thank you For more information, contact: Anthony (Tony) Cristello Standard Motor Products, Inc. (972) 316-8107 tony.cristello@smpcorp.com
Exhibit 99.4
Standard Motor Products, Inc. Resegmentation Announcement February 22, 2023
Safe Harbor – Forward Looking Statements 2 You should be aware that except for historical information, the matters discussed herein are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward looking statements, including projections and anticipated levels of future performance, are based on current information and assumptions and involve risks and uncertainties which may cause actual results to differ materially from those discussed herein. In addition, we use metrics such as Adjusted EBITDA and Income from Operations without Special Items throughout this presentation, which are non-GAAP measures. You are urged to review all of our filings with the SEC and our press releases from time to time for details of risks and uncertainties that could cause future performance to vary from the expectations expressed or implied by the forward-looking statements herein and for certain reconciliations of GAAP to non-GAAP results.
Announcing New Operating Segment Renaming the Engine Management Segment To better align the Company’s operating categories with its strategic focus and more accurately reflect the evolution of the products and categories SMP offers Providing Greater Clarity Provides greater clarity into how the Company is positioned to capture growth opportunities including powertrain-neutral and electrification-specific offerings New Alignment with Strategic Focus This new segment focuses on custom designed parts for vehicle and equipment manufacturers (OEMs) across diverse global end markets New Subcategories Vehicle Control 3
Broadens the Company’s target opportunities for manufacturers across multiple industries with new end markets Market Expansion Sales driver as new segment has potential for long-term organic growth Growth Provides better visibility of the unique dynamics and margin profiles across segments Clarity Supports and expands SMP’s aftermarket position through sharing technologies and engineering expertise Collaboration Greater Visibility Into Our Performance 4
SMP Segment Transition Snapshot 5 Engine Management 73% Sales Mix Prior 2022 Segments New 2023 Segments (2022 Sales) Temperature Control 27% Sales Mix Vehicle Control 55% Total Sales Mix Engineered Solutions 20% Total Sales Mix Temperature Control 25% Total Sales Mix Vehicle Control and Temperature Control are Aftermarket Only
Aftermarket Snapshot 6 Aftermarket Net Sales 2022 Aftermarket Sales Mix Nationally Recognized Brands Supplier to All Major Distributors Aftermarket EBITDA* & Margin% *reflects adjusted EBITDA which is a non-GAAP financial measure; see reconciliation in appendix
Engineered Solutions Snapshot 7 Commercial Vehicle - $80M Light Vehicle - $92M All Other - $56M Construction / Agriculture - $42M Engineered Solutions Net Sales Engineered Solutions EBITDA* & Margin% *reflects adjusted EBITDA which is a non-GAAP financial measure; see reconciliation in appendix
New Product Development Diversification Market Expansion M&A Opportunities Sales Support Customer Service Engineering Technical Resources Adaptable development and manufacturing for unique and specific requirements Advanced quality systems Committed to continuous improvement Focused Growth Global Reach with Local Support Customizable Designs World Class Manufacturing An extensive portfolio of adaptable products and a global network of resources positioned to serve a diverse customer base Engineered Solutions Strategy 8
Engineered Solutions provides diversified and fast growth potential across new opportunities Strong financial results with healthy cash flow generation Leader in Aftermarket with significant share; generating consistent annual growth Longstanding business led by experienced management team Commitment to corporate and social responsibility Disciplined capital allocation strategy driving organic and inorganic growth with improving ROIC Why Invest in SMP 9
Appendix
Segment Reporting - Annual Sales and Profit by Segment 11 2021 2022 Vehicle Control Temperature Control Engineered Solutions Other Total Vehicle Control Temperature Control Engineered Solutions Other Total Net Sales 737,431 324,080 237,305 - 1,298,816 750,571 351,237 270,007 - 1,371,815 Net Sales % of total 53.8% 23.6% 17.3% 100.0% 54.7% 25.6% 19.7% 100.0% Gross Margin 238,790 91,738 46,727 - 377,255 232,267 98,913 51,359 - 382,539 32.4% 28.3% 19.7% 29.0% 30.9% 28.2% 19.0% 27.9% Operating Expenses 141,373 61,664 26,421 16,702 246,160 151,596 70,192 32,646 15,190 269,624 19.2% 19.0% 11.1% 19.0% 20.2% 20.0% 12.1% 19.7% Operating Profit 97,417 30,074 20,306 (16,702) 131,095 80,671 28,721 18,713 (15,190) 112,915 13.2% 9.3% 8.6% 10.1% 10.7% 8.2% 6.9% 8.2% Adjusted EBITDA 111,234 35,461 30,136 (14,992) 161,839 95,961 33,593 30,465 (13,879) 146,140 15.1% 10.9% 12.7% 12.5% 12.8% 9.6% 11.3% 10.7% Note: All operating results provided except for revenues are on a non-GAAP basis. See GAAP to non-GAAP reconciliation later in the Appendix. Years ending December 31
Segment Reporting - Mix by Segment 12 2021 2022 Total Aftermarket - % by category Q1'21 Q2'21 Q3'21 Q4'21 FY 2021 Q1'22 Q2'22 Q3'22 Q4'22 FY 2022 Ignition, Emissions & Fuel 44.6% 39.6% 37.0% 47.8% 41.8% 43.6% 38.3% 37.4% 47.4% 41.3% Electrical & Safety 22.9% 19.2% 19.4% 23.8% 21.2% 20.9% 19.6% 20.3% 23.4% 20.9% Wire Sets & Other 8.1% 6.0% 5.8% 6.3% 6.5% 6.3% 5.9% 5.1% 6.7% 5.9% Vehicle Control Total 75.6% 64.9% 62.2% 77.9% 69.5% 70.8% 63.7% 62.7% 77.5% 68.1% AC System Components 15.8% 27.5% 28.8% 12.4% 21.8% 18.9% 28.0% 28.7% 10.7% 22.3% Other Thermal Components 8.6% 7.6% 9.0% 9.7% 8.7% 10.3% 8.2% 8.6% 11.8% 9.6% Temperature Control Total 24.4% 35.1% 37.8% 22.1% 30.5% 29.2% 36.3% 37.3% 22.5% 31.9% Aftermarket Total 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% Engineered Solutions - % by category Commercial Vehicle 33.8% 29.4% 32.9% 32.4% 32.1% 29.6% 28.7% 29.1% 31.7% 29.7% Construction / Agriculture 14.2% 13.4% 14.0% 14.5% 14.0% 15.1% 16.5% 16.6% 14.6% 15.7% Light Vehicle 44.3% 43.4% 31.3% 29.9% 36.4% 36.0% 33.9% 32.3% 33.2% 33.9% All Other 7.7% 13.9% 21.9% 23.2% 17.5% 19.3% 20.9% 22.0% 20.6% 20.7% Total 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% Years ending December 31
Segment Reporting - Vehicle Control By Quarter 13 2021 2022 Q1'21 Q2'21 Q3'21 Q4'21 FY 2021 Q1'22 Q2'22 Q3'22 Q4'22 FY 2022 Ignition, Emissions & Fuel $ 103,032 $ 112,107 $ 111,036 $ 118,021 $ 444,196 $ 109,149 $ 111,581 $ 117,750 $ 116,091 $ 454,571 Electrical & Safety 52,985 54,388 58,284 58,863 224,520 52,257 57,054 63,867 57,309 230,487 Wire Sets & Other 18,713 17,002 17,468 15,532 68,715 15,858 17,137 16,081 16,437 65,513 Net Sales 174,730 183,497 186,788 192,416 737,431 177,264 185,772 197,698 189,837 750,571 Gross Margin 58,008 59,126 59,292 62,364 238,790 55,424 53,728 60,350 62,765 232,267 Gross Margin % 33.2% 32.2% 31.7% 32.4% 32.4% 31.3% 28.9% 30.5% 33.1% 30.9% Operating Expenses 33,481 35,910 35,902 36,080 141,373 35,039 37,679 39,229 39,649 151,596 Operating Expense % 19.2% 19.6% 19.2% 18.8% 19.2% 19.8% 20.3% 19.8% 20.9% 20.2% Operating Profit $ 24,527 $ 23,216 $ 23,390 $ 26,284 $ 97,417 $ 20,385 $ 16,049 $ 21,121 $ 23,116 $ 80,671 Operating Profit Margin % 14.0% 12.7% 12.5% 13.7% 13.2% 11.5% 8.6% 10.7% 12.2% 10.7% Adjusted EBITDA $ 28,739 $ 26,945 $ 26,493 $ 29,057 $ 111,234 $ 24,399 $ 19,776 $ 25,004 $ 26,782 $ 95,961 EBITDA % 16.4% 14.7% 14.2% 15.1% 15.1% 13.8% 10.6% 12.6% 14.1% 12.8% Note: All operating results provided except for revenues are on a non-GAAP basis. See GAAP to non-GAAP reconciliation later in the Appendix. Years ending December 31
Segment Reporting – Temperature Control By Quarter 14 Years ending December 31
Segment Reporting – Engineered Solutions By Quarter 15 Years ending December 31
Segment Reporting - Analysis by Quarter (Percent of Net Sales) 16 Years ending December 31
GAAP to Non-GAAP Reconciliations
18 GAAP to non-GAAP Reconciliation Segment Reporting - Annual Sales and Profit by Segment
19 GAAP to non-GAAP Reconciliation Segment Reporting - 2022 Quarterly Sales and Profit by Segment
20 GAAP to non-GAAP Reconciliation Segment Reporting - 2021 Quarterly Sales and Profit by Segment
Thank you For more information, contact: Anthony (Tony) Cristello Standard Motor Products, Inc. (972) 316-8107 tony.cristello@smpcorp.com