CHICAGO, Feb. 26, 2009 (GLOBE NEWSWIRE) -- LKQ Corporation (Nasdaq:LKQX) today announced results for its fourth quarter and full year ended December 31, 2008.
Net income for the fourth quarter of 2008 was $13.0 million and diluted earnings per share was $0.09. For the full year of 2008, net income was $99.9 million and diluted earnings per share was $0.71. Excluding the effect of restructuring expenses totaling $1.9 million in the fourth quarter of 2008 and $8.6 million in the full year of 2008, diluted earnings per share would have been $0.10 and $0.75 for the quarter and full year, respectively.
"I am proud of the results we were able to achieve in 2008, given the impact the economic downturn had on collision repairs and the extreme volatility we saw in commodity prices. We increased 2008 earnings per share by 36%, excluding the effect of restructuring expenses, despite very challenging economic trends," commented Joseph Holsten, President and Chief Executive Officer. "Our results demonstrate the strength of our market position as the leading provider of alternative collision repair parts for passenger vehicles."
2008 Reported Results
For the fourth quarter of 2008, revenue totaled $470.3 million compared with $414.7 million for the fourth quarter of 2007, an increase of 13.4%. Organic revenue growth for the quarter was 0.7%. Net income for the fourth quarter of 2008 was $13.0 million compared with $21.5 million in the fourth quarter of 2007, a decline primarily attributable to $11.8 million in operating losses in LKQ's self-service recycle operations as a result of a steep decrease of commodity prices over a short time frame.
For the full year of 2008, revenue totaled $1.9 billion compared with $1.1 billion for the prior year, an increase of 71.9%. The majority of the revenue growth during 2008 was attributable to LKQ's purchase of Keystone on October 12, 2007. Assuming LKQ owned Keystone for all of fiscal 2007, pro forma organic revenue growth was 8.8%. Net income for the full year of 2008 was $99.9 million compared with $65.9 million for the prior year, an increase of 51.6%.
Balance Sheet and Liquidity
As of December 31, 2008, LKQ's balance sheet reflected cash and equivalents of $79.1 million and long-term debt, including the current portion, of $642.9 million. Included in total long-term debt was $5.3 million of borrowings on the company's $115 million revolving credit facility. Availability under the revolving credit facility was further reduced by $23.2 million for letters of credit.
Business Acquisitions
During 2008, LKQ acquired three separate heavy-duty truck recycled parts businesses in Houston, Chicago and Toledo, a large multi-location self-service auto recycler in California, and two wholesale automobile recyclers in Ontario, Canada. Collectively, the businesses acquired had approximately $152 million of historical annual revenue.
Additionally, in early 2009, the company acquired a heavy-duty truck recycled parts business in Tampa and a wholesale automobile salvage business in the Raleigh/Durham market with combined historical annual revenue of $13 million.
Company Outlook
"In light of the current economic environment and its impact on collision repair trends, we anticipate organic revenue for 2009, excluding the Other Revenue category, to grow at a rate of 6% to 8%," said Mr. Holsten. "While the economy will likely dampen our near-term growth rates, the long-term trends are positive and are likely to lead to an increase in the usage rates of alternative parts, in general, and LKQ's market share. Our strong balance sheet and positive free cash flow will support our leadership position."
In light of current conditions and excluding any restructuring expenses, LKQ anticipates full year 2009 net income will be in the range of $114 million to $123 million and earnings per share will be in the range of $0.80 to $0.86.
Net cash provided by operating activities for 2009 is projected to be over $145 million. The company estimates capital expenditures related to property and equipment, excluding expenditures for acquiring businesses, will be between $75 million to $80 million. Maintenance or replacement capital expenditures are expected to be slightly less than 20% of the total for 2009.
LKQ is also providing quarterly guidance for the first quarter of 2009. Excluding any restructuring expenses, net income is projected to be between $30 million to $32 million and diluted earnings per share is anticipated to be approximately $0.21 to $0.22 per share.
Weighted average diluted shares outstanding are anticipated to be approximately 143 million for 2009. Share numbers are estimates and will be affected by factors such as future stock issuances, the number of options exercised in subsequent periods, and changes in stock price.
2008 Earnings and 2009 Financial Guidance Conference Call
LKQ will host a conference call and audio webcast to discuss its fourth quarter and full year 2008 financial results and its 2009 financial guidance on Thursday February 26, 2009 at 10:30 a.m. Eastern Time. The live audio webcast can be accessed on the internet at www.lkqcorp.com in the Investor Relations section. To participate in the conference call, please dial (877) 705-6008 or (201) 689-8481 if calling outside of the U.S.
A replay of the conference call will be available on the company's website approximately two hours after the live presentation and will remain on the site for approximately one month. To access the telephonic replay, dial (877) 660-6852 or (201) 612-7415 and enter pass code: 314510.
About LKQ Corporation
LKQ Corporation is the largest nationwide provider of aftermarket collision replacement products, recycled OEM products and refurbished OEM collision replacement products such as wheels, bumper covers and lights used to repair light vehicles. LKQ operates approximately 280 facilities offering its customers a broad range of replacement systems, components, and parts to repair automobiles and light-duty trucks and heavy-duty trucks.
Forward Looking Statements
The statements in this press release that are not historical in nature are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These include statements regarding our expectations, beliefs, hopes, intentions or strategies. Forward-looking statements involve risks and uncertainties, some of which are not currently known to us. Actual events or results may differ materially from those expressed or implied in the forward looking statements as a result of various factors.
These factors include:
* uncertainty as to changes in U.S. general economic activity and the
impact of these changes on the demand for our products and our
ability to obtain financing for operations;
* fluctuations in the pricing of new OEM replacement parts;
* the availability and cost of our inventory;
* variations in vehicle accident rates;
* changes in state or federal laws or regulations affecting our
business;
* changes in the types of replacements parts that insurance carriers
will accept in the repair process;
* changes in the demand for our products and the supply of our
inventory due to severity of weather and seasonality of weather
patterns;
* the amount and timing of operating costs and capital expenditures
relating to the maintenance and expansion of our business,
operations and infrastructure;
* increasing competition in the automotive parts industry;
* our ability to increase or maintain revenue and profitability at
our facilities;
* uncertainty as to our future profitability on a consolidated basis;
* uncertainty as to the impact on our industry of any terrorist
attacks or responses to terrorist attacks;
* our ability to operate within the limitations imposed by financing
arrangements;
* our ability to obtain financing on acceptable terms to finance our
growth;
* declines in the values of our assets;
* fluctuations in fuel and other commodity prices;
* fluctuations in the prices of scrap and other metals that could
adversely affect our financial results;
* our ability to develop and implement the operational and financial
systems needed to manage our operations;
* our ability to integrate and successfully operate acquired
companies and any companies acquired in the future and the risks
associated with these companies;
* the risk that Keystone's business will not be integrated
successfully or that we will incur unanticipated costs of
integration;
* claims by original equipment manufacturers that attempt to restrict
or eliminate the sale of aftermarket products;
* decreases in the supply of end of life and crush only vehicles that
we process and sell for scrap; and
* other risks that are described in our Form 10-K filed February 29,
2008 and in other reports filed by us from time to time with the
Securities and Exchange Commission.
You should not place undue reliance on the forward looking statements. We assume no obligation to update any forward-looking statement to reflect events or circumstances arising after the date on which it was made except as required by law.
LKQ CORPORATION AND SUBSIDIARIES
Unaudited Consolidated Condensed Statements of Income
(In thousands, except per share data)
Three Months Ended Year Ended
December 31, December 31,
------------------ ----------------------
2008 2007 2008 2007
---- ---- ---- ----
Revenue $470,300 $414,735 $1,937,301 $1,126,825
Cost of goods sold 272,568 229,621 1,080,632 621,076
-------- -------- ---------- ----------
Gross margin 197,732 185,114 856,669 505,749
Facility and warehouse
expenses 50,862 40,145 187,645 116,577
Distribution expenses 43,332 39,995 180,063 108,185
Selling, general and
administrative expenses 65,191 54,874 251,982 140,843
Restructuring expenses 1,866 388 8,589 388
Depreciation and
amortization 8,665 6,550 30,694 17,099
-------- -------- ---------- ----------
Operating income 27,816 43,162 197,696 122,657
Other expense (income):
Interest expense, net 8,633 9,945 35,537 16,012
Other income, net (710) (483) (1,429) (1,626)
-------- -------- ---------- ----------
Total other expense 7,923 9,462 34,108 14,386
-------- -------- ---------- ----------
Income before provision
for income taxes 19,893 33,700 163,588 108,271
Provision for income taxes 6,929 12,168 63,689 42,370
-------- -------- ---------- ----------
Net income $ 12,964 $ 21,532 $ 99,899 $ 65,901
======== ======== ========== ==========
Net income per share:
Basic $ 0.09 $ 0.16 $ 0.73 $ 0.58
======== ======== ========== ==========
Diluted $ 0.09 $ 0.16 $ 0.71 $ 0.55
======== ======== ========== ==========
Weighted average common
shares outstanding:
Basic 139,488 133,401 136,488 114,161
======== ======== ========== ==========
Diluted 142,378 138,848 141,023 119,937
======== ======== ========== ==========
LKQ CORPORATION AND SUBSIDIARIES
Unaudited Consolidated Condensed Statements of Cash Flows
(In thousands)
Year Ended
December 31,
--------------------
2008 2007
---- ----
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income $ 99,899 $ 65,901
Adjustments to reconcile net income to net cash
provided by operating activities:
Depreciation and amortization 33,421 18,018
Stock-based compensation expense 5,498 3,039
Deferred income taxes 13,535 4,304
Excess tax benefit from share-based payment
arrangements (12,547) (19,257)
Other adjustments 3,352 286
Changes in operating assets and liabilities,
net of effects from purchase transactions:
Receivables (15,026) (11,026)
Inventory 4,232 (35,134)
Prepaid income taxes/income taxes payable 8,960 17,000
Accounts payable (4,785) 6,877
Other operating assets and liabilities (3,578) 4,361
--------- ---------
Net cash provided by operating activities 132,961 54,369
--------- ---------
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchases of property and equipment (66,908) (38,401)
Proceeds from disposal of assets 2,206 602
Cash used in acquisitions (74,208) (868,022)
--------- ---------
Net cash used in investing activities (138,910) (905,821)
--------- ---------
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from exercise of stock options 10,402 12,080
Proceeds from the sale of common stock -- 349,529
Repurchase and retirement of redeemable common
stock -- (1,125)
Excess tax benefit from share-based payment
arrangements 12,547 19,257
Debt issuance costs (219) (12,832)
(Repayments) Borrowings under term loans (9,957) 650,984
Net repayments of long-term debt (980) (96,264)
--------- ---------
Net cash (used in) provided by financing
activities 11,793 921,629
--------- ---------
Effect of exchange rate changes on cash and
equivalents (1,018) 33
Net increase in cash and equivalents 4,826 70,210
Cash and equivalents, beginning of period 74,241 4,031
--------- ---------
Cash and equivalents, end of period $ 79,067 $ 74,241
========= =========
LKQ CORPORATION AND SUBSIDIARIES
Unaudited Consolidated Condensed Balance Sheets
(In thousands, except share and per share data)
December 31, December 31,
2008 2007
---- ----
Assets
Current Assets:
Cash and equivalents $ 79,067 $ 74,241
Receivables, net 148,422 125,572
Inventory 332,756 320,238
Deferred income taxes 19,644 18,809
Prepaid income taxes 21,164 6,344
Prepaid expenses 7,865 8,088
------------ ------------
Total Current Assets 608,918 553,292
Property and Equipment, net 258,956 217,059
Intangibles 994,957 900,832
Other Assets 18,973 21,472
------------ ------------
Total Assets $ 1,881,804 $ 1,692,655
============ ============
Liabilities and Stockholders' Equity
Current Liabilities:
Accounts payable $ 65,411 $ 68,871
Accrued expenses 75,135 73,172
Deferred revenue 4,733 4,844
Current portion of long-term obligations 21,934 16,936
------------ ------------
Total Current Liabilities 167,213 163,823
Long-Term Obligations, Excluding Current
Portion 620,940 641,526
Deferred Income Tax Liability 43,518 25,607
Other Noncurrent Liabilities 29,627 11,922
Commitments and Contingencies
Stockholders' Equity:
Common stock, $0.01 par value, 500,000,000
shares authorized, 139,921,410 and
134,149,066 shares issued at December 31,
2008 and December 31, 2007, respectively 1,399 1,341
Additional paid-in capital 790,933 705,778
Retained earnings 241,938 142,039
Accumulated other comprehensive income
(loss) (13,764) 619
------------ ------------
Total Stockholders' Equity 1,020,506 849,777
------------ ------------
Total Liabilities and Stockholders'
Equity $ 1,881,804 $ 1,692,655
============ ============
LKQ CORPORATION AND SUBSIDIARIES
Unaudited Supplementary Data
(In thousands, except per share data)
Three Months Ended December 31,
Operating --------------------------------------------------
Highlights 2008 2007
------------------ ---------------- ----------------
% of % of %
Revenue Revenue Change Change
Revenue $470,300 100.0% $414,735 100.0% $ 55,565 13.4%
Cost of goods sold 272,568 58.0% 229,621 55.4% 42,947 18.7%
-------- ------ -------- ------ --------
Gross margin 197,732 42.0% 185,114 44.6% 12,618 6.8%
Facility and
warehouse expenses 50,862 10.8% 40,145 9.7% 10,717 26.7%
Distribution
expenses 43,332 9.2% 39,995 9.6% 3,337 8.3%
Selling, general and
administrative
expenses 65,191 13.9% 54,874 13.2% 10,317 18.8%
Restructuring
expenses 1,866 0.4% 388 0.1% 1,478 *
Depreciation and
amortization 8,665 1.8% 6,550 1.6% 2,115 32.3%
-------- ------ -------- ------ --------
Operating income 27,816 5.9% 43,162 10.4% (15,346) -35.6%
Other expense
(income):
Interest expense,
net 8,633 1.8% 9,945 2.4% (1,312) -13.2%
Other income, net (710) -0.2% (483) -0.1% (227) 47.0%
-------- ------ -------- ------ --------
Total other expense 7,923 1.7% 9,462 2.3% (1,539) -16.3%
-------- ------ -------- ------ --------
Income before
provision for
income taxes 19,893 4.2% 33,700 8.1% (13,807) -41.0%
Provision for income
taxes 6,929 1.5% 12,168 2.9% (5,239) -43.1%
-------- ------ -------- ------ --------
Net income $ 12,964 2.8% $ 21,532 5.2% $ (8,568) -39.8%
======== ====== ======== ====== ========
Net income per
share:
Basic $ 0.09 $ 0.16 $ (0.07) -43.8%
======== ======== ========
Diluted $ 0.09 $ 0.16 $ (0.07) -43.8%
======== ======== ========
Weighted average
common shares
outstanding:
Basic 139,488 133,401 6,087 4.6%
======== ======== ========
Diluted 142,378 138,848 3,530 2.5%
======== ======== ========
* Not meaningful
LKQ CORPORATION AND SUBSIDIARIES
Unaudited Supplementary Data
(In thousands, except per share data)
Year Ended December 31,
Operating ------------------------------------------------------
Highlights 2008 2007
-------------- ------------------ ------------------
% of % of %
Revenue Revenue Change Change
Revenue $1,937,301 100.0% $1,126,825 100.0% $810,476 71.9%
Cost of goods
sold 1,080,632 55.8% 621,076 55.1% 459,556 74.0%
---------- ------ ---------- ------ --------
Gross margin 856,669 44.2% 505,749 44.9% 350,920 69.4%
Facility and
warehouse
expenses 187,645 9.7% 116,577 10.3% 71,068 61.0%
Distribution
expenses 180,063 9.3% 108,185 9.6% 71,878 66.4%
Selling, general
and
administrative
expenses 251,982 13.0% 140,843 12.5% 111,139 78.9%
Restructuring
expenses 8,589 0.4% 388 0.0% 8,201 *
Depreciation and
amortization 30,694 1.6% 17,099 1.5% 13,595 79.5%
---------- ------ ---------- ------ --------
Operating
income 197,696 10.2% 122,657 10.9% 75,039 61.2%
Other expense
(income):
Interest
expense, net 35,537 1.8% 16,012 1.4% 19,525 121.9%
Other income,
net (1,429) -0.1% (1,626) -0.1% 197 -12.1%
---------- ------ ---------- ------ --------
Total other
expense 34,108 1.8% 14,386 1.3% 19,722 137.1%
---------- ------ ---------- ------ --------
Income before
provision for
income taxes 163,588 8.4% 108,271 9.6% 55,317 51.1%
Provision for
income taxes 63,689 3.3% 42,370 3.8% 21,319 50.3%
---------- ------ ---------- ------ --------
Net income $ 99,899 5.2% $ 65,901 5.8% $ 33,998 51.6%
========== ====== ========== ====== ========
Net income per
share:
Basic $ 0.73 $ 0.58 $ 0.15 25.9%
========== ========== ========
Diluted $ 0.71 $ 0.55 $ 0.16 29.1%
========== ========== ========
Weighted average
common shares
outstanding:
Basic 136,488 114,161 22,327 19.6%
========== ========== ========
Diluted 141,023 119,937 21,086 17.6%
========== ========== ========
* Not meaningful
The following unaudited table reconciles EBITDA to net income:
Three Months Ended Year Ended
December 31, December 31,
------------------ ------------------
2008 2007 2008 2007
-------- -------- -------- --------
(In thousands)
Net income $ 12,964 $ 21,532 $ 99,899 $ 65,901
Depreciation and amortization 9,423 7,085 33,421 18,018
Interest expense, net 8,633 9,945 35,537 16,012
Provision for income taxes 6,929 12,168 63,689 42,370
-------- -------- -------- --------
Earnings before interest,
taxes, depreciation and
amortization (EBITDA) $ 37,949 $ 50,730 $232,546 $142,301
======== ======== ======== ========
EBITDA as a percentage of
revenue 8.1% 12.2% 12.0% 12.6%
We have typically provided a reconciliation of Net income to EBITDA
as we believe it provides investors, security analysts and other
interested parties useful information regarding our results of
operations because it assists in analyzing our performance and the
value of our business. EBITDA provides insight into our
profitability trends, and allows management and investors to analyze
our operating results with and without the impact of depreciation,
amortization, interest and income tax expense. We believe EBITDA
is used by security analysts, investors, and other interested parties
in evaluating companies, many of which present EBITDA when reporting
their results.
The following unaudited table compares certain revenue categories:
Three Months Ended Year Ended
December 31, December 31,
------------------ ----------------------
2008 2007 2008 2007
-------- -------- ---------- ----------
(In thousands) (In thousands)
Included in Consolidated
Income Statements of LKQ
Corporation
Recycled and related
products and services $171,765 $138,009 $ 660,731 $ 535,907
Aftermarket, other new and
refurbished products 252,072 229,612 998,690 409,427
Other 46,463 47,114 277,880 181,491
-------- -------- ---------- ----------
$470,300 $414,735 $1,937,301 $1,126,825
======== ======== ========== ==========
Three Months Ended Year Ended
December 31, December 31,
------------------ ----------------------
2008 2007 2008 2007
-------- -------- ---------- ----------
(In thousands) (In thousands)
On a Proforma Basis
Assuming Keystone
Automotive Industries, Inc.
included in 2007 Amounts
Recycled and related
products and services $171,765 $138,009 $ 660,731 $ 535,907
Aftermarket, other new and
refurbished products 252,072 256,871 998,690 989,958
Other 46,463 47,114 277,880 181,491
-------- -------- ---------- ----------
$470,300 $441,994 $1,937,301 $1,707,356
======== ======== ========== ==========
CONTACT: LKQ Corporation
Sarah Lewensohn, Director, Investor Relations
(312) 621-2793
|
| Symbol: |
LKQX |
| Last Trade: |
17.83
(11/20/2009 ET)
|
| Change: |
-0.16
(-0.889383%)
|
| Day's Range: |
17.69 -
18.070 |
| Open: |
17.85 |
| Previous Close: |
17.99 |
| TSO: |
141,402,000 |
| Market Cap: |
2.52B |
| Day's Volume: |
309,604 |
|
Blogger
Blog Search
Digg
del.icio.us
Facebook
Newsvine
Reddit
StumbleUpon
Technorati
Yahoo MyWeb
