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Chicago, IL (October 29, 2015) - LKQ Corporation (Nasdaq:LKQ) today reported revenue for the third quarter of 2015 of $1.83 billion, an increase of 6.4% as compared to $1.72 billion in the third quarter of 2014. On a constant currency basis, revenue for the third quarter of 2015 grew by 10.2% compared to the third quarter of 2014. Net income for the third quarter of 2015 was $101.3 million, an increase of 10.7% as compared to $91.5 million for the same period of 2014. Diluted earnings per share of $0.33 for the third quarter ended September 30, 2015 increased 10.0% from $0.30 for the third quarter of 2014. The Company noted that adjusted diluted earnings per share for the third quarter 2015 would have been $0.34 compared to $0.31 for the third quarter of 2014 after adjusting each of the periods for net losses resulting from restructuring and acquisition related expenses, and the change in fair value of contingent consideration liabilities.
"We are very pleased with our operating results during the quarter even though the headwinds related to lower scrap prices and exchange rate fluctuations which we faced in the first half of 2015 continued in the third quarter," stated Robert Wagman, President and Chief Executive Officer of LKQ Corporation. “I am particularly pleased with the 14.9% revenue growth in parts and services on a constant currency basis. Our European segment showed continued improvement, with its EBITDA margins for the quarter increasing 190 basis points over the prior year. Organic revenue growth for parts and services was 6.8% on a global basis, including a solid 10.0% for our Specialty segment.”
On a nine month year-to-date basis, revenue was $5.44 billion, an increase of 7.7% from $5.06 billion for the comparable period of 2014. Parts and services organic revenue growth for the first nine months of 2015 was 7.3%. Net income for the first nine months of 2015 was $328.2 million, a 9.0% increase compared to $301.1 million for the first nine months of 2014. Diluted earnings per share was $1.07 for the first nine months of 2015, as compared to $0.98 for the comparable period of 2014, and adjusted diluted earnings per share was $1.10 for the first nine months of 2015 compared to $1.01 in 2014.
Balance Sheet and Liquidity
Cash flow from operations totaled $491.3 million on a nine month year-to-date basis, which after using approximately $253.8 million to finance acquisitions, capital expenditures and other long term assets, allowed the Company to reduce its outstanding debt compared to the same period of 2014. As of September 30, 2015, LKQ’s balance sheet reflected cash and equivalents of $137.1 million and outstanding debt of $1.6 billion. Total availability under the Company’s credit facilities at September 30, 2015 was approximately $1.3 billion.
In addition to closing the previously announced acquisitions of PartsChannel, Inc.; The Coast Distribution System, Inc.; and eight self-service yards from Ecology Auto Parts, Inc. during the third quarter of 2015, LKQ acquired four distributors of aftermarket automotive products in the Netherlands. LKQ’s European operations opened four Euro Car Parts branches in the third quarter of 2015.
“Our acquisition of the Netherlands based distributors largely completes our efforts of converting a portion of Sator’s network to a two-step model and achieves our goal of operating over 80 branches in the market. Once fully integrated, this branch network should strengthen Sator’s long-term prospects and margin profile and position the business well for our expected entry into alternative collision parts,” stated Mr. Wagman.
The Company updated its guidance for 2015.
Organic revenue growth (parts & services)
7.0% to 7.5%
7.0% to 8.5%
Adjusted net income
$428 million to $442 million
$425 million to $445 million
Adjusted diluted EPS
$1.39 to $1.44
$1.38 to $1.45
Cash flow from operations
$525 million to $550 million
Approximately $450 million
$135 million to $150 million
$150 million to $180 million
Guidance for 2015 is based on current conditions (including 2015 acquisitions completed to date) and excludes the impact of restructuring and acquisition related expenses, gains or losses related to acquisitions or divestitures (including changes in the fair value of contingent consideration liabilities), and capital spending related to future business acquisitions. Click here for full report.
Conference Call Details
LKQ will host a conference call and webcast on October 29, 2015 at 10:00 a.m. Eastern Time (9:00 a.m. Central Time) with members of senior management to discuss the Company's results.
To access the investor conference call, please dial (877) 407-0668. International access to the call may be obtained by dialing (201) 689-8558.
Webcast and Presentation Details
The audio webcast and accompanying slide presentation can be accessed at www.lkqcorp.com in the Investor Relations section.
A replay of the conference call will be available by telephone at (877) 660-6853 or (201) 612-7415 for international calls. The telephone replay will require you to enter conference ID: 13621871#. An online replay of the audio webcast will be available on the Company's website. Both formats of replay will be available through November 29, 2015. Please allow approximately two hours after the live presentation before attempting to access the replay. Click here for full report.
About LKQ Corporation
LKQ Corporation (www.lkqcorp.com) is a leading provider of alternative and specialty parts to repair and accessorize automobiles and other vehicles. LKQ has operations in North America, the United Kingdom, the Netherlands, Belgium, France, Scandinavia, Australia and Taiwan. LKQ offers its customers a broad range of replacement systems, components, equipment and parts to repair and accessorize automobiles, trucks, and recreational and performance vehicles.
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 outlook or guidance, 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 the following (not necessarily in order of importance):
You should not place undue reliance on these forward-looking statements. All of these forward-looking statements are based on our expectations as of the date of this press release. We undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law.
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Joseph P. Boutross-LKQ Corporation, Director, Investor Relations