QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934.
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934.
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(State or other jurisdiction of incorporation or organization)
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(I.R.S. Employer Identification No.)
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(Address of principal executive offices)
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(Zip Code)
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Title of each class
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Trading Symbol(s)
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Name of each exchange on which registered
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Accelerated Filer ☐
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Non-Accelerated Filer ☐
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Smaller reporting company
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Emerging growth company
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Page No.
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Item 1. |
Consolidated Financial Statements:
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3 | ||
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4 | ||
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5 | ||
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6 |
||
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7 | ||
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9
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||
Item 2. |
27
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Item 3. |
40
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Item 4. |
41
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Item 1. |
41
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Item 2. |
42
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Item 6. |
42
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43
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ITEM 1. |
CONSOLIDATED FINANCIAL STATEMENTS
|
Three Months Ended
September 30,
|
Nine Months Ended
September 30,
|
|||||||||||||||
(In thousands, except share and per share data)
|
2021
|
2020
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2021
|
2020
|
||||||||||||
(Unaudited)
|
(Unaudited)
|
|||||||||||||||
Net sales
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$
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$
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$
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$
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||||||||
Cost of sales
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||||||||||||
Gross profit
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||||||||||||
Selling, general and administrative expenses
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||||||||||||
Restructuring and integration expenses
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||||||||||||
Other income (expense), net
|
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(
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)
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(
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)
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||||||||||
Operating income
|
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||||||||||||
Other non-operating income, net
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||||||||||||
Interest expense
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||||||||||||
Earnings from continuing operations before taxes
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||||||||||||
Provision for income taxes
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||||||||||||
Earnings from continuing operations
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||||||||||||
Loss from discontinued operations, net of income taxes
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(
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)
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(
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)
|
(
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)
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(
|
)
|
||||||||
Net earnings
|
|
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$
|
|
|||||||||||
Net earnings attributable to noncontrolling interest
|
|
|
|
|
||||||||||||
Net earnings attributable to SMP (a)
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$
|
|
$
|
|
$
|
|
$
|
|
||||||||
Net earnings attributable to SMP
|
||||||||||||||||
Earnings from continuing operations
|
$
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|
$
|
|
$
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|
$
|
|
||||||||
Discontinued operations
|
(
|
)
|
(
|
)
|
(
|
)
|
(
|
)
|
||||||||
Total
|
$
|
|
$
|
|
$
|
|
$
|
|
||||||||
Per share data attributable to SMP
|
||||||||||||||||
Net earnings per common share – Basic:
|
||||||||||||||||
Earnings from continuing operations
|
$
|
|
$
|
|
$
|
|
$
|
|
||||||||
Discontinued operations
|
(
|
)
|
(
|
)
|
(
|
)
|
(
|
)
|
||||||||
Net earnings per common share – Basic
|
$
|
|
$
|
|
$
|
|
$
|
|
||||||||
Net earnings per common share – Diluted:
|
||||||||||||||||
Earnings from continuing operations
|
$
|
|
$
|
|
$
|
|
$
|
|
||||||||
Discontinued operations
|
(
|
)
|
(
|
)
|
(
|
)
|
(
|
)
|
||||||||
Net earnings per common share – Diluted
|
$
|
|
$
|
|
$
|
|
$
|
|
||||||||
Dividend declared per share
|
$
|
|
$
|
|
$
|
|
$
|
|
||||||||
Average number of common shares
|
|
|
|
|
||||||||||||
Average number of common shares and dilutive common shares
|
|
|
|
|
|
Three Months Ended
September 30,
|
Nine Months
Ended
September 30,
|
||||||||||||||
(In thousands)
|
2021
|
2020
|
2021
|
2020
|
||||||||||||
(Unaudited)
|
(Unaudited)
|
|||||||||||||||
|
||||||||||||||||
Net earnings
|
$
|
|
$
|
|
$
|
|
$
|
|
||||||||
Other comprehensive income (loss), net of tax:
|
||||||||||||||||
Foreign currency translation adjustments
|
(
|
)
|
|
(
|
)
|
(
|
)
|
|||||||||
Pension and postretirement plans
|
(
|
)
|
(
|
)
|
(
|
)
|
(
|
)
|
||||||||
Total other comprehensive income, net of tax
|
(
|
)
|
|
(
|
)
|
(
|
)
|
|||||||||
Total Comprehensive
income
|
|
|
|
|
||||||||||||
Comprehensive income (loss) attributable to noncontrolling interest, net of tax:
|
||||||||||||||||
Net earnings
|
|
|
|
|
||||||||||||
Foreign currency translation adjustments
|
|
|
(
|
)
|
|
|||||||||||
Comprehensive income (loss) attributable to noncontrolling interest, net of tax
|
|
|
|
|
||||||||||||
Comprehensive income attributable to SMP
|
$
|
|
$
|
|
$
|
|
$
|
|
(In thousands, except share and per share data)
|
September 30,
2021
|
December 31,
2020
|
||||||
|
(Unaudited)
|
|||||||
ASSETS
|
||||||||
CURRENT ASSETS:
|
||||||||
Cash and cash equivalents
|
$
|
|
$
|
|
||||
Accounts receivable, less allowances for discounts and doubtful accounts of $
|
|
|
||||||
Inventories
|
|
|
||||||
Unreturned customer inventories
|
|
|
||||||
Prepaid expenses and other current assets
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|
||||||
Total current assets
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|
|
||||||
|
||||||||
Property, plant and equipment, net of accumulated depreciation of $
|
|
|
||||||
Operating lease right-of-use assets
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|
||||||
Goodwill
|
|
|
||||||
Other intangibles, net
|
|
|
||||||
Deferred income taxes
|
|
|
||||||
Investments in unconsolidated affiliates
|
|
|
||||||
Other assets
|
|
|
||||||
Total assets
|
$
|
|
$
|
|
||||
|
||||||||
LIABILITIES AND STOCKHOLDERS’ EQUITY
|
||||||||
CURRENT LIABILITIES:
|
||||||||
Notes payable
|
$
|
|
$
|
|
||||
Current portion of other debt
|
|
|
||||||
Accounts payable
|
|
|
||||||
Sundry payables and accrued expenses
|
|
|
||||||
Accrued customer returns
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|
||||||
Accrued core liability
|
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|
||||||
Accrued rebates
|
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|
||||||
Payroll and commissions
|
|
|
||||||
Total current liabilities
|
|
|
||||||
Long-term debt
|
|
|
||||||
Noncurrent operating lease liabilities
|
|
|
||||||
Other accrued liabilities
|
|
|
||||||
Accrued asbestos liabilities
|
|
|
||||||
Total liabilities
|
|
|
||||||
Commitments and contingencies
|
|
|
||||||
Stockholders’ equity:
|
||||||||
Common stock – par value $
|
||||||||
Authorized –
|
|
|
||||||
Capital in excess of par value
|
|
|
||||||
Retained earnings
|
|
|
||||||
Accumulated other comprehensive income
|
(
|
)
|
(
|
)
|
||||
Treasury stock – at cost (
|
(
|
)
|
(
|
)
|
||||
Total SMP stockholders’ equity
|
|
|
||||||
Noncontrolling interest
|
|
|
||||||
Total stockholders’ equity
|
|
|
||||||
Total liabilities and stockholders’ equity
|
$
|
|
$
|
|
(In thousands)
|
Nine Months
Ended
September 30,
|
|||||||
|
2021
|
2020
|
||||||
|
(Unaudited)
|
|||||||
CASH FLOWS FROM OPERATING ACTIVITIES:
|
||||||||
Net earnings
|
$
|
|
$
|
|
||||
Adjustments to reconcile net earnings to net cash provided by operating activities:
|
||||||||
Depreciation and amortization
|
|
|
||||||
Amortization of deferred financing cost
|
|
|
||||||
Increase to allowance for doubtful accounts
|
|
|
||||||
Increase (decrease) to inventory reserves
|
(
|
)
|
|
|||||
Equity income from joint ventures
|
(
|
)
|
(
|
)
|
||||
Employee stock ownership plan allocation
|
|
|
||||||
Stock-based compensation
|
|
|
||||||
(Increase) decrease in deferred income taxes
|
|
(
|
)
|
|||||
Loss on discontinued operations, net of tax
|
|
|
||||||
Change in assets and liabilities:
|
||||||||
(Increase) in accounts receivable
|
(
|
)
|
(
|
)
|
||||
(Increase) decrease in inventories
|
(
|
)
|
|
|||||
Decrease in prepaid expenses and other current assets
|
|
|
||||||
Increase (decrease) in accounts payable
|
|
(
|
)
|
|||||
Increase in sundry payables and accrued expenses
|
|
|
||||||
Net change in other assets and liabilities
|
(
|
)
|
(
|
)
|
||||
Net cash provided by operating activities
|
|
|
||||||
CASH FLOWS FROM INVESTING ACTIVITIES:
|
||||||||
Acquisitions of and investments in businesses
|
(
|
)
|
|
|||||
Capital expenditures
|
(
|
)
|
(
|
)
|
||||
Other investing activities
|
|
|
||||||
Net cash used in investing activities
|
(
|
)
|
(
|
)
|
||||
CASH FLOWS FROM FINANCING ACTIVITIES:
|
||||||||
Net borrowings (payments) under line-of-credit agreements
|
|
(
|
)
|
|||||
Net borrowings (payments) of other debt and finance lease obligations
|
|
(
|
)
|
|||||
Purchase of treasury stock
|
(
|
)
|
(
|
)
|
||||
Increase in overdraft balances
|
|
|
||||||
Dividends paid
|
(
|
)
|
(
|
)
|
||||
Net cash provided by (used in) financing activities
|
|
(
|
)
|
|||||
Effect of exchange rate changes on cash
|
(
|
)
|
|
|||||
Net increase in cash and cash equivalents
|
|
|
||||||
CASH AND CASH EQUIVALENTS at beginning of period
|
|
|
||||||
CASH AND CASH EQUIVALENTS at end of period
|
$
|
|
$
|
|
||||
Supplemental disclosure of cash flow information:
|
||||||||
Cash paid during the period for:
|
||||||||
Interest
|
$
|
|
$
|
|
||||
Income taxes
|
$
|
|
$
|
|
(In thousands)
|
Common
Stock
|
Capital in
Excess of
Par Value
|
Retained
Earnings
|
Accumulated
Other
Comprehensive
Income (Loss)
|
Treasury
Stock
|
Total
SMP
|
Non-
Controlling
Interest
|
Total
|
||||||||||||||||||||||||
Balance at June 30, 2021
|
$
|
|
$
|
|
$
|
|
$
|
(
|
)
|
$
|
(
|
)
|
$
|
|
$
|
|
$
|
|
||||||||||||||
Net earnings
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||
Other comprehensive income, net of tax
|
|
|
|
(
|
)
|
|
(
|
)
|
|
(
|
)
|
|||||||||||||||||||||
Cash dividends paid
|
|
|
(
|
)
|
|
|
(
|
)
|
|
(
|
)
|
|||||||||||||||||||||
Purchase of treasury stock
|
|
|
|
|
(
|
)
|
(
|
)
|
|
(
|
)
|
|||||||||||||||||||||
Stock-based compensation
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||
Balance at September 30, 2021
|
$
|
|
$
|
|
$
|
|
$
|
(
|
)
|
$
|
(
|
)
|
$
|
|
$
|
|
$
|
|
(In
thousands)
|
Common
Stock
|
Capital in
Excess of
Par Value
|
Retained
Earnings
|
Accumulated
Other
Comprehensive
Income (Loss)
|
Treasury
Stock
|
Total
SMP
|
Non-
Controlling
Interest
|
Total
|
||||||||||||||||||||||||
Balance at June 30,
2020
|
$
|
|
$
|
|
$
|
|
$
|
(
|
)
|
$
|
(
|
)
|
$
|
|
$
|
|
$
|
|
||||||||||||||
Net earnings
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||
Other comprehensive income, net of tax
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||
Stock-based compensation
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||
Balance at September 30, 2020
|
$
|
|
$
|
|
$
|
|
$
|
(
|
)
|
$
|
(
|
)
|
$
|
|
$
|
|
$
|
|
(In thousands)
|
Common
Stock
|
Capital in
Excess of
Par Value
|
Retained
Earnings
|
Accumulated
Other
Comprehensive
Income (Loss)
|
Treasury
Stock
|
Total
SMP
|
Non-
Controlling
Interest
|
Total
|
||||||||||||||||||||||||
Balance at December 31, 2020
|
$
|
|
$
|
|
$
|
|
$
|
(
|
)
|
$
|
(
|
)
|
$
|
|
$
|
|
$
|
|
||||||||||||||
Noncontrolling interest in business acquired
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||
Net earnings
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||
Other comprehensive income, net of tax
|
|
|
|
(
|
)
|
|
(
|
)
|
(
|
)
|
(
|
)
|
||||||||||||||||||||
Cash dividends paid
|
|
|
(
|
)
|
|
|
(
|
)
|
(
|
)
|
||||||||||||||||||||||
Purchase of treasury stock
|
|
|
|
|
(
|
)
|
(
|
)
|
|
(
|
)
|
|||||||||||||||||||||
Stock-based compensation
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||
Employee Stock Ownership Plan
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||
Balance at September 30, 2021
|
$
|
|
$
|
|
$
|
|
$
|
(
|
)
|
$
|
(
|
)
|
$
|
|
$
|
|
$
|
|
(In thousands)
|
Common
Stock
|
Capital in
Excess of
Par Value
|
Retained
Earnings
|
Accumulated
Other
Comprehensive
Income (Loss)
|
Treasury
Stock
|
Total
SMP
|
Non-
Controlling
Interest
|
Total
|
||||||||||||||||||||||||
Balance at December 31, 2019
|
$
|
|
$
|
|
$
|
|
$
|
(
|
)
|
$
|
(
|
)
|
$
|
|
$
|
|
$
|
|
||||||||||||||
Net earnings
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||
Other comprehensive income, net of tax
|
|
|
|
(
|
)
|
|
(
|
)
|
|
(
|
)
|
|||||||||||||||||||||
Cash dividends paid
|
|
|
(
|
)
|
|
|
(
|
)
|
|
(
|
)
|
|||||||||||||||||||||
Purchase of treasury stock
|
|
|
|
|
(
|
)
|
(
|
)
|
|
(
|
)
|
|||||||||||||||||||||
Stock-based compensation
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||
Employee Stock Ownership Plan
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||
Balance at September 30, 2020
|
$
|
|
$
|
|
$
|
|
$
|
(
|
)
|
$
|
(
|
)
|
$
|
|
$
|
|
$
|
|
STANDARD MOTOR PRODUCTS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) – (Continued)
|
Standard
|
|
Description
|
|
Date of
adoption
|
|
Effects on the financial
statements or other
significant matters
|
|
||||||
ASU 2019-12, Income Taxes (Topic 740): Simplifying
the Accounting for Income Taxes
|
|
This standard is intended to simplify the accounting for income taxes by removing certain ASC Topic 740 exceptions in performing intra-period tax
allocations among income statement components, in calculating certain deferred tax liabilities related to outside basis differences, and in calculating income taxes in interim periods with year-to-date losses. In addition, this standard is
also intended to improve consistency and add simplification by clarifying and amending the reporting of franchise taxes and other taxes partially based on income, the recognition of deferred income taxes related to the step-up in tax basis
goodwill, and the reporting in interim periods of the recognition of the enactment of tax laws or rate changes.
|
|
January 1, 2021
|
|
The adoption of the technical clarifications in the standard did not materially impact our accounting for income taxes, our consolidated financial
statements and related disclosures.
|
Standard
|
|
Description
|
|
Date of
adoption /
Effective date
|
|
Effects on the financial
statements or other
significant matters
|
|
||||||
ASU 2020-04, Reference Rate Reform (Topic 848):
Facilitation of the Effects of Reference Rate Reform on Financial Reporting
|
|
This standard is intended to provide optional
guidance for a limited time to ease the potential burden in accounting for (or recognizing the effects of) reference rate reform on financial reporting. The new standard is applicable to contracts that reference LIBOR, or another reference
rate, expected to be discontinued due to reference rate reform.
|
|
Effective March 12, 2020 through December 31,
2022
|
|
The new standard may be applied as of the beginning of an interim period that includes March 12, 2020 through December 31, 2022. As certain of our
contracts reference LIBOR, including our revolving credit facility and supply chain financing arrangements, we are currently reviewing the optional guidance in the standard to determine its impact upon the discontinuance of LIBOR. At this
time, we do not believe that the new guidance, nor the discontinuance of LIBOR, will have a material impact on our consolidated financial statements and related disclosures.
|
STANDARD MOTOR PRODUCTS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) – (Continued)
|
Purchase price
|
$
|
|
||||||
Assets acquired and liabilities assumed:
|
||||||||
Receivables
|
$
|
|
||||||
Inventory
|
|
|||||||
Other current assets (1)
|
|
|||||||
Property, plant and equipment, net
|
|
|||||||
Operating lease right-of-use assets
|
|
|||||||
Intangible assets
|
|
|||||||
Goodwill
|
|
|||||||
Current liabilities
|
(
|
)
|
||||||
Noncurrent operating lease liabilities
|
(
|
)
|
||||||
Deferred income taxes
|
(
|
)
|
||||||
Net assets acquired
|
$
|
|
(1) |
|
STANDARD MOTOR PRODUCTS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) – (Continued)
|
Purchase price
|
$
|
|
||||||
Assets acquired and liabilities assumed:
|
||||||||
Receivables
|
$
|
|
||||||
Inventory
|
|
|||||||
Other current assets (1)
|
|
|||||||
Property, plant and equipment, net
|
|
|||||||
Operating lease right-of-use assets
|
|
|||||||
Intangible assets
|
|
|||||||
Goodwill
|
|
|||||||
Current liabilities
|
(
|
)
|
||||||
Noncurrent operating lease liabilities
|
(
|
)
|
||||||
Deferred income taxes
|
(
|
)
|
||||||
Subtotal
|
|
|||||||
Fair value of acquired noncontrolling interest
|
(
|
)
|
||||||
Net assets acquired
|
$
|
|
(1) |
|
STANDARD MOTOR PRODUCTS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) – (Continued)
|
Purchase Price
|
$
|
|
||||||
Assets acquired and liabilities assumed:
|
||||||||
Inventory
|
$
|
|
||||||
Machinery and equipment, net
|
|
|||||||
Intangible assets
|
|
|||||||
Net assets acquired
|
$
|
|
|
Workforce
Reduction
|
Other Exit
Costs
|
Total
|
|||||||||
Exit activity liability at December 31, 2020
|
$
|
|
$
|
|
$
|
|
||||||
Restructuring and integration costs: |
||||||||||||
Amounts provided for during 2021
|
||||||||||||
Cash payments
|
(
|
)
|
(
|
)
|
(
|
)
|
||||||
Exit activity liability at September 30, 2021
|
$
|
|
$
|
|
$
|
|
STANDARD MOTOR PRODUCTS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) – (Continued)
|
STANDARD MOTOR PRODUCTS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) – (Continued)
|
|
September 30,
2021
|
December 31,
2020
|
||||||
|
(In thousands)
|
|||||||
Finished goods
|
$
|
|
$
|
|
||||
Work in process
|
|
|
||||||
Raw materials
|
|
|
||||||
Subtotal
|
|
|
||||||
Unreturned customer inventories
|
|
|
||||||
Total inventories
|
$
|
|
$
|
|
|
September 30,
2021
|
December 31,
2020
|
||||||
|
(In thousands)
|
|||||||
Customer relationships
|
$
|
|
$
|
|
||||
Patents, developed technology and intellectual property
|
|
|
||||||
Trademarks and trade names
|
|
|
||||||
Non-compete agreements
|
|
|
||||||
Supply agreements
|
|
|
||||||
Leaseholds
|
|
|
||||||
Total acquired intangible assets
|
|
|
||||||
Less accumulated amortization (1)
|
(
|
)
|
(
|
)
|
||||
Net acquired intangible assets
|
$
|
|
$
|
|
(1) |
|
STANDARD MOTOR PRODUCTS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) – (Continued)
|
Balance Sheet Information
|
September 30,
2021
|
December 31,
2020
|
||||||
Assets
|
||||||||
Operating lease right-of-use assets
|
$
|
|
$
|
|
||||
|
||||||||
Liabilities
|
||||||||
Sundry payables and accrued expenses
|
$
|
|
$
|
|
||||
Noncurrent operating lease liabilities
|
|
|
||||||
Total operating lease liabilities
|
$
|
|
$
|
|
||||
|
||||||||
Weighted Average Remaining Lease Term
|
||||||||
Operating leases
|
|
|
||||||
|
||||||||
Weighted Average Discount Rate
|
||||||||
Operating leases
|
|
%
|
|
%
|
Three Months Ended
September 30,
|
||||||||
Expense and Cash Flow Information
|
2021
|
2020
|
||||||
Lease Expense
|
||||||||
Operating lease expense (a)
|
$
|
|
$
|
|
Nine Months
Ended
September 30,
|
||||||||
2021
|
2020
|
|||||||
Lease Expense
|
||||||||
Operating lease expense (a)
|
$
|
|
$
|
|
||||
Supplemental Cash Flow Information
|
||||||||
Cash paid for the amounts included in the measurement of lease liabilities:
|
||||||||
Operating cash flows from operating leases
|
$
|
|
$
|
|
||||
Right-of-use assets obtained in exchange for new lease obligations:
|
||||||||
Operating leases
|
$
|
|
$
|
|
(a) |
|
STANDARD MOTOR PRODUCTS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) – (Continued)
|
2021
|
$
|
|
||
2022
|
|
|||
2023
|
|
|||
2024
|
|
|||
2025
|
|
|||
Thereafter
|
|
|||
Total lease payments
|
$
|
|
||
Less: Interest
|
(
|
)
|
||
Present value of lease liabilities
|
$
|
|
|
September 30,
2021
|
December 31,
2020
|
||||||
|
(In thousands)
|
|||||||
Revolving credit facilities
|
$
|
|
$
|
|
||||
Other (1)
|
|
|
||||||
Total debt
|
$
|
|
$
|
|
||||
|
||||||||
Current maturities of debt
|
$
|
|
$
|
|
||||
Long-term debt
|
|
|
||||||
Total debt
|
$
|
|
$
|
|
(1) |
|
STANDARD MOTOR PRODUCTS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) – (Continued)
|
STANDARD MOTOR PRODUCTS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) – (Continued)
|
Shares
|
Weighted Average
Grant Date Fair
Value Per Share
|
|||||||
Balance at December 31,
2020
|
|
$
|
|
|||||
Granted
|
|
|
||||||
Vested
|
(
|
)
|
|
|||||
Forfeited
|
(
|
)
|
|
|||||
Balance at September 30, 2021
|
|
$
|
|
STANDARD MOTOR PRODUCTS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) – (Continued)
|
Three Months Ended
September 30,
|
Nine
Months Ended
September 30,
|
|||||||||||||||
2021
|
2020
|
2021
|
2020
|
|||||||||||||
Net Earnings
Attributable to SMP -
|
||||||||||||||||
Earnings from continuing operations
|
$
|
|
$
|
|
$
|
|
$
|
|
||||||||
Loss from discontinued operations
|
(
|
)
|
(
|
)
|
(
|
)
|
(
|
)
|
||||||||
Net earnings attributable to SMP
|
$
|
|
$
|
|
$
|
|
$
|
|
||||||||
Basic Net Earnings Per Common Share Attributable to SMP -
|
||||||||||||||||
Earnings from continuing operations per
common share
|
$
|
|
$
|
|
$
|
|
$
|
|
||||||||
Loss from discontinued operations per common share
|
(
|
)
|
(
|
)
|
(
|
)
|
(
|
)
|
||||||||
Net earnings per common share attributable to SMP
|
$
|
|
$
|
|
$
|
|
$
|
|
||||||||
Weighted average common shares outstanding
|
|
|
|
|
||||||||||||
Diluted Net Earnings Per Common Share Attributable to SMP -
|
||||||||||||||||
Earnings from continuing operations per common share
|
$
|
|
$
|
|
$
|
|
$
|
|
||||||||
Loss from discontinued operations per common share
|
(
|
)
|
(
|
)
|
(
|
)
|
(
|
)
|
||||||||
Net earnings per common share attributable to SMP
|
$
|
|
$
|
|
$
|
|
$
|
|
||||||||
Weighted average common shares outstanding
|
|
|
|
|
||||||||||||
Plus incremental shares from assumed conversions:
|
||||||||||||||||
Dilutive effect of restricted stock and performance-based stock
|
|
|
|
|
||||||||||||
Weighted average common shares outstanding –
Diluted
|
|
|
|
|
STANDARD MOTOR PRODUCTS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) – (Continued)
|
|
Three Months Ended
September 30,
|
Nine Months
Ended
September 30,
|
||||||||||||||
|
2021
|
2020
|
2021
|
2020
|
||||||||||||
Restricted and performance-based shares
|
|
|
|
|
|
Three Months Ended
September 30,
|
Nine Months
Ended
September 30,
|
||||||||||||||
|
2021
|
2020
|
2021
|
2020
|
||||||||||||
Net Sales (a)
|
||||||||||||||||
Engine Management
|
$
|
|
$
|
|
$
|
|
$
|
|
||||||||
Temperature Control
|
|
|
|
|
||||||||||||
All Other
|
|
|
|
|
||||||||||||
Consolidated
|
$
|
|
$
|
|
$
|
|
$
|
|
||||||||
|
||||||||||||||||
Intersegment Revenue (a)
|
||||||||||||||||
Engine Management
|
$
|
|
$
|
|
$
|
|
$
|
|
||||||||
Temperature Control
|
|
|
|
|
||||||||||||
All Other
|
(
|
)
|
(
|
)
|
(
|
)
|
(
|
)
|
||||||||
Consolidated
|
$
|
|
$
|
|
$
|
|
$
|
|
||||||||
|
||||||||||||||||
Operating Income
|
||||||||||||||||
Engine Management
|
$
|
|
$
|
|
$
|
|
$
|
|
||||||||
Temperature Control
|
|
|
|
|
||||||||||||
All Other
|
(
|
)
|
(
|
)
|
(
|
)
|
(
|
)
|
||||||||
Consolidated
|
$
|
|
$
|
|
$
|
|
$
|
|
(a) |
|
STANDARD MOTOR PRODUCTS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) – (Continued)
|
Three months ended September 30, 2021 (a)
|
Engine
Management
|
Temperature
Control
|
Other (b)
|
Total
|
||||||||||||
Geographic Area:
|
||||||||||||||||
United States
|
$
|
|
$
|
|
$
|
|
$
|
|
||||||||
Canada
|
|
|
|
|
||||||||||||
Asia
|
|
|
|
|
||||||||||||
Mexico
|
|
|
|
|
||||||||||||
Europe
|
|
|
|
|
||||||||||||
Other foreign
|
|
|
|
|
||||||||||||
Total
|
$
|
|
$
|
|
$
|
|
$
|
|
||||||||
Major Product Group:
|
||||||||||||||||
Ignition, emission control, fuel and safety
related system products
|
$
|
|
$
|
|
$
|
|
$
|
|
||||||||
Wire and cable
|
|
|
(
|
)
|
|
|||||||||||
Compressors
|
|
|
|
|
||||||||||||
Other climate control parts
|
|
|
|
|
||||||||||||
Total
|
$
|
|
$
|
|
$
|
|
$
|
|
||||||||
Major Sales Channel:
|
||||||||||||||||
Aftermarket
|
$
|
|
$
|
|
$
|
|
$
|
|
||||||||
OE/OES
|
|
|
|
|
||||||||||||
Export
|
|
|
|
|
||||||||||||
Total
|
$
|
|
$
|
|
$
|
|
$
|
|
|
Three months ended September 30, 2020 (a) |
Engine
Management
|
Temperature
Control
|
Other (b)
|
Total
|
||||||||||||
Geographic Area:
|
||||||||||||||||
United States
|
$
|
|
$
|
|
$
|
|
$
|
|
||||||||
Canada
|
|
|
|
|
||||||||||||
Asia
|
|
|
|
|
||||||||||||
Mexico
|
|
|
|
|
||||||||||||
Europe
|
|
|
|
|
||||||||||||
Other foreign
|
|
|
|
|
||||||||||||
Total
|
$
|
|
$
|
|
$
|
|
$
|
|
STANDARD MOTOR PRODUCTS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) – (Continued)
|
Three months ended September 30, 2020 (a) |
Engine
Management
|
Temperature
Control
|
Other (b) |
Total |
||||||||||||
Major Product Group:
|
||||||||||||||||
Ignition, emission control, fuel and safety
related system products
|
$
|
|
$
|
|
$
|
|
$
|
|
||||||||
Wire and cable
|
|
|
|
|
||||||||||||
Compressors
|
|
|
|
|
||||||||||||
Other climate control parts
|
|
|
|
|
||||||||||||
Total
|
$
|
|
$
|
|
$
|
|
$
|
|
||||||||
Major Sales Channel:
|
||||||||||||||||
Aftermarket
|
$
|
|
$
|
|
$
|
|
$
|
|
||||||||
OE/OES
|
|
|
|
|
||||||||||||
Export
|
|
|
|
|
||||||||||||
Total
|
$
|
|
$
|
|
$
|
|
$
|
|
Nine months ended
September 30, 2021 (a)
|
Engine
Management
|
Temperature
Control
|
Other (b)
|
Total
|
||||||||||||
Geographic Area:
|
||||||||||||||||
United States
|
$
|
|
$
|
|
$
|
|
$
|
|
||||||||
Canada
|
|
|
|
|
||||||||||||
Asia
|
|
|
|
|
||||||||||||
Mexico
|
|
|
|
|
||||||||||||
Europe
|
|
|
|
|
||||||||||||
Other foreign
|
|
|
|
|
||||||||||||
Total
|
$
|
|
$
|
|
$
|
|
$
|
|
||||||||
Major Product Group:
|
||||||||||||||||
Ignition, emission control, fuel and safety
related system products
|
$
|
|
$
|
|
$
|
|
$
|
|
||||||||
Wire and cable
|
|
|
(
|
)
|
|
|||||||||||
Compressors
|
|
|
|
|
||||||||||||
Other climate control parts
|
|
|
|
|
||||||||||||
Total
|
$
|
|
$
|
|
$
|
|
$
|
|
||||||||
Major Sales Channel:
|
||||||||||||||||
Aftermarket
|
$
|
|
$
|
|
$
|
|
$
|
|
||||||||
OE/OES
|
|
|
|
|
||||||||||||
Export
|
|
|
|
|
||||||||||||
Total
|
$
|
|
$
|
|
$
|
|
$
|
|
Nine Months ended September 30, 2020 (a)
|
Engine
Management
|
Temperature
Control
|
Other (b)
|
Total
|
||||||||||||
Geographic Area:
|
||||||||||||||||
United States
|
$
|
|
$
|
|
$
|
|
$
|
|
||||||||
Canada
|
|
|
|
|
||||||||||||
Asia
|
|
|
|
|
||||||||||||
Mexico
|
|
|
|
|
||||||||||||
Europe
|
|
|
|
|
||||||||||||
Other foreign
|
|
|
|
|
||||||||||||
Total
|
$
|
|
$
|
|
$
|
|
$
|
|
STANDARD MOTOR PRODUCTS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) – (Continued)
|
Nine Months ended September 30, 2020 (a)
|
Engine
Management
|
Temperature
Control
|
Other (b)
|
Total
|
||||||||||||
Major Product Group:
|
||||||||||||||||
Ignition, emission control, fuel and safety
related system products
|
$
|
|
$
|
|
$
|
|
$
|
|
||||||||
Wire and cable
|
|
|
|
|
||||||||||||
Compressors
|
|
|
|
|
||||||||||||
Other climate control parts
|
|
|
|
|
||||||||||||
Total
|
$
|
|
$
|
|
$
|
|
$
|
|
||||||||
Major Sales Channel:
|
||||||||||||||||
Aftermarket
|
$
|
|
$
|
|
$
|
|
$
|
|
||||||||
OE/OES
|
|
|
|
|
||||||||||||
Export
|
|
|
|
|
||||||||||||
Total
|
$
|
|
$
|
|
$
|
|
$
|
|
(a) |
|
(b) |
|
STANDARD MOTOR PRODUCTS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) – (Continued)
|
STANDARD MOTOR PRODUCTS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) – (Continued)
|
Three Months Ended |
Nine
Months Ended |
|||||||||||||||
|
September 30,
|
September 30,
|
||||||||||||||
|
2021
|
2020
|
2021
|
2020
|
||||||||||||
Balance, beginning of period
|
$
|
|
$
|
|
$
|
|
$
|
|
||||||||
Liabilities accrued for current year sales
|
|
|
|
|
||||||||||||
Settlements of warranty claims
|
(
|
)
|
(
|
)
|
(
|
)
|
(
|
)
|
||||||||
Balance, end of period
|
$
|
|
$
|
|
$
|
|
$
|
|
Three Months Ended September 30,
|
||||||||
2021
|
2020
|
|||||||
Engine Management:
|
||||||||
Ignition, Emission Control, Fuel and Safety Related System Products
|
$
|
208,443
|
$
|
190,891
|
||||
Wire and Cable
|
38,708
|
38,663
|
||||||
Total Engine Management
|
247,151
|
229,554
|
||||||
Temperature Control:
|
||||||||
Compressors
|
75,080
|
70,785
|
||||||
Other Climate Control Parts
|
43,995
|
39,608
|
||||||
Total Temperature Control
|
119,075
|
110,393
|
||||||
All Other
|
4,084
|
3,662
|
||||||
Total
|
$
|
370,310
|
$
|
343,609
|
Three Months Ended
September 30,
|
Engine
Management
|
Temperature
Control
|
Other
|
Total
|
||||||||||||
2021
|
||||||||||||||||
Net sales
|
$
|
247,151
|
$
|
119,075
|
$
|
4,084
|
$
|
370,310
|
||||||||
Gross margins
|
66,714
|
33,815
|
4,676
|
105,205
|
||||||||||||
Gross margin percentage
|
27
|
%
|
28.4
|
%
|
—
|
28.4
|
%
|
|||||||||
2020
|
||||||||||||||||
Net sales
|
$
|
229,554
|
$
|
110,393
|
$
|
3,662
|
$
|
343,609
|
||||||||
Gross margins
|
72,361
|
32,212
|
3,175
|
107,748
|
||||||||||||
Gross margin percentage
|
31.5
|
%
|
29.2
|
%
|
—
|
31.4
|
%
|
Nine Months Ended September 30,
|
||||||||
2021
|
2020
|
|||||||
Engine Management:
|
||||||||
Ignition, Emission Control, Fuel and Safety Related System Products
|
$
|
574,595
|
$
|
498,204
|
||||
Wire and Cable
|
117,790
|
105,621
|
||||||
Total Engine Management
|
692,385
|
603,825
|
||||||
Temperature Control:
|
||||||||
Compressors
|
178,031
|
141,011
|
||||||
Other Climate Control Parts
|
109,988
|
93,216
|
||||||
Total Temperature Control
|
288,019
|
234,227
|
||||||
All Other
|
8,535
|
7,798
|
||||||
Total
|
$
|
988,939
|
$
|
845,850
|
Nine Months Ended
September 30,
|
Engine
Management
|
Temperature
Control
|
Other
|
Total
|
||||||||||||
2021
|
||||||||||||||||
Net sales
|
$
|
692,385
|
$
|
288,019
|
$
|
8,535
|
$
|
988,939
|
||||||||
Gross margins
|
199,231
|
78,468
|
10,562
|
288,261
|
||||||||||||
Gross margin percentage
|
28.8
|
%
|
27.2
|
%
|
—
|
29.1
|
%
|
|||||||||
2020
|
||||||||||||||||
Net sales
|
$
|
603,825
|
$
|
234,227
|
$
|
7,798
|
$
|
845,850
|
||||||||
Gross margins
|
175,296
|
60,828
|
6,377
|
242,501
|
||||||||||||
Gross margin percentage
|
29
|
%
|
26
|
%
|
—
|
28.7
|
%
|
(In thousands)
|
2021
|
2022
|
2023
|
2024
|
2025
|
2026-2031
|
Total
|
|||||||||||||||||||||
Operating lease obligations
|
$
|
2,723
|
$
|
10,422
|
$
|
9,441
|
$
|
7,128
|
$
|
5,802
|
$
|
11,664
|
$
|
47,180
|
||||||||||||||
Postretirement benefits
|
8
|
29
|
25
|
25
|
25
|
25
|
137
|
|||||||||||||||||||||
Severance payments related to restructuring and integration
|
56
|
32
|
1
|
—
|
—
|
—
|
89
|
|||||||||||||||||||||
Total commitments
|
$
|
2,787
|
$
|
10,483
|
$
|
9,467
|
$
|
7,153
|
$
|
5,827
|
$
|
11,689
|
$
|
47,406
|
(a) |
Indebtedness under our revolving credit facility is not included in the table above as it is reported as a current liability in our consolidated balance sheets. As of September 30,
2021, amounts outstanding under our revolving credit facilities were $128.9 million.
|
ITEM 3. |
QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
|
ITEM 4. |
CONTROLS AND PROCEDURES
|
(a) |
Evaluation of Disclosure Controls and Procedures.
|
(b) |
Changes in Internal Control Over Financial Reporting.
|
ITEM 1. |
LEGAL PROCEEDINGS
|
ITEM 2. |
UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS
|
Period
|
Total Number of
Shares Purchased
(1)
|
Average
Price Paid
Per Share
|
Total Number of
Shares Purchased
as Part of Publicly
Announced Plans
or Programs (2)
|
Maximum Number (or
Approximate Dollar
Value) of Shares that
may yet be Purchased
Under the Plans or
Programs (2)
|
||||||||||||
July 1 – 31, 2021
|
—
|
$
|
—
|
—
|
$
|
—
|
||||||||||
August 1 – 31, 2021
|
202,850
|
43.30
|
202,850
|
6,639,228
|
||||||||||||
September 1 – 30, 2021
|
156,789
|
42.34
|
156,789
|
—
|
||||||||||||
Total
|
359,639
|
$
|
42.88
|
359,639
|
$
|
—
|
(1) |
All shares were purchased through the publicly announced stock repurchase program in open-market transactions.
|
(2) |
In February 2021, our Board of Directors authorized the purchase of up to $20 million of our common stock under a stock repurchase program. Under this program, during the three
months and nine months ended September 30, 2021, we repurchased 359,639 and 464,992 shares of our common stock, respectively, at a total cost of $15.4 million and $20 million, respectively, thereby completing the 2021 Board of Directors
authorization. In October 2021, our Board of Directors authorized the purchase of up to an additional $30 million of our common stock under a new stock repurchase program. Stock will be purchased from time to time, in the open market, or
through private transactions, as market conditions warrant.
|
ITEM 6. |
EXHIBITS
|
Exhibit
Number
|
|
101.INS**
|
Inline XBRL Instance Document (the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document).
|
101.SCH**
|
Inline XBRL Taxonomy Extension Schema Document.
|
101.CAL**
|
Inline XBRL Taxonomy Extension Calculation Linkbase Document.
|
101.LAB**
|
Inline XBRL Taxonomy Extension Label Linkbase Document.
|
101.PRE**
|
Inline XBRL Taxonomy Extension Presentation Linkbase Document.
|
101.DEF**
|
Inline XBRL Taxonomy Extension Definition Linkbase Document.
|
104
|
Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101).
|
STANDARD MOTOR PRODUCTS, INC.
|
|
(Registrant)
|
|
Date: October 29, 2021
|
/s/ Nathan R. Iles
|
Nathan R. Iles
|
|
Chief Financial Officer
|
|
(Principal Financial and
|
|
Accounting Officer)
|