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. |
31
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Item 3. |
45
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Item 4. |
46
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Item 1. |
47
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Item 2. |
47
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Item 6. |
48
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49
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ITEM 1. |
CONSOLIDATED FINANCIAL STATEMENTS
|
Three Months Ended
June 30,
|
Six Months Ended
June 30,
|
|||||||||||||||
(In thousands, except share and per share data)
|
2022
|
2021
|
2022
|
2021
|
||||||||||||
(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, net
|
||||||||||||||||
Operating income
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||||||||||||
Other non-operating income, net
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|
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||||||||||||
Interest expense
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|
||||||||||||
Earnings from continuing operations before taxes
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|
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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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(
|
)
|
(
|
)
|
(
|
)
|
(
|
)
|
||||||||
Net earnings
|
|
|
|
|
|
|||||||||||
Net earnings attributable to noncontrolling interest
|
|
|
|
|
||||||||||||
Net earnings attributable to SMP (a)
|
$
|
|
$
|
|
$
|
|
$
|
|
||||||||
Net earnings attributable to SMP
|
||||||||||||||||
Earnings from continuing operations
|
$
|
|
$
|
|
$
|
|
$
|
|
||||||||
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
June 30,
|
Six Months Ended
June 30,
|
||||||||||||||
(In thousands)
|
2022
|
2021
|
2022
|
2021
|
||||||||||||
(Unaudited)
|
(Unaudited)
|
|||||||||||||||
|
||||||||||||||||
Net earnings
|
$
|
|
$
|
|
$
|
|
$
|
|
||||||||
Other comprehensive income (loss), net of tax:
|
||||||||||||||||
Foreign currency translation adjustments
|
(
|
)
|
|
(
|
)
|
|
||||||||||
Derivative instruments
|
||||||||||||||||
Pension and postretirement plans
|
(
|
)
|
(
|
)
|
(
|
)
|
(
|
)
|
||||||||
Total other comprehensive income, net of tax
|
(
|
)
|
|
(
|
)
|
|
||||||||||
Total Comprehensive income
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|
|
|
|
||||||||||||
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)
|
June 30,
2022
|
December 31,
2021
|
||||||
|
(Unaudited)
|
|||||||
ASSETS
|
||||||||
CURRENT ASSETS:
|
||||||||
Cash and cash equivalents
|
$
|
|
$
|
|
||||
Accounts receivable, less allowances for discounts and expected credit losses of $
|
|
|
||||||
Inventories
|
|
|
||||||
Unreturned customer inventories
|
|
|
||||||
Prepaid expenses and other current assets
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|
||||||
Total current assets
|
|
|
||||||
|
||||||||
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
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|
|
||||||
Other assets
|
|
|
||||||
Total assets
|
$
|
|
$
|
|
||||
|
||||||||
LIABILITIES AND STOCKHOLDERS’ EQUITY
|
||||||||
CURRENT LIABILITIES:
|
||||||||
Current portion of revolving credit facility
|
$
|
|
$
|
|
||||
Current portion of term loan and other debt
|
|
|
||||||
Accounts payable
|
|
|
||||||
Sundry payables and accrued expenses
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|
||||||
Accrued customer returns
|
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|
||||||
Accrued core liability
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|
||||||
Accrued rebates
|
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|
||||||
Payroll and commissions
|
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|
||||||
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)
|
Six Months Ended
June 30,
|
|||||||
|
2022
|
2021
|
||||||
|
(Unaudited)
|
|||||||
CASH FLOWS FROM OPERATING ACTIVITIES:
|
||||||||
Net earnings
|
$
|
|
$
|
|
||||
Adjustments to reconcile net earnings to net cash provided by (used in) operating activities:
|
||||||||
Depreciation and amortization
|
|
|
||||||
Amortization of deferred financing cost
|
|
|
||||||
Increase (decrease) to allowance for expected credit losses
|
(
|
)
|
|
|||||
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) in inventories
|
(
|
)
|
(
|
)
|
||||
(Increase) decrease in prepaid expenses and other current assets
|
(
|
)
|
|
|||||
Increase in accounts payable
|
|
|
||||||
(Decrease) in sundry payables and accrued expenses
|
(
|
)
|
(
|
)
|
||||
Net change in other assets and liabilities
|
(
|
)
|
(
|
)
|
||||
Net cash provided by (used in) 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:
|
||||||||
Borrowings under the term loan |
||||||||
Net borrowings under revolving credit facilities
|
|
|
||||||
Net borrowings of other debt and capital lease obligations
|
|
|
||||||
Purchase of treasury stock
|
(
|
)
|
(
|
)
|
||||
Payments of debt issuance costs
|
( |
) | ||||||
Increase in overdraft balances
|
|
|
||||||
Dividends paid
|
(
|
)
|
(
|
)
|
||||
Net cash provided by financing activities
|
|
|
||||||
Effect of exchange rate changes on cash
|
(
|
)
|
|
|||||
Net increase (decrease) 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 March 31, 2022
|
$
|
|
$
|
|
$
|
|
$
|
(
|
)
|
$
|
(
|
)
|
$
|
|
$
|
|
$
|
|
||||||||||||||
Net earnings
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||
Other comprehensive income, net of tax
|
|
|
|
(
|
)
|
|
(
|
)
|
(
|
)
|
(
|
)
|
||||||||||||||||||||
Cash dividends paid
|
|
|
(
|
)
|
|
|
(
|
)
|
|
(
|
)
|
|||||||||||||||||||||
Purchase of treasury stock
|
|
|
|
|
(
|
)
|
(
|
)
|
|
(
|
)
|
|||||||||||||||||||||
Stock-based compensation
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||
Balance at June 30, 2022
|
$
|
|
$
|
|
$
|
|
$
|
(
|
)
|
$
|
(
|
)
|
$
|
|
$
|
|
$
|
|
(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 March 31, 2021
|
$
|
|
$
|
|
$
|
|
$
|
(
|
)
|
$
|
(
|
)
|
$
|
|
$
|
|
$
|
|
||||||||||||||
Noncontrolling interest acquired
|
||||||||||||||||||||||||||||||||
Net earnings
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||
Other comprehensive income, net of tax
|
|
|
|
|
|
|
(
|
)
|
|
|||||||||||||||||||||||
Cash dividends paid
|
|
|
(
|
)
|
|
|
(
|
)
|
|
(
|
)
|
|||||||||||||||||||||
Purchase of treasury stock
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||
Stock-based compensation
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||
Balance at June 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, 2021
|
$
|
|
$
|
|
$
|
|
$
|
(
|
)
|
$
|
(
|
)
|
$
|
|
$
|
|
$
|
|
||||||||||||||
Net earnings
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||
Other comprehensive income, net of tax
|
|
|
|
(
|
)
|
|
(
|
)
|
(
|
)
|
(
|
)
|
||||||||||||||||||||
Cash dividends paid
|
|
|
(
|
)
|
|
|
(
|
)
|
|
(
|
)
|
|||||||||||||||||||||
Purchase of treasury stock
|
|
|
|
|
(
|
)
|
(
|
)
|
|
(
|
)
|
|||||||||||||||||||||
Stock-based compensation
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||
Employee Stock Ownership Plan
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||
Balance at June 30, 2022
|
$
|
|
$
|
|
$
|
|
$
|
(
|
)
|
$
|
(
|
)
|
$
|
|
$
|
|
$
|
|
(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 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 June 30, 2021
|
$
|
|
$
|
|
$
|
|
$
|
(
|
)
|
$
|
(
|
)
|
$
|
|
$
|
|
$
|
|
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 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.
|
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) |
|
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) |
|
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, 2021
|
$
|
|
$
|
|
$
|
|
||||||
Restructuring and integration costs: |
||||||||||||
Amounts provided for during 2022
|
||||||||||||
Cash payments
|
(
|
)
|
(
|
)
|
(
|
)
|
||||||
Reclassification
|
( |
) | ( |
) | ||||||||
Exit activity liability at June 30, 2022
|
$
|
|
$
|
|
$
|
|
|
June 30,
2022
|
December 31,
2021
|
||||||
|
(In thousands)
|
|||||||
Finished goods
|
$
|
|
$
|
|
||||
Work in process
|
|
|
||||||
Raw materials
|
|
|
||||||
Subtotal
|
|
|
||||||
Unreturned customer inventories
|
|
|
||||||
Total inventories
|
$
|
|
$
|
|
|
June 30,
2022
|
December 31,
2021
|
||||||
|
(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) |
|
Balance Sheet Information
|
June 30,
2022
|
December 31,
2021
|
||||||
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
|
|
%
|
|
%
|
Expense and Cash Flow Information |
Three Months Ended
June 30,
|
|||||||
|
2022
|
2021
|
||||||
Lease Expense
|
||||||||
Operating lease expense (a)
|
$
|
|
$
|
|
Six Months Ended
June 30,
|
||||||||
2022
|
2021
|
|||||||
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) |
|
2022
|
$
|
|
||
2023
|
|
|||
2024
|
|
|||
2025
|
|
|||
2026
|
|
|||
Thereafter
|
|
|||
Total lease payments
|
$
|
|
||
Less: Interest
|
(
|
)
|
||
Present value of lease liabilities
|
$
|
|
|
June 30,
2022
|
December 31,
2021
|
||||||
|
(In thousands)
|
|||||||
Credit facility – term loan due 2027 |
$ |
$ |
||||||
Credit facility – revolver due 2027 |
||||||||
Senior secured facility – revolver due 2023
|
|
|
|
|
||||
Other (1)
|
|
|
||||||
Total debt
|
$
|
|
$
|
|
||||
|
||||||||
Current maturities of debt
|
$
|
|
$
|
|
||||
Long-term debt
|
|
|
||||||
Total debt
|
$
|
|
$
|
|
(1) |
|
Revolving Credit Facility
|
Term Loan Facility
|
Polish Overdraft Facility and Other Debt
|
Total
|
|||||||||||||
Remainder of 2022
|
$
|
|
$
|
|
$
|
|
$
|
|
||||||||
2023
|
|
|
|
|
||||||||||||
2024
|
|
|
|
|
||||||||||||
2025
|
|
|
|
|
||||||||||||
2026
|
|
|
|
|
||||||||||||
2027
|
|
|
|
|
||||||||||||
Total
|
$
|
|
$
|
|
$
|
|
$
|
|
||||||||
Less: current maturities
|
(
|
)
|
(
|
)
|
(
|
)
|
(
|
)
|
||||||||
Long-term debt
|
$
|
|
$
|
|
$
|
|
$
|
|
(In thousands)
|
||||
Remainder of 2022
|
$
|
|
||
2023
|
|
|||
2024
|
|
|||
2025
|
|
|||
2026
|
|
|||
2027
|
|
|||
Total amortization
|
$
|
|
Three Months Ended June 30, 2022
|
||||||||||||||||
Foreign
Currency
Translation
|
Unrecognized
Postretirement
Benefit Costs
(Credit)
|
Unrealized
derivative
gains
(losses)
|
Total
|
|||||||||||||
Balance at March 31, 2022 attributable to SMP
|
$
|
(
|
)
|
$
|
|
$
|
|
$
|
(
|
)
|
||||||
Other comprehensive income before reclassifications
|
(
|
)
|
|
|
(1) |
(
|
)
|
|||||||||
Amounts reclassified from accumulated other comprehensive income
|
|
(
|
)
|
|
|
|||||||||||
Other comprehensive income, net
|
(
|
)
|
(
|
)
|
|
(
|
)
|
|||||||||
Balance at June 30, 2022 attributable to SMP
|
$
|
(
|
)
|
$
|
|
$
|
|
$
|
(
|
)
|
Six Months Ended June 30, 2022
|
||||||||||||||||
Foreign
Currency
Translation
|
Unrecognized
Postretirement
Benefit Costs
(Credit)
|
Unrealized
derivative
gains
(losses)
|
Total
|
|||||||||||||
Balance at December 31, 2021 attributable to SMP
|
$
|
(
|
)
|
$
|
|
$
|
|
$
|
(
|
)
|
||||||
Other comprehensive income before reclassifications
|
(
|
)
|
|
|
(1) |
(
|
)
|
|||||||||
Amounts reclassified from accumulated other comprehensive income
|
|
(
|
)
|
|
|
|||||||||||
Other comprehensive income, net
|
(
|
)
|
(
|
)
|
|
(
|
)
|
|||||||||
Balance at June 30, 2022 attributable to SMP
|
$
|
(
|
)
|
$
|
|
$
|
|
$
|
(
|
)
|
(1)
|
|
Three Months
Ended June 30,
|
Six Months
Ended June 30,
|
||||||
Details About Accumulated Other Comprehensive Income Components |
2022
|
2022
|
||||||
Derivative cash flow hedge:
|
||||||||
Unrecognized gain (loss) (1)
|
$
|
|
$
|
|
||||
Postretirement Benefit Plans:
|
||||||||
Unrecognized gain (loss) (2)
|
(
|
)
|
(
|
)
|
||||
Total before income tax
|
|
|
||||||
Income tax expense
|
|
|
||||||
Total reclassifications attributable to SMP
|
$
|
|
$
|
|
(1)
|
|
(2)
|
|
Shares
|
Weighted Average
Grant Date Fair
Value Per Share
|
|||||||
Balance at December 31, 2021
|
|
$
|
|
|||||
Granted
|
|
|
||||||
Vested
|
(
|
)
|
|
|||||
Forfeited
|
(
|
)
|
|
|||||
Balance at June 30, 2022
|
|
$
|
|
June 30, 2022
|
December 31, 2021
|
||||||||||||||||
Fair Value Hierarchy
|
Fair Value | Carrying Amount | Fair Value | Carrying Amount | |||||||||||||
Cash and cash equivalents
|
LEVEL 1
|
$
|
|
$
|
|
$
|
|
$
|
|
||||||||
Deferred compensation
|
LEVEL 1
|
|
|
|
|
||||||||||||
Short term borrowings
|
LEVEL 1
|
|
|
|
|
||||||||||||
Long-term debt
|
LEVEL 1
|
|
|
|
|
||||||||||||
Cash flow interest rate swap
|
LEVEL 2
|
|
|
|
|
Three Months Ended
June 30,
|
Six Months
Ended
June 30,
|
|||||||||||||||
2022
|
2021
|
2022
|
2021
|
|||||||||||||
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
|
|
|
|
|
|
Three Months Ended
June 30,
|
Six Months Ended
June 30,
|
||||||||||||||
|
2022
|
2021
|
2022
|
2021
|
||||||||||||
Restricted and performance-based shares
|
|
|
|
|
|
Three Months Ended
June 30,
|
Six Months Ended
June 30,
|
||||||||||||||
|
2022
|
2021
|
2022
|
2021
|
||||||||||||
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) |
|
Three months ended June 30, 2022 (a)
|
Engine
Management
|
Temperature
Control
|
Other (b)
|
Total
|
||||||||||||
Geographic Area:
|
||||||||||||||||
United States
|
$
|
|
$
|
|
$
|
|
$
|
|
||||||||
Canada
|
|
|
|
|
||||||||||||
Europe
|
|
|
|
|
||||||||||||
Mexico
|
|
|
|
|
||||||||||||
Asia
|
|
|
|
|
||||||||||||
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 June 30, 2021 (a)
|
Engine
Management
|
Temperature
Control
|
Other (b)
|
Total
|
||||||||||||
Geographic Area:
|
||||||||||||||||
United States
|
$
|
|
$
|
|
$
|
|
$
|
|
||||||||
Canada
|
|
|
|
|
||||||||||||
Europe
|
|
|
|
|
||||||||||||
Mexico
|
|
|
|
|
||||||||||||
Asia
|
|
|
|
|
||||||||||||
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
|
$
|
|
$
|
|
$
|
|
$
|
|
Six months ended June 30, 2022 (a)
|
Engine
Management
|
Temperature
Control
|
Other (b)
|
Total
|
||||||||||||
Geographic Area:
|
||||||||||||||||
United States
|
$
|
|
$
|
|
$
|
|
$
|
|
||||||||
Canada
|
|
|
|
|
||||||||||||
Europe
|
|
|
|
|
||||||||||||
Mexico
|
|
|
|
|
||||||||||||
Asia
|
|
|
|
|
||||||||||||
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 |
$ |
$ |
$ |
$ |
Six months ended June 30,
2021 (a)
|
Engine
Management
|
Temperature
Control
|
Other (b)
|
Total
|
||||||||||||
Geographic Area:
|
||||||||||||||||
United States
|
$
|
|
$
|
|
$
|
|
$
|
|
||||||||
Canada
|
|
|
|
|
||||||||||||
Europe
|
|
|
|
|
||||||||||||
Mexico
|
|
|
|
|
||||||||||||
Asia
|
|
|
|
|
||||||||||||
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
|
$
|
|
$
|
|
$
|
|
$
|
|
(a) |
|
(b) |
|
Three Months Ended |
Six
Months Ended |
|||||||||||||||
|
June 30,
|
June 30,
|
||||||||||||||
|
2022
|
2021
|
2022
|
2021
|
||||||||||||
Balance, beginning of period
|
$
|
|
$
|
|
$
|
|
$
|
|
||||||||
Liabilities accrued for current year sales
|
|
|
|
|
||||||||||||
Settlements of warranty claims
|
(
|
)
|
(
|
)
|
(
|
)
|
(
|
)
|
||||||||
Balance, end of period
|
$
|
|
$
|
|
$
|
|
$
|
|
ITEM 2. |
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
|
Three Months Ended
June 30,
|
||||||||
(In thousands, except per share data)
|
2022
|
2021
|
||||||
Net sales
|
$
|
359,412
|
$
|
342,076
|
||||
Gross profit
|
96,351
|
99,272
|
||||||
Gross profit %
|
26.8
|
%
|
29
|
%
|
||||
Operating income
|
27,893
|
36,925
|
||||||
Operating income %
|
7.8
|
%
|
10.8
|
%
|
||||
Earnings from continuing operations before income taxes
|
27,999
|
37,262
|
||||||
Provision for income taxes
|
7,122
|
9,248
|
||||||
Earnings from continuing operations
|
20,877
|
28,014
|
||||||
Loss from discontinued operations, net of income taxes
|
(1,666
|
)
|
(853
|
)
|
||||
Net earnings
|
19,211
|
27,161
|
||||||
Net earnings (loss) attributable to noncontrolling interest
|
85
|
19
|
||||||
Net earnings attributable to SMP
|
19,126
|
27,142
|
||||||
Per share data attributable to SMP – Diluted:
|
||||||||
Earnings from continuing operations
|
$
|
0.93
|
$
|
1.23
|
||||
Discontinued operations
|
(0.07
|
)
|
(0.03
|
)
|
||||
Net earnings per common share
|
$
|
0.86
|
$
|
1.20
|
Three Months Ended June 30,
|
||||||||
2022
|
2021
|
|||||||
Engine Management:
|
||||||||
Ignition, Emission Control, Fuel and Safety Related System Products
|
$
|
202,823
|
$
|
192,486
|
||||
Wire and Cable
|
39,050
|
40,730
|
||||||
Total Engine Management
|
241,873
|
233,216
|
||||||
Temperature Control:
|
||||||||
Compressors
|
72,063
|
69,577
|
||||||
Other Climate Control Parts
|
42,369
|
36,894
|
||||||
Total Temperature Control
|
114,432
|
106,471
|
||||||
All Other
|
3,107
|
2,389
|
||||||
Total
|
$
|
359,412
|
$
|
342,076
|
Three Months Ended
June 30,
|
Engine Management
|
Temperature Control
|
Other
|
Total
|
||||||||||||
2022
|
||||||||||||||||
Net sales
|
$
|
241,873
|
$
|
114,432
|
$
|
3,107
|
$
|
359,412
|
||||||||
Gross margins
|
62,294
|
30,564
|
3,493
|
96,351
|
||||||||||||
Gross margin percentage
|
25.8
|
%
|
26.7
|
%
|
—
|
26.8
|
%
|
|||||||||
2021
|
||||||||||||||||
Net sales
|
$
|
233,216
|
$
|
106,471
|
$
|
2,389
|
$
|
342,076
|
||||||||
Gross margins
|
67,447
|
28,658
|
3,167
|
99,272
|
||||||||||||
Gross margin percentage
|
28.9
|
%
|
26.9
|
%
|
—
|
29
|
%
|
Six Months Ended June 30,
|
||||||||
2022
|
2021
|
|||||||
Engine Management:
|
||||||||
Ignition, Emission Control, Fuel and Safety Related System Products
|
$
|
403,177
|
$
|
366,152
|
||||
Wire and Cable
|
77,953
|
79,082
|
||||||
Total Engine Management
|
481,130
|
445,234
|
||||||
Temperature Control:
|
||||||||
Compressors
|
115,340
|
102,951
|
||||||
Other Climate Control Parts
|
80,413
|
65,993
|
||||||
Total Temperature Control
|
195,753
|
168,944
|
||||||
All Other
|
5,360
|
4,451
|
||||||
Total
|
$
|
682,243
|
$
|
618,629
|
Six Months Ended
June 30,
|
Engine Management
|
Temperature Control
|
Other
|
Total
|
||||||||||||
2022
|
||||||||||||||||
Net sales
|
$
|
481,130
|
$
|
195,753
|
$
|
5,360
|
$
|
682,243
|
||||||||
Gross margins
|
127,829
|
50,550
|
7,812
|
186,191
|
||||||||||||
Gross margin percentage
|
26.6
|
%
|
25.8
|
%
|
—
|
27.3
|
%
|
|||||||||
2021
|
||||||||||||||||
Net sales
|
$
|
445,234
|
$
|
168,944
|
$
|
4,451
|
$
|
618,629
|
||||||||
Gross margins
|
132,517
|
44,653
|
5,886
|
183,056
|
||||||||||||
Gross margin percentage
|
29.8
|
%
|
26.4
|
%
|
—
|
29.6
|
%
|
ITEM 3. |
QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
|
ITEM 4. |
CONTROLS AND PROCEDURES
|
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)
|
||||||||||||
April 1 – 30, 2022
|
96,028
|
$
|
42.72
|
96,028
|
$
|
18,703,548
|
||||||||||
May 1 – 31, 2022
|
104,400
|
39.59
|
104,400
|
14,570,753
|
||||||||||||
June 1 – 30, 2022
|
271,030
|
42.10
|
271,030
|
3,160,443
|
||||||||||||
Total
|
471,458
|
$
|
41.67
|
471,458
|
$
|
3,160,443
|
(1) |
All shares were purchased through the publicly announced stock repurchase programs in open-market transactions.
|
(2) |
In October 2021, our Board of Directors authorized the purchase of up to $30 million of our common stock under a stock repurchase program. Stock repurchases under this program, during the year ended December 31, 2021 were 7,000 shares
at a total cost of $0.3 million; and during the three and six months ended June 30, 2022 were 471,458 shares and 621,885 shares of our common stock, respectively, at a total cost of $19.6 million and $26.5 million, respectively. As of June
30, 2022, there was approximately $3.2 million available for future stock purchases under the program. During the period from July 1, 2022 through July 18, 2022, we have repurchased an additional 70,182 shares of our common stock at a
total cost of $3.2 million, thereby completing the Board of Directors October 2021 authorization.
In July 2022, 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
|
|
31.1
|
|
31.2
|
|
32.1
|
|
32.2
|
|
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).
|
**
|
In accordance with Regulation S-T, the XBRL-related information in Exhibit 101 to the Original Filing shall be deemed to be “furnished” and not “filed.”
|
STANDARD MOTOR PRODUCTS, INC.
|
|
(Registrant)
|
|
Date: August 4, 2022
|
/s/ Nathan R. Iles
|
Nathan R. Iles
|
|
Chief Financial Officer
|
|
(Principal Financial and Accounting Officer)
|