Industrial supply and MRO giant Motion on Thursday posted better-than-expected full-year financial results and a modest increase in sales in the final quarter of the year.
Motion parent Genuine Parts Company said the industrial business — the no. 2 distributor on ID’s latest Big 50 — saw $2.1 billion in sales in the fourth quarter, up by 1.7% compared to the same period in 2022.
Motion’s quarterly profit, meanwhile, jumped by 19.3% year-over-year to $275 million, and its profit margin rose by 190 basis points to 12.9% over that span. Acquisitions accounted for 0.5% in increased sales, officials said.
For the full year, Motion reported more than $8.8 billion in sales, an increase of nearly 5% over 2022 levels, while the division’s annual profit climbed from $887 million to just over $1.1 billion.
GPC, which also owns the NAPA automotive parts brand, said Motion’s performance, along with its international automotive operations, helped offset its U.S. auto business, whose profit slipped both in the latest quarter and on an annual basis. The company overall reported $5.6 billion in fourth-quarter sales and $23.1 billion in 2023 revenue, reflecting increases of 1.1% and 4.5%, respectively.
In the company’s earnings statement, GPC officials also announced that it would introduce a "global restructuring" initiative that aims to improve asset alignment and efficiency. The effort will include a "voluntary retirement offer" in the U.S., along with the "rationalization and optimization" of select distribution hubs, stores and other company operations. The company expects the initiative to cost $100 million to $200 million this year while generating $20 million to $40 million in savings; moving forward, savings are projected to reach $5 million to $90 million annually.
Additional details of the proposal, including the number of potentially affected jobs or company locations, were not disclosed.
"We continuously pursue initiatives to simplify and streamline our business, enhance our service proposition and align with the market environments," GPC President and COO Will Stengel said in the statement. "Our coordinated global restructuring program is designed to improve service for customers and create value for our shareholders. We are focused on what we can control and will execute with discipline to deliver on our long-term financial targets."
GPC’s debut 2024 forecast anticipates 3% to 5% sales growth both in the Motion business and overall. The company’s projected earnings per diluted share — $8.95 to $9.15 — would fall below 2023’s level of $9.33 per share.
