Genuine Parts Company reported its 2020 fourth quarter and full-year financial results on Wednesday, showing that sales at its recently rebranded industrial parts subsidiary — Motion (formerly Motion Industries) — remain suppressed, though improved, amid impacts of the COVID-19 pandemic.
GPC said that Q4 sales at MRO parts distributor Motion were $1.43 billion (34 percent of GPC's total), down 3.3 percent year-over-year and up marginally from $1.41 billion in Q3. The year-over-year decrease included a 4.4 percent decrease in comparable sales. Segment profit of $133 million improved 5.1 percent year-over-year, with a margin of 9.3 percent that improved 70 basis points. For the full year, Motion had 2020 sales of $5.68 billion, down 13.0 percent from 2019, with comparable sales down 8.4 percent.
GPC noted continued sequential and month-to-month improvement for industrial sales and that industrial sales were up approximately 1 percent year-over-year in January, with comparable sales improving to approximately 1 percent as well.
For Industrial, Motion said its strategic initiatives going forward will include:
- Omni-channel buildout – accelerate e-commerce growth
- Expand industrial services and solutions capabilities
- M&A to further boost products/services offering
- Enhance pricing and product category management - w/ strategic intent
- Network optimization and automation for improved productivity
GPC's Automotive unit — which does business as NAPA Auto Parts — saw Q4 sales of $2.82 billion that were up 0.7 percent year-over-year, but down 2.0 percent on a comparable basis. Segment profit of $240 million jumped 19.4 percent year-over-year, with margin of 8.5 percent that improved 130 basis points. For the full year, NAPA had 2020 sales of $10.86 billion, down 1.2 percent from 2019, with comparable sales down 4.4 percent.
Overall, GPC had Q4 total sales of $4.25 billion, down 0.7 percent year-over-year, with comparable sales down 2.8 percent. Operating profit of $172 million more than doubled the $79 million it had a year earlier. For the full year, GPC's 2020 sales of $16.5 billion were down 5.6 percent from 2019, but down only 2.3 percent when excluding divestitures. Operating profit of $163 million was dwarfed by 2019's $647 million. The company took a net loss of $29 million in 2020, compared to a $621 million profit in 2019.
Looking forward, GPC is forecasting full-year 2021 sales growth of 4 to 6 percent for the company, including 4 to 6 percent growth in Automotive and 3 to 5 percent in Industrial. The company is currently budgeting between $275 million and $325 million for 2021 capital expenditures.
Just two days earlier, Motion announced promotions for seven of its field managers. And on Jan. 20, the company kicked off 2021 — its 75th-anniversary year — by announcing its rebranding that shortened the company name from Motion Industries to Motion.