Genuine Parts Company reported its 2021 third quarter fiscal results on Oct. 21, showing continued strong results at its industrial parts group — primarily doing business as Motion (formerly Motion Industries) — that further exemplified the greater MRO products market's recovery from a forgettable 2020.
Birmingham, AL-based Motion saw Q3 sales of $1.61 billion (34 percent of GPC's total), up 14.5 percent year-over-year and sequentially up narrowly from Q2's $1.59 billion. The past two quarters have been a major acceleration from Q1, when sales dipped 0.1 percent year-over-year.
The 14.5 percent year-over-year increase was powered by a 13.4 percent gain in comparable sales, a 0.8 percent favorable gain from foreign currency and a 0.3 percent bump from acquisitions. Motion's Q3 segment profit of $166 million jumped 31.9 percent year-over-year and topped Q2's $150 million, with profit margin of 10.3 percent up from 8.9 percent a year earlier and 9.5 percent in Q2.
In its Q3 investor presentation for its Industrial segment, GPC noted better sales trends among virtually all product categories and industries served in North America, with customers operating at higher run rates and releasing capital project orders. Motion is strong growth outlook for plant automation and robotics solutions and is projecting positive comparable sales over the balance of 2021.
GPC is forecasting full year 2021 Industrial sales growth of 10 to 11 percent, a considerable increase from the 6-8 percent growth outlook shared in its Q2 report and 4 to 6 percent issued after Q1.
GPC's shared the same strategic initiatives for its Industrial Group that it stated in its Q1 and Q2 presentations:
- Omni-channel buildout to accelerate e-commerce growth
- Expand industrial services and solutions capabilities
- Considering strategic M&A to further boost products/services offering
- Strategically enhanced pricing and product category management
- Network optimization and automation to further improve productivity
GPC's Automotive unit — which does business as NAPA Auto Parts — saw Q3 sales of $3.20 billion, up 8.2 percent year-over-year and identical to Q2. The growth was powered by a 4.8 percent increase in comparable sales, a 2.4 percent benefit from acquisitions and a 1.0 percent bump from foreign currency and other. Segment profit of $281 million improved 5.6 percent year-over-year and trailed Q2's $291 million, while Q3 profit margin of 8.8 percent trailed the 9.0 percent from a year earlier and 9.1 percent in Q2.
GPC is forecasting full year Automotive sales growth of 14 to 15 percent, up from the 11 to 13 percent growth issued in the company's Q2 report.
Overall, GPC's total Q3 sales of $4.82 billion increased 10.3 percent year-over-year and topped Q2's $4.78 billion. The improvement was powered by a 7.6 percent increase in comparable sales, a 1.8 percent benefit from acquisitions and a 0.9 percent bump from foreign currency and other. Q3 operating profit of $229 million trailed the $233 million GPC had a year earlier and $253 million in Q2