NTP-STAG Parent Co. Announces Q4, Full Year Results

CHICAGO – LKQ Corporation (Nasdaq:LKQ), the parent company of Keystone Automotive and its NTP-STAG RV distribution division, reported fourth quarter and full year 2022 financial results.

“The fourth quarter was a solid operational finish to 2022. Our Wholesale – North America and Europe segments again delivered outstanding organic revenue growth and solid margins, exceeding our expectations for the quarter and year. Importantly, our global teams delivered these results in the midst of rampant inflation, supply chain disruptions, a tight labor market, lower commodity prices, and volatile exchange rates. The execution of our strategy, the resiliency of our business model, and the strength of our balance sheet have the Company well positioned to continue its success and performance in 2023,” noted Dominick Zarcone, president and chief executive officer.

Fourth Quarter and Full Year 2022 Financial Results

Revenue for the fourth quarter of 2022 was $3.0 billion, a decrease of 5.8% as compared to $3.2 billion in the fourth quarter of 2021. On a constant currency basis, fourth quarter revenue decreased by 0.1%. For the fourth quarter of 2022, parts and services organic revenue increased 4.5% (5.9% on a per day basis), while the net impact of acquisitions and divestitures decreased revenue by 3.1% and foreign exchange rates decreased revenue by 6.1%, for a total parts and services revenue decrease of 4.8%. Other revenue fell 20.1% in the fourth quarter of 2022 primarily due to weaker commodity prices relative to the same period in 2021.

Net income for the fourth quarter of 2022 was $193 million as compared to $235 million for the same period in 2021. Diluted earnings per share for the quarter was $0.72 as compared to $0.81 for the same period of 2021, a decrease of 11.1%.

On an adjusted basis, net income in the fourth quarter of 2022 was $209 million as compared to $254 million for the same period of 2021, a decrease of 17.5%. Adjusted diluted earnings per share for the fourth quarter of 2022 was $0.78 as compared to $0.87 for the same period of 2021, a decrease of 10.3%.

The effective tax rate for the fourth quarter of 2022 was 29.7%, which reflected adjustments to true-up the calculated full year effective rate as well as discrete tax expenses.

Revenue for the full year of 2022 was $12.8 billion, a decrease of 2.3% as compared to $13.1 billion for the full year of 2021. On a constant currency basis, full year 2022 revenue increased by 2.8% to $13.5 billion. For the full year of 2022, parts and services organic revenue increased 5.0% on a reported basis (5.2% on a per day basis), while the net impact of acquisitions and divestitures decreased revenue by 1.2% and foreign exchange rates decreased revenue by 5.5%, for a total parts and services revenue decrease of 1.7%. Other revenue for the full year of 2022 fell 9.2% primarily due to weaker commodity prices relative to 2021.

Net income for the full year of 2022 was $1.14 billion as compared to $1.09 billion for the same period in 2021. Diluted earnings per share for the full year of 2022 was $4.11 as compared to $3.66 for the same period of 2021, an increase of 12.3%.

On an adjusted basis, net income for the full year of 2022 was $1.07 billion as compared to $1.18 billion for the same period of 2021, a decrease of 9.4%. Adjusted diluted earnings per share for the full year of 2022 was $3.85 as compared to $3.96 for the same period of 2021, a decrease of 2.8%.

Cash Flow and Balance Sheet

Cash flow from operations and free cash flow were $1.25 billion and $1.0 billion, respectively, for the full year of 2022. As of Dec. 31, 2022, the balance sheet reflected total debt of $2.7 billion, and total leverage, as defined in our credit facility, was 1.5x EBITDA.

Stock Repurchase and Dividend Programs

During the fourth quarter of 2022, the company invested $152 million to repurchase 3.0 million shares of its common stock. For the year ended Dec. 31, 2022, the company invested $1.04 billion to repurchase 20.5 million shares. Since initiating the stock repurchase program in late October 2018, the company has repurchased approximately 55 million shares for a total of $2.4 billion through Dec. 31, 2022. On Oct. 25, 2022, the Board of Directors authorized a $1 billion increase to the existing share repurchase program, which raised the aggregate authorization to $3.5 billion, and extended the duration of the program through Oct. 25, 2025.

On Feb. 21, 2023, the Board of Directors declared a quarterly cash dividend of $0.275 per share of common stock, payable on March 30, 2023, to stockholders of record at the close of business on March 16, 2023.

Other Events

On Jan. 5, 2023, the company entered into a new credit agreement with several lenders, at which time the prior credit agreement was terminated. The new credit agreement includes an unsecured revolving credit facility of up to a U.S. Dollar equivalent of $2 billion and an unsecured term loan facility of up to $500 million. The revolving credit facility has a maturity date of Jan. 5, 2028, and the term loan has a maturity date of Jan. 5, 2026, each of which maturity dates may be extended for a one-year extension.

2023 Outlook

Rick Galloway, senior vice president and chief financial officer, commented: “Our 2023 annual guidance reflects our ongoing commitment of creating long-term value for our stockholders through our operational excellence initiatives of driving profitable growth, implementing ongoing margin enhancement programs, and generating robust levels of free cash flow through disciplined capital spending and active working capital management. As we navigate this period of macro uncertainty and non-operational headwinds, we expect healthy demand for our products and services, solid organic growth and sustained operating momentum across our industry leading business segments.”

Source: https://rvbusiness.com/ntp-stag-parent-co-announces-q4-full-year-results/