CHICAGO, Feb. 24, 2011 (GLOBE NEWSWIRE) -- LKQ Corporation (Nasdaq:LKQX) today announced results for its fourth quarter and full year ended December 31, 2010. Income from continuing operations for the fourth quarter was $41.3 million and diluted earnings per share from continuing operations was $0.28. For the full year, income from continuing operations was $167.1 million and diluted earnings per share from continuing operations was $1.15.
"I am very pleased with the quarter and the year, as we continued our stellar financial performance, with revenue for the year growing 20.6% to $2.5 billion," commented Joseph Holsten, Vice Chairman and Co-Chief Executive Officer of LKQ Corporation. "We continued to see increased usage of alternative collision parts in 2010, which has allowed us to grow despite challenging economic conditions. Our organic revenue growth rate for parts and services was 7.0% during the fourth quarter."
Mr. Holsten added, "We also continued to grow through acquisitions. In 2010 we completed 20 acquisitions, which helped us to continue to build out our North American footprint and to add depth and breadth to our product offering. Revenue growth attributable to acquisitions was 10.7% in the fourth quarter of 2010. I expect 2011 will be another busy year for acquisitions."
2010 Reported Results
For the fourth quarter of 2010, revenue was $674 million compared with $556 million for the fourth quarter of 2009, an increase of 21.3%. Income from continuing operations for the quarter was $41.3 million compared with $36.5 million in the prior year, an increase of 13.2%. The results of the fourth quarter of 2009 included an after tax gain on bargain purchase of $4.3 million.
For the full year of 2010, revenue was $2.47 billion compared with $2.05 billion for the full year of 2009, an increase of 20.6%. Income from continuing operations for the full year was $167.1 million compared with $127.1 million for the prior year, an increase of 31.4%. Income from continuing operations for the full year included $0.7 million, or $0.4 million after tax, of restructuring expenses compared to $2.6 million, or $1.6 million after tax, for the prior year. The results of 2009 also included an after tax gain on bargain purchase of $4.3 million.
Balance Sheet and Liquidity
As of December 31, 2010, LKQ's balance sheet reflected cash and equivalents of $95.7 million and long-term debt (including the current portion) of $601.0 million. The Company had no borrowings on its $100 million revolving credit facility although availability was reduced to $73 million due to outstanding letters of credit.
Business Acquisitions
During the fourth quarter of 2010, LKQ acquired a total of eight businesses including a wholesale recycled products business in Arkansas and a self serve business with two facilities in southern California. These acquisitions were in addition to the previously announced fourth quarter acquisitions of Cross Canada, PROFormance Power Train, SPI Distribution, Best Bumper, a wholesale recycling business in Virginia, and a self service recycling operation in Colorado. Since the beginning of 2011, the Company has completed four additional acquisitions including ATK Vege, an engine remanufacturing business headquartered in Texas; an aftermarket distributor of heating and cooling products located in the Midwest; a heavy duty truck recycling business located in Texas; and a recycled parts business in Milwaukee, Wisconsin.
Company Outlook
"We continue to see opportunities for organic growth through increased use of alternative parts, an improving economy, additional geographic expansion and an enhanced product offering," said Robert Wagman, LKQ's President and Co-Chief Executive Officer. "Revenue from parts and services is anticipated to grow organically in 2011 at a rate of 6% to 8%."
Based on current conditions and excluding restructuring expenses and any gains or losses related to acquisitions or divestitures, LKQ anticipates full year 2011 income from continuing operations will be in the range of $194 million to $208 million and diluted earnings per share from continuing operations will be in the range of $1.31 to $1.39.
Net cash provided by operating activities for 2011 is projected to be approximately $195 million. The Company estimates capital expenditures related to property and equipment will be between $85 million to $95 million.
Quarterly Conference Call
The Company will host a conference call for the investment community at 10:00 a.m. Eastern Time (9:00 a.m. Central Time) on February 24, 2011 and a simultaneous audio webcast. To access the investor conference call, please dial (877) 407-0315. International access to the call may be obtained by dialing (201) 689-8501. The audio webcast can be accessed via the Company's website at in the Investor Relations section.
A replay of the conference call will be available by telephone at (877) 660-6853 or (201) 612-7415 for international calls. The telephone replay will require you to enter -- account: 286, conference ID: 365353. An online replay of the audio webcast will be available on the Company's website. Both formats of replay will be available through March 23, 2011. Please allow approximately two hours after the live presentation before attempting to access the replay.
About LKQ Corporation
LKQ Corporation is the largest nationwide provider of aftermarket and recycled collision replacement parts, and refurbished collision replacement products such as wheels, bumper covers and lights, and a leading provider of mechanical replacement parts used to repair light vehicles. LKQ operates more than 325 facilities, offering its customers a broad range of replacement systems, components, and parts to repair automobiles and light, medium and heavy-duty trucks.
Forward Looking Statements
The statements in this press release that are not historical in nature are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These include statements regarding our expectations, beliefs, hopes, intentions or strategies. Forward-looking statements involve risks and uncertainties, some of which are not currently known to us. Actual events or results may differ materially from those expressed or implied in the forward looking statements as a result of various factors.
These factors include:
- uncertainty as to changes in U.S. general economic activity and the impact of these changes on the demand for our products and our ability to obtain financing for operations;
- fluctuations in the pricing of new original equipment manufacturer ("OEM") replacement parts;
- the availability and cost of our inventory;
- variations in vehicle accident rates or miles driven;
- changes in state or federal laws or regulations affecting our business;
- changes in the types of replacement parts that insurance carriers will accept in the repair process;
- changes in the demand for our products and the supply of our inventory due to severity of weather and seasonality of weather patterns;
- increasing competition in the automotive parts industry;
- uncertainty as to the impact on our industry of any terrorist attacks or responses to terrorist attacks;
- our ability to operate within the limitations imposed by financing arrangements;
- our ability to obtain financing on acceptable terms to finance our growth;
- declines in the values of our assets;
- fluctuations in fuel and other commodity prices;
- fluctuations in the prices of scrap metal and other metals;
- our ability to develop and implement the operational and financial systems needed to manage our operations;
- our ability to integrate and successfully operate acquired companies and any companies acquired in the future and the risks associated with these companies;
- claims by OEMs or others that attempt to restrict or eliminate the sale of aftermarket products:
- termination of business relationships with insurance companies that promote the use of our products;
- product liability claims by the end users of our products or claims by other parties who we have promised to indemnify for product liability matters;
- currency fluctuations in the U.S. dollar versus the Canadian dollar, the Mexican peso and the Taiwan dollar;
- instability in regions in which we operate, such as Mexico, that can affect our supply of certain products; and
- other risks that are described in our Form 10-K filed February 26, 2010 and in other reports filed by us from time to time with the Securities and Exchange Commission.
You should not place undue reliance on these forward-looking statements. All of these forward-looking statements are based on our expectations as of the date of this press release. We undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law.
We provide a reconciliation of Income from Continuing Operations to EBITDA as we believe it offers investors, securities analysts and other interested parties useful information regarding our results of operations because it assists in analyzing our performance and the value of our business. EBITDA provides insight into our profitability trends, and allows management and investors to analyze our operating results with and without the impact of depreciation, amortization, interest and income tax expense. We believe EBITDA is used by securities analysts, investors, and other interested parties in evaluating companies, many of which present EBITDA when reporting their results. EBITDA should not be construed as an alternative to operating income, net income or net cash provided by (used in) operating activities, as determined in accordance with accounting principles generally accepted in the United States. In addition, not all companies that report EBITDA information calculate EBITDA in the same manner as we do and, accordingly, our calculation is not necessarily comparable to similarly named measures of other companies and may not be an appropriate measure for performance relative to other companies.
CONTACT: Investors and Analysts: John Quinn EVP and Chief Financial Officer (312) 621-1950 General Media Queries: LKQ Corporation Investor Relations Department (312) 621-1950