Standard Motor Products, Inc. (SMP) reported a consolidated net sales increase of 7.8% for the fiscal year ending December 31, 2024, reaching $1.464 billion, compared to $1.358 billion in 2023. The growth was driven by strong demand in the Temperature Control segment, which benefited from warmer weather conditions, and the addition of $35.7 million in sales from the newly acquired Nissens Automotive segment. Gross profit also rose to $423.3 million, resulting in a gross margin of 28.9%, slightly up from 28.6% in the previous year. However, operating income decreased to $80.6 million, or 5.5% of net sales, down from 6.8% in 2023, primarily due to increased selling, general, and administrative expenses.
The acquisition of Nissens Automotive, completed on November 1, 2024, marked a significant strategic development for SMP, expanding its footprint in the European automotive aftermarket. This acquisition is expected to enhance cross-selling opportunities and generate synergies, with Nissens Automotive projected to follow a seasonal sales pattern similar to the Temperature Control segment. The company also announced plans to open a new distribution center in Shawnee, Kansas, which is anticipated to improve logistics and operational efficiencies by 2025.
Operationally, SMP employed approximately 5,600 people as of December 31, 2024, with a significant presence in both the U.S. and international markets. The company reported a stable customer base, with its three largest customers—O’Reilly Auto Parts, AutoZone, and NAPA—accounting for about 60.7% of total net sales. The company’s focus on maintaining strong relationships with these key customers is critical, as any loss or reduction in purchases from them could adversely impact financial performance.
Despite the positive sales growth, SMP faced challenges, including rising operational costs and inflationary pressures. Selling, general, and administrative expenses increased by $41.5 million, attributed to the consolidation of Nissens Automotive's expenses and higher distribution costs. The company anticipates continued margin pressure but expects to mitigate these impacts through cost-saving initiatives and pricing strategies. Looking ahead, SMP remains optimistic about leveraging its recent acquisition and expanding its market presence, while also navigating the complexities of the automotive aftermarket landscape.
About STANDARD MOTOR PRODUCTS, INC.
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