Standard Motor Products Reports 24.7% Revenue Growth in Q1 2025

Standard Motor Products, Inc. (SMP) reported a significant increase in financial performance for the first quarter of 2025, with consolidated net sales reaching $413.4 million, a 24.7% increase from $331.4 million in the same period of 2024. The growth was driven by strong sales across most operating segments, particularly the newly acquired Nissens Automotive segment, which contributed $66.2 million in sales. Gross profit also saw a notable rise, increasing to $124.7 million, resulting in a gross margin of 30.2%, up from 27% in the prior year. Operating income improved to $24.5 million, or 5.9% of net sales, compared to $14.6 million, or 4.4%, in the previous year.

The company's profitability metrics also reflected positive trends, with earnings from continuing operations amounting to $13.9 million, compared to $10 million in the first quarter of 2024. Net earnings attributable to SMP were $12.6 million, or $0.56 per diluted share, up from $8.8 million, or $0.39 per diluted share, in the same quarter last year. The increase in earnings was partially offset by a rise in interest expenses, which surged to $7.8 million due to higher borrowings related to the Nissens acquisition.

Operationally, SMP has been focusing on restructuring and integration initiatives, incurring $0.7 million in related expenses during the quarter. The company is also expanding its cost reduction efforts, which include relocating certain product lines to manufacturing facilities in Mexico. These initiatives are expected to enhance operational efficiency and reduce costs over time. Additionally, the company reported a slight increase in selling, general, and administrative expenses, which rose to $99.8 million, primarily due to expenses associated with the Nissens Automotive segment.

SMP's balance sheet as of March 31, 2025, showed total assets of $1.93 billion, up from $1.81 billion at the end of 2024. The company’s total debt increased to $650.6 million, reflecting the financing of the Nissens acquisition. Cash and cash equivalents stood at $50.3 million, providing a solid liquidity position. The company also declared a quarterly dividend of $0.31 per share, an increase from $0.29 in the previous year, indicating a commitment to returning value to shareholders.

Looking ahead, SMP anticipates that the impact of new tariffs on imports will begin to affect its operations in the second quarter of 2025. The company plans to mitigate these effects through price increases and cost reduction strategies. Overall, SMP remains optimistic about its growth potential, particularly in the automotive aftermarket and the newly integrated Nissens Automotive segment, while continuing to navigate challenges in the broader economic landscape.