Standard Motor Products, Inc. (NYSE:SMP) Q1 2024 Earnings Call Transcript May 4, 2024
Standard Motor Products, Inc. isn’t one of the 30 most popular stocks among hedge funds at the end of the third quarter (see the details here).
Operator: [Call Starts Abruptly] Also, today’s call is being recorded, and I will be standing by if anyone should need any assist. Now at this time I will turn things over to Mr. Tony Cristello Vice President Investor Relations. Please go ahead, sir.
Tony Cristello: Thank you, Bo, and good morning, everyone. Thank you for joining us on Standard Motor Products first quarter 2024 earnings conference call. With me today are Larry Sills, Chairman Emeritus; Eric Sills, Chairman and Chief Executive Officer; Jim Burke, Chief Operating Officer; and Nathan Iles, Chief Financial Officer. On our call today, Eric will give an overview of our performance in the quarter, and Nathan will then discuss our financial results. Eric will then provide some concluding remarks and open up the call for Q&A. Before we begin this morning, I’d like to remind you that some of the material that we’ll be discussing today may include forward-looking statements regarding our business and expected financial results.
When we use words like anticipate, believe, estimate or expect, these are generally forward-looking statements. Although we believe that the expectations reflected in these forward-looking statements are reasonable, they are based on information currently available to us and certain assumptions made by us, and we cannot assure you that they will prove correct. You should also read our filings with the Securities and Exchange Commission for a discussion of the risks and uncertainties that could cause our actual results to differ from our forward-looking statements. I’ll now turn the call over to Eric Sills, our CEO.
Eric Sills: Thank you, Tony, and good morning, everyone, and welcome to our first quarter earnings call. Let me open by thanking all of our employees around the world for their tireless efforts as we enter our 105th year. So it’s fair to say that our first quarter results were mixed. We’re pleased with our top line performance where we set a record for first quarter sales. However, as expected, our profitability continued to lag, demonstrating some of the challenges in keeping up with inflationary pressures. Let me get into the details best explained at the segment level, starting with Vehicle Control. After a soft fourth quarter, we are pleased to see a nice rebound in sales. We were up about 0.5 point over 2023, which was a challenging comp as Q1 of 2023 was very strong, up more than 4% over the previous year.
After a soft end to last year, we are pleased to see a return to more normal demand. Customer POS was soft in the quarter, though again, it’s being compared to a very strong sell-through last year. Turning to Temperature Control. As you well know, the first quarter is not indicative of how the year will turn out. This is the time of year that we ship customers their preseason orders and as those can ship in late Q1 or early Q2 and whiplash numbers around. Ultimately, this division will depend on the total season and its dynamics, when it gets hot, how hot it is and where and how long it stays that way. So let’s see how the year behaves. On to Engineered Solutions. The year is off to a strong start for sales, up 4.5%, hitting a single quarter record.
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