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LKQ Corporation Announces Results for First Quarter 2018

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LKQ Corporation Announces Results for First Quarter 2018

 
April 26, 2018
 
  • Revenue growth of 16.1% to $2.72 billion
  • Organic revenue growth for parts and services of 3.7%
  • Growth of net income from continuing operations attributable to LKQ stockholders of 9% to $153 million
  • First quarter 2018 diluted EPS from continuing operations attributable to LKQ stockholders of $0.49; adjusted diluted EPS of $0.55
  • 2018 annual earnings guidance updated

CHICAGO, April 26, 2018 (GLOBE NEWSWIRE) -- LKQ Corporation (Nasdaq:LKQ) today reported record revenue for the first quarter of 2018 of $2.72 billion, an increase of 16.1% as compared to $2.34 billion in the first quarter of 2017. For the first quarter, parts and services organic revenue growth was 3.7% and acquisition revenue growth was 6.6%, while the impact of exchange rates was 5.4%, for total parts and services revenue growth of 15.7%.

Net income from continuing operations attributable to LKQ stockholders for the first quarter of 2018 was $153 million, an increase of 9% as compared to $141 million for the same period of 2017. On an adjusted basis, net income from continuing operations attributable to LKQ stockholders was $170 million, an increase of 11% as compared to the $153 million for the same period of 2017. Diluted earnings per share from continuing operations attributable to LKQ stockholders for the first quarter of 2018 was $0.49, an increase of 9% as compared to the $0.45 for the same period of 2017. On an adjusted basis, diluted earnings per share from continuing operations attributable to LKQ stockholders for the first quarter of 2018 was $0.55, an increase of 12% as compared to the $0.49 for the same period of 2017. Dominick Zarcone, President and Chief Executive Officer of LKQ Corporation, stated, “I am very pleased with the 6.5% organic parts and services growth in our North America segment. Although we faced a few revenue headwinds in Europeand our Specialty business and experienced certain near-term cost pressures in the quarter, we are actively addressing the issues and I am confident that we have solid plans to quickly return to our historical levels of growth and profitability.”

Balance Sheet and Liquidity

Cash flow from operations totaled $145 million during the first quarter of 2018, and the Company invested approximately $62 million in capital expenditures and other long term assets for continuing operations. As of March 31, 2018, LKQ’s balance sheet reflected cash and equivalents of $246 million and outstanding debt of $3.3 billion. Total availability under the Company’s credit facilities at March 31, 2018 was approximately $1.5 billion.

Other Events

On March 22, 2018, the Company priced an offering of €1.0 billion in aggregate principal amount of senior notes. The offering consisted of €750 million 3.625% senior notes due 2026 (the “2026 notes”) and €250 million 4.125% senior notes due 2028 (the “2028 notes” and, together with the 2026 notes, the “notes”). LKQ European Holdings B.V. will pay interest on the notes semi-annually on April 1 and October 1 of each year, commencing on October 1, 2018. The 2026 notes will mature on April 1, 2026, and the 2028 notes will mature on April 1, 2028. The notes are fully and unconditionally guaranteed by LKQ Corporation and each of its domestic wholly-owned subsidiaries that are guarantors under its senior secured credit facility. The Company intends to use the net proceeds from the offering, together with borrowings under its senior secured credit facility, (i) to finance a portion of the consideration payable for the pending Stahlgruber GmbH acquisition, (ii) for general corporate purposes and (iii) to pay related fees and expenses, including the refinancing of net financial debt. The note offering closed on April 9, 2018.

During the first quarter of 2018, LKQ acquired an aftermarket radiator and related products distributor in Tennessee. Also in the first quarter, LKQ’s European operations opened one branch in Western Europeand four branches in Eastern Europe.

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