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By Counterman
Schaeffler earlier this month published its 2023 Sustainability Report, highlighting the progress along its “three ESG dimensions.”
“Sustainability is an integral part of our corporate strategy,” Schaeffler CEO Klaus Rosenfeld said. “Schaeffler has always been known for its innovative strength and technological expertise – building on this, we want to bridge the gap between sustainability and cost efficiency. We have set ourselves ambitious targets. Despite all the progress we have made in recent years, we are aware that we still have a fair way to go.”
The
link hidden, please login to viewincludes the definition of 10 actionable areas for the implementation of Schaeffler’s sustainability strategy, which are assigned to the three areas of environment, social and governance (ESG). “Sustainability & Engagement” is a subprogram of “Roadmap 2025,” Schaeffler’s overarching business strategy. The program was updated in 2023 with its Climate Action Plan, which was devised in 2022 and details specific measures for reducing CO2e emissions.
Schaeffler is currently focusing on seven key ESG goals in the implementation of the sustainability strategy, including climate neutrality, efficient use of resources, environmental protection and occupational health and safety.
For example, Schaeffler said it aims to achieve climate neutrality across production and its supply chain by 2030 and 2040, respectively.
The company said it instituted measures in 2023 that will lead to an annual reduction in freshwater consumption of 150,000 cubic meters.
The Schaeffler Group reduced its freshwater consumption by around 9% in the reporting year, with 27 water-saving measures implemented and verified externally in 2023, according to the company. The measures are expected to account for a minimum annual savings of 265,000 cubic meters from 2024.
Among other highlights, the global nonprofit environmental organization CDP awarded Schaeffler an “A” score in the climate-change category for 2023 by for corporate transparency and performance, and an “A-“ in the water category.
In the EcoVadis sustainability rating, Schaeffler improved its score to achieve a total of 79 out of 100 points, earning itself Platinum status again and a repeat ranking in the top 1% in its peer group in 2023.
Focus on Decarbonization
Decarbonization is a key focus area for Schaeffler. Sustainable supply chains (Scope 3 upstream) and the purchase of low-emission materials and services are a few of the strategies Schaeffler is employing in this area.
“Through close and trusting partnerships with our suppliers, we have already achieved initial successes and set the right course,” said Andreas Schick, chief operating officer at Schaeffler. “Transparency and dialog with our suppliers are now crucial to mastering the challenges ahead of us together and achieving our goal of a climate-neutral supply chain in 2040.”
At Schaeffler, the decarbonization of production (Scope 1 and 2) is largely based on the use of renewable energies, increasing energy efficiency and retrofitting plants to use renewable energies. For this reason, the internal generation of renewable energies is being developed at sites across the Schaeffler Group as an extension to the existing energy-efficiency program.
Since 2023, Schaeffler says 100% of the electricity purchased at almost every plant in Europe, Greater China and the Americas has come from renewable sources, with the plants in the Asia/Pacific region set to follow suit in 2024.
The Schaeffler Group has seen a reduction in production-related greenhouse gases of around 24% compared with the previous year, resulting in a decrease from 493,000 tons CO2e tons 375,000 tons CO2e, according to the company.
“Sustainability and innovative strength are firmly rooted in the Schaeffler Group’s DNA,” said Uwe Wagner, chief technology officer at Schaeffler. “This is the only way for us to overcome the challenges of tomorrow and pave the way to a sustainable and eco-friendly future.”
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By Counterman
The Auto Care Association recently announced the addition of Jacki Lutz as director of content to its communications team.
As the director of content, Lutz will be tasked with leading a cross-functional and multimedia content strategy, development and execution across all platforms. Lutz also will be responsible for shaping and driving content initiatives to meet the association’s business objectives; enhancing brand presence; and engaging with current and prospective members.
With more than a decade of marketing and communications experience in the automotive aftermarket, “Lutz’s mastery of telling brands’ stories in a clear and compelling way will enable the association to expand the reach of its mission to more industry professionals both across the supply chain and up and down the business ladder,” the association said in a news release.
“The Auto Care Association has spent the past several years working on building an organization that meets its members’ needs of today with solutions that can carry them into the industry of tomorrow,” said Bill Hanvey, president and CEO. “A vital part of being that kind of a dependable association for its members means being able to connect with them – all of them – and that begins with great communication. The addition of Jacki Lutz to our communications team will help the Auto Care Association to grow its connections with our members and share their stories in an impactful way with the entire auto care industry.”
Prior to joining the Auto Care Association, Lutz served as the senior manager of global corporate marketing communications for Sensata Technologies, where she created and executed a new centralized marketing communication strategy for all of its business units, including aerospace, automotive, heavy-duty, clean energy and aftermarket. Since 2013, Lutz previously held additional roles within Sensata Technologies, including global head of communications, training and e-commerce, auto and aftermarket; global head of marketing and communications, aftermarket; and marketing and communications manager, NA aftermarket.
Lutz has been an active member of the Auto Care Association, participating in and providing leadership to the association’s Marketing and Communications Committee; the Young Auto Care Network Group (YANG); the AWDA Manufacturer’s Advisory Council; and the Women in Auto Care Executive Board.
Lutz has contributed to several other prominent industry organizations throughout her career. She served as president of the Automotive Communications Council and has contributed her expertise to the boards of MEMA Aftermarket’s Marketing Executive Council and the Automotive Aftermarket Charitable Foundation.
Lutz’s remarkable contributions have been recognized with prestigious accolades, including the Auto Care Impact Award, SEMA’s 35 under 35 distinction, membership in Babcox’s Women at the Wheel and induction into Tire Review’s esteemed Club 3633.
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By Counterman
Applications are being accepted for the Federated Car Care Scholarship program.
Interested students should complete and submit their applications at
link hidden, please login to view by March 31. The Federated Car Care scholarships are funded by Fisher Auto Parts in memory of Art Fisher, founder of Federated Auto Parts and the Federated Car Care program. Qualified candidates should specify “Federated” on their application when applying online.
Administered by the University of the Aftermarket Foundation (
link hidden, please login to view), the scholarships will be awarded to employees and children of active Federated Car Care Center members attending a two- or four-year accredited college, an ASE/NATEF-certified post-secondary automotive, heavy-duty or collision technician training program or any licensed and accredited vocational school. Students graduating from high school in 2024 and heading to any of these post-secondary programs also are eligible. “It is a privilege for us to once again provide scholarship opportunities to the children and employees of Car Care members, assisting them in furthering their education,” said Bo Fisher, chairman and CEO of Fisher Auto Parts. “The University of the Aftermarket Foundation’s AutomotiveScholarships.com website streamlines the application process. We urge all interested candidates to submit their applications by March 31 and look forward to awarding Federated Car Care scholarships to another group of deserving young men and women for the 2024-25 academic year.”
Federated is one of more than 30 other organizations awarding scholarships on
link hidden, please login to view. As an added benefit for students who apply at this site, each completed application will be considered by every scholarship where the candidate meets the qualifications. The post
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By Advance Auto Parts
Advance Auto Parts Reports Fourth Quarter and Full Year 2023 Results
02/28/2024 RALEIGH, N.C.--(BUSINESS WIRE)-- Advance Auto Parts, Inc. (NYSE: AAP), a leading automotive aftermarket parts provider in North America, that serves both professional installer and do-it-yourself customers, announced its financial results for the fourth quarter and full year ended December 30, 2023.
“As we closed out 2023, we continued to act with a sense of urgency to stabilize the business and position the company to return to profitable growth,” said Shane O'Kelly, president and chief executive officer. “Our full year results are well below our expectations, and we are focused on instilling greater discipline and accountability both in the fundamental business and in how the organization executes across the board. In addition to the operational improvements we are implementing, we are strengthening internal controls and enhancing the quality of our accounting information to help better inform how we drive the business forward.
“We continue to advance our ongoing operational and strategic review of the business, including the separate sales processes for Worldpac and our Canadian business. We have streamlined and reorganized the company’s leadership structure and have made several important new hires, including the appointments of Ryan Grimsland as Chief Financial Officer and Elizabeth Dreyer as Chief Accounting Officer. Building on the $150 million in annualized SG&A reductions our team executed in the fourth quarter, we recently launched an initiative to eliminate costs related to our indirect spend by an additional $50 million on an annualized basis. We are also moving forward with the consolidation of our supply chain to a single, unified network to create efficiencies and better serve customers. Looking ahead, we are committed to driving enhanced value for shareholders by executing on the fundamentals of our business – focusing on the customer, investing in our frontline and strengthening our competitive position.”
Fourth Quarter and Full Year 2023 Results (1)
Fourth quarter 2023 Net sales totaled $2.5 billion, a 0.4% decrease compared with the prior year. Comparable store sales for the fourth quarter 2023 decreased 1.4%. For full year 2023, Net sales of $11.3 billion increased 1.2% from 2022. Comparable store sales for the full year decreased 0.3%.
The company's Gross profit decreased 11.9% from the fourth quarter of the prior year to $950.8 million or 38.6% of Net sales compared with 43.6% in the prior year quarter. This result reflects both business performance and atypical drivers, primarily attributable to a change in inventory related items and elevated supply chain costs. The company's full year Gross profit was $4.5 billion, or 40.1% of Net sales, representing a 414 basis points decrease from the prior year primarily driven by inventory related items and costs not fully covered by pricing actions.
The company's SG&A was $999.4 million in the fourth quarter, or 40.6% of Net sales compared with 38.8% for the prior year quarter. This was primarily driven by a year over year increase in occupancy costs and store labor. The company's full year SG&A was $4.4 billion, or 39.1% of Net sales compared with 38.2% in the prior year.
The company's fourth quarter Operating loss was $48.6 million, or (2.0)% of Net sales compared with the fourth quarter of the prior year Operating income of $119.3 million or 4.8% of Net sales. The company's full year Operating income was $114.4 million, or 1.0% of Net sales, compared with $670.3 million, or 6.0% of Net sales, in the prior year.
The company's effective tax rate in the fourth quarter of 2023 was 42.3%. The company's Diluted loss per share was $0.59 compared with Diluted earnings per share of $1.39 in the fourth quarter of the prior year. The company's effective tax rate for full year 2023 was 6.6%. The company's 2023 Diluted earnings per share was $0.50 compared with $7.65 in the prior year.
Net cash provided by operating activities was $0.3 billion for the full year 2023 versus $0.7 billion for the prior year. The decrease was primarily driven by lower Net income and working capital. Free cash flow for the full year 2023 was $43.7 million, compared with $312.5 million for the prior year.
During management’s review, the company identified issues with certain previously reported financials. All comparisons are based on the corrected historical results as depicted in the financial tables herein, which include the correction of non-material errors in previously reported results.
The company filed a Form 12b-25 with the Securities and Exchange Commission and disclosed that it expects to file its Form 10-K prior to the expiration of the extension period.
(1) All comparisons are based on the same time period in the prior year. Comparable store sales include locations open for 13 complete accounting periods and excludes sales to independently owned Carquest locations.
Capital Allocation
On February 13, 2024, the company declared a regular cash dividend of $0.25 per share to be paid on April 26, 2024 to all common stockholders of record as of April 12, 2024.
Subsequent Events
On February 26, 2024, the company entered into an amendment to its revolving credit facility to enable certain addbacks to financial covenants for specific write-downs of inventory and vendor receivables. As of December 30, 2023, considering the amendment, the company was in compliance with the credit facility’s financial covenants.
Full Year 2024 Guidance (1)
"In 2024, we are refining our operational improvement plans and building on the decisive actions we have taken to turn around the company’s performance. We are committed to improving overall productivity and taking a disciplined approach to reducing expenses, which will support our focus on investing in our team members. Our 2024 full year guidance is reflective of the steps we must take to reset the business and solidify our foundation for the long term," said Ryan Grimsland, executive vice president and chief financial officer.
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