2024 ANNUAL REPORT
FINANCIAL HISTORY
YEAR
NET SALES
INCOME BEFORE INCOME TAXES
INCOME TAXES
NET INCOME
TOTAL EQUITY END OF YEAR
1928
$
75,129
$
-2,570
$
-
$
-2,570
$
38,756
1929
227,978
8,027
599
7,428
49,837
1930
339,732
15,666
1,158
14,508
60,591
1931
402,463
21,516
1,857
19,659
78,097
1932
482,525
16,839
2,787
14,052
90,187
1933
629,751
34,614
6,160
28,454
109,025
1934
904,580
52,115
10,159
41,956
149,176
1935
1,035,477
38,503
7,140
31,363
171,238
1936
1,299,185
70,234
13,187
57,047
185,119
1937
1,520,199
72,622
17,647
54,975
240,140
1938
1,858,252
78,305
18,185
60,120
358,621
1939
3,180,241
136,902
27,320
109,582
476,750
1940
3,928,342
176,301
50,505
125,796
623,521
1941
6,109,724
348,690
149,020
199,670
738,536
1942
6,592,707
337,252
204,234
133,018
859,449
1943
8,205,316
430,634
260,084
170,550
1,032,182
1944
10,084,893
489,547
310,082
179,465
1,202,955
1945
11,355,633
532,944
323,302
209,642
1,415,974
1946
19,237,291
1,621,541
650,060
971,481
2,379,001
1947
18,531,472
1,088,967
429,045
659,922
3,029,334
1948
20,729,280
1,176,590
438,498
738,092
4,005,910
1949
19,845,875
1,067,096
420,175
646,921
4,372,831
1950
24,447,042
1,454,832
636,275
818,557
4,966,086
1951
26,244,669
1,168,405
601,386
567,019
5,325,561
1952
28,468,962
1,416,235
744,330
671,905
5,647,553
1953
29,731,105
1,408,213
736,190
672,023
6,022,077
1954
30,744,504
1,642,148
864,331
777,817
6,449,894
1955
34,073,288
1,921,777
1,020,148
901,629
7,001,523
1956
41,325,377
2,473,384
1,309,667
1,163,717
7,815,241
1957
48,140,313
3,328,598
1,752,800
1,575,798
8,969,272
1958
56,504,293
4,251,175
2,261,582
1,989,593
10,807,320
1959
71,581,580
6,001,005
3,165,042
2,835,963
13,285,215
1960
75,010,726
5,661,551
2,988,000
2,673,551
14,967,697
1961
80,533,146
6,491,113
3,481,000
3,010,113
17,142,687
1962
90,248,450
7,107,524
3,795,000
3,312,524
19,213,273
1963
96,651,445
7,210,807
3,850,000
3,360,807
21,189,880
1964
120,313,692
9,324,827
4,620,000
4,704,827
29,268,289
1965
171,545,228
12,262,510
5,890,000
6,372,510
45,565,926
1966
175,132,785
12,409,363
6,030,000
6,379,363
47,308,163
1967
204,893,008
14,918,758
7,272,000
7,491,411
55,679,256
1968
245,443,798
19,330,334
10,362,000
8,794,941
63,649,275
1969
303,455,677
24,228,557
13,240,000
10,778,467
77,437,679
1970
340,036,395
28,163,228
14,600,000
13,290,852
85,290,945
1971
387,138,252
33,897,667
16,966,000
16,535,006
95,476,147
1972
450,500,768
36,104,767
18,200,000
17,567,931
108,053,465
1973
501,189,438
42,088,098
21,280,000
20,341,677
121,548,638
1974
572,833,282
50,234,298
25,408,000
24,005,057
137,156,965
1975
678,353,280
63,552,088
32,650,000
29,981,108
163,092,941
1976
846,192,692
79,321,897
40,538,000
37,763,166
206,861,402
1977
942,958,756
88,365,511
44,918,000
42,243,015
233,641,292
1978
1,148,632,000
105,070,000
53,429,000
50,263,000
275,127,000
1979
1,337,468,000
121,953,000
58,808,000
61,715,000
320,706,000
1980
1,431,713,000
133,996,000
64,545,000
67,833,000
359,889,000
1981
1,584,642,000
154,271,000
74,471,000
77,543,000
410,689,000
1982
1,936,524,000
193,560,000
92,552,000
100,167,000
581,915,000
1983
2,068,231,000
200,822,000
97,188,000
103,634,000
636,218,000
1984
2,303,594,000
234,713,000
115,046,000
119,667,000
701,113,000
1985
2,332,544,000
245,203,000
118,962,000
126,241,000
729,231,000
1986
2,394,072,000
240,565,000
119,013,000
121,552,000
758,493,000
1987
2,606,246,000
262,068,000
113,776,000
148,292,000
760,256,000
1988
2,941,963,000
290,445,000
109,072,000
181,373,000
863,159,000
1989
3,161,198,000
321,877,000
122,389,000
199,488,000
971,764,000
1990
3,319,394,000
333,219,000
126,623,000
206,596,000
1,033,100,000
1991
3,434,642,000
335,027,000
127,350,000
207,677,000
1,126,718,000
1992
3,668,814,000
353,998,000
134,210,000
219,788,000
1,235,366,000
1993
4,384,294,000
425,829,000
166,961,000
257,813,000
1,445,263,000
1994
4,858,415,000
474,868,000
186,320,000
288,548,000
1,526,165,000
1995
5,261,904,000
510,794,000
201,626,000
309,168,000
1,650,882,000
1996
5,697,592,000
545,233,000
215,157,000
330,076,000
1,732,054,000
1997
5,981,224,000
565,600,000
223,203,000
342,397,000
1,859,468,000
1998
6,587,576,000
589,117,000
233,323,000
355,794,000
2,053,332,000
1999
7,950,822,000
628,067,000
250,445,000
377,622,000
2,177,517,000
2000
8,369,857,000
646,750,000
261,427,000
385,323,000
2,260,806,000
2001
8,220,668,000
603,813,000 *
242,289,000 *
361,524,000 *
2,345,123,000
2002
8,258,927,000
605,736,000
238,236,000
367,500,000 *
2,130,009,000
2003
8,449,300,000
571,743,000
218,101,000
353,642,000 *
2,312,283,000
2004
9,097,267,000
635,919,000
240,367,000
395,552,000
2,544,377,000
2005
9,783,050,000
709,064,000
271,630,000
437,434,000
2,693,957,000
2006
10,457,942,000
770,916,000
295,511,000
475,405,000
2,549,991,000
2007
10,843,195,000
816,745,000
310,406,000
506,339,000
2,716,716,000
2008
11,015,263,000
768,468,000
293,051,000
475,417,000
2,324,332,000
2009
10,057,512,000
644,165,000
244,590,000
399,575,000
2,629,372,000
2010
11,207,589,000
761,783,000
286,272,000
475,511,000
2,802,714,000
2011
12,458,877,000
890,806,000
325,690,000
565,116,000
2,792,819,000
2012
13,013,868,000
1,018,932,000
370,891,000
648,041,000
3,008,179,000
2013
14,077,843,000
1,044,304,000
359,345,000
684,959,000
3,358,768,000
2014
15,341,647,000
1,117,739,000
406,453,000
711,286,000
3,312,364,000
2015
15,280,044,000
1,123,681,000
418,009,000
705,672,000
3,159,242,000
2016
15,339,713,000
1,074,340,000
387,100,000
687,240,000
3,207,356,000
2017
16,308,801,000
1,058,408,000 *
362,627,000 *
695,782,000 *
3,464,156,000
2018
18,735,073,000
1,111,717,000 *
275,635,000 *
836,082,000 *
3,471,991,000
2019
19,392,305,000
1,103,551,000 *
270,370,000 *
833,181,000 *
3,695,500,000
2020
16,537,433,000
1,013,833,000 *
248,795,000 *
765,038,000 *
3,218,003,000
2021
18,870,510,000
1,328,394,000 *
331,384,000 *
997,010,000 *
3,503,290,000
2022
22,095,973,000
1,577,623,000 *
390,038,000 *
1,187,585,000 *
3,804,447,000
2023
23,090,610,000
1,742,348,000 *
425,824,000 *
1,316,524,000 *
4,416,985,000
2024
23,486,569,000
1,491,697,000 *
351,856,000 *
1,139,841,000 *
4,351,851,000
*Excludes non-recurring items; Our financial history presented on this page reflects financial information as reported in the company’s annual reports
GENUINE PARTS COMPANY
Established in 1928, Genuine Parts Company is a leading global service provider of automotive and
industrial replacement parts and value-added solutions. Our Automotive Parts Group operates across
the U.S., Canada, Mexico, Australasia, France, the U.K., Ireland, Germany, Poland, the Netherlands,
Belgium, Spain and Portugal, while our Industrial Parts Group serves customers in the U.S., Canada,
Mexico and Australasia. We keep the world moving with a vast network of over 10,700 locations
spanning 17 countries supported by more than 63,000 teammates.
2 0 2 4 K E Y M E T R I C S
NET SALES
BY SEGMENT
Automotive: 63%
Industrial: 37%
NET SALES
BY REGION
United States: 65%
Europe: 16%
Canada: 8%
Australasia: 10%
Mexico: <1%
Sales
Billions
2020
$16.54
$18.90
$22.10
$23.09
$23.49
2021
2022
2023
2024
Adjusted Diluted Earnings
Per Share (EPS)1
2020
$5.27
$6.91
$8.34
$9.33
$8.16
2021
2022
2023
2024
Free Cash Flow 2
Millions
2020
$1,861
$992
$1,127
$923
$684
2021
2022
2023
2024
1 A non-GAAP measure. See “Non-GAAP Financial Measures” in this report for more information and a reconciliation to GAAP
2 Free Cash Flow is defined as Cash from Operations minus Capex
Returned Over $700 Million
of Capital to Shareholders
2024 Dividend Per Share
$4.00, +5.3%
NET SALES
BY REGION
FEBRUARY 21, 2025
To Our Stakeholders
Paul Donahue | Executive Chairman & Will Stengel | President & CEO
For nearly a century, GPC has been a trusted partner to our
customers, suppliers and communities, driven by our purpose:
We Keep the World Moving! This guiding principle continues to
shape our strategies, investments and daily operations as we
work to deliver value to all stakeholders.
We are proud of the commitment and efforts demonstrated by our global
teams throughout 2024 as they navigated a dynamic and challenging
macroeconomic environment, all while continuing to deliver exceptional
service to our customers. In 2024, despite softer-than-expected market
conditions, we remained focused on controlling what we could control:
we efficiently managed our operations, advanced our strategic initiatives
to improve the business and delivered strong cash flows. This enabled
us to continue our disciplined approach to capital allocation, thoughtfully
pursuing attractive investments for long-term value creation through
economic cycles and returning capital to shareholders through our
long-standing dividend. In 2024, we returned approximately $705
million back to our shareholders in the form of dividends and share
repurchases. And in February 2025, our Board increased our annual
dividend by 3%, to an annualized $4.12 per share. This marks the 69th
consecutive year of increasing the GPC dividend and underscores the
confidence that our Board of Directors has in the future of GPC.
Our achievements this year would not have been possible without the
dedication and hard work of our over 63,000 global teammates. To each
of you, we extend our deepest gratitude.
Paul D. Donahue | Non-Executive Chairman
William P. Stengel, II | President & CEO
YEAR IN REVIEW
While global market conditions were challenging in 2024, we
continued to strategically invest in our people, technology and supply
chain to build on our existing advantages and create new capabilities.
We delivered:
• Sales of $23.5 billion, an increase of 1.7% from 2023
• Net earnings of $904 million and adjusted net earnings of
$1.1 billion or $8.16 per share on an adjusted basis
• Working capital of ~6% of total sales, ending the year with a
Debt-to-Adjusted EBITDA ratio of 2.2x, within our stated target of
2.0x-2.5x
• Ample liquidity of ~$2.0 billion, ~$1.3 billion in cash from
operations and over $680 million in free cash flow
Our market-leading Industrial business, Motion, delivered total
sales of $8.7 billion, which was down slightly from 2023 due to
continued softness in industrial production activity and reduced
customer spending on capital projects. Despite these challenges, we
believe Motion’s diverse end markets and product offering, focus on
customer service, technical expertise and solutions-based selling
enabled the team to outperform the broader market.
During the year, Motion delivered strong results and renewal rates
with its corporate account customers, which represent approximately
45% of its business. As a testament to its value proposition and
customer focus, Motion received more supplier of the year awards
in 2024 than any other year. Motion also acquired four bolt-on
acquisitions to add to its technical and value-added solutions
capabilities. Motion remains well positioned to capitalize on the
eventual improvement in the broader industrial economy.
For the year, Motion achieved segment EBITDA of $1.1 billion,
representing 12.6% of sales. This performance was driven by sales
effectiveness, category management and productivity initiatives,
which helped offset the impact of softer market conditions.
Additionally, we continued to invest in our supply chain capabilities,
including the automation of existing facilities and the opening of a
new Market Distribution Center that provides a faster, better and more
efficient experience for our customers. We also made great progress
with technology investments including enhanced digital tools and
customer integrations to improve the customer experience.
Our Automotive business delivered total sales of $14.8 billion, an
increase of 3.7% over the prior year. This growth was driven by
acquisitions and continued progress with our long-term initiatives.
We made significant improvements in our U.S. Automotive business,
focusing on investments in inventory, better product availability,
enhanced store execution and improved delivery times. These efforts
have positioned us well to serve the needs of our Do-It-For-Me (DIFM)
customers, which represent approximately 80% of our business.
Additionally, we made progress on our initiative to own more of our
stores in priority U.S. markets with the acquisitions of more than
500 stores from our independent owners and competitors. This
strategic shift strengthens our ability to deliver superior service and
drive sustainable growth. In 2025, we will celebrate NAPA’s 100th
anniversary, a remarkable milestone that reflects the enduring
strength of the NAPA brand and the trust we’ve earned from our
customers over the years. As we look to the future, we believe the
investments and decisive actions we are taking will ensure success
for NAPA for the next 100 years.
Internationally, we believe our businesses continue to outperform the
market despite softer market conditions. A standout achievement
was the continued success of the NAPA brand rollout in Europe,
with sales now exceeding €500 million in just five years. This rollout
has proven to be a key differentiator in the marketplace, driving
growth and enhancing our competitive position even in a challenging
environment.
For the year, Automotive segment EBITDA was $1.3 billion,
representing 8.7% of sales. This performance was negatively
impacted by weaker than expected market conditions, partially offset
by the benefits of acquisitions, along with significant progress on the
global restructuring efforts that we announced at the beginning of the
year. In addition to the long-term strategic investments we continue
to make, we are taking decisive actions near-term to ensure our
assets and costs are aligned to current market conditions. Our global
Automotive businesses continue to experience supportive industry
fundamentals, and we see significant opportunity to grow in our
highly fragmented markets.
KEY MANAGEMENT CHANGES
In April 2024, Jim Neill retired from GPC as the Executive Vice
President and Chief People Officer, after his nearly 18-year career
with GPC. In connection with Mr. Neill’s retirement, we welcomed
Jenn Hulett as our new Executive Vice President, Chief People Officer
in August 2024. She joins GPC with a wealth of HR experience, most
recently serving as Executive Vice President and Chief People Officer
for Dollar Tree, Inc. Jenn has been an excellent addition to the GPC
team and is building upon the solid foundation Jim established.
THE YEAR AHEAD
We are confident that we are investing in the right areas to
appropriately position GPC for the future, and we’re gaining traction
across numerous efforts. We are focused each day on the key aspects
of the customer experience. The long-term fundamentals of our
industries are attractive, and our businesses are well established with
leadership positions. We’re continuing to balance near-term actions
and medium- and long-term investments.
I am humbled and honored to serve as the CEO of this great company
and especially grateful for my GPC teammates and the support of
Paul and the board of directors. As we enter 2025, we remain focused
on executing our strategic initiatives and navigating the evolving
macroeconomic environment. The actions we are taking better
position us to capitalize on an upturn in market conditions to drive
value and deliver sustained success in the future.
In closing, we extend a sincere thank you to our teammates,
customers, suppliers, shareholders and communities for your
continued support of Genuine Parts Company. Together, we are
building a stronger, more resilient GPC for the future.
Respectfully,
WILLIAM P. STENGEL, II
President and Chief Executive Officer
Thank You to Our GPC Stakeholders
As I reflect on my time as CEO of this incredible company, I am
filled with pride and gratitude for all we have achieved together
as One GPC team. Over the past 20+ years, it has been an
extraordinary privilege to be part of this organization, and I am
deeply thankful for the opportunity to serve as your CEO.
When Will transitioned to the CEO role in June 2024, I was
excited to welcome him as only the sixth CEO in our company’s
remarkable 96-year history. Our culture and history of consistent
leadership has and will continue to be a competitive advantage
for our business. I have every confidence in Will, our global
leadership teams and our board of directors to continue driving
our vision to be the leading global automotive and industrial parts
distributor and solutions provider. I look forward to continuing to
work with Will and the rest of our remarkable members of the
board to drive value for our shareholders and all stakeholders.
In conjunction with our commitment to be a leader in corporate
governance, in 2024 we made progress in our multiyear program
to refresh the Board. During the year, in addition to adding
Will upon his appointment as CEO, we also welcomed Charles
“Chuck” K. Stevens III, formerly EVP and CFO of General Motors
Company, who brings unparalleled financial and automotive
expertise.
At our upcoming Annual Meeting in April 2025, Elizabeth “Besty”
Camp, Gary Fayard, John “Johnny” Johns and Wendy Needham
will be retiring from our Board. We want to express our gratitude
to each of these directors for their years of dedicated service
and valuable contributions to GPC. In connection with these four
directors’ retirements, we are nominating Laurie Schupmann
to the Board. Ms. Schupmann spent nearly 40 years with PwC,
most recently serving as a Global Client Partner, and will bring
significant financial and accounting expertise to our Board.
To our shareholders – we thank you for your investment in
GPC, and to our teams around the world, thank you for your
unwavering commitment, hard work and dedication to GPC’s
success. It has been an honor to work alongside such talented
and passionate individuals, and I am truly grateful for the journey
we have shared.
With heartfelt appreciation,
PAUL D. DONAHUE
Non-Executive Chairman
Automotive Parts Group 63% of Total GPC Net Sales
The Automotive Parts Group is a leading
global service provider of replacement parts,
accessories and solutions.
We have operations across North America, Europe
and Australasia and service our customers through a
vast network of over 10,000 locations. Through our
global network, we serve both the Commercial (DIFM
- 80%) and Retail (DIY - 20%) automotive aftermarket
segments with products and services for substantially
all domestic and foreign motor vehicle models.
• In the U.S., we offer approximately 800,000
different parts, sold primarily under the NAPA brand
name, widely recognized for quality parts, quality
service and knowledgeable people.
• In Canada, we are the market leader serving both
the automotive aftermarket and heavy vehicles.
• In Europe, we serve each country under a variety
of banners, including GROUPAUTO, Precisium
Group, Piėces Auto, UAN, Coler Busch, Hennig,
Knoll, Voigt, Alliance Automotive Trading, PartsPoint,
Lausan, Soulima and Gaudi. In 2019, we introduced
the NAPA brand to the European market and
surpassed €500 million of NAPA-branded sales in
only five years.
• In Australasia, we serve the market primarily
under the Repco and NAPA brand names.
Atlanta, GA
napaonline.com
U.S.
• 51 NAPA Distribution
Centers
• 11 Automotive Supply
Facilities
• 5,997 NAPA Auto
Parts Stores
(2,002 company-owned)
• 27 Traction Heavy
Duty Parts Stores
(all company-owned)
CANADA
• 13 Distribution Centers
• 685 NAPA and Heavy Vehicle
Stores
(228 company-owned)
• 22 Import Parts Facilities
(all company-owned)
MEXICO
• 12 Stores
London, England
allianceautomotivegroup.eu
FRANCE
• 18 Distribution Centers
• 1,058 Stores
(234 company-owned)
U.K.
• 23 Distribution Centers
• 822 Stores
(282 company-owned)
REPUBLIC OF IRELAND
• 2 Distribution Centers
• 8 Stores
(all company-owned)
GERMANY
• 13 Distribution Centers
• 76 Stores
(all company-owned)
POLAND
• 245 Stores
THE NETHERLANDS &
BELGIUM
• 7 Distribution Centers
• 186 Stores
(125 company-owned)
SPAIN & PORTUGAL
• 10 Distribution Centers
• 57 Stores
(all company-owned)
Melbourne, Australia
gpcasiapac.com
AUSTRALIA & NEW ZEALAND
• 14 Distribution Centers
• 433 Auto Parts Stores
and Branches in AU
• 128 Auto Parts Stores
and Branches in NZ
(AU/NZ all company-
owned)
MAJOR PRODUCTS
• Automotive
Replacement Parts
• Heavy Duty
Replacement Parts
• Paint and Refinishing
Supplies
• Tools and Equipment
• Automotive Accessories
Industrial Parts Group
37% of Total GPC Net Sales
The Industrial Parts Group is a leading global
service provider of replacement parts and
value-added solutions.
We have operations in North America and Australasia
with a vast network of 755 branches and service
centers. We provide access to more than 18 million
industrial replacement parts and supplies for more
than 190,000 maintenance, repair and operations
(MRO ~80%) and original equipment manufacturer
(OEM ~20%) customers in a diverse group of
industries. We track 14 different end markets which
includes: equipment and machinery, food products,
iron & steel, pulp & paper, mining and automotive,
among others.
Birmingham, AL
motion.com
U.S., CANADA & MEXICO
• 17 Distribution Centers
• 534 Branches
• 77 Service Centers
SERVICE CAPABILITIES
• 24/7/365 Product Delivery
• Repair and Fabrication
• Quality Processes (ISO)
• Technical Expertise
• Asset Repair Tracking
• Application and Design
• Inventory Management
& Logistics
Sydney, Australia
motionasiapac.com
AUSTRALIA, NEW ZEALAND,
INDONESIA & SINGAPORE
• 13 Distribution Centers
• 140 Branches
• 4 Service Centers
• Training Programs
• E-business Technologies
• Storeroom & Replenishment
Tracking
• Automation, Fluid Power and
Conveyance value-add solutions
MAJOR PRODUCTS
• Bearings
• Mechanical & Electrical
Power Transmission
Products
• Electrical &
Industrial Automation
• Hydraulic and
Industrial Hose
• Hydraulic and
Pneumatic Components
• Industrial and
Safety Supplies
• Material Handling
Products
• Seals & Pumps
UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 10-K
Check box Checked
ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended December 31, 2024
Or
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the transition period from
to
Commission file number: 1-5690
GENUINE PARTS COMPANY
(Exact name of registrant as specified in its charter)
GA
(State or other jurisdiction of
incorporation or organization)
58-0254510
(I.R.S. Employer Identification No.)
2999 WILDWOOD PARKWAY,
ATLANTA, GA
(Address of principal executive offices)
30339
(Zip Code)
678-934-5000
(Registrant’s telephone number, including area code)
Securities registered pursuant to Section 12(b) of the Act:
Title of each class
Trading Symbol(s)
Name of each exchange on which
registered
Common Stock, $1.00 par value per
share
GPC
New York Stock Exchange
Securities registered pursuant to Section 12(g) of the Act:
None
Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the
Securities Act. Yes Check box Checked No Check box UnChecked
Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of
the Exchange Act. Yes Check box UnChecked No Check box Checked
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or
15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such filing requirements for the past
90 days. Yes Check box Checked No Check box UnChecked
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required
to be submitted pursuant to Rule 405 of Regulation S-T (Section 232,495 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).
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Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-
accelerated filer, a smaller reporting company or an emerging growth company. See the definitions of “large
accelerated filer,” “accelerated filer,” “smaller reporting company” and "emerging growth company" in Rule 12b-2 of
the Exchange Act.
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If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended
transition period for complying with any new or revised financial accounting standards provided pursuant to Section
13(a) of the Exchange Act. Check box UnChecked
Indicate by check mark whether the Registrant has filed a report on and attestation to its management’s
assessment of the effectiveness of its internal control over financial reporting under Section 404(b) of the Sarbanes-
Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued its audit report. Check box Checked
If securities are registered pursuant to Section 12(b) of the Act, indicate by check mark whether the financial
statements of the registrant included in the filing reflect the correction of an error to previously issued financial
statements. Check box UnChecked
Indicate by check mark whether any of those error corrections are restatements that required a recovery
analysis of incentive-based compensation received by any of the registrant's executive officers during the relevant
recovery period pursuant to Section 240.10D-1(b). Check box UnChecked
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act).
Yes Check box UnChecked No Check box Checked
As of June 30, 2024, the aggregate market value of the registrant’s common stock held by non-affiliates of the
registrant was approximately $16.2 billion based on the closing sale price as reported on the New York Stock
Exchange.
There were 138,782,030 shares of the company's common stock outstanding as of February 18, 2025.
DOCUMENTS INCORPORATED BY REFERENCE
Specifically identified portions of the company’s definitive Proxy Statement for the Annual Meeting of
Shareholders to be held on April 28, 2025 are incorporated by reference into Part III of this Form 10-K.
Table of Contents
Page
PART I
Item 1.
Business
2
Item 1A.
Risk Factors
8
Item 1B.
Unresolved Staff Comments
16
Item 1C.
Cybersecurity
16
Item 2.
Properties
17
Item 3.
Legal Proceedings
17
Item 4.
Mine Safety Disclosures
17
PART II
Item 5.
Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of
18
Equity Securities
Item 6.
[Reserved]
19
Item 7.
Management’s Discussion and Analysis of Financial Condition and Results of Operations
20
Item 7A.
Quantitative and Qualitative Disclosures About Market Risk
33
Item 8.
Financial Statements and Supplementary Data
35
Item 9.
Changes in and Disagreements With Accountants on Accounting and Financial Disclosure
74
Item 9A.
Controls and Procedures
74
Item 9B.
Other Information
76
Item 9C.
Disclosure Regarding Foreign Jurisdictions that Prevent Inspections
76
PART III
Item 10.
Directors, Executive Officers and Corporate Governance
77
Item 11.
Executive Compensation
78
Item 12.
Security Ownership of Certain Beneficial Owners and Management and Related Stockholder
78
Matters
Item 13.
Certain Relationships and Related Transactions, and Director Independence
78
Item 14.
Principal Accounting Fees and Services
78
PART IV
Item 15.
Exhibits and Financial Statement Schedules
80
Item 16.
Form 10-K Summary
84
Signatures
85
PART I.
ITEM 1. BUSINESS.
Incorporated in the State of Georgia in 1928, Genuine Parts Company is a global service organization engaged
in the distribution of automotive and industrial replacement parts. We serve our customers from more than 10,700
locations, primarily in North America, Europe, as well as Australia and New Zealand ("Australasia"). We offer
outstanding service, an industry-leading assortment of replacement parts, extensive supply chain and distribution
capabilities, and enhanced technology solutions.
As used in this report, "we," "us," "our," "GPC," and the “company” refers to GPC and its subsidiaries, except as
otherwise indicated by the context; and the terms “automotive parts” and “industrial parts” refer to replacement parts
in each respective category.
OUR BUSINESS
We are one global team unified by our mission to be an employer of choice, supplier of choice, valued
customer, responsible corporate citizen and investment of choice for our shareholders. In order to execute this
mission, we focus our businesses on delivering excellent customer service, profitable growth, operational
efficiencies and strong cash flow. In 2024, we had net sales of $23.5 billion and our revenue mix was 74% in North
America, 16% in Europe and 10% in Australasia.
We are organized into two business segments: our Automotive Parts Group (“Automotive”) and our Industrial
Parts Group (“Industrial”). Our main Automotive customers are repair and maintenance shops, and our main
Industrial customers are businesses operating distribution, manufacturing and production equipment.
In Automotive, we see long-term growth opportunities across each of the markets we serve which are supported
by an increasing number of miles driven, a growing and aging car parc, increasing vehicle complexity, and an
emerging opportunity with electric vehicles. In Industrial, growth drivers include disruptions in the global supply
chain creating opportunities with nearshoring, a strong outlook for automation and robotics solutions, the need for
industrial expertise due to an aging technical workforce and diversified end market opportunities. Together, our
business segments create a competitive differentiation in two distinct and growing markets with compelling
shareholder value.
We believe our primary competitive advantages are our: (1) global presence and brand strength; (2) industry-
leading positions in each of the markets we serve; (3) extensive supply chain and distribution capabilities; and (4)
enhanced technology solutions.
Our strategic financial objectives complement our mission and drive value for all our stakeholders. These
financial objectives include: (1) revenue growth in excess of market growth; (2) continuously improving operating
margins; (3) maintaining a strong balance sheet and cash flows; and (4) effective capital allocation.
As we look to the future, our strategy is built to position us for long-term, profitable growth. By staying true to our
purpose, leveraging our strengths, and executing on our strategic priorities, we are confident in our ability to deliver
sustainable growth and create lasting value for our shareholders, customers, employees, and communities.
OUR SEGMENTS
AUTOMOTIVE
Our Automotive segment, which represents 63% of total GPC net sales, is the largest global automotive network
of parts and autocare. We distribute automotive parts, accessories and solutions in North America, Europe and
Australasia. Our Automotive businesses offer extensive inventory depth and assortment, cataloging, marketing,
training and other programs to the aftermarket in each of these regions, distinguishing our business from the
competition.
Our global Automotive network sells to customers in both commercial do-it-for-me (“DIFM”) and retail do-it-
yourself (“DIY”) segments of the market and covers substantially all global motor vehicle models. Our DIFM
customers include local, regional and national repair centers, auto dealers, service stations and both private and
public sector accounts. Our DIY customers are primarily served over-the-counter at our global stores or digitally. Our
DIFM and DIY customers represent approximately 80% and 20% of total Automotive sales, respectively, and
channel mix varies by geography.
Our Automotive network consists of over one million customer locations. We have diversity amongst our
commercial customer base with no specific customer type representing an outsized concentration of our overall
business. Our Automotive segment operates in large and fragmented markets with a combined total addressable
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2
market of over $200 billion. The majority of the automotive aftermarket is comprised of small, local competitors and
our scale, advanced technology, and supply chain efficiency differentiates us from competitors.
Our Automotive distribution network provides access to hundreds of thousands of replacement parts (other
than collision parts and tires) and accessory items for substantially all motor vehicle makes and models, including
hybrid and electric vehicles, trucks, and SUVs, as well as for buses, motorcycles, farm equipment, and heavy duty
equipment. We supply certain equipment parts and technologies used by repair shops, service stations, fleet
operators, automobile and truck dealers, leasing companies, farms, and individuals who perform their own
maintenance and parts installation.
Inventory availability is critical to the success of our business and our teams utilize data and analytics to have
the right parts, in the right place and at the right time. The majority of products distributed in North America utilize
the NAPA brand, which we believe is a competitive differentiator. In Australasia and Europe, products are distributed
under several brand names, including many of the national brands, as well as the NAPA brand. Our U.S. Automotive
business offers approximately 800,000 different parts and related supply items. These items are purchased from
hundreds of different suppliers, with approximately 55% of 2024 automotive parts inventories purchased from 10
major suppliers.
Regional Operations & Products. In North America, our U.S. operations are headquartered in Atlanta, Georgia
and our Canadian operations are headquartered in Montreal, Quebec. We are differentiated from many of our North
American competitors because our revenues are primarily generated with commercial DIFM customers. We service
the U.S. and Canadian markets primarily through company-owned and independent auto part stores, heavy vehicle
stores, and specialty paint and equipment stores. Our North American auto parts stores sell a comprehensive range
of automotive parts, including brakes, batteries, filters, engine components, tools, accessories, and fluids. Some
locations offer custom services such as paint mixing, hydraulic hose assembly, battery testing, and key cutting. Our
heavy vehicle stores sell parts, accessories, and tools and equipment for servicing heavy duty and diesel vehicles,
and we operate service and mechanical repair centers for heavy vehicles. We serve the heavy vehicle market under
the banners Traction, TruckPro, TW, and Cadel. In Canada, our specialty stores operate paint and body care
equipment and supply under the banner NAPA/CMAX and high-quality replacement parts and lubricants for
imported vehicles under the banners Altrom and Auto-Camping.
Separately, we provide a unique NAPA Auto Care program available to independent repair shops and auto care
centers across the U.S. and Canada where they can leverage the NAPA brand to increase visibility as well as
receive part discounts and other product and technology benefits. We also offer technical expertise by training and
employing knowledgeable staff who can provide technical assistance, product recommendations, and guidance on
automotive repairs and maintenance, and we organize DIY workshops and training sessions to educate customers
on automotive repair and maintenance tasks. Our online platform in North America is NAPA online, which provides
our customers an option to browse, purchase, and have automotive products bought online and picked up in store
or delivered to their homes or businesses. Through NAPA Online, customers can also locate nearby participating
NAPA Auto Care locations.
We believe that the quality and the range of products and services provided to our North American customers
constitute a significant advantage for our automotive parts distribution system. Our goal is to properly stock our
locations with the right parts to ensure we provide quick and quality service to our customers whose orders are
often filled and shipped the same day they are received. Our services also include up to date parts cataloging
(including the use of electronic NAPA Auto Parts catalogs) and stock adjustments through a continuous parts
classification system which, as initiated by us, allows independently-owned stores to return certain merchandise on
a scheduled basis. We offer our NAPA Auto Parts stores various management aids, marketing aids and service on
topics such as selling and promotional tools, inventory control, pricing and cost analysis, as well as marketing
conferences and seminars, sales and advertising manuals and training programs. We have developed and refined
an inventory classification system to determine the most advantageous distribution center and auto parts store
inventory levels for automotive parts stocking based on automotive registrations, usage rates, production statistics,
technological advances, including predictive analytics, and other similar factors. This system, which undergoes
continuous analytical review, is an integral part of our inventory control procedures and comprises an important
feature of the inventory management services that we make available to our NAPA Auto Parts stores. Losses from
inventory obsolescence have not been significant historically which we attribute to the successful operation of our
classification system, including product return privileges with most of our suppliers.
In Europe, we operate Alliance Automotive Group (“AAG”), headquartered in London, England. Europe is
predominantly a DIFM market, with very few over-the-counter sales. We serve thousands of vehicle repairers,
collision shops and auto-centers from over 2,500 distributor outlets across Europe, supported by a logistics
infrastructure of national and regional distribution centers. Our distributor outlets include company-owned and
independent auto part stores and outlets, heavy vehicle outlets, and online and specialty outlets. Our European
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3
banners include Groupauto, Precisium and Pièces Auto in France; Coler, Busch, Hennig and Knoll in Germany;
Groupauto, UAN, FPS Distribution, APEC Braking, BTN Turbo, Platinum International, Alliance Automotive U.K.
Subsidiaries, and J&S Automotive Distributors in the U.K. and Republic of Ireland; PartsPoint in Belgium and the
Netherlands; Lausan, Soulima and Gaudi in Spain and Portugal; and GroupAuto in Poland. In France, we also
provide parts and services for heavy duty and diesel vehicles under the Todd banner and we operate Back2Car,
which distributes recycled car parts. In the Netherlands and Belgium, we offer programs for repair shops that want
to join our installer network to increase their visibility and brand awareness while remaining independent. Separately
in Europe, we operate WinParts, an online platform for customers to browse, purchase, and have automotive
products delivered to their homes or businesses.
In Australia and New Zealand, we operate GPC Asia Pacific – the region’s largest automotive aftermarket parts
supplier. We resell and distribute automotive replacement parts, accessories and related tools and equipment
through a network of company-owned retail stores and advanced distribution centers. In our Australasian
operations, we go to market solely with a company-owned store model. GPC Asia Pacific operates three main lines
of business: Automotive Australia, Automotive New Zealand and Two Wheel Division. Automotive Australia and
Automotive New Zealand operate our auto parts stores in Australia and New Zealand under two banners: (i) Repco,
which operates a nationwide dual-format store network across both countries, providing parts, equipment, tools,
batteries, technology, and oil to both trade and retail customers, and (ii) NAPA Auto Parts, which offers automotive
electrical and mechanical parts to trade, fleet, industrial, commercial and mining specialist customers. Both Repco
and NAPA compliment their network with the market's leading digital capability, providing our customers with a
seamless omni-channel transactional capability. Our Two Wheel Division is a whole seller and retails motorcycle
parts, apparel and accessories, with the market's leading range of the world’s most respected motorcycle brands,
many of which are supplied under exclusive distribution agreements. Two Wheel Division operates two wholesale
banners (McLeod Accessories and John Titman Racing), and also operates Australia's largest and fastest growing
motorcycle accessories and apparel retailer (AMX Super Stores).
Distribution Network. Our independently-owned and company-owned stores located in every region are
sourced by our distribution networks. Both types of automotive stores sell to a wide variety of customers in the
automotive aftermarket. We strategically locate our stores close to repair shops and autocare service centers, which
are our primary customers, and we deliver products to our customers routinely throughout each business day by
delivery vehicles. Traditional over-the-counter retail sales make up a smaller part of our overall business and vary
by geography.
Independently-owned stores purchase inventory from our company-operated distribution centers. These
independently-owned stores are responsible for operating and managing their businesses, including operating costs
and capital expenditures. We generally do not receive a royalty from independently-owned stores. Independently-
owned stores, which represent 63% of our total automotive store network, provide a competitive advantage in
certain markets by allowing for local market knowledge and insights, enabling quicker adaptation to local customer
preferences.
The mix of independently-owned versus company-owned stores in a given market varies based on several
factors including our overall market strategy, the ability to access desirable local retail space, the complexity,
profitability and expected ultimate size of the market and our ability to provide operational support within a
geographic region. In 2024, as part of our strategic financial objectives to grow revenue and improve operating
margins, we made a pivot in strategy in the U.S. to own more stores in priority markets. We made significant
progress on this initiative in 2024, including the acquisition of our two largest independently owned stores groups,
Motor Parts & Equipment Corporation ("MPEC") and Walker Automotive Supply, Inc ("Walker"), and completed
strategic acquisitions of more than 500 NAPA stores from independent owners, as well as competitive stores,
bringing our company owned store count to approximately 35% of our store mix. These acquisitions are in key
markets where we can provide synergies and resources for these stores to further drive revenue growth.
During 2024, we expanded our network with the addition of 41 net new stores during the year. The following
table details the breakdown of our Automotive distribution network including our distribution centers, company-
owned and independently-owned automotive stores by geographic region as of December 31, 2024.
North America
Europe
Australasia
Total
Distribution centers
75
73
14
162
Company-owned stores
2,279
782
561
3,622
Independently-owned stores
4,464
1,760
—
6,224
Total automotive locations
6,818
2,615
575
10,008
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4
Repair Center Networks. We provide programs for repair centers to join regional networks to leverage our
branding and supply network to increase their visibility and awareness while remaining independent. The largest of
these is our independent NAPA Auto Care center network in the U.S. and Canada, which includes over 19,000
locations nationwide.
NAPA. We are the sole member of the National Automotive Parts Association, LLC a voluntary association
formed in 1925 to promote the distribution of automotive parts for its members. NAPA, which neither buys nor sells
automotive parts, functions as a trade association that develops marketing concepts and programs for its sole
member.
Among the automotive products purchased by us from various manufacturers for distribution are certain lines
designated, cataloged, advertised and promoted as “NAPA” lines. Generally, we are not required to purchase any
specific quantity of parts and we may purchase competitive lines from the same as well as other supply sources.
We use the federally registered trademark NAPA® as part of the trade name of many of our distribution centers
and parts stores in the U.S., Canada and Australia. We fund NAPA’s advertising program, which is designed to
increase public recognition of the NAPA brand and to promote NAPA product lines.
We are a party to, together with the former members of NAPA, a consent decree entered by the Federal District
Court in Detroit, Michigan, on May 4, 1954. The consent decree enjoins certain practices under the federal antitrust
laws, including the use of exclusive agreements with manufacturers of automotive parts, allocation or division of
territories among us and former NAPA members, fixing of prices or terms of sale for such parts among such
members, and agreements to adhere to any uniform policy in selecting parts customers or determining the number
and location of, or arrangements with, auto parts customers.
Competition. The automotive aftermarket is highly competitive. We compete with other national, regional and
local automotive parts chains, automobile manufacturers (some of which sell replacement parts for vehicles built by
other manufacturers as well as those that they build themselves), automobile dealers, and warehouse clubs. In
addition, we compete with the distributing outlets of parts manufacturers, mass merchandisers (including national
retail chains) and other parts distributors and retailers, including online retailers. We compete primarily on
availability of product offering, service, brand recognition and price. Our automotive competitors include AutoZone,
Inc., O-Reilly Auto Parts, Inc., Advance Auto Parts, Inc., LKQ Corporation (predominantly in Europe) and Bapcor
(Australasia), among many others. Further information regarding competition in the industry is set forth in “Item 1A.
Risk Factors — We face substantial competition in the industries in which we do business.”
INDUSTRIAL
Our Industrial segment, which represents 37% of total GPC net sales, operates in both North America and
Australasia through our wholly-owned subsidiaries Motion Industries, Inc. (“Motion”), headquartered in Birmingham,
Alabama, and Motion Asia Pacific, headquartered in Sydney, Australia. Our Industrial business offers replacement
parts and solutions to maintenance, repair and operation (“MRO”) customers and original equipment manufacturer
(“OEM”) customers. Our Industrial segment operates in a large and fragmented market with a total addressable
market of greater than $150 billion. In 2024, our Industrial segment served over 190,000 MRO and OEM customers
in all types of industries with approximately 900,000 customer locations.
The nature of Motion's business demands the maintenance of adequate inventories and the ability to promptly
meet critical delivery requirements. Virtually all of the products distributed are installed by the customer or used in
plant and facility maintenance activities. Most orders are filled immediately from existing stock and deliveries are
normally made within 24 hours of order receipt. The majority of all sales are on open account. Motion has ongoing
sales agreements with many of its national account customers which, collectively, represent 45% of its annual sales
volume.
Operations & Products. Motion is a premier industrial solutions provider in North America and Australasia
(including Australia, New Zealand, Indonesia and Singapore) due to our superior customer service, value-added
services and access to approximately 18 million replacement parts. Our product and solution offerings include MRO
and OEM support, specialty stores, on-site solutions offerings, service and repair offerings, and e-business
assistance. We distribute a large range of MRO and OEM industrial products, including replacement parts and
related supplies such as abrasives, adhesives, sealants and tape, bearings, chemicals, cutting tools, electrical,
facility maintenance, hose and fittings, hydraulics, janitorial, mechanical power transmission, pneumatics, process
pumps and equipment, safety, seals and gaskets, and tools and testing instruments. The sectors we operate in
include aggregate and cement, automotive, chemical and allied products, equipment and machinery, equipment
rental and leasing, fabricated metals, food and beverage, iron and steel, mining, lumber and wood, oil and gas, pulp
and paper, and rubber products. We have strategically targeted specialty industries in power generation, alternative
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5
energy, government, transportation, ports, and an electric vehicle battery category based on increasing
opportunities presented by the build-out of new battery manufacturing facilities across North America.
Motion provides customers with supply chain efficiencies achieved through our on-site solutions offering. Our
onsite solutions service provides inventory management, asset repair and tracking, vendor managed inventory
("VMI"), as well as radio frequency identification ("RFID") asset management of the customer’s inventory. We also
provide a wide range of services and repairs such as gearbox and fluid power assembly and repair, process pump
assembly and repair, drive shaft repair, electrical panel assembly and repair, and hose and gasket manufacture and
assembly. Motion is also a leading supplier of automation products and motion control solutions in North America
through Motion AI. Separately, Motion provides leading e-business capabilities through MiSupplierConnect, a highly
developed supply chain with vendor partnerships and connectivity that provides integration between our information
technology network and suppliers’ systems, creating numerous benefits for both the supplier and customer. These
services and supply chain efficiencies assist Motion in providing the cost savings that many of its customers require
and expect.
Distribution Network. The following table details the breakdown of our Industrial distribution centers, branches
and service centers by geographic region as of December 31, 2024.
North America
Australasia
Total
Distribution centers
17
13
30
Branches
534
140
674
Service centers
77
4
81
Total industrial locations
628
157
785
Our Industrial distribution centers serve the branches and service centers located throughout the geographic
regions in which we operate. The branches and service centers, in turn, sell to MRO and OEM customers in all
types of industries across North America and Australasia.
We are committed to enhancing the customer experience by improving access to inventory through our market
distribution centers. The market distribution center strategy is designed to address the customer expectations of a
broader inventory selection closer to the point of demand, supported by world-class final-mile delivery occurring the
next business day with same-day service available. We continued to invest in our market distribution center strategy
with the opening of a third North American facility in 2024. We plan to open additional North American facilities in
the future.
In North America, sales are generated from facilities in the U.S., Puerto Rico, Mexico and Canada. Motion has
access to approximately 18 million different items which are purchased from more than 45,000 different suppliers.
Approximately 46% of total industrial product purchases in 2024 were made from our top 50 strategic suppliers.
In Australasia, our Industrial business operates a network of distribution centers, branches and service centers
across Australia, New Zealand, Indonesia and Singapore as of December 31, 2024.
Most branches are facilities that stock inventory representative of the products used by customers in the
respective market areas served.
Supplier Agreements. Non-exclusive distributor agreements are in effect with most of the Industrial suppliers.
The terms of these agreements vary; however, it has been our experience that the custom of the trade is to treat
such agreements as continuing until breached by one party or until terminated by mutual consent.
Competition. The industrial distribution business is highly competitive and fragmented. We compete with
national, regional and local distributors, general line distributors and others. To a lesser extent, we compete with
manufacturers that sell directly to the customer and with various industrial eCommerce sites. Our Industrial
competitors include Applied Industrial Technologies, Inc., Fastenal Company, and W.W. Grainger, Inc, among many
others. We compete primarily on the breadth of product offerings, quality service and competitive pricing. Further
information regarding competition in the industry is set forth in “Item 1A. Risk Factors — We face substantial
competition in the industries in which we do business.”
ENVIRONMENTAL SUSTAINABILITY
Table of
We are committed to the development of sustainable and efficient operations and business practices that
enhance and protect our people, our communities and our planet. Our goal is to generate above-market returns
while aligning our business practices to support the interests of our stakeholders.
Our process of defining sustainability priorities focuses on the simultaneous improvement of our environmental,
social and financial position, and our strong leadership and governance practices that strive to integrate
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6
sustainability into our business strategy and corporate culture. The Nominating and ESG Committee of the Board of
Directors oversees our sustainability initiatives which aim to deliver long-term value for our shareholders and all our
stakeholders.
We seek to promote an inclusive workplace and to ensure the health, safety and well-being of all employees.
We emphasize giving back and uplifting the communities in which we operate through partnerships and volunteer
efforts. Refer to the “Human Capital Management” section below for further information on our human capital
management initiatives.
We are committed to reducing our environmental footprint through the implementation of sustainable initiatives
throughout our value chain. We are continuously incorporating environmental stewardship in our practices and
discovering opportunities to develop more efficient operations. Additional information regarding our sustainability
efforts and future initiatives can be found in our 2024 Sustainability Report and the Sustainability section of our
website at www.genpt.com.
HUMAN CAPITAL MANAGEMENT
Our key human capital management objectives are to attract, retain and develop the highest quality talent. To
support these objectives, our human resources programs are designed to connect prospective and current talent to
opportunities at the company, engage current employees through an inclusive culture, and develop employees to
grow for future opportunities within the organization.
As of December 31, 2024, we employed more than 63,000 people worldwide and operated within 17 countries.
We are proud of our employees and are committed to helping them improve their physical, emotional, financial and
social well-being. Our benefit offerings are designed to meet the varied and evolving needs of a diverse workforce
across businesses and geographies while helping our employees care for themselves and their families. We offer
healthcare benefits aimed at improving quality of care while limiting out-of-pocket costs. In addition, our well-being
programs include an online platform that offers an interactive way to accomplish personal and financial goals and a
rewards platform to reward employees for completing company sponsored competitions and well-being activities.
We periodically conduct a global engagement survey as a means of measuring employee engagement and
satisfaction, as well as a tool for improving our human capital management strategies. Our leadership team reviews
the survey results and based on the survey responses, action plans are developed to focus on areas of opportunity.
We are pleased to report that our most recent engagement survey results were favorable overall and have shown
that our employees are proud to work for the company. The results of the engagement surveys help us continuously
improve our human capital strategies and find ways to foster engagement and growth for our employees.
In addition, to empower employees to continually enhance their skills and reach their maximum potential, we
provide a range of development programs, resources and opportunities. Many are facilitated locally by each
business unit with core leadership development at the enterprise level. One of our more significant programs is
focused on high potential employees from all global business units. This program is a combination of in-person and
virtual coursework and training with the intent that participants become fully immersed in the operations of our
business and develop strategies and improvements cross-functionally. We also offer various internship and
rotational programs that allow employees to see different operations of our business while also building strong
relationships throughout the company. Other development opportunities include on-demand and live training
courses to help our employees achieve their professional and personal goals. We believe these programs
demonstrate our ongoing commitment to develop our future leaders.
Our culture is strengthened by our core values, which includes a steadfast commitment to standing up for
equality for our teammates, suppliers, customers, communities and other stakeholders. We embrace different ideas
and perspectives and are committed to creating a welcoming environment where all teammates have opportunities
to grow and feel a sense of belonging. Our goal is to create an inclusive and welcoming culture where we value,
respect, and provide equal opportunities for all employees.
Please refer to our 2024 Sustainability Report and Human Rights Policy, which can be found on our investor
relations website, for further information on human capital management.
Additional Information
T
Our website can be found at www.genpt.com. We make available, free of charge through our website, access to
our Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K, proxy
statements, any amendments to these documents, and other reports. These documents and reports are available
under the Investor Relations section of our website as soon as reasonably practicable after such material is filed
with or furnished to the Securities and Exchange Commission (“SEC”). We also use our website as a means of
disclosing material information and for complying with our disclosure obligations under the SEC’s Regulation FD
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able of
(Fair Disclosure). Important information, including news releases, analyst presentations and financial information
regarding GPC is routinely posted on our website. Accordingly, investors should monitor the Investor Relations
portion of our website, in addition to following our press releases, SEC filings and public conference calls and
webcasts. Additionally, our corporate governance guidelines, codes of conduct and ethics, charters of the
Compensation and Human Capital Committee and the Nominating and ESG Committee, and information regarding
our procedure for shareholders and other interested parties to communicate with our Board of Directors, are
available also on our website.
In Part III of this Form 10-K, we incorporate certain information by reference to our proxy statement for our 2025
annual meeting of shareholders. We expect to file the proxy statement with the SEC on or about February 28, 2025,
and it will be available online at the same time at http://www.proxydocs.com/gpc. Please refer to the proxy
statement for the information incorporated by reference into Part III of this Form 10-K when it is available.
ITEM 1A. RISK FACTORS.
FORWARD-LOOKING STATEMENTS
Some statements in this report, as well as in other materials we file with the SEC or otherwise release to the
public and in materials that we make available on our website, constitute forward-looking statements that are
subject to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Senior officers may also
make verbal statements to analysts, investors, the media and others that are forward-looking. Forward-looking
statements may relate, for example, to future operations, including the anticipated synergies and benefits of any
acquisitions or divestitures, as well as prospects, strategies, investments, financial condition, economic performance
(including growth and earnings), industry conditions and demand for our products and services. We caution that our
forward-looking statements involve risks and uncertainties, and while we believe that our expectations for the future
are reasonable in view of currently available information, you are cautioned not to place undue reliance on our
forward-looking statements. Actual results or events may differ materially from those indicated in our forward-looking
statements as a result of various important factors. Such factors include, but are not limited to, those discussed
below.
Forward-looking statements are only as of the date they are made, and we undertake no duty to update our
forward-looking statements except as required by law. You are advised, however, to review any further disclosures
we make on related subjects in our subsequent Forms 10-Q, 8-K and other reports filed with the SEC.
You should carefully consider the risks described below in addition to the other information set forth in this
Annual Report on Form 10-K. Set forth below are the material risks and uncertainties that, if they were to occur,
could materially and adversely affect our business or could cause our actual results to differ materially from the
results contemplated by the forward-looking statements in this report and in the other public statements we make.
Please be aware that these risks may change over time and other risks may prove to be important in the future.
New risks may emerge at any time, and we cannot predict such risks or estimate the extent to which they may affect
our business, financial condition, results of operations or the trading price of our securities. The considerations and
risks that follow are organized within relevant headings but may be relevant to other headings as well. Furthermore,
it is possible material risks and uncertainties described below have already materialized.
STRATEGIC AND OPERATIONAL RISKS
Our business will be adversely affected if demand for our products slows.
Our business depends on customer demand for the products that we distribute. Demand for these products
depends on many factors.
With respect to our Automotive segment, the primary factors are:
•
the number of miles vehicles are driven annually, as higher vehicle mileage increases the need for
maintenance and repair;
•
the number of vehicles in the car parc, a function of new vehicle sales and vehicle scrappage rates, as a
steady or growing total vehicle population supports the continued demand for maintenance and repair;
•
the quality of the vehicles manufactured by the original vehicle manufacturers and the length of the
warranty or maintenance offered on new vehicles;
•
the number of vehicles in current service that are six years old and older, as these vehicles are typically
no longer under the original vehicle manufacturers’ warranty and will need more maintenance and repair
than newer vehicles;
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•
the addition of electric vehicles, hybrid vehicles, ride sharing services, alternative transportation means
and autonomously driven vehicles and future legislation, including incentivizing the purchase of electric
and hybrid vehicles, related thereto, may result in reduced need for parts;
•
gas prices, as increases in gas prices may deter consumers from using their vehicles;
•
changes in travel patterns, which may cause consumers to rely more on other transportation;
•
the weather, as milder weather conditions may lower the failure rates of automotive parts, while extended
periods of rain and winter precipitation may cause our customers to defer maintenance and repair on their
vehicles; extremely hot or cold conditions may enhance demand for our products due to increased failure
rates of our customers’ automotive parts, and global warming trends and other significant climate changes
can create more variability in the short term or lead to other weather conditions that could impact our
business;
•
restrictions on access to diagnostic tools and repair information imposed by the original vehicle
manufacturers or by governmental regulation, as consumers may be forced to have all diagnostic work,
repairs and maintenance performed by the vehicle manufacturers’ dealer networks; and
•
the economy generally, which in declining conditions including persistent inflation, volatile and/or elevated
interest rates and higher levels of consumer debt may cause consumers to defer vehicle maintenance
and repair and defer discretionary spending and purchases.
With respect to our Industrial segment, the primary factors are:
•
the level of industrial production and manufacturing capacity utilization, as these indices reflect the need
for industrial replacement parts;
•
changes in manufacturing reflected in the level of the Institute for Supply Management’s Purchasing
Managers Index, as an index reading of 50 or more implies an expanding manufacturing economy, while
a reading below 50 implies a contracting manufacturing economy;
•
the consolidation of certain of our manufacturing customers and the trend of manufacturing operations
being moved overseas, which subsequently reduces demand for our products;
•
changes in legislation or government regulations or policies which could impact international trade among
our multi-national customer base and cause reduced demand for our products; and
•
the economy in general, which in declining conditions may cause reduced demand for industrial output.
Supply chain delays or interruptions, including as it relates to our dependence on our supplier
relationships and the modernization of our supply chain, could harm our business
As a distributor of automotive and industrial parts, our business depends on developing and maintaining close
and productive relationships with our suppliers. We depend on our suppliers to sell us quality products at favorable
prices. A variety of factors, many outside our control, affect our suppliers' ability to deliver quality merchandise to us
at favorable prices and in a timely manner. These include raw material shortages, inadequate manufacturing
capacity, labor strikes, shortages and disputes anywhere within the supply and distribution chain delivering products
to us, tariff and customs legislation and enforcement, transportation disruptions, tax and other legislative
uncertainties, public health emergencies and/or weather conditions.
Furthermore, financial or operational difficulties at a particular supplier could cause that supplier to increase the
cost, or decrease the quality, of the products we purchase. Supplier consolidation could also limit the number of
suppliers from which we may purchase products and could materially affect the prices we pay for these products. In
addition, we would suffer an adverse impact if our suppliers limit or cancel the return privileges that currently protect
us from inventory obsolescence.
Additionally, in connection with our supply chain modernization initiative, we have, and intend to continue to,
invest in capital improvements and operational enhancements to certain of our existing market distribution and
fulfillment centers, as well as the development of new market distribution and fulfillment centers. Our supply chain
modernization initiative is designed to improve our efficiency, geographic reach and market penetration; however,
executing this initiative requires substantial capital investment, including significant expenditures for, among other
things, real estate and construction and technology enhancements. Delays or disruptions in executing our supply
chain modernization initiative, including the investment in our market distribution centers, could have a material
adverse impact on our business, financial condition and results of operations.
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We face substantial competition in the industries in which we do business.
The sale of automotive and industrial parts, particularly replacement automotive parts, is highly competitive and
impacted by many factors, including name recognition, product availability, customer service, changing customer
preferences, store location, and pricing pressures. Because we seek to offer competitive prices, we may be forced
to reduce our prices if our competitors reduce their prices or increase promotional spending, which could result in a
material decline in our revenues and earnings. Increased competition among distributors of automotive and
industrial parts, including increased availability among digital and e-commerce providers across the markets in
which we do business, could cause a material adverse effect on our results of operations. We anticipate no decline
in competition in any of our business segments in the foreseeable future.
In addition, the automotive aftermarket industry continues to experience consolidation. Consolidation among our
competitors could further enhance their financial position, provide them with the ability to offer more competitive
prices to customers for whom we compete, take advantage of acquisitions and other opportunities more
readily, more successfully utilize developing technology, including data analytics, artificial intelligence, and machin
e learning, and allow them to achieve increased efficiencies in their consolidated operations that enable them to more effectively compete for customers. If we are unable to continue to develop successful competitive strategies or if our competitors develop more effective strategies, we could lose customers and our sales and profits may decline.
The impact of geopolitical conflicts may adversely affect our business and results of operations.
We have operations or activities in numerous countries and regions outside the United States, including
throughout western Europe and Australasia. As a result, our global operations are affected by economic, geopolitical
and other conditions in the foreign countries in which we do business as well as U.S. laws regulating international
trade. Specifically, instability in the geopolitical environment in many parts of the world (including as a result of the
conflict between Russia and Ukraine, the conflict and unrest in the Middle East, and China-Taiwan relations) and
other disruptions may continue to put pressure on global economic conditions and supply chains. For example, the
U.S., other NATO members and other countries across the globe have instituted sanctions and other penalties
against Russia in response to its conflict with Ukraine. While we do not have operations in Russia or Ukraine,
retaliatory measures such as this have created, and may continue to create, global security concerns that could
result in broader military and political conflicts, further disrupt global automotive supply chains and otherwise have a
substantial impact on regional and global economies, any or all of which could adversely affect our business,
particularly our European operations.
While the broader consequences are uncertain at this time, the continuation and/or escalation of these or other
geopolitical conflicts creates a number of risks that could adversely impact our business, including:
•
persistent inflationary pressures and significant volatility in commodity prices;
•
disruptions to our global technology infrastructure, including through cyberattacks, ransom attacks or cyber-
intrusion;
•
adverse changes in international trade policies and relations, including U.S. relations with China;
•
our ability to maintain or increase our prices, including freight in response to increased fuel costs;
•
disruptions in global supply chains;
•
increased exposure to foreign currency fluctuations; and
•
constraints, volatility or disruption in the credit and capital markets.
If we experience a security breach, if our internal information systems fail to function properly or if we are
unsuccessful in implementing, integrating or upgrading our information systems, our business operations
could be materially affected.
We depend on information systems to process customer orders, manage inventory and accounts receivable
collections, purchase products, manage accounts payable processes, ship products to customers on a timely basis,
maintain cost effective operations, provide superior service to customers and consolidate financial results, among
many other things.
Despite our implementation of various security measures, our IT systems and operations could be subject to
damage or interruption from computer viruses, natural disasters, unauthorized physical or electronic access, power
outages, telecommunications failure, computer system or network failures, wire transfer failure, employee error/
malfeasance, cyber-attacks, security breaches, and other similar disruptions. For example, the CrowdStrike outage
that occurred in July 2024 negatively impacted our operations and financial results in the third quarter of 2024. In
addition, the IT systems of businesses that we have acquired or may acquire could present issues that we were not
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able to identify prior to the acquisition or other issues that continue to pose risk to us, such as those related to
collection, use maintenance and data disclosure practices or other cybersecurity vulnerabilities. Additionally, the
techniques and sophistication used to conduct cyber-attacks and breaches of IT systems change frequently,
including as a result of the deployment of evolving artificial intelligence tools used to identify vulnerabilities and
create more effective phishing attempts, and have the potential to not be recognized until such attacks are launched
or have been in place for a period of time. Maintaining, operating, and protecting these systems and related
personal and sensitive information about our employees, customers and suppliers requires continuous investments
in physical and technological security measures, employee training, and third-party services which we have made
and will continue to make. A cyber-attack or security breach could result in, among other things, sensitive and
confidential data being lost, manipulated or exposed to unauthorized persons or to the public or delay our ability to
process customer orders and manage inventory. While we also seek to obtain assurances from third parties with
whom we interact to protect confidential information, there are risks that the confidentiality or accessibility of data
held or utilized by such third parties may be compromised.
To date, we have not experienced a material breach of cybersecurity; however, our computer systems and the
computer systems of our third-party service providers have been, and will likely continue to be, subjected to
unauthorized access or phishing attempts, computer viruses, malware, ransomware or other malicious codes. In
particular, work-from-home arrangements rely on virtual environments and communications systems, which have
been subjected to increasing third-party vulnerabilities and security risks at various businesses.
A serious prolonged disruption of our information systems for any of the above reasons could materially impair
fundamental business processes and increase expenses, decrease sales or otherwise impact earnings and cash
flows. Furthermore, such a disruption may harm our reputation and business prospects and subject us to legal
claims if there is loss, disclosure or misappropriation of or access to our customers, employees or suppliers'
information. As the regulatory environment related to information security, data collection and use, and privacy
becomes increasingly rigorous, compliance with these requirements could also result in significant additional costs.
As threats related to cybersecurity breaches grow more sophisticated and frequent, it may become more difficult to
timely detect and protect our data and infrastructure.
We recognize the growing demand for business-to-business and business-to-customer e-commerce
options and solutions, and we could lose business if we fail to provide or adapt to the e-commerce options
and solutions our customers wish to use.
Our retail and business customers increasingly demand convenient, easy-to-use e-commerce tools as an option
to conduct their business with us. The success of our e-commerce platform depends on our ability to accurately
identify the products to make available through our e-commerce platform, and to provide and maintain an efficient
online experience with the highest level of data security for our customers. Operating an e-commerce platform is a
complex undertaking and exposes us to risks and difficulties frequently experienced by internet-based businesses,
included risks related to, among other things, our ability to support, expand, and develop our internet operations,
website, mobile applications and software and related operational systems. Continuing to improve our e-commerce
platform involves substantial investment of capital and resources, increasing supply chain and distribution
capabilities, attracting, developing and retaining qualified personnel with relevant subject matter expertise and
effectively managing and improving the customer experience. If we are unable to successfully provide the e-
commerce solutions our retail and business customers desire, differentiate ourselves from our competitors' e-
commerce solutions or adapt to new or enhanced e-commerce tools, we may lose existing customers and fail to
attract new ones. Our business, financial condition, results of operations and cash flows may be materially and
adversely affected as a result.
Our dependence on key personnel and the increasing potential for union activity could adversely affect our
future results and harm our business.
Our future success significantly depends on the continued services and performance of our key management
personnel. We believe our management team’s depth and breadth of experience in our industry is integral to
executing our business plan. We also will need to continue to attract, motivate, and retain other key personnel as
well as maintain employee safety and well-being. The loss of services of members of our senior management team
or other key employees, the inability to attract additional qualified personnel as needed or failure to plan for the
succession of senior management and key personnel could have a material adverse effect on our business.
In addition, in recent years there has been an increase in workers exercising their right to form or join a union,
particularly in the U.S. There can be no assurance that our employees will not elect to be represented by labor
unions in the future, which could among other things, adversely impact our culture, increase operating costs and
otherwise disrupt our business and operations. Further, our responses to any union organizing efforts could
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negatively impact how our brand is perceived by our employees and customers and have material adverse effects
on our business and future results.
Our strategic transactions, initiatives and transformation plan involve risks, which could have an adverse
impact on our financial condition and results of operation, and we may not realize the anticipated benefits
of these transactions and initiatives.
We regularly consider and enter into strategic transactions, including mergers, acquisitions, investments,
alliances, and other growth and market expansion strategies, with the expectation that these transactions will result
in increases in sales, cost savings, synergies and various other benefits. Assessing the viability and realizing the
benefits of these transactions is subject to significant uncertainty, and we face significant competition in pursuing
strategically beneficially transactions. Pursuing strategic transactions is also a time-consuming process that can
involve significant expenses and management attention. For each of our acquisitions, we need to successfully
integrate the target company’s products, services, associates and systems into our business operations, including in
particular the challenges associated with the integration of foreign operations to ensure the adequacy of internal
controls. Integration can be a complex and time-consuming process, and if the integration is not fully successful or
is delayed for a material period of time, we may not achieve the anticipated synergies or benefits of the acquisition.
Furthermore, even if the target companies are successfully integrated, the acquisitions may fail to further our
business strategy as anticipated, expose us to increased competition or challenges with respect to our products or
services, and expose us to additional liabilities. Any impairment of goodwill or other intangible assets acquired in a
strategic transaction may reduce our earnings. In addition, any investments we hold in other companies are subject
to a risk of partial or total loss of our investment. We also consider and enter into divestitures from time to time, with
the expectation that these transactions will result in increases in cost savings and various other benefits. Strategic
divestitures are subject to uncertainty and can be a complex and time-consuming process. If the divestiture is not
fully successful or is delayed for a material period of time, or if we are unable to reinvest the proceeds of the
divestiture in a manner consistent with our strategic objectives, we may not achieve the anticipated benefits of the
divestiture.
Additionally, in undertaking the transformation plan for our business, we have integrated our strategic initiatives
into a cohesive business model which balances competing priorities. If we are unable to continue to implement
these strategic initiatives, such as our technology, supply chain and sales effectiveness initiatives, efficiently and
effectively, or if these strategic initiatives are unsuccessful, our business, financial condition, results of operations
and cash flows could be adversely affected. To facilitate this transformation plan, we are continuing to make
substantial investments, recruit new talent, and optimize our business model, management system, and
organization. Accordingly, a strong balance sheet that provides the flexibility to invest in these new growth
opportunities and maintaining discipline in our capital allocation is critical to the success of our transformation plans.
If we are unable to continue to maintain a strong balance sheet or optimize our capital allocation or are otherwise
not successful in executing our strategic initiatives and transformation plan (or are delayed for reasons outside of
our control), we may not be able to realize the full benefits of our plan. Furthermore, if we are unable to successfully
drive employee or customer adoption of certain strategic initiatives, we may not realize the full benefits of our plan.
Additionally, failure to continue to make progress on our plans (or failure to accurately measure progress on our
plan), may disrupt the conduct of our business and divert management’s attention and resources. All of these
potential outcomes could have an adverse effect on our financial condition and results of operations.
If we fail to maintain an effective system of internal controls over financial reporting there is a reasonable
possibility that a material misstatement of our annual or interim financial statements will not be prevented
or detected on a timely basis, which could result in a loss of investor confidence and negatively impact our
business, results of operations, financial condition and stock price.
Effective internal controls are necessary for us to provide reliable and accurate financial statements and to
effectively prevent fraud. However, a control system, no matter how well conceived and operated, can provide only
reasonable, not absolute, assurance that the objectives of the control system are met. There can be no assurance
that all control issues or fraud will be detected. As we continue to grow our business, our internal controls continue
to become more complex and require more resources. Further, some of our employees work remotely and could
introduce potential vulnerabilities to our financial reporting systems and our internal control environment and the
effectiveness of our internal controls over financial reporting. Any failure to maintain effective controls could prevent
us from timely and reliably reporting financial results and may harm our operating results. In addition, if we are
unable to conclude that we have effective internal control over financial reporting, or if our independent registered
public accounting firm is unable to provide an unqualified report as to the effectiveness of our internal control over
financial reporting, as of each fiscal year end, we may be exposed to negative publicity, which could cause investors
to lose confidence in our reported financial information. Any failure to maintain effective internal controls and any
such resulting negative publicity may negatively affect our business and stock price.
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Additionally, the existence of any material weaknesses or significant deficiencies would require management to
devote significant time and incur significant expense to remediate any such material weaknesses or significant
deficiencies and management may not be able to remediate any such material weaknesses or significant
deficiencies in a timely manner. The existence of any material weakness in our internal control over financial
reporting could also result in errors in our financial statements that could require us to restate our financial
statements, cause us to fail to meet our reporting obligations and cause stockholders to lose confidence in our
reported financial information, all of which could materially and adversely affect us and the market price of our
common stock.
MACROECONOMIC, INDUSTRY AND FINANCIAL RISKS
Uncertainty and/or deterioration in general macro-economic conditions domestically and globally, including
inflation or deflation, employment rates and wages, changes in tax policies, changes in energy costs,
uncertain credit markets, or other economic conditions, could have a negative impact on our business,
financial condition, results of operations and cash flows.
Our business, financial condition, results of operations and cash flows have been and may in the future be
adversely affected by uncertain global economic conditions, including inflation or deflation, domestic outputs,
geopolitical uncertainty and unrest, employment rates and wages, including increases in minimum wage, changes in
tax policies, changes in energy costs, instability in credit markets, declining consumer and business confidence,
fluctuating commodity prices, elevated interest rates for prolonged periods, monetary policies, volatile exchange
rates, changes in fiscal and regulatory priorities as a result of the outcome of the 2024 U.S. presidential election,
and other challenges that could affect the global economy. Both our commercial and retail customers may
experience deterioration of their financial resources, which could result in existing or potential customers delaying or
canceling plans to purchase our products.
Our vendors may also be adversely affected by these and other uncertain or deteriorating macro-economic
conditions, which could impact their ability to fulfill their financial obligations to us.
Fluctuations in foreign currency exchange rates have adversely affected and could continue to adversely
affect our operating results.
Because the functional currency of most of our foreign operations is the applicable local currency, but our
financial reporting currency is the U.S. dollar, we are required to translate the assets, liabilities, expenses, and
revenues of our foreign operations into U.S. dollars at the applicable exchange rate in preparing our Consolidated
Financial Statements. Accordingly, we face foreign currency exchange rate risk arising from transactions in the
normal course of business, such as sales and loans to wholly owned subsidiaries, sales to third-party customers,
purchases from suppliers, and bank lines of credit with creditors denominated in foreign currencies.
Foreign currency exchange rates have affected our net sales, net earnings, and operating results and could
continue to result in declines in our reported net sales and net earnings. Currency exchange rate fluctuations may
also affect the comparative prices between products we sell and products our foreign competitors sell in the same
market, which may decrease demand for our products. Substantial exchange rate fluctuations as a result of the
strengthening of the U.S. dollar or otherwise, may have an adverse effect on our operating results, financial
condition, and cash flows, as well as the comparability of our Consolidated Financial Statements between reporting
periods. While we actively manage our foreign currency market risk in the normal course of business by entering
into various derivative instruments to hedge against such risk, these derivative instruments involve risks and may
not effectively limit our underlying exposure to foreign currency exchange rate fluctuations or minimize our net
earnings and cash volatility associated with foreign currency exchange rate changes. Further, the failure of one or
more counterparties to our foreign currency exchange rate contracts to fulfill their obligations to us could adversely
affect our operating results.
Our debt levels could adversely affect our cash flow and prevent us from fulfilling our obligations.
We have an unsecured revolving credit facility and unsecured senior notes and our level of indebtedness could,
among other things:
•
make it more difficult to satisfy our financial obligations, including those relating to our unsecured
revolving credit facility and our unsecured senior notes;
•
increase our vulnerability to adverse economic and industry conditions;
•
limit our flexibility in planning for, or reacting to, changes and opportunities in our industry, which may
place us at a competitive disadvantage;
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•
require us to dedicate a substantial portion of our cash flows to service the principal and interest on the
debt, reducing the funds available for other business purposes, such as working capital, capital
expenditures or other cash requirements;
•
limit our ability to incur additional debt with acceptable terms; and
•
expose us to fluctuations in interest rates.
The terms of our financing obligations include restrictions, such as affirmative, negative and financial covenants,
conditions on borrowing and subsidiary guarantees. A failure to comply with these restrictions could result in a
default under our financing obligations or could require us to obtain waivers from our lenders for failure to comply
with these restrictions. The occurrence of a default that remains uncured or the inability to secure a necessary
consent or waiver could have a material adverse effect on our business, financial condition, results of operations
and cash flows. We also guarantee the borrowings of certain independently owned automotive parts stores and
certain other affiliates in which we have a non-controlling equity ownership interest. To date, we have not
experienced any significant losses in connection with these guarantees. However, if any of the borrowers under
these guarantees experienced a default, we may be required to satisfy their payment obligations in an amount that
could be material.
In addition, our indebtedness is rated by credit rating agencies. Our overall credit rating may be negatively
impacted by deteriorating and uncertain credit markets or other factors that may or may not be within our control.
The interest rates on our unsecured revolving credit facility, as well as any additional indebtedness we may incur in
the future, are impacted by our credit ratings. Accordingly, any negative impact of our credit ratings, or placement of
our credit ratings on “review” or “watch” status, could result in higher interest expense and could impact the terms of
any additional indebtedness we incur in the future.
LEGAL AND REGULATORY RISKS
We may be affected by global climate change or legal, tax, regulatory, or market responses to such change.
The concern over climate change has led to legislative and regulatory initiatives aimed at reducing greenhouse
gas emissions (“GHG”). For example, regulations that impose extensive mandatory requirements related to GHG
continue to be considered by or have been issued by policy makers in both the federal and certain state
governments in the U.S., by the European Union, and by national governments in Canada, the U.K., Australia and
elsewhere. Many of the regulations that have been issued create mandatory, annual reporting requirements related
to carbon emissions and other sustainability-related information that will ultimately be subject to audit and could
expose our company to fines, regulatory inquiry or negative publicity if we fail to comply. Additionally, significant
increases in fuel economy requirements, new federal or state restrictions on emissions of carbon dioxide or new
federal or state incentive programs that may be imposed on vehicles and automobile fuels could adversely affect
demand for the products we sell. We may not be able to accurately predict, prepare for and respond to new kinds of
technological innovations with respect to electric vehicles and other technologies that minimize emissions. Laws
enacted to reduce GHG could directly or indirectly affect our suppliers and could adversely affect our business,
financial condition, results of operations and cash flows. Changes in automotive technology (including the adoption
of electric vehicles or the use of artificial intelligence) and compliance with any new or more stringent laws or
regulations, or stricter interpretations of existing laws, could require additional expenditures by us or our suppliers all
of which could adversely impact the demand for our products and our business, financial condition, results of
operations or cash flows.
Because we are involved in litigation from time to time and are subject to numerous laws and governmental
regulations, we could incur substantial judgments, fines, legal fees and other costs as well as reputational
harm.
We are sometimes the subject of complaints or litigation from customers, employees or other third parties for
various reasons, including as a result of new legal or regulatory frameworks. For example, we are party to, among
other litigation, numerous pending asbestos liability lawsuits relating to our national distribution of automotive parts
and supplies sold primarily before 1991, many of which involve claims of personal injury allegedly resulting from the
use of automotive parts distributed by us. The damages sought against us in some of these litigation proceedings
are substantial. Although we maintain liability insurance for some litigation claims, if one or more of the claims were
to greatly exceed our insurance coverage limits or if our insurance policies do not cover a claim our business,
financial condition, results of operations and cash flows could be materially and adversely affected.
Additionally, we are subject to an increasing number of laws in the various jurisdictions in which we operate as
well as governmental regulations relating to taxes, environmental protection, product quality standards,
cybersecurity, machine learning, artificial intelligence, data privacy, building and zoning requirements, and
employment law matters. If we fail to comply with existing or future laws or regulations, we may be subject to
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governmental or judicial fines or sanctions, while incurring substantial legal fees and costs. In addition, our capital
expenses could increase due to remediation measures that may be required if we are found to be noncompliant with
any existing or future laws or regulations.
Changes in legislation or government regulations or policies, particularly those relating to taxation and
international trade, could have a significant impact on our results of operations.
Our business is global, so changes to existing international trade agreements, blocking of foreign trade,
increased protectionism, or imposition of tariffs on foreign goods could result in decreased revenues and/or
increases in pricing, either of which could have an adverse impact on our business, results of operations, financial
condition and cash flows in future periods. For instance, the United States imposed Section 232 tariffs on many
imported products of steel and aluminum in March 2018 and expanded the tariffs to additional derivative products of
steel and aluminum effective February 8, 2020. The United States imposed Section 301 tariffs on most imported
products from China starting in July 2018. Although the United States and China reached a Phase One trade deal in
January 2020, there was no Phase Two trade deal implemented and most of the tariffs imposed remain in place.
Uncertainty persists in the trade relationship between the two countries that impacts the global trade landscape, and
as of February 2025, new tariffs were enacted that significantly increase tariffs on foreign imports into the United
States. The effects of these changes, including responsive actions from foreign governments, could also have
significant impacts on our financial results.
In addition, as a global business, we are subject to taxation in each of the jurisdictions in which we operate.
Changes in the tax laws of these jurisdictions, or in the interpretation or enforcement of existing tax laws, could
subject our business to audits, inquiries and legal challenges from taxing authorities and could reduce the benefit of
tax structures previously implemented for our operations. As a result, we may incur additional costs, including taxes
and penalties for historical periods, that may have a material and adverse effect on our business, financial condition,
results of operations and cash flows.
GENERAL RISKS
We are subject to risks related to corporate social responsibility and reputation.
Many factors influence our reputation and the value of our brands including the perception held by our
customers, business partners, investors, regulators, other key stakeholders and the communities in which we do
business. Our business faces increasing scrutiny and regulations related to corporate social responsibility practices
and disclosures and we face an increasing risk of damage to our reputation and the value of our brands if we fail to
act responsibly and/or in compliance with applicable laws and regulations in a number of areas, such as
environmental stewardship and sustainability, supply chain management, climate change, inclusion, workplace
conduct, human rights, philanthropy and support for local communities. We are continually assessing our
obligations under proposed and enacted rules and expect that compliance could require substantial effort in the
future. Standards for tracking and reporting on sustainability matters, including climate-related matters, have also
not been harmonized. Changes to these standards could require adjustments to our accounting or operational
policies, as well as updates to our existing systems to meet these reporting obligations. We will therefore likely need
to be prepared to contend with overlapping, yet distinct, disclosure approaches, frameworks and requirements.
Our 2024 Sustainability Report is available on our website. If our sustainability practices or disclosures do not
meet, or are perceived not to meet, evolving regulatory, investor and other stakeholder expectations and standards,
our reputation, our ability to attract or retain employees, and our attractiveness as an investment or business partner
could be negatively affected. Similarly, our failure, or perceived failure, to pursue or fulfill any sustainability-focused
goals, targets, or objectives, to comply with ethical, environmental, or other standards, regulations, or expectations,
or to satisfy various reporting standards with respect to these matters, within the timelines we announce, or at all,
could adversely affect our business or reputation, as well as expose us to government enforcement actions and
private litigation. While we monitor a broad range of sustainability matters, we cannot be certain that we will manage
such matters successfully, or that we will successfully meet the expectations of regulators, investors, employees,
customers and other stakeholders. Any failure to meet such expectations could impact employee engagement and
retention and the willingness of customers and our partners to do business with us, which could have a material
adverse effect on our business, results of operations and cash flows.
Our stock price is subject to fluctuations, and the value of your investment may decline.
The trading price of our common stock is subject to fluctuations, and may be subject to fluctuations in the future
based upon external economic and market conditions. The stock market in general has experienced significant
price and volume fluctuations that sometimes have been unrelated or disproportionate to the operating performance
of listed companies. These broad market, geopolitical and industry factors among others may harm the market price
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15
of our common stock, regardless of our operating performance and growth outlook, and the value of your
investment may decline.
ITEM 1B. UNRESOLVED STAFF COMMENTS.
Not applicable.
ITEM 1C. CYBERSECURITY.
Our information security program is managed by a dedicated Chief Information Security Officer ("CISO"), whose
team is responsible for leading enterprise-wide cybersecurity strategy, risk assessment and management policies,
standards, architecture, and processes. The CISO, along with the Chief Information and Digital Officer ("CIDO"),
each have over 20 years of prior work experience in various roles involving information technology, including
security, compliance, and systems. The CISO provides periodic reports, which take into account information from
internal stakeholders, known privacy and security vulnerabilities, threat detection plans, and information from
external sources such as reported security incidents, industry trends, and third-party evaluations to our executive
leadership team and, as well as regular updates to our Audit Committee. The Audit Committee receives regular
updates specific to the company’s cyber security program and IT security risk, including threat protection posture, IT
compliance reporting, and IT risk posture. The Board of Directors ("Board") has ultimate oversight for risks relating
to our information security program and practices and receives periodic updates from the Audit Committee Chair on
cybersecurity and IT security risk and mitigation strategies, as well as periodic updates directly from the CIDO and
CISO. Our program is regularly evaluated by internal and external resources with the results of those reviews
reported to senior management, the Audit Committee and the Board. We also actively engage with key vendors,
industry participants, and intelligence and law enforcement communities for benchmarking and awareness of best
practices as part of our continuing efforts to evaluate and enhance the effectiveness of our information security
policies and procedures. As part of our cybersecurity risk management system, our governance, risk and
compliance team tracks and logs privacy and security incidents across GPC as well as performs third-party risk
management to identify and mitigate risks from third parties such as vendors and suppliers. The results of our
evaluations and the feedback from our engagements are used to drive alignment on, and prioritization of, initiatives
to enhance our cybersecurity strategies, policies, and processes and make recommendations to improve
processes.
Our policies, standards, processes and practices for assessing, identifying, and managing material risks from
cybersecurity threats are integrated into our overall risk management program to ensure that cybersecurity
considerations are an integral part of our decision-making processes and are based on frameworks established by
the National Institute of Standards and Technology Cybersecurity Framework (“NIST CSF”) and other applicable
industry standards. In connection with our information security program, we perform ongoing internal and external
risk assessment activities, and deploy systems, processes, and procedures across our global business units in
response to identified risks. As cybersecurity events are detected via our global processes, the potential impact of
the events is assessed based on criticality, and mitigation and remediation actions are taken in accordance with our
incident response plan. The incident response plan is periodically evaluated by our cybersecurity team as well as by
independent advisors using simulated security exercises. Security awareness training is also key component of our
information security program and involves required training for all our teammates and contingent workers.
Although we have not experienced a material breach of cybersecurity to date, our computer systems and the
computer systems of our third-party service providers have been, and will likely continue to be, subjected to
unauthorized access or phishing attempts, computer viruses, malware, ransomware or other malicious codes.
Despite our security measures, there can be no assurance that we, or the third parties with which we interact, will
not experience a cybersecurity incident in the future that will materially affect us. For more information about these
and other information security risks we face, see “Item 1A. Risk Factors — Strategic and Operational Risks.”
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16
ITEM 2. PROPERTIES.
The following table summarizes our company-owned and operated distribution centers, retail stores, branches
and service centers as of December 31, 2024:
Distribution Centers
Other Locations
Automotive:
North America
75
2,279
Europe
73
782
Australasia
14
561
Total Automotive
162
3,622
Industrial:
North America
17
611
Australasia
13
144
Total Industrial
30
755
Total
192
4,377
In addition to the properties set forth above, we have various headquarters, shared service centers and other
facilities. Our corporate and U.S. Automotive headquarters are located in two office buildings owned by us in
Atlanta, Georgia. We generally own distribution centers and lease retail stores and branches. We believe that our
facilities as a whole are in good condition, are adequately insured, are fully utilized and are suitable and adequate to
conduct the business of our current operations.
ITEM 3. LEGAL PROCEEDINGS.
Information with respect to our legal proceedings may be found in the Commitments and Contingencies
Footnote in the Notes to Consolidated Financial Statements in Item 8 of Part II, which is incorporated herein by
reference.
ITEM 4. MINE SAFETY DISCLOSURES.
Not applicable.
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17
PART II.
ITEM 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND
ISSUER PURCHASES OF EQUITY SECURITIES.
Market Information Regarding Common Stock
Our common stock is traded on the New York Stock Exchange under the ticker symbol “GPC.”
Dividend Information
We have paid a cash dividend to shareholders every year since going public in 1948 and increased the annual
dividend for 68 consecutive years through 2024. While we have historically paid dividends to holders of our common
stock on a quarterly basis and expect to continue doing so going forward, the declaration and payment of future
dividends will depend on many factors, including, but not limited to, our earnings, financial condition, business
development needs and regulatory considerations, and are at the discretion of our Board of Directors.
Stock Performance Graph
Set forth below is a line graph comparing the yearly dollar change in the cumulative total shareholder return on
our common stock against the cumulative total shareholder return of the Standard and Poor’s ("S&P") 500 Stock
Index and a peer group composite index (“Peer Index”) structured by us as set forth below for the five year period
that commenced December 31, 2019 and ended December 31, 2024. This graph assumes that $100 was invested
on December 31, 2019 in Genuine Parts Company common stock, the S&P 500 Stock Index (we are a member of
the S&P 500 Stock Index, and our cumulative total shareholder return went into calculating the S&P 500 Stock
Index results set forth in the graph) and the peer group composite index as set forth below, and assumes
reinvestment of all dividends.
Comparison of five year cumulative total shareholder return
Cumulative Total Shareholder Return $ at
Fiscal Year End
2019
2020
2021
2022
2023
2024
Genuine Parts Company
$100.00
$97.82
$140.26
$177.84
$145.59
$126.35
S&P 500 Stock Index
$100.00
$118.39
$152.34
$124.73
$157.48
$196.85
Peer Index
$100.00
$121.13
$150.76
$124.23
$145.76
$137.18
In constructing the Peer Index for use in the stock performance graph above, we used the shareholder returns
of various publicly held companies (weighted in accordance with each company’s stock market capitalization at
December 31, 2019 and including reinvestment of dividends) that compete with us in our two industry segments:
automotive parts and industrial parts (each group of companies included in the Peer Index as competing with us in a
separate industry segment is hereinafter referred to as a “Peer Group”). Included in the automotive parts Peer
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18
Group are those companies making up the Dow Jones U.S. Auto Parts Index (we are a member of such industry
group, and its individual shareholder return was included when calculating the Peer Index results set forth in the
performance graph). Included in the industrial parts Peer Group are Applied Industrial Technologies, Inc., Fastenal
Company, and W.W. Grainger, Inc. In determining the Peer Index, each Peer Group was weighted to reflect our
annual net sales in each industry segment.
Holders
As of December 31, 2024, there were 6,428 holders of record of the company’s common stock. The number of
holders of record does not include beneficial owners of the common stock whose shares are held in the names of
various dealers, clearing agencies, banks, brokers and other fiduciaries.
Issuer Purchases of Equity Securities
The following table provides information about the purchases of shares of the company’s common stock during
the three month period ended December 31, 2024:
Period
Total
Number o
f Shar
es Purchased (1)
Average
Price Paid
per Share
Total Number of Shares
Purchased as Part of
Publicly Announced
Plans or Programs (2)
Maximum Number of
Shares That May Yet
be Purchased Under
the Plans or Programs
October 1, 2024 through
October 31, 2024
206,704 $
124.18
206,704
7,552,129
November 1, 2024 through
November 30, 2024
104,849 $
119.10
99,318
7,452,811
December 1, 2024 through
December 31, 2024
8,106 $
115.22
—
7,452,811
Total
319,659 $
122.29
306,022
7,452,811
(1) Includes shares surrendered by employees to the company to satisfy tax withholding obligations in connection
with the vesting of shares of restricted stock, the exercise of share appreciation rights and/or tax withholding
obligations.
(2) On August 21, 2017, the Board of Directors announced that it had authorized the repurchase of 15 million
shares. Under this program, shares may be repurchased in privately negotiated and/or open market
transactions, including under plans complying with Rule 10b5-1 under the Exchange Act. The authorization for
these repurchase plans continues until all such shares have been repurchased or the repurchase program is
terminated by action of the Board of Directors. The program may be suspended at any time and does not have
an expiration date. Approximately 7.5 million shares authorized remain available to be repurchased by the
company. There were no other repurchase plans announced as of December 31, 2024.
ITEM 6. [RESERVED]
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19
ITEM 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
OPERATIONS.
The following discussion and analysis contains forward-looking statements, including, without limitation,
statements relating to our plans, strategies, objectives, expectations, intentions and resources. Such forward-
looking statements should be read in conjunction with our disclosures under “Item 1A. Risk Factors” of this Form 10-
K.
OVERVIEW
Genuine Parts Company ("GPC") is a global service organization with a long history of growth and innovation
dating back to our founding in Atlanta, Georgia, in 1928. Over nearly a century, we’ve built a reputation for delivering
excellent customer service, profitable growth, leading distribution capabilities and strong cash flow.
In 2024, we conducted business in North America, Europe and Australasia from more than 10,700 locations.
Our Automotive business operated in the U.S., Canada, Mexico, France, the U.K., Ireland, Germany, Poland, the
Netherlands, Belgium, Spain, Portugal, Australia and New Zealand and accounted for 63% of total revenues for the
year. Our Industrial business operated in the U.S., Canada, Mexico, Australia, New Zealand, Indonesia and
Singapore and accounted for 37% of total revenues.
Our mission is to be the employer, supplier, and investment of choice, while also being a valued corporate
citizen in the communities we serve. This mission drives our strategic financial objectives: outpacing market
revenue growth, improving operating margins, maintaining a strong balance sheet and cash flows, and allocating
capital effectively. As we look to the future, we are leaning into modernizing our supply chain and technology
through digital innovation, and data-driven strategies to enhance our competitive edge. By leveraging technology
and optimizing supply chains, we are empowering our teams with cutting-edge tools to focus on delivering
exceptional customer service and driving sustainable growth. At the heart of it all is our commitment to excellence,
supported by a culture of continuous improvement and a legacy of strong leadership that has guided us for nearly
100 years.
KEY PERFORMANCE INDICATORS
We consider a variety of performance and financial measures in assessing our business, and the key
performance indicators used to measure our results are summarized below.
Comparable Sales
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Comparable sales refer to period-over-period comparisons of our net sales excluding the impact of acquisitions,
divestitures, foreign currency and other. Our calculation of comparable sales is computed using total business days
for the period and is inclusive of both company-owned stores and sales to our independent owner's stores. We
consider this metric useful to investors because it provides greater transparency into management’s view and
assessment of our core ongoing operations. This metric is widely used by analysts, investors and competitors in our
industry, however our calculation of the metric is not comparable to similar measures disclosed by other companies,
because not all companies and analysts calculate this metric in the same manner.
Gross Profit and Gross Margin
Gross profit represents net sales less cost of goods sold. Gross profit as a percentage of net sales is referred to
as gross margin. Cost of goods sold primarily represents the cost of merchandise sold, including the cost of inbound
freight from suppliers. It also includes the effects of supplier volume incentives and inventory adjustments. Our
gross profit is variable in nature and generally follows changes in net sales. We believe that gross profit and gross
margin are useful measures because they allow management, analysts, investors and others to evaluate the profit
we generate from our sales, before operating and other expenses and income.
Selling, Administrative and Other Expenses ("SG&A")
SG&A includes all personnel and personnel-related costs at our corporate offices, segment headquarters,
distribution centers, stores and branches. Additional costs in SG&A include our facilities, freight and delivery,
marketing, advertising, technology, digital, legal and professional costs. Freight and delivery costs are the shipping
and handling costs incurred related to delivering merchandise to our customers. We believe SG&A is a useful
measure because it allows management, analysts, investors and others to understand the level of costs we incur
operating our business each period.
Segment EBITDA and Segment EBITDA Margin
Segment EBITDA is the measure we use to assess the profitability of our company’s business segments and it
is calculated as net sales less cost of goods sold and total other operating expenses of the business segment, and it
20
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21
excludes amounts reflected in Corporate EBITDA, net interest expense, depreciation and amortization and other
unallocated costs. Segment EBITDA as a percentage of Segment Net Sales is referred to as Segment EBITDA
margin.
We changed our segment profit and segment profit margin measures in the fourth quarter of 2024 to Segment
EBITDA and Segment EBITDA margin, respectively. We believe that Segment EBITDA and Segment EBITDA
margin are useful measures because they allow management, analysts, investors, and other interested parties to
evaluate the profitability of our segments and they align with how management evaluates performance and sets
compensation plans. Refer to the Segment Data Footnote in the Notes to Consolidated Financial Statements for
additional information.
Net Income and EBITDA
We believe that net income and EBITDA, along with their respective adjusted measures, are useful measures of
operating performance. Net income represents our profitability after the effects of all operating and other expenses
and income. EBITDA helps us assess the underlying profitability of our company’s business operations before the
effects of certain net expenses that directly arise from our capital investment decisions (depreciation, amortization),
financing decisions (interest), and tax strategies (income taxes).
The adjusted measures of net income and EBITDA eliminate certain non-recurring charges and other items that
we do not believe are reflective of our ongoing business performance. These adjusted measures help us evaluate
our operating performance on a comparable basis from period-to-period so that we can better understand the
ongoing factors and trends affecting our business operations. We also use adjusted net income, together with
adjusted EBITDA, to forecast our performance, evaluate our actual results against our forecasts and compare our
results to others in the industries that we serve. Adjusted EBITDA is also a measure of performance included in our
executive incentive compensation plans. See “Non-GAAP Financial Measures” below for a discussion of how we
define adjusted net income and adjusted EBITDA and a reconciliation of adjusted net income, EBITDA and adjusted
EBITDA to net income, the most directly comparable financial measure calculated and presented in accordance with
accounting principles generally accepted in the United States (“GAAP”).
CONSOLIDATED RESULTS OF OPERATIONS
Our discussion of our results focuses on 2024 and 2023 and year-to-year comparisons between those periods.
Discussions of 2022 results and year-to-year comparisons between 2023 and 2022 results that are not included in
this Form 10-K can be found in “Management’s Discussion and Analysis of Financial Condition and Results of
Operations” in Part II, Item 7 of our Annual Report on Form 10-K for the fiscal year ended December 31, 2023.
In 2024, our net sales of $23.5 billion increased 1.7% year-over-year. Our sales growth was driven primarily by
acquisitions in our Automotive segment and two additional selling days. Sales growth was partially offset by the
negative impact of weak market conditions in both segments, as persistent high interest rates and economic
uncertainty led to lower customer demand which resulted in flat Automotive comparable sales and declines in
Industrial comparable sales in 2024. Economic activity in the U.S. manufacturing sector, measured by the
Purchasing Mangers' Index ("PMI"), contracted through most of 2024, negatively impacting purchases from our
Industrial customers.
In 2024, net income totaled $904 million, down 31.3%, driven by costs associated with our global restructuring
program, which was designed to better align our assets and cost structure to the current economic environment.
During the year, we incurred $221 million in restructuring and other costs under this program, and a charge of $62
million to cost of goods sold to write down certain existing inventory associated with a new global rebranding and
relaunch of a key tool and equipment offering.
Our earnings in 2024 were also negatively impacted by higher SG&A costs, which were driven by increases in
personnel and rent costs due to inflationary pressure and planned investments in technology to modernize our
systems and digital platforms. The investments we are making in technology, as well as new supply chain
capabilities, are driving higher year-over-year depreciation and interest expense. These costs were partially offset
by improved gross margin due to the benefits from acquired businesses and ongoing initiatives around pricing and
sourcing and from our global restructuring program.
Our results of operations are summarized below for the years ended December 31, 2024 and 2023.
(in thousands)
Year Ended December 31,
$ Change
% Change
2024
2023
$
% of Sales
$
% of Sales
Net sales
$ 23,486,569
100.0 % $ 23,090,610
100.0 % $ 395,959
1.7 %
Cost of goods sold
14,962,954
63.7 %
14,799,938
64.1 %
163,016
1.1 %
Gross profit
8,523,615
36.3 %
8,290,672
35.9 %
232,943
2.8 %
Operating expenses:
Selling, administrative and
other expenses
6,642,900
28.3 %
6,167,143
26.7 %
475,757
7.7 %
Depreciation and amortization
407,978
1.7 %
350,529
1.5 %
57,449
16.4 %
Provision for doubtful accounts
30,001
0.1 %
25,947
0.1 %
4,054
15.6 %
Restructuring and other costs
213,520
0.9 %
—
— %
213,520
100.0 %
Total operating expenses
7,294,399
31.1 %
6,543,619
28.3 %
750,780
11.5 %
Non-operating expenses
(income):
Interest expense, net
96,827
0.4 %
64,469
0.3 %
32,358
50.2 %
Other
(43,579)
(0.2) %
(59,764)
(0.3) %
16,185
(27.1) %
Total non-operating expenses
53,248
0.2 %
4,705
— %
48,543
1031.7 %
Income before income taxes
1,175,968
5.0 %
1,742,348
7.5 %
(566,380)
(32.5) %
Income taxes
271,892
1.2 %
425,824
1.8 %
(153,932)
(36.1) %
Net income
$
904,076
3.8 % $ 1,316,524
5.7 % $ (412,448)
(31.3) %
(in thousands, except per share data)
Year Ended December 31,
$ Change
% Change
2024
2023
Diluted EPS
$
6.47
$
9.33
$
(2.86)
(30.7) %
Adjusted diluted EPS
$
8.16
$
9.33
$
(1.17)
(12.5) %
Automotive segment EBITDA
$ 1,283,531
$ 1,339,134
$
(55,603)
(4.2) %
Industrial segment EBITDA
$ 1,102,188
$ 1,132,921
$
(30,733)
(2.7) %
Corporate EBITDA
$
(389,217)
$
(314,709)
$
(74,508)
23.7 %
Adjusted EBITDA
$ 1,996,502
$ 2,157,346
$
(160,844)
(7.5) %
Automotive segment EBITDA margin
8.7 %
9.4 %
Industrial segment EBITDA margin
12.6 %
12.8 %
Corporate EBITDA margin
(1.7) %
(1.4) %
Adjusted EBITDA margin
8.5 %
9.3 %
Table of
Net Sales
Our consolidated net sales increase of 1.7% includes a 2.6% benefit from acquisitions, which was partially
offset by a 0.8% comparable sales decrease as described in the following segment discussions.
Automotive
Net sales for Automotive were $14.8 billion in 2024, a 3.7% increase from 2023, driven by acquisitions,
particularly in our U.S. Automotive business. In 2024, we completed strategic acquisitions of more than 500 stores
in the U.S., mostly from our independent owners, including the acquisition of our two largest, Motor Parts &
Equipment Corporation ("MPEC") and Walker Automotive Supply, Inc. ("Walker"). These store acquisitions were in
strategic markets and enable us to capture commercial benefits, leverage synergies and further drive revenue
growth.
In 2024, our comparable sales were flat due to softer demand, as macro-economic headwinds such as high
interest rates and persistent cost inflation continued to impact customer buying behavior. The impact on net sales
from foreign currency translation was negligible.
Contents
22
Industrial
Net sales for Industrial were $8.7 billion in 2024, a 1.4% decrease from 2023, driven by a 2.1% decrease in
comparable sales and a 0.1% unfavorable impact of currency translation. This was partially offset by a 0.8%
contribution from acquisitions.
Our comparable sales decreased as we experienced softness in industrial production and an ongoing
moderation in demand in many customer end markets. We continued to experience an adverse macro-economic
environment when compared to 2023, as persistently high interest rates and economic uncertainty led customers to
delay discretionary capital expenditures. Economic activity in the U.S. manufacturing sector, measured by PMI,
remained contractionary through most of 2024.
Gross Profit & Gross Margin
Gross profit increased $233 million, or approximately 2.8%, from 2023 due primarily to an increase in net sales.
This was partially offset by a charge of $62 million to write down certain existing inventory associated with a new
global rebranding and relaunch of a key tool and equipment offering. Gross margin increased to 36.3% from 35.9%
in 2023, a 40 basis point improvement, which was primarily driven by the benefit of acquired businesses.
Inventory Rebranding Strategic Initiative
We are implementing a strategic realignment of our global tools and equipment inventory strategy. This strategy
targets a new generation of installers by reducing our global product offerings to two primary tiers and launching a
new global branding initiative in 2025, which we expect to enhance market penetration across all regions.
As part of this initiative, we have elected to liquidate certain otherwise marketable tools and equipment
inventory in 2025 to accelerate the realization of the program benefits, thereby improving operational efficiency and
enhancing the projected financial outcomes. By streamlining our product range in this key category, we enhance
warehouse space for new inventory and enable our sales force to focus on the new strategy, facilitating earlier
market capture. Accordingly, we have recognized a $62 million non-cash charge reflected in cost of goods sold to
write down the inventory to its market value, assuming liquidation.
Selling, Administrative and Other Expenses
SG&A expenses increased $476 million, or 7.7%, from 2023. Approximately 50% of the increase was driven by
personnel expense and 10% by higher rent expense, reflecting inflationary pressures on annual wage increases
and lease renewals and higher operating costs due to acquisitions, primarily from the addition of more U.S.
automotive stores. Additionally, 10% of the increase was attributable to our investments in technology as we
continue to enhance our digital capabilities to improve the customer experience, increase automation in distribution
centers, and modernize payment platforms. The remainder of the increase was attributable to other SG&A
categories, as we incurred higher operating costs from acquired businesses, and we continued to invest in our
supply chain to optimize product assortment and positioning, which helps reduce distribution costs. Partially
offsetting the increase were $43 million in real estate sale gains, primarily from sale-leaseback transactions to
enhance our financial operational flexibility on properties we continue to use in our ongoing operations.
SG&A as a percentage of sales increased to 28.3% in 2024 from 26.7% in 2023. The 160 basis point increase
was primarily driven by approximately 80 basis points from inflationary pressures on certain operating expenses, 40
basis points from increased operating expenses from acquisitions and 25 basis points from fixed cost deleverage.
Comparable sales were flat for Automotive and down for Industrial, which drove fixed cost deleveraging.
Restructuring and Other Costs
In February 2024, we approved and announced a global restructuring designed to better align our assets and
further improve the profitability of the business. This initiative included an announced voluntary retirement offer in
the U.S., along with a rationalization and optimization of certain distribution centers, stores and other facilities. We
incurred a $62 million inventory charge, described above, and $221 million of restructuring and other costs related
to the initiative, which includes $91 million of severance costs. We recognized approximately $45 million in cost
savings related to this global restructuring initiative for 2024.
In 2025, we are expanding our restructuring initiatives and expect to incur additional restructuring and other
costs in the range of $150 to $180 million. These global restructuring initiatives are expected to generate
approximately $100 to $125 million in savings for 2025. The estimated charges that we expect to incur are subject
to a number of assumptions, and actual amounts may differ materially from such estimates. We may also incur
additional charges not currently contemplated due to unanticipated events that may occur, including in connection
with the implementation of these initiatives. We expect to substantially complete the initiative by the end of 2025.
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23
When fully annualized in 2026, we expect that our 2024 and 2025 restructuring efforts and cost actions will deliver
approximately $200 million of cost savings.
Refer to the Restructuring Footnote in the Notes to Consolidated Financial Statements for more information on
our global restructuring initiative.
Depreciation and Amortization
Depreciation and amortization expenses increased $57 million related to ongoing investments in technology
and supply chain initiatives.
Non-Operating Expenses and Income
We incurred $53 million in net non-operating expenses in 2024, a $48.5 million increase from $5 million in net
non-operating expenses in 2023. This category primarily includes net interest expense, pension and investment
income, foreign currency gains and losses, and fees associated with our Accounts Receivable Sales Agreement ("A/
R Sales Agreement"). The $49 million expense increase includes the effects of a $32 million increase in net interest
expense in 2024, due to increased borrowings, including the senior notes issued in August 2024, and a $16 million
decrease in other non-operating income driven by decreased pension income, foreign currency gains, and income
from cash surrender value of life insurance policies.
Income Taxes
Our effective income tax rate was 23.1% as of December 31, 2024, compared to 24.4% in 2023. For the year
ended December 31, 2024, the rate decrease is primarily due to expanded investment and domestic credit benefits.
Net Income and Adjusted Net Income
Net income was $904 million in 2024, a decrease of 31.3% compared to $1.3 billion in 2023. Diluted earnings
per share ("EPS") was $6.47 in 2024, down $2.86 compared to $9.33 in 2023. Adjusted net income was $1.1 billion
in 2024, a decrease of 13.4% compared to $1.3 billion in 2023. Adjusted diluted EPS was $8.16, down $1.17
compared to $9.33 in 2023.
The year over year declines in these metrics are primarily due to $221 million in restructuring and other costs,
$62 million in inventory liquidation charges, and higher SG&A expenses driven by inflationary pressures and
investments in technology. These impacts were partially offset by improved gross profit and margin from
acquisitions and pricing and sourcing initiatives and the benefits from the restructuring program.
Segment EBITDA
Automotive
2024 EBITDA decreased 4.2% or $56 million from 2023, and EBITDA margin decreased 70 basis points to 8.7%
in 2024 compared to 9.4% in 2023, driven by the following factors. Automotive segment sales grew $522 million or
3.7% due primarily to acquisitions. Gross profit increased $275 million or 4.9% and gross margin improved 50 basis
points primarily due to strategic acquisitions in our U.S. business, including MPEC and Walker. Our gross profit
improvement was offset by rising operating expenses. Operating expenses increased $330 million, with
approximately 75% of the increase driven by personnel cost increases of $200 million and rent increases of $53
million. Operating expenses increased partly due to acquisitions, however the EBITDA and EBITDA margin declines
largely were driven by persistent cost inflation, primarily in wages and rent, in our existing businesses.
2023 EBITDA was $1.3 billion, a decrease of 2.6% from 2022, and EBITDA margin decreased 70 basis points to
9.4% in 2023 compared to 10.1% in 2022, driven by the following factors. Automotive segment sales increased
4.2% driven by a 2.8% contribution from acquisitions and 2.1% growth in comparable sales, partially offset by a
0.7% unfavorable impact from foreign currency and other. Gross profit increased $295 million, or 5.5%, in 2023 due
to sales growth. This improvement was offset by a $330 million increase in operating expenses, including $160
million attributed to higher personnel expenses that were driven by persistent cost inflation and the effects of
acquisitions.
Industrial
2024 EBITDA decreased 2.7% to $1.1 billion from 2023, and EBITDA margin declined 20 basis points to 12.6%
in 2024 compared to 12.8% in 2023, driven by the following factors. Industrial segment sales declined $126 million
or 1.4%, primarily driven by a decline of 2.1% in comparable sales due to contractionary market conditions and
partially offset by 0.8% benefit from acquisitions. Gross profit increased $21 million or 0.8% in 2024 due to a 70
basis point improvement in gross margin primarily driven by acquisitions and strategic pricing and sourcing
initiatives, partially offset by a decline in sales. In 2024, operating expenses increased due to continued pressure
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from ongoing cost inflation and to a lesser extent acquisitions, particularly personnel costs and rent, which
increased $38 million and $15 million, respectively.
2023 EBITDA increased 20.7% to $1.1 billion in 2023, and EBITDA margin improved 170 basis points to 12.8%
compared to 11.1% in 2022, driven by the following factors. Industrial segment sales increased 4.9% driven by 4.8%
growth in comparable sales due to sales initiatives and strong market conditions and a 0.6% contribution from
acquisitions. This was slightly offset by a 0.5% unfavorable impact of currency translation. Gross profit increased
$246 million, or 10.3%, in 2023 due to sales growth and our focus on leveraging expenses and executing supply
chain initiatives as well as other strategic initiatives in areas such as category management and pricing. This
improvement was partially offset by a $52 million increase in operating expenses, primarily driven by a $32 million
increase in personnel expenses due to inflationary pressures and a $15 million increase in technology expense for
planned investments.
Corporate EBITDA and other Segment Reconciling items
Corporate EBITDA primarily reflects costs related to our corporate headquarter's broad support to our business
units and other costs that are managed centrally and not allocated to business segments. These include personnel
and other costs for company-wide functions such as executive leadership, human resources, technology,
cybersecurity, legal, corporate finance, internal audit, and risk management, as well as asbestos-related product
liability costs and A/R Sales Agreement fees. Our operational objective is to maintain Corporate EBITDA within a
range of 1.5% to 2.0% of net sales.
Corporate EBITDA amounted to a loss of $389 million, or 1.7% of net sales, in 2024, compared to a loss of
$315 million, or 1.4% of net sales, in 2023.
Corporate EBITDA increased primarily due to the impact of a higher asbestos liability costs and ongoing
investments in technology, each of which accounted for approximately 30% of the increase.
Other unallocated costs represent restructuring and other costs and acquisition and integration related costs
and other. These increased year-over-year due to the global restructuring initiative that was approved in February
2024 and the significant increase in acquisition activity in 2024.
EBITDA
EBITDA was $1.7 billion in 2024, a decrease of 22.1% from $2.2 billion in 2023. Adjusted EBITDA was $2.0
billion in 2024, a decrease of 7.5% from $2.2 billion in 2023. Results were affected by $221 million of costs related
to the global restructuring initiative, $33 million of acquisition and integration costs, and a $62 million inventory
liquidation charge (described above). Decreases in adjusted EBITDA margin were primarily driven by an 80 basis
point negative impact from inflationary pressures, particularly personnel costs and rent.
Adjusted net income, adjusted diluted EPS, EBITDA and adjusted EBITDA are non-GAAP measures (see table
below for reconciliations to the most directly comparable GAAP measures).
Non-GAAP Financial Measures
The following tables set forth reconciliations of net income and diluted EPS to adjusted net income and adjusted
diluted EPS, respectively, to account for the impact of adjustments. We also include reconciliations from net income
to adjusted EBITDA. We believe that the presentation of adjusted net income, adjusted diluted EPS and adjusted
EBITDA, which are not calculated in accordance with GAAP, when considered together with the corresponding
GAAP financial measures and the reconciliations to those measures, provide meaningful supplemental information
to both management and investors that is indicative of our core operations. We consider these metrics useful to
investors because they provide greater transparency into management’s view and assessment of our ongoing
operating performance by removing items management believes are not representative of our operations and may
distort our longer-term operating trends. For example, for the year ended December 31, 2024, certain of the non-
GAAP metrics contained herein exclude costs relating to our global restructuring initiative and acquisition of Motor
Parts & Equipment Corporation, which are one-time events that do not recur in the ordinary course of business. We
believe these measures to be useful to enhance the comparability of our results from period to period and with our
competitors, as well as to show ongoing results from operations distinct from items that are infrequent or not
associated with our core operations. We do not, nor do we suggest investors should, consider such non-GAAP
financial measures in isolation from, or as a substitute for, GAAP financial information.
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The table below reconciles GAAP net income to adjusted net income:
(in thousands)
Year Ended December 31,
2024
2023
GAAP net income
$
904,076 $
1,316,524
Adjustments:
Restructuring and other costs (1)
221,007
—
Acquisition and integration related costs and other (2)
33,126
—
Inventory rebranding strategic initiative (3)
61,596
—
Total adjustments
315,729
—
Tax impact of adjustments (4)
(79,964)
—
Adjusted net income
$
1,139,841 $
1,316,524
The table below represents amounts per common share assuming dilution:
(in thousands, except per share data)
Year Ended December 31,
2024
2023
GAAP diluted EPS
$
6.47 $
9.33
Adjustments:
Restructuring and other costs (1)
1.58
—
Acquisition and integration related costs and other (2)
0.24
—
Inventory rebranding strategic initiative (3)
0.44
—
Total adjustments
2.26
—
Tax impact of adjustments (4)
(0.57)
—
Adjusted diluted EPS
$
8.16 $
9.33
Weighted average common shares outstanding - assuming dilution
139,670
141,034
(1) Adjustment reflects costs related to the global restructuring initiative which includes a voluntary retirement offer
in the U.S. and rationalization and optimization of certain distribution centers, stores and other facilities,
including related inventory liquidation costs. The inventory liquidation costs, recognized in cost of goods sold,
total $7 million and arise from facility closures.
(2) Adjustment primarily reflects integration costs related to the completion of the acquisitions of MPEC in April
2024 and Walker in July 2024, including professional services costs, personnel costs, and lease and other exit
costs.
(3) Adjustment reflects a charge to write down certain existing inventory associated with a new global rebranding
and relaunch of a key tool and equipment offering. The existing inventory that will be liquidated is comprised of
otherwise saleable inventory, and the liquidation does not arise from our normal, recurring operational activities.
(4) We determine the tax effect of non-GAAP adjustments by considering the tax laws and statutory income tax
rates applicable in the tax jurisdictions of the underlying non-GAAP adjustments, including any related valuation
allowances. For the year ended December 31, 2024, we applied the statutory income tax rates to the taxable
portion of all of our adjustments, which resulted in a tax impact of $80 million. A portion of our transaction costs
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included in our non-GAAP adjustments for the year ended December 31, 2024 were not deductible for income
tax purposes; therefore, no statutory income tax rate was applied to such costs.
The table below reconciles GAAP net income to adjusted EBITDA:
(in thousands)
Year Ended December 31,
2024
2023
GAAP net income
$
904,076 $
1,316,524
Depreciation and amortization
407,978
350,529
Interest expense, net
96,827
64,469
Income taxes
271,892
425,824
EBITDA
1,680,773
2,157,346
Total adjustments (1)
315,729
—
Adjusted EBITDA
$
1,996,502 $
2,157,346
(1) Amounts are the same as adjustments included within the adjusted net income table above.
The table below clarifies where the adjusted items are presented in the consolidated statement of income:
(in thousands)
Year Ended December 31,
2024
2023
Line item:
Cost of goods sold
$
69,083 $
—
Selling, administrative and other expenses
33,126
—
Restructuring and other costs
213,520
—
Total adjustments
$
315,729 $
—
OUTLOOK
We expect revenue and earnings growth in 2025 to be pressured by weak market conditions, particularly in the
first half of the year. Despite the current macroeconomic conditions, we expect gross margin improvement in 2025
driven by the benefit of acquired businesses and are committed to improving operating leverage through disciplined
cost actions and initiatives as evidenced by our ongoing global restructuring.
We will continue to focus on disciplined capital allocation, increasing our dividend as we continue to grow
earnings, pursuing strategic bolt-on acquisitions that expand our capabilities and geographic footprint and
continuing to invest in technology and supply chain to enhance the customer experience and improve efficiencies in
our business. In 2025, we intend to reduce our net outstanding debt, further strengthening our balance sheet.
We are confident that when the macroeconomic conditions begin to improve that these disciplined cost actions
and initiatives will propel our sales and earnings growth.
FINANCIAL CONDITION
Our balance sheet reflects our disciplined financial management and strategic investments to support our
growth and operational priorities. Key changes in cash, working capital, and debt demonstrate our commitment to
maintaining financial flexibility while meeting customer demands and driving long-term value creation. Our cash
balance at December 31, 2024 was $480 million compared to cash of $1.1 billion a year ago. Accounts receivable
decreased $41 million, or 1.8%, from December 31, 2023 primarily due to foreign currency translation. Inventory
increased $838 million, or 17.9% from December 31, 2023 as a result of our U.S. automotive acquisitions and
enhanced investment in our product assortment and a more strategic approach to ensuring we have the right
products available to meet customer demands. Accounts payable increased $424 million, or 7.7% from
December 31, 2023 due to increased purchases to support higher net sales. Total debt of $4.3 billion at
December 31, 2024 increased $378 million from December 31, 2023 primarily due to the August 7, 2024 Senior
Notes offering (as discussed below), partially offset by the repayment of our Series J Senior Unsecured Notes upon
their maturity.
LIQUIDITY AND CAPITAL RESOURCES
Our strong financial position and cash flow performance have provided us with the capacity to invest in
acquisitions, capital expenditures and technology to support our global growth strategy, as well as return value to
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our shareholders through dividends and share repurchases. Our sources of capital consist primarily of cash flows
from operations, supplemented as necessary by issuing commercial paper, private and public issuances of debt and
bank borrowings.
Sources and Uses of Cash
A summary of our consolidated statements of cash flows is as follows:
(In thousands)
Year Ended December 31,
$ Change
% Change
2024
2023
Operating activities
$ 1,251,251 $ 1,435,610 $
(184,359)
(12.8) %
Investing activities
$ (1,507,524) $
(705,792) $
(801,732)
113.6 %
Financing activities
$
(333,936) $
(292,161) $
(41,775)
14.3 %
Operating Activities
The cash provided by operating activities decreased $184 million compared to 2023. The decrease is driven by
lower net income and changes in working capital, including higher inventory levels compared to prior year as a
result of our U.S. automotive acquisitions and enhanced investment in our product assortment and a more strategic
approach to ensuring we have the right products available to meet customer demands.
Investing Activities
We continue to invest in our business through strategic acquisitions and capital expenditures to broaden our
product and service offerings, improve our business operations and expand our global footprint. In 2024, net cash
used in investing activities included $1.1 billion used for acquisitions and $567 million used for capital expenditures
to improve our supply chain, facilities, and technology environment.
Financing Activities
Cash provided by financing activities reflects $399 million of net proceeds from debt primarily from the August 7,
2024 Senior Notes offering, dividends paid to shareholders of $555 million and repurchases of our common stock of
$150 million. In 2024, we announced a 5% increase in our regular quarterly cash dividend, we have paid a cash
dividend every year since going public in 1948, and 2024 marks the 68th consecutive year of increased dividends
paid to shareholders.
Planned Pension Plan Termination
On April 29, 2024, our Board of Directors approved the termination of the frozen U.S. qualified defined benefit
plan (pension plan), effective September 30, 2024. As part of the plan settlement process, pension plan participants
not currently receiving payments will have the opportunity to select a single lump sum payment or an annuity from
the insurance company that will pay and administer future benefit payments. We intend to settle the pension plan
and transfer the management and delivery of continuing benefits associated with the pension plan to a third-party
insurance company by the end of 2025 or early 2026, subject to government approvals. As of December 31, 2024
the benefit obligation for the pension plan was determined based on the amount expected to be required to settle
the obligations. Assumptions utilized considered the portion of the obligations expected to be settled through
participant elections of lump sum payments or annuities and the cost to purchase annuities, which are subject to
change upon actual plan settlement. Upon settlement, we expect to recognize a non-cash, pre-tax pension
settlement charge in 2025 or early 2026 equal to the actuarial losses accumulated in accumulated other
comprehensive income ("AOCI"), which totaled approximately $735 million ($540 million, net of tax) as of
December 31, 2024. Once settled, we will be fully relieved of all obligations under the pension plan. Furthermore, in
connection with this anticipated transaction, we have adjusted our investment strategy for our plan assets, which will
significantly reduce our pension income in 2025.
Notes and Other Borrowings
Currently, we believe that our cash on hand and available short-term and long-term sources of capital are
sufficient to fund our operations in both the short and long term, including working capital requirements, strategic
acquisitions, dividends, share repurchases, capital expenditures, scheduled debt and interest payments, and
income tax obligations.
On August 7, 2024, we issued $750 million of unsecured 4.950% Senior Notes due 2029. Interest is payable on
February 15 and August 15 of each year, beginning February 15, 2025.
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On November 29, 2023, we entered into a commercial paper program that allows us to issue unsecured
commercial paper notes up to $1.5 billion. As of December 31, 2024, we had no borrowings outstanding under our
commercial paper program.
At December 31, 2024, we had $4.3 billion of unsecured Senior Notes outstanding. Approximately $1.2 billion of
these borrowings contain covenants related to a maximum debt to EBITDA ratio and certain limitations on additional
borrowings. At December 31, 2024, we were in compliance with the covenants under our outstanding unsecured
Senior Notes, as well as our covenants under the Syndicated Facility Agreement, dated as of October 30, 2020, as
amended (the "Unsecured Revolving Credit Facility"). Any failure to comply with our debt covenants or restrictions
could result in a default under our financing arrangements or require us to obtain waivers from our lenders for failure
to comply with these restrictions. The occurrence of a default that remains uncured or the inability to secure a
necessary consent or waiver could create cross defaults under other debt arrangements and have a material
adverse effect on our business, financial condition, results of operations and cash flows.
We ended the year with $2.0 billion of total liquidity (comprising $1.5 billion availability on the revolving credit
facility and $480 million of cash and cash equivalents). Due to the workers’ compensation and insurance reserve
requirements in certain states, we also had unused letters of credit of approximately $71 million outstanding at
December 31, 2024. Our unused letters of credit expire within one year, but have automatic renewal clauses. From
time to time, we may enter into other credit facilities or financing arrangements to provide additional liquidity and to
manage against foreign currency risk.
Our total average cost of debt was 3.62% at December 31, 2024 and 3.16% at December 31, 2023. Total
interest expense, net of interest income, for all borrowings was $97 million and $64 million in 2024 and 2023,
respectively. Refer to the Debt Footnote in the Notes to Consolidated Financial Statements for more information.
Contractual and Other Obligations
The following table summarizes our material cash requirements at December 31, 2024 that we expect to be
paid in cash. The table does not include amounts that are contingent on events or other factors that are uncertain or
unknown at this time, including legal contingencies and uncertain tax positions. The amounts presented are based
on various estimates and actual results may vary from the amounts presented.
(In thousands)
Payment Due by Period
Total
Less Than
1 Year
1-3 Years
3-5 Years
Over 5 Years
Debt
$ 4,314,480 $
541,705 $
728,490 $ 1,357,105 $ 1,687,180
Operating leases
2,212,974
436,600
704,689
388,772
682,913
Total material cash requirements
$ 6,527,454 $
978,305 $ 1,433,179 $ 1,745,877 $ 2,370,093
Purchase orders or contracts for the purchase of inventory and other goods and services are not included in our
estimates. We are not able to determine the aggregate amount of such purchase orders that represent contractual
cash requirement, as purchase orders may represent authorizations to purchase rather than binding agreements.
Our purchase orders are based on our current distribution needs and are fulfilled by our vendors within short time
horizons. We do not have significant agreements for the purchase of inventory or other goods specifying minimum
quantities or set prices that exceed our expected requirements.
Additionally, we guarantee the borrowings of certain independently owned automotive parts stores
(independents). Our maximum exposure to loss as a result of our involvement with these independents is generally
equal to the total borrowings subject to our guarantee. At December 31, 2024, the total borrowings of the
independents subject to guarantee by the company were approximately $575 million, down from $954 million at
December 31, 2023. These loans generally mature over periods from one to six years. Our amount of commitment
expiring in 2025 is approximately $375 million. To date, we have had no significant losses in connection with
guarantees of independents’ borrowings.
Share Repurchases
In 2024, we repurchased approximately 1.1 million shares of our common stock for an aggregate $150 million,
and we had remaining authority to purchase approximately 7.5 million shares of our common stock at December 31,
2024. We expect to remain active in our share repurchase program and continue to return capital to our
shareholders. There were no other repurchase plans announced as of December 31, 2024.
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Capital Resources
Our total debt outstanding at December 31, 2024 increased by $378 million from December 31, 2023, as
discussed above. We expect to continue to have access to the capital markets on both short-term and long-term
bases when needed for liquidity purposes by issuing commercial paper or new long-term debt. The availability and
the borrowing costs of these funds could be adversely affected, however, by a downgrade of our debt ratings or a
deterioration of certain financial ratios. The table below reflects our debt ratings by Standard & Poor’s ("S&P") and
Moody’s as of December 31, 2024, which provide an enhanced understanding of our sources of liquidity and the
effect of our ratings on our cost of debt. A debt rating is not a recommendation by the rating agency to buy, sell, or
hold and each rating should be evaluated independently of any other rating. Credit rating agencies review their
ratings periodically and, therefore, the credit ratings assigned to us by each agency may be subject to revision at
any time.
Debt Ratings
S&P
Moody's
Commercial paper
A-2
P-2
Long-term debt
BBB
Baa1
Outlook
Stable
Stable
CRITICAL ACCOUNTING POLICIES
Management’s Discussion and Analysis of Financial Condition and Results of Operations is based upon our
consolidated financial statements, which have been prepared in accordance with U.S. GAAP. The preparation of our
consolidated financial statements requires management to make estimates, assumptions and judgments that affect
the reported amounts of assets, liabilities, net sales and expenses and related disclosure of contingent assets and
liabilities. Management bases its estimates on historical experience and on various other assumptions that are
believed to be reasonable under the circumstances, the results of which form the basis for making judgments about
the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ
from these estimates under different assumptions or conditions.
We describe in this section certain critical accounting policies that require us to make significant estimates,
assumptions and judgments. An accounting policy is deemed to be critical if it requires an accounting estimate to be
made based on assumptions about matters that are uncertain at the time the estimate is made and if different
estimates that reasonably could have been used, or changes in the accounting estimates that are reasonably likely
to occur periodically, could materially impact the consolidated financial statements. Management believes the
following critical accounting policies reflect its most significant estimates and assumptions used in the preparation of
the consolidated financial statements. For further information on the critical accounting policies, see the Summary of
Significant Accounting Policies Footnote in the Notes to Consolidated Financial Statements.
Consideration Received from Vendors
We frequently enter into agreements with our vendors that provide for inventory purchase incentives. Generally,
we earn inventory purchase incentives upon achieving specified volume purchasing levels or other similar criteria.
We accrue for the receipt of these incentives as a deduction from our inventory carrying cost based on cumulative
purchases of inventory to date and projected inventory purchases through the end of the year. We recognize these
incentives in earnings as a reduction of costs of goods sold as the corresponding inventory is sold to our customers.
While management believes we will continue to receive consideration from vendors in 2025 and beyond, there can
be no assurance that vendors will continue to provide comparable amounts of incentives in the future or that we will
be able to achieve the specified volumes necessary to take advantage of such incentives. Consideration receivable
from vendors, generally reflected in prepaid expenses and other current assets, was $973 million and $928 million
as of December 31, 2024 and December 31, 2023, respectively.
Impairment of Goodwill and Other Intangible Assets
At least annually, we evaluate goodwill and other intangible assets for potential impairment indicators. Our
judgments regarding the existence of impairment indicators are based on market conditions and operational
performance, among other factors. Future events could cause us to conclude that impairment indicators exist and
that assets associated with a particular operation are impaired. Evaluating for impairment also requires us to
estimate future operating results and cash flows which requires judgment by management. Any resulting impairment
loss could have a material adverse impact on our financial condition and results of operations. Refer to the Goodwill
and Other Intangible Assets Footnote of the Notes to Consolidated Financial Statements for further information on
the results of our annual goodwill impairment testing.
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Employee Benefit Plans
Effective December 31, 2013, our U.S. pension plan was amended to freeze benefit plan accruals for
participants and provide for immediate vesting of accrued benefits. On April 29, 2024, our Board of Directors
approved the termination of the frozen U.S. plan, effective September 30, 2024. Refer to the Employee Benefit
Plans Footnote of the Notes to Consolidated Financial Statements for further information on the termination of the
frozen U.S. plan.
Our benefit plan committees in the U.S. and Canada establish investment policies and strategies and regularly
monitors the performance of our pension plan assets. Our U.S. plan, our largest pension plan, is well-funded, with a
funded status of 128% at December 31, 2024. The plans in Europe are unfunded and therefore there are no plan
assets.
Beginning in 2024, the U.S. pension plan strategy implemented by our management is to minimize funded
status volatility through the plan termination process.
Our investment strategy with respect to U.S. pension plan assets is to fully hedge plan obligations on a
termination basis. In connection with the planned U.S. pension plan termination process, we acquired certain
annuity contracts from an insurance company using existing plan assets to fund on-going obligations under the U.S.
pension plan prior to termination.
The Canadian pension plan investment strategy implemented by our management is to achieve long-term
objectives and invest the pension assets in accordance with the applicable pension legislation in Canada, as well as
fiduciary standards. The long-term primary objectives for the Canadian pension plan is to provide for a reasonable
amount of long-term growth of capital without undue exposure to risk, protect the assets from erosion of purchasing
power and provide investment results that meet or exceed the pension plans’ actuarially assumed long-term rates of
return. The Company's Investment Strategy with respect to Canadian pension plan assets is to generate a return in
excess of the passive portfolio benchmark (50% Equity, 40% Fixed Income, 10% Other).
We make several assumptions in determining our pension plan assets and liabilities and related pension
income. We believe the most critical of these assumptions are the expected rate of return on plan assets and the
discount rate. Other assumptions we make relate to employee demographic factors such as rate of compensation
increases, mortality rates, retirement patterns and turnover rates. Refer to the Employee Benefit Plans Footnote of
the Notes to Consolidated Financial Statements for more information regarding these assumptions.
Based on the investment policy for the pension plans, as well as an asset study that was performed based on
our asset allocations and future expectations, our expected rate of return on plan assets for measuring 2025
pension income is 5.33% for the plans. The asset study forecasted expected rates of return for the approximate
duration of our benefit obligations, using capital market data and historical relationships.
The discount rate is chosen as the rate at which pension obligations could be effectively settled and is based on
capital market conditions as of the measurement date. Prior to December 31, 2024, the discount rate for the U.S.
pension plan was calculated using a bond matching approach to select specific bonds that would satisfy the
projected benefit payments. As a result of the of the decision to terminate the U.S. pension plan, as of December
31, 2024, the benefit obligation for the U.S. pension plan was determined based on the amount expected to be
required to settle the obligations. Assumptions utilized included the portion of the obligations expected to be settled
through elections of lump sum payments or annuities and the cost to purchase annuities, which are subject to
change upon actual plan settlement. We have matched the timing and duration of the expected cash flows of our
pension obligations to a yield curve generated from a broad portfolio of high-quality fixed income debt instruments to
select our discount rate. Based upon this cash flow matching analysis, we selected a weighted average discount
rate for the plans of 5.15% at December 31, 2024.
Our pension income for 2024 is determined at the December 31, 2023 measurement date. A 25 basis point
increase in discount rate would result in an approximate $38 million decrease on our projected benefit obligation. A
25 basis point decrease in discount rate would result in approximate $40 million increase on our projected benefit
obligation. A 25 basis point change in discount rate would have an immaterial impact on our pension income. A 25
basis point change in expected return on asset would have an approximate $6 million impact on our pension
income. These sensitivities reflect the effect of changing one assumption at a time and assume no changes to the
design of the pension plans.
Net periodic benefit income for our defined benefit pension plans was $54 million, $44 million, and $27 million
for the years ended December 31, 2024, 2023 and 2022, respectively. The income associated with the pension in
2024, 2023 and 2022 reflects the impact of the U.S. plan freeze. The termination of our U.S. plan will significantly
reduce pension income prospectively.
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Refer to the Employee Benefit Plans Footnote of the Notes to Consolidated Financial Statements for more
information regarding employee benefit plans.
Business Combinations
When we acquire businesses, we apply the acquisition method of accounting and recognize the identifiable
assets acquired, the liabilities assumed, and any noncontrolling interests in an acquiree at their fair values on the
acquisition date, which requires significant estimates and assumptions. Goodwill is measured as the excess of the
fair value of the consideration transferred over the net of the acquisition date fair values of the identifiable assets
acquired and liabilities assumed. The acquisition method requires us to record provisional amounts for any items for
which the accounting is not complete at the end of a reporting period. We must complete the accounting during the
measurement period, which cannot exceed one year. Adjustments made during the measurement period could have
a material impact on our financial condition and results of operations.
We typically measure customer relationships and other intangible assets using an income approach. Significant
estimates and assumptions used in this approach include discount rates and certain assumptions that form the
basis of the forecasted cash flows expected to be generated from the asset (e.g., future revenue growth rates and
EBITDA margins). If the subsequent actual results and updated projections of the underlying business activity
change compared with the assumptions and projections used to develop these values, we could record impairment
charges. In addition, we have estimated the economic lives of certain acquired tangible and intangible assets and
these lives are used to calculate depreciation and amortization expense. If our estimates of the economic lives
change, depreciation or amortization expenses could be increased or decreased, or the acquired asset could be
impaired.
Legal and Asbestos Liabilities
We accrue for potential losses related to legal disputes, litigation, asbestos liability, and regulatory matters when
it is probable (the future event or events are likely to occur) that we have incurred a loss and the amount of the loss
can be reasonably estimated.
To calculate our asbestos liability, we estimate potential losses relating to pending claims and also estimate the
likelihood of additional, similar claims being filed against us in the future. To estimate potential losses on claims that
could be filed in the future, we consider claims pending against us, claim filing rates, the number of codefendants
and the extent to which they share in settlements, and the amount of loss by claim type. The estimated losses for
pending and potential future claims are calculated on a discounted basis using risk-free interest rates derived from
market data about monetary assets with maturities comparable to those of the projected asbestos liability. We use
an actuarial specialist to assist with measuring our asbestos liability.
While we believe our legal and asbestos liability estimates are reasonable in light of all available information, if
one or more legal claims were to greatly exceed our estimates, our results of operations and cash flows could be
materially and adversely affected. Refer to the Commitments and Contingencies Footnote of the Notes to
Consolidated Financial Statements for additional information regarding our asbestos liability.
RECENT ACCOUNTING PRONOUNCEMENTS
Changes to U.S. GAAP are established by the Financial Accounting Standards Board (“FASB”) in the form of
Accounting Standards Updates (“ASU”) to the FASB Accounting Standards Codification (“ASC”). We consider the
applicability and impact of all ASUs and any not listed below were assessed and determined to not be applicable or
are expected to have an immaterial impact on our Condensed Consolidated Financial Statements.
Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40):
Disaggregation of Income Statement Expenses
In November 2024, the FASB issued ASU 2024-03, Income Statement - Reporting Comprehensive Income
- Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses. This standard requires disclosure in the notes to financial statements, at each interim and annual reporting period, of specified information about certain costs and expenses including purchases of inventory, employee compensation, depreciation and intangible asset amortization included in each relevant expense caption. Also required is a qualitative description of the amounts remaining in relevant expense captions that are not separately disaggregated. This guidance is effective for all public entities for fiscal years beginning after December 15, 2026, and interim periods beginning after December 15, 2027, and early adoption is permitted. This guidance should be applied either prospectively to financial statements issued after the effective date of this update or retrospectively to all prior periods presented in the financial statements. We are currently evaluating the impact of adopting this standard on our financial statements and disclosures.
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33
Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures
In November 2023, the FASB issued ASU 2023-07, Segment Reporting (Topic 280): Improvements to
Reportable Segment Disclosures. This standard requires disclosures of significant segment expenses that are
regularly provided to the chief operating decision maker ("CODM") and included within each reported measure of
segment profit or loss, an amount and description of other segment items by reportable segment, and all annual
disclosures currently required by Topic 280 to be included in interim periods. This standard also requires disclosure
of the title and position of the CODM. We adopted this standard effective December 31, 2024.
Income Taxes (Topic 740): Improvements to Income Tax Disclosures
In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax
Disclosures. The standard requires disclosure of specific categories in the rate reconciliation and additional
information for reconciling items, income before tax expense disaggregated between domestic and foreign, income
tax expense disaggregated by federal, state and foreign, as well as further information on income taxes paid. The
guidance is effective for our Annual Report on Form 10-K for the year ended December 31, 2025, with early
adoption permitted. The guidance should be applied on a prospective basis, with retrospective application
permitted. We are currently evaluating the impact of adopting this standard on our financial statements and
disclosures.
ITEM 7A.QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.
Although we do not face material risks related to commodity prices, we are exposed to changes in interest rates
and in foreign currency rates with respect to foreign currency denominated operating revenues and expenses.
Foreign Currency
We incur translation gains or losses resulting from the translation of an operating unit’s foreign functional
currency into U.S. dollars for consolidated financial statement purposes. For the periods presented, our principal
foreign currency exchange exposures are the Euro, the primary functional currency of our European operations; the
Canadian dollar, the functional currency of our Canadian operations; and the Australian dollar, the primary functional
currency of our Australasian operations. We monitor our foreign currency exposures and from time to time, we enter
into currency forward contracts to manage our exposure to currency fluctuations. Foreign currency exchange
exposure, in regard to the Australian and Canadian dollar, negatively impacted our results, while the Euro positively
impacted our results for the year ended December 31, 2024. Foreign currency exchange exposure, particularly in
regard to the Australian and Canadian dollar, and to a lesser extent the Euro, positively impacted our results for the
year ended December 31, 2023.
During 2024 and 2023, it was estimated that a 10% shift in exchange rates between those foreign functional
currencies and the U.S. dollar would have impacted translated net sales by approximately $829 million and
$797 million, respectively. A 15% shift in exchange rates between those functional currencies and the U.S. dollar
would have impacted translated net sales by approximately $1.2 billion in 2024 and $1.2 billion in 2023. A 20% shift
in exchange rates between those functional currencies and the U.S. dollar would have impacted translated net sales
by approximately $1.7 billion in 2024 and $1.6 billion in 2023.
Interest Rates
We are subject to interest rate volatility with regard to existing and future issuances of debt and with respect to
the A/R Sales Agreement, for which the fees are linked to interest rate changes. We monitor our mix of fixed-rate
and variable-rate debt as well as our mix of short-term debt and long-term debt. From time to time, we enter into
interest rate swap agreements to manage our exposure to interest rate fluctuations. As of December 31, 2024, we
primarily had fixed-rate debt. Based on our variable-rate debt and derivative instruments outstanding as
of December 31, 2024 and 2023, we estimate that a 100 basis point increase in interest rates would have an
immaterial impact in 2024 and 2023 and would increase the fees on our A/R Sales Agreement by $10 million.
Inflation
In 2024 and 2023, we experienced inflationary pressures across various parts of our business and operations,
including, but not limited to, increases to our product costs, and higher operating costs, including those related to
salaries, wages, rent and freight expenses. We continue to monitor the impact of inflation in order to minimize its
effects through pricing strategies, productivity improvements and cost reductions. If our costs were to be subject to
more significant inflationary pressures, we may not be able to fully offset such higher costs through price increases
or other cost efficiency measures. Our inability or failure to do so could harm our business, financial condition and
results of operations.
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35
ITEM 8.FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA.
ANNUAL REPORT ON FORM 10-K
INDEX TO CONSOLIDATED FINANCIAL STATEMENTS
Page
Report of Independent Registered Public Accounting Firm (PCAOB ID: 42)
36
Consolidated Balance Sheets as of December 31, 2024 and 2023
38
Consolidated Statements of Income for the Years Ended December 31, 2024, 2023 and 2022
39
Consolidated Statements of Comprehensive Income for the Years Ended December 31, 2024, 2023, and
2022
40
Consolidated Statements of Equity for the Years Ended December 31, 2024, 2023 and 2022
41
Consolidated Statements of Cash Flows for the Years Ended December 31, 2024, 2023 and 2022
42
Notes to Consolidated Financial Statements
43
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36
Report of Independent Registered Public Accounting Firm
To the Shareholders and the Board of Directors of Genuine Parts Company
Opinion on the Financial Statements
We have audited the accompanying consolidated balance sheets of Genuine Parts Company and Subsidiaries (the
Company) as of December 31, 2024 and 2023, the related consolidated statements of income, comprehensive
income, equity and cash flows for each of the three years in the period ended December 31, 2024, and the related
notes (collectively referred to as the “consolidated financial statements”). In our opinion, the consolidated financial
statements present fairly, in all material respects, the financial position of the Company at December 31, 2024 and
2023, and the results of its operations and its cash flows for each of the three years in the period ended December
31, 2024, in conformity with U.S. generally accepted accounting principles.
We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United
States) (PCAOB), the Company’s internal control over financial reporting as of December 31, 2024, based on
criteria established in Internal Control—Integrated Framework issued by the Committee of Sponsoring
Organizations of the Treadway Commission (2013 framework), and our report dated February 21, 2025 expressed
an unqualified opinion thereon.
Basis for Opinion
These financial statements are the responsibility of the Company's management. Our responsibility is to express an
opinion on the Company’s financial statements based on our audits. We are a public accounting firm registered with
the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal
securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the
PCAOB.
We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan
and perform the audit to obtain reasonable assurance about whether the financial statements are free of material
misstatement, whether due to error or fraud. Our audits included performing procedures to assess the risks of
material misstatement of the financial statements, whether due to error or fraud, and performing procedures that
respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and
disclosures in the financial statements. Our audits also included evaluating the accounting principles used and
significant estimates made by management, as well as evaluating the overall presentation of the financial
statements. We believe that our audits provide a reasonable basis for our opinion.
Critical Audit Matter
The critical audit matter communicated below is a matter arising from the current period audit of the financial
statements that was communicated or required to be communicated to the audit committee and that: (1) relates to
accounts or disclosures that are material to the financial statements and (2) involved our especially challenging,
subjective or complex judgments. The communication of the critical audit matter does not alter in any way our
opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical
audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to
which it relates.
Asbestos-Related Product Liability
Description of the
Matter
As disclosed in Notes 1 and 16 to the consolidated financial statements, the Company is
subject to pending asbestos-related product liability lawsuits resulting from its distribution and
sale of asbestos-containing brake and friction products. The Company accrues for asbestos-
related product liabilities if it is probable that the Company has incurred a loss and the amount
of the loss can be reasonably estimated. The amount accrued for the asbestos-related product
liability as of December 31, 2024 was $256 million.
Auditing the Company’s asbestos-related product liability required complex judgments due to
the significant measurement uncertainty associated with the estimate and the use of valuation
techniques. In addition, the asbestos-related product liability is sensitive to significant
management assumptions, including the number of future claims and costs of resolving claims.
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37
How We
Addressed the
Matter in Our
Audit
We obtained an understanding, evaluated the design and tested the operating effectiveness of
relevant controls over the Company’s process for estimating the asbestos-related product
liability. For example, we tested controls over management's review of the significant
assumptions described above and the reconciliation of claims data to that used by the
Company’s actuarial specialist.
To test the estimated asbestos-related product liability, our audit procedures included, among
others, assessing the methodology used, testing the significant assumptions, including testing
the completeness and accuracy of the underlying data, and comparing significant assumptions
to historical claims as well as external data. We evaluated the legal letters obtained from
internal and external legal counsel and held discussions with legal counsel. We involved our
actuarial specialists to assist in our evaluation of the methodology and assumptions used by
management and to independently develop a range of the estimated asbestos-related product
liability. We compared the Company's estimated asbestos-related product liability to the range
developed by our actuarial specialists. We also assessed the adequacy of the Company’s
disclosures, included in Notes 1 and 16 to the consolidated financial statements, in relation to
this matter.
Signature of Ernst & Young LLP
We have served as the Company’s auditor since 1948.
Atlanta, Georgia
February 21, 2025
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38
Genuine Parts Company and Subsidiaries
Consolidated Balance Sheets
(In Thousands, Except Share Data and per Share Amounts)
As of December 31,
2024
2023
Assets
Current assets:
Cash and cash equivalents
$
479,991 $ 1,102,007
Trade accounts receivable, net
2,182,856
2,223,431
Merchandise inventories, net
5,514,427
4,676,686
Prepaid expenses and other current assets
1,675,310
1,603,728
Total current assets
9,852,584
9,605,852
Goodwill
2,897,270
2,734,681
Other intangible assets, net
1,799,031
1,792,913
Property, plant and equipment, net
1,950,760
1,616,785
Operating lease assets
1,769,720
1,268,742
Other assets
1,013,340
949,481
Total assets
$ 19,282,705 $ 17,968,454
Liabilities and equity
Current liabilities:
Trade accounts payable
$ 5,923,684 $ 5,499,536
Current portion of debt
541,705
355,298
Other current liabilities
1,925,636
1,839,640
Dividends payable
134,355
132,635
Total current liabilities
8,525,380
7,827,109
Long-term debt
3,742,640
3,550,930
Operating lease liabilities
1,458,391
979,938
Pension and other post-retirement benefit liabilities
218,629
219,644
Deferred tax liabilities
441,705
437,674
Other long-term liabilities
544,109
536,174
Equity:
Preferred stock, par value $1 per share — authorized 10,000,000 shares; none
issued
—
—
Common stock, par value $1 per share — authorized 450,000,000 shares; issued
and outstanding — 2024 — 138,779,664 shares and 2023 — 139,567,071
shares
138,780
139,567
Additional paid-in capital
196,532
173,025
Accumulated other comprehensive loss
(1,261,743)
(976,872)
Retained earnings
5,263,838
5,065,327
Total parent equity
4,337,407
4,401,047
Noncontrolling interests in subsidiaries
14,444
15,938
Total equity
4,351,851
4,416,985
Total liabilities and equity
$ 19,282,705 $ 17,968,454
See accompanying notes.
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39
Genuine Parts Company and Subsidiaries
Consolidated Statements of Income
(In Thousands, Except per Share Amounts)
Year Ended December 31,
2024
2023
2022
Net sales
$ 23,486,569 $ 23,090,610 $ 22,095,973
Cost of goods sold
14,962,954
14,799,938
14,355,869
Gross profit
8,523,615
8,290,672
7,740,104
Operating expenses:
Selling, administrative and other expenses
6,642,900
6,167,143
5,758,295
Depreciation and amortization
407,978
350,529
347,819
Provision for doubtful accounts
30,001
25,947
19,791
Restructuring and other costs
213,520
—
—
Total operating expenses
7,294,399
6,543,619
6,125,905
Non-operating (income) expense:
Interest expense, net
96,827
64,469
73,887
Other
(43,579)
(59,764)
(32,290)
Total non-operating expenses
53,248
4,705
41,597
Income before income taxes
1,175,968
1,742,348
1,572,602
Income taxes
271,892
425,824
389,901
Net income
$
904,076 $ 1,316,524 $ 1,182,701
See accompanying notes.
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40
Genuine Parts Company and Subsidiaries
Consolidated Statements of Comprehensive Income
(In Thousands, Except per Share Amounts)
Year Ended December 31,
2024
2023
2022
Net income
$
904,076 $ 1,316,524 $ 1,182,701
Other comprehensive (loss) income, net of income taxes:
Foreign currency translation adjustments
(221,812)
64,429
(143,890)
Cash flow hedge adjustments, net of income taxes in 2024 — $0,
2023 — $951, and 2022 — $4,612
—
2,572
12,470
Pension and postretirement benefit adjustments, net of income
taxes of 2024 — $23,276, 2023 — $4,174, and 2022 — $15,846
(63,059)
(11,331)
(43,383)
Other comprehensive (loss) income, net of tax
(284,871)
55,670
(174,803)
Comprehensive income
$
619,205 $ 1,372,194 $ 1,007,898
See accompanying notes.
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41
Genuine Parts Company and Subsidiaries
Consolidated Statements of Equity
(In Thousands, Except Share Data and per Share Amounts)
Common Stock
Additional
Paid-In
Capital
Accumulated
Other
Comprehensive
Loss
Retained
Earnings
Total
Parent
Equity
Non-
controlling
Interests in
Subsidiaries
Total
Equity
Shares
Amount
Balance at January 1, 2022 142,180,683
$ 142,181
$ 119,975
$
(857,739) $4,086,325
$3,490,742
$
12,548
$3,503,290
Net Income
—
—
—
—
1,182,701
1,182,701
—
1,182,701
Other comprehensive
income, net of tax
—
—
—
(174,803)
—
(174,803)
—
(174,803)
Cash dividends declared,
$3.58 per share
—
—
—
—
(506,232)
(506,232)
—
(506,232)
Share-based awards
exercised, including
tax benefit of $5,495
333,185
332
(17,709)
—
—
(17,377)
—
(17,377)
Share-based
compensation
—
—
38,058
—
—
38,058
—
38,058
Purchase of stock
(1,572,219)
(1,572)
—
—
(221,154)
(222,726)
—
(222,726)
Noncontrolling interest
activities
—
—
—
—
—
—
1,536
1,536
Balance at December 31,
2022
140,941,649
140,941
140,324
(1,032,542)
4,541,640
3,790,363
14,084
3,804,447
Net income
—
—
—
—
1,316,524
1,316,524
—
1,316,524
Other comprehensive
loss, net of tax
—
—
—
55,670
—
55,670
—
55,670
Cash dividends declared,
$3.80 per share
—
—
—
—
(533,118)
(533,118)
—
(533,118)
Share-based awards
exercised, including
tax benefit of $6,802
380,376
380
(24,525)
—
—
(24,145)
—
(24,145)
Share-based
compensation
—
—
57,226
—
—
57,226
—
57,226
Purchase of stock
(1,754,954)
(1,754)
—
—
(259,719)
(261,473)
—
(261,473)
Noncontrolling interest
activities
—
—
—
—
—
—
1,854
1,854
Balance at December 31,
2023
139,567,071
139,567
173,025
(976,872)
5,065,327
4,401,047
15,938
4,416,985
Net income
—
—
—
—
904,076
904,076
—
904,076
Other comprehensive
income, net of tax
—
—
—
(284,871)
—
(284,871)
—
(284,871)
Cash dividend declared,
$4.00 per share
—
—
—
—
(556,651)
(556,651)
—
(556,651)
Share-based awards
exercised, including
tax benefit of $2,178
297,827
298
(17,186)
—
—
(16,888)
—
(16,888)
Share-based
compensation
—
—
40,693
—
—
40,693
—
40,693
Purchase of stock
(1,085,234)
(1,085)
—
—
(148,914)
(149,999)
—
(149,999)
Noncontrolling interest
activities
—
—
—
—
—
—
(1,494)
(1,494)
Balance at December 31,
2024
138,779,664
$ 138,780
$ 196,532
$
(1,261,743) $5,263,838
$4,337,407
$
14,444
$4,351,851
See accompanying notes.
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42
Genuine Parts Company and Subsidiaries
Consolidated Statements of Cash Flows
(In Thousands)
Year Ended December 31,
2024
2023
2022
Operating activities:
Net income
$ 904,076 $ 1,316,524 $ 1,182,701
Adjustments to reconcile net income to net cash provided by operating
activities:
Depreciation and amortization
407,978
350,529
347,819
Deferred income taxes
(18,598)
42,114
2,220
Share-based compensation
40,693
57,226
38,058
Gains on sales of real estate
(43,049)
—
(102,803)
Other operating activities
47,473
(41,626)
18,377
Changes in operating assets and liabilities:
Trade accounts receivable, net
(50,939)
31,989
(244,371)
Merchandise inventories, net
(440,549)
(69,148)
(380,420)
Trade accounts payable
512,347
2,038
676,406
Operating lease right-of-use asset
634,448
344,580
370,476
Other current and noncurrent assets
(122,864)
(168,742)
(19,948)
Operating lease current and noncurrent liabilities
(662,641)
(355,335)
(372,733)
Other current and noncurrent liabilities
42,876
(74,539)
(48,811)
Net cash provided by operating activities
1,251,251
1,435,610
1,466,971
Investing activities:
Purchases of property, plant and equipment
(567,339)
(512,675)
(339,632)
Proceeds from sale of property, plant and equipment
122,432
25,099
145,007
Acquisitions of businesses
(1,080,238)
(306,881) (1,690,208)
Proceeds from divestitures of businesses
1,631
10,754
33,604
Proceeds from sale of investment
—
80,482
—
Proceeds from settlement of net investment hedge
15,990
—
158,441
Other investing activities
—
(2,571)
8,548
Net cash used in investing activities
(1,507,524)
(705,792) (1,684,240)
Financing activities:
Proceeds from debt
895,299
3,769,132
5,108,641
Payments on debt
(496,156) (3,237,959) (4,147,773)
Shares issued from employee incentive plans
(16,888)
(24,145)
(17,377)
Dividends paid
(554,931)
(526,674)
(495,917)
Purchase of stock
(149,999)
(261,473)
(222,726)
Other financing activities
(11,261)
(11,042)
(19,747)
Net cash (used in) provided by financing activities
(333,936)
(292,161)
205,101
Effect of exchange rate changes on cash and cash equivalents
(31,807)
10,887
(49,070)
Net (decrease) increase in cash and cash equivalents
(622,016)
448,544
(61,238)
Cash and cash equivalents at beginning of year
1,102,007
653,463
714,701
Cash and cash equivalents at end of year
$ 479,991 $ 1,102,007 $ 653,463
Supplemental disclosures of cash flow information
Cash paid during the year for:
Income taxes
$ 264,625 $ 366,270 $ 362,859
Interest
$ 124,977 $
90,405 $
73,368
See accompanying notes.
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43
Genuine Parts Company and Subsidiaries
Notes to Consolidated Financial Statements
December 31, 2024
1.Summary of Significant Accounting Policies
Business
Genuine Parts Company is a distributor of automotive replacement parts and industrial parts and materials. We
serve a diverse customer base through a network of more than 10,700 locations throughout North America, Europe,
and Australasia.
Principles of Consolidation
The consolidated financial statements include all of our accounts. The net income attributable to noncontrolling
interests is not material to our consolidated net income. Intercompany accounts and transactions have been
eliminated in consolidation.
Certain prior year amounts are reclassified to conform to the current year presentation. These reclassifications had
no impact on our previously reported total assets, total liabilities, results of operations, comprehensive income or net
cash flows from operating, financing or investing activities.
We have evaluated subsequent events through the date the financial statements were issued.
Use of Estimates
The preparation of the consolidated financial statements, in conformity with U.S. generally accepted accounting
principles, requires management to make estimates and assumptions that affect the amounts reported in the
consolidated financial statements and accompanying notes. Actual results may differ from those estimates and the
differences could be material.
Revenue Recognition
We recognize revenue at the point the customer obtains control of the products or services and at an amount that
reflects the consideration expected to be received for those products or services.
Revenue is recognized net of allowances for returns, variable consideration and any taxes collected from customers
that will be remitted to governmental authorities. Revenue recognized over time is not significant. Payment terms
with customers vary by the type and location of the customer and the products or services offered. We do not adjust
the promised amount of consideration for the effects of significant financing components based on the expectation
that the period between when we transfer a promised good or service to a customer and when the customer pays
for that good or service will be one year or less. Arrangements with customers that include payment terms extending
beyond one year are not significant. Liabilities for customer incentives, discounts, sales returns or rebates are
included in other current liabilities in the consolidated balance sheets.
Product Distribution Revenues
We generate revenue primarily by distributing products through wholesale and, to a lesser extent, retail channels.
For wholesale customers, revenue is recognized when title and control of the goods has passed to the wholesale
customer. Retail revenue is recognized at the point of sale when the goods are transferred to customers and
consideration is received. Certain shipping and handling activities may be performed prior to the customer obtaining
control of the products. Costs associated with shipping and handling to our customers are considered costs to fulfill
a contract and are included in selling, administrative and other expenses in the period they are incurred.
Other Revenues
We offer software support, product cataloging, marketing, training and other membership program and support
services to certain customers. This revenue is recognized as services are performed. Revenue from these services
is recognized over a short duration and the impact to our consolidated financial statements is not significant.
Variable Consideration
Our products are generally sold with a right of return and may include variable consideration in the form of
incentives, discounts, credits or rebates. We estimate variable consideration based on historical experience to
determine the expected amount to which we will be entitled in exchange for transferring the promised goods or
services to a customer. We recognize estimated variable consideration as an adjustment to the transaction price
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44
when control of the related product or service is transferred. The realization of variable consideration occurs within a
short period of time from product delivery; therefore, the time value of money effect is not significant.
Foreign Currency Translation
The consolidated balance sheets and statements of income of our foreign subsidiaries have been translated into
U.S. dollars at the current and average exchange rates, respectively. The foreign currency translation adjustment is
included as a component of accumulated other comprehensive loss.
Cash and Cash Equivalents
We consider all highly liquid investments with original maturities of three months or less when purchased to be cash
equivalents.
Trade Accounts Receivable and the Allowance for Doubtful Accounts
We evaluate the collectability of trade accounts receivable based on a combination of factors. We estimate an
allowance for doubtful accounts as a percentage of net sales based on various factors, including historical
experience, current economic conditions and future expected credit losses and collectability trends. We will
periodically adjust this estimate when we become aware of a specific customer’s inability to meet its financial
obligations (e.g., bankruptcy filing) or as a result of changes in the overall aging of accounts receivable. While we
have a large customer base that is geographically dispersed, a general economic downturn in any of the industry
segments in which we operate could result in higher than expected defaults and, therefore, the need to revise
estimates for bad debts. We have limited exposure from credit losses to any particular customer, region, or industry
segment. We perform periodic credit evaluations of our customers’ financial condition and generally do not require
collateral. For the years ended December 31, 2024, 2023, and 2022, we recorded provisions for doubtful accounts
of approximately $30 million, $26 million, and $20 million, respectively. At December 31, 2024 and 2023, the
allowance for doubtful accounts was approximately $69 million and $57 million, respectively.
Merchandise Inventories, Including Consideration Received From Vendors
Merchandise inventories are valued at the lower of cost or either market value or net realizable value, as applicable.
Cost is determined by the last-in, first-out ("LIFO") method for a majority of U.S. automotive and industrial parts, and
generally by the weighted average method for non-U.S. and certain other inventories. If the FIFO method had been
used in place of LIFO, the carrying cost of inventory in the consolidated balance sheets would have been
approximately $896 million and $880 million higher than reported at December 31, 2024 and 2023, respectively.
Reductions in certain industrial parts inventories resulted in liquidations of LIFO inventory layers, which reduced
cost of goods sold by immaterial amounts in 2024 and 2023. There were no liquidations of LIFO inventory layers in
2022.
We identify slow moving or obsolete inventories and estimate appropriate provisions related thereto. Historically,
these losses have not been significant as the vast majority of our inventories are not highly susceptible to
obsolescence and are eligible for return under various vendor return programs. While we have no reason to believe
our inventory return privileges will be discontinued in the future, our risk of loss associated with obsolete or slow
moving inventories would increase if such were to occur.
We enter into agreements at the beginning of each year with many of our vendors that provide for inventory
purchase incentives. Generally, we earn inventory purchase incentives upon achieving specified volume purchasing
levels or other criteria. We accrue for the receipt of these incentives as part of our inventory cost based on
cumulative purchases of inventory to date and projected inventory purchases through the end of the year. While
management believes we will continue to receive consideration from vendors in 2025 and beyond, there can be no
assurance that vendors will continue to provide comparable amounts of incentives in the future.
Prepaid Expenses and Other Current Assets
Prepaid expenses and other current assets consist primarily of consideration receivable from vendors, prepaid
expenses, income taxes and other miscellaneous receivables.
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The following table provides a reconciliation of prepaid expenses and other current assets reported within the
consolidated balance sheets at December 31:
(in thousands)
2024
2023
Prepaid expenses
$
118,401 $
110,863
Consideration receivable from vendors
972,842
928,499
Other current assets
584,067
564,366
Total prepaid expenses and other current assets
$
1,675,310 $
1,603,728
Consideration receivable from vendors include rebates receivable for various vendor funding programs.
Goodwill
We review our goodwill annually for impairment in the fourth quarter, or sooner if circumstances indicate that the
carrying amount may exceed fair value. We test goodwill for impairment at the reporting unit level, which is an
operating segment or a level below an operating segment (a component). A component is a reporting unit if the
component constitutes a business for which discrete financial information and operating results are available and
management regularly reviews that information. However, we aggregate two or more components of an operating
segment into a single reporting unit if the components have similar economic characteristics and the other
aggregation requirements are met.
To review goodwill at a reporting unit for impairment, we generally elect to first assess qualitative factors to
determine whether it is more likely than not that the fair value of the reporting unit is less than its carrying amount.
Qualitative factors include adverse macroeconomic, industry or market conditions, cost factors, or financial
performance. If we elect not to perform a qualitative assessment or conclude from our assessment of qualitative
factors that it is more likely than not that the fair value of the reporting unit is less than its carrying amount, we must
perform a quantitative test to evaluate goodwill impairment.
To perform a quantitative test, we estimate the fair value of the reporting unit and compare that amount to the
reporting unit's carrying value. We typically calculate the fair value by using a combination of a market approach and
an income approach that is based on a discounted cash flow model. The assumptions used in the market approach
generally include benchmark company market multiples and the assumptions used in the income approach
generally include the projected cash flows of the reporting unit, which are based on projected revenue growth rates
and EBITDA margins, the estimated weighted average cost of capital, working capital and terminal value. We use
inputs and assumptions we believe are consistent with those a hypothetical marketplace participant would use. We
recognize goodwill impairment (if any) as the excess of the reporting unit's carrying value over its fair value, not to
exceed the total amount of goodwill allocated to the reporting unit.
Refer to the Goodwill and Other Intangible Assets Footnote for further information on the results of our annual
goodwill impairment testing.
Long-Lived Assets Other Than Goodwill
We assess our long-lived assets other than goodwill for impairment whenever facts and circumstances indicate that
the carrying amount may not be fully recoverable. To analyze recoverability, we project undiscounted net future cash
flows over the remaining life of such assets. If these projected cash flows are less than the carrying amount, an
impairment would be recognized, resulting in a write-down of assets with a corresponding charge to earnings.
Impairment losses, if any, are measured based upon the difference between the carrying amount and the fair value
of the assets. There were no significant impairment losses in 2024 or 2023. In 2022, we recognized losses related
to impairments and disposals of $17 million. Refer to the Goodwill and Other Intangible Assets Footnote for more
information on the losses that occurred in 2022.
Other Assets
Other assets consist primarily of cash surrender value of life insurance policies, equity method and other
investments, guarantee fees receivable, and deferred compensation benefits.
Property, Plant and Equipment
Property, plant and equipment are carried at cost less accumulated depreciation.
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We capitalize software costs and classify them within property, plant, and equipment, with the associated
depreciation reflected as depreciation expense. These software costs include the costs of developing or obtaining
internal-use software, such as external direct costs of materials and services, payroll and benefits costs, interest
costs, and costs to develop or obtain software that allows for access or conversion of historical data by new
systems. We capitalize costs when the preliminary project stage is complete, management has authorized and
committed to funding the software project, it is probable that the software project will be completed, and it is
probable that the software will be used to perform the intended function. Cost capitalization ceases when the
software project is substantially complete and ready for its intended use. Costs that are associated with the
preliminary stage activities, training, maintenance and all other post-implementation stage activities are expensed
as incurred.
Depreciation is primarily determined on a straight-line basis over the following estimated useful lives of each asset:
buildings, 10 to 40 years; machinery and equipment, 5 to 15 years; furniture and fixtures, 5 to 15 years; capitalized
software, generally 3 to 5 years, but up to 20 years for strategic investments in enterprise resource planning and
other core systems with low obsolescence risk; and the shorter of lease term or useful life for leasehold
improvements.
Other Current Liabilities
Other current liabilities consist primarily of current lease obligations, allowances for sales returns expected within
the next year, accrued compensation, accrued income and other taxes, and other reserves for expenses incurred.
Other Long-Term Liabilities
Other long-term liabilities consist primarily of allowances for sales returns expected after the next year, guarantee
obligations, accrued taxes and other non-current obligations.
Self-Insurance
We are self-insured for the majority of our group health insurance costs. A reserve for claims incurred but not
reported is developed by analyzing historical claims data provided by our claims administrators. These reserves are
included in accrued expenses in the accompanying consolidated balance sheets as the expenses are expected to
be paid within one year.
Long-term insurance liabilities consist primarily of reserves for our workers’ compensation program. We carry high
deductible policies for a majority of these liabilities. We record our reserves based on an analysis performed by an
independent actuary. The analysis involves calculating loss development factors and applying them to reserves
supplied by our insurance providers. While we believe the assumptions used in these calculations are appropriate,
significant changes in actual experience or our assumptions could materially affect the worker’s compensation costs
and reserves recorded.
Business Combinations
When we acquire businesses, we apply the acquisition method of accounting and recognize the identifiable assets
acquired, the liabilities assumed, and any noncontrolling interests in an acquiree at their fair values on the
acquisition date, which requires significant estimates and assumptions. Goodwill is measured as the excess of the
fair value of the consideration transferred over the net of the acquisition date fair values of the identifiable assets
acquired and liabilities assumed. The acquisition method requires us to record provisional amounts for any items for
which the accounting is not complete at the end of a reporting period. We must complete the accounting during the
measurement period, which cannot exceed one year. Adjustments made during the measurement period could have
a material impact on our financial condition and results of operations.
We typically measure customer relationships and other intangible assets using an income approach. Significant
estimates and assumptions used in this approach include discount rates and certain assumptions that form the
basis of the forecasted cash flows expected to be generated from the asset (e.g., future revenue growth rates and
EBITDA Margin). If the subsequent actual results and updated projections of the underlying business activity
change compared with the assumptions and projections used to develop these values, we could record impairment
charges. In addition, we have estimated the economic lives of certain acquired tangible and intangible assets and
these lives are used to calculate depreciation and amortization expense. If our estimates of the economic lives
change, depreciation or amortization expenses could be increased or decreased, or the acquired asset could be
impaired.
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Legal and Asbestos Liabilities
We accrue for potential losses related to legal disputes, litigation, asbestos liability, and regulatory matters when it is
probable (the future event or events are likely to occur) that we have incurred a loss and the amount of the loss can
be reasonably estimated.
The asbestos-related product liability amount reflects our reasonable estimate of losses based upon currently
known facts. To calculate the liability, we estimate potential losses relating to pending claims and also estimate the
likelihood of additional, similar claims being filed against us in the future. To estimate potential losses on claims that
could be filed in the future, we consider claims pending against us, claim filing rates, the number of codefendants
and the extent to which they share in settlements, and the amount of loss by claim type. The estimated losses for
pending and potential future claims are calculated on a discounted basis using risk-free interest rates derived from
market data about monetary assets with maturities comparable to those of the projected asbestos liability. We use
an actuarial specialist to assist with measuring our asbestos liability.
Fair Value Measurements
Fair value is defined as an exit price, representing the amount that would be received to sell an asset or paid to
transfer a liability in an orderly transaction between market participants. Fair value is a market-based measurement
that is determined based on assumptions that market participants would use in pricing an asset or liability.
Additionally, ASC 820, Fair Value Measurements, defines levels within a hierarchy based upon observable and non-
observable inputs.
•
Level 1- Observable inputs such as quoted prices in active markets;
•
Level 2- Inputs, other than quoted prices in active markets, that are observable either directly or indirectly;
and
•
Level 3- Unobservable inputs in which there is little or no market data, which require the reporting entity to
develop its own assumptions
At December 31, 2024 and 2023, the fair value of our senior unsecured notes was approximately $4.1 billion and
$3.7 billion, respectively, which are designated as Level 2 in the fair value hierarchy. Our valuation technique is
based primarily on prices and other relevant information generated by observable transactions involving identical or
comparable assets or liabilities.
Derivative instruments are recognized in the consolidated balance sheets at fair value and are designated as Level
2 in the fair value hierarchy. They are valued using inputs other than quoted prices, such as foreign exchange rates
and yield curves.
Fair value measurements of non-financial assets and non-financial liabilities are primarily used in the impairment
analyses of goodwill, other intangible assets, and long-lived assets. These involve fair value measurements on a
nonrecurring basis using Level 3 inputs as defined in the fair value hierarchy. The carrying amounts reflected in the
consolidated balance sheets for cash and cash equivalents, trade accounts receivable, and trade accounts payable
approximate their respective fair values based on the short-term nature of these instruments.
Fair value measurement using unobservable inputs is inherently uncertain, and the use of different methodologies
or assumptions to determine the fair value instruments could result in a different fair value measurement at the
reporting date. There have been no changes in the methodologies used during the periods presented.
Derivatives and Hedging
We are exposed to various risks arising from business operations and market conditions, including fluctuations in
interest rates and certain foreign currencies. When deemed appropriate, we use derivative and non-derivative
instruments as risk management tools to mitigate the potential impact of interest rate and foreign exchange rate
risks. The objective of using these tools is to reduce fluctuations in our earnings, cash flows and net investments in
certain foreign subsidiaries associated with changes in these rates. Derivative financial instruments are not used for
trading or other speculative purposes. We have not historically incurred, and do not expect to incur in the future, any
losses as a result of counterparty default related to derivative instruments.
We formally document relationships between hedging instruments and hedged items, as well as the risk
management objective and strategy for undertaking various hedge transactions. This process includes linking cash
flow hedges to specific forecasted transactions or variability of cash flow to be paid. We also formally assess, both
at the hedge’s inception and on an ongoing basis, whether the designated derivative and non-derivative instruments
that are used in hedging transactions are highly effective in offsetting changes in the cash flows of the hedged
items. When a designated instrument is determined not to be highly effective as a hedge or the underlying hedged
transaction is no longer probable, hedge accounting is discontinued prospectively.
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Shipping and Handling Costs
Shipping and handling costs are classified as selling, administrative and other expenses in the accompanying
consolidated statements of income and totaled approximately $381 million, $451 million, and $407 million, for the
years ended December 31, 2024, 2023, and 2022, respectively.
Advertising Costs
Advertising costs are expensed as incurred and totaled $237 million, $234 million, and $236 million in the years
ended December 31, 2024, 2023, and 2022, respectively.
Accounting for Legal Costs
We expense legal costs related to loss contingencies as they are incurred.
Share-Based Compensation
We maintain various long-term incentive plans, which provide for the granting of stock options, stock appreciation
rights ("SARs"), restricted stock, restricted stock units ("RSUs"), performance awards, dividend equivalents and
other share-based awards. SARs represent a right to receive upon exercise an amount, payable in shares of
common stock, equal to the excess, if any, of the fair market value of our common stock on the date of exercise
over the base value of the grant. The terms of such SARs require net settlement in shares of common stock and do
not provide for cash settlement. RSUs represent a contingent right to receive one share of our common stock at a
future date. The majority of awards previously granted vest on a pro-rata basis for periods ranging from one to three
years and are expensed accordingly on a straight-line basis. Forfeitures are accounted for as they occur. We issue
new shares upon exercise or conversion of awards under these plans.
Income Taxes
We account for income taxes under the asset and liability method. Under this method, deferred tax assets and
liabilities are determined based on the differences between the financial statement carrying amount and the tax
basis of assets and liabilities using enacted tax rates in effect for the year in which the differences are expected to
reverse. Deferred tax assets and liabilities are recorded net as noncurrent deferred income taxes. In addition,
valuation allowances are recorded to reduce deferred tax assets to the amount that will more likely than not be
realized. In making this determination, we consider all available positive and negative evidence including projected
future taxable income, future reversals of existing temporary differences, recent financial operations and tax
planning strategies.
We recognize a tax benefit from uncertain tax positions when it is more likely than not that the position will be
sustained upon examination, including resolutions of any related appeals or litigation processes, based on the
technical merits.
Net Income per Common Share
Basic net income per common share is computed by dividing net income by the weighted average number of
common shares outstanding during the year. The computation of diluted net income per common share includes the
dilutive effect of stock options, stock appreciation rights and nonvested restricted stock awards options. Options to
purchase approximately 11 thousand, 3 thousand, and 4 thousand shares of common stock ranging from $72 -
$179 per share were outstanding at December 31, 2024, 2023, and 2022, respectively. These options were
excluded from the computation of diluted net income per common share because the options’ exercise prices were
greater than the average market prices of common stock in each respective year.
The following table summarizes basic and diluted shares outstanding for the year ended December 31:
(in thousands, except per share data)
2024
2023
2022
Net income
$
904,076 $
1,316,524 $
1,182,701
Weighted average common shares outstanding
139,208
140,367
141,468
Dilutive effect of stock options and non-vested restricted stock
awards
462
667
854
Weighted average common shares outstanding – assuming
dilution
139,670
141,034
142,322
Basic earnings per share
$
6.49 $
9.38 $
8.36
Diluted earnings per share
$
6.47 $
9.33 $
8.31
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Recent Accounting Pronouncements
Changes to U.S. GAAP are established by the Financial Accounting Standards Board (“FASB”) in the form of
Accounting Standards Updates (“ASU”) to the FASB Accounting Standards Codification (“ASC”). We consider the
applicability and impact of all ASUs and any not listed below were assessed and determined to not be applicable or
are expected to have an immaterial impact on our Consolidated Financial Statements.
Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40):
Disaggregation of Income Statement Expenses
In November 2024, the FASB issued ASU 2024-03, Income Statement - Reporting Comprehensive Income
- Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses. This standard requires disclosure in the notes to financial statements, at each interim and annual reporting period, of specified information about certain costs and expenses including purchases of inventory, employee compensation, depreciation and intangible asset amortization included in each relevant expense caption. Also required is a qualitative description of the amounts remaining in relevant expense captions that are not separately disaggregated. This guidance is effective for all public entities for fiscal years beginning after December 15, 2026, and interim periods beginning after December 15, 2027, and early adoption is permitted. This guidance should be applied either prospectively to financial statements issued after the effective date of this update or retrospectively to all prior periods presented in the financial statements. We are currently evaluating the impact of adopting this standard on our financial statements and disclosures.
Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures
In November 2023, the FASB issued ASU 2023-07, Segment Reporting (Topic 280): Improvements to Reportable
Segment Disclosures. This standard requires disclosures of significant segment expenses that are regularly
provided to the chief operating decision maker ("CODM") and included within each reported measure of segment
profit or loss, an amount and description of other segment items by reportable segment, and all annual disclosures
currently required by Topic 280 to be included in interim periods. This standard also requires disclosure of the title
and position of the CODM. We adopted this standard effective December 31, 2024.
Income Taxes (Topic 740): Improvements to Income Tax Disclosures
In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax
Disclosures. The standard requires disclosure of specific categories in the rate reconciliation and additional
information for reconciling items, income before tax expense disaggregated between domestic and foreign, income
tax expense disaggregated by federal, state and foreign, as well as further information on income taxes paid. The
guidance is effective for the year ended December 31, 2025, with early adoption permitted. The guidance should be
applied on a prospective basis, with retrospective application permitted. We are currently evaluating the impact of
adopting this standard on our financial statements and disclosures.
2. Segment Information
Our reportable segments consist of the Automotive Parts Group ("Automotive") and Industrial Parts Group
("Industrial"). Within the reportable segments, certain of our operating segments are aggregated since they have
similar economic characteristics, products and services, type and class of customers, and distribution methods. Our
Automotive segment distributes replacement parts (other than collision parts) for substantially all makes and models
of automobiles, trucks, and other vehicles. Our Industrial segment distributes a wide variety of industrial bearings,
mechanical and fluid power transmission equipment, including hydraulic and pneumatic products, material handling
components and related parts and supplies.
Inter-segment sales are not significant. Approximately $415 million, $577 million and $472 million of income before
income taxes were generated in jurisdictions outside the U.S. for the years ended December 31, 2024, 2023, and
2022, respectively. Net sales and net property, plant and equipment by country relate directly to our operations in
the respective country. Corporate assets are principally cash and cash equivalents and headquarters’ facilities and
equipment.
During the fourth quarter of 2024, we changed our segment profit measure to segment earnings before interest,
taxes, depreciation and amortization ("EBITDA"). We believe that Segment EBITDA and Segment EBITDA margin
are useful measures because they allow management, analysts, investors, and other interested parties to evaluate
the profitability of our business operations before the effects of certain net expenses that directly arise from our
capital investment decisions (depreciation, amortization), financing decisions (interest) and tax strategies (income
taxes). In addition, EBITDA is a metric included in certain long term incentive compensation plans.
Our President and Chief Executive Officer is our Chief Operating Decision Maker ("CODM") and uses segment
EBITDA to assess segment operating performance and allocate resources among our segments.
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The significant segment expenses regularly provided to the CODM are total cost of sales and total other operating
expenses. Total other operating expenses represent all other costs of operating our segments, such as personnel,
freight and delivery, facility, technology, marketing costs, as well as items such as foreign currency.
Automotive Segment
The following table presents a summary of our reportable automotive segment financial information:
(in thousands)
2024
2023
2022
Net sales
$ 14,769,133
$ 14,246,783
$ 13,666,634
Cost of goods sold
8,831,702
8,584,065
8,299,239
Gross profit
5,937,431
5,662,718
5,367,395
Operating expenses
4,653,900
4,323,584
3,993,194
EBITDA
$ 1,283,531
$ 1,339,134
$ 1,374,201
Gross margin (1)
40.2 %
39.7 %
39.3 %
Operating expenses as a percentage of net sales
31.5 %
30.3 %
29.2 %
EBITDA margin (2)
8.7 %
9.4 %
10.1 %
Industrial Segment
The following table presents a summary of our reportable industrial segment financial information:
(in thousands)
2024
2023
2022
Net sales
$ 8,717,436
$ 8,843,827
$ 8,429,339
Cost of goods sold
6,062,301
6,210,043
6,041,655
Gross profit
2,655,135
2,633,784
2,387,684
Operating expenses
1,552,947
1,500,863
1,449,030
EBITDA
$ 1,102,188
$ 1,132,921
$
938,654
Gross margin (1)
30.5 %
29.8 %
28.3 %
Operating expenses as a percentage of net sales
17.8 %
17.0 %
17.2 %
EBITDA margin (2)
12.6 %
12.8 %
11.1 %
(1) Gross margin is gross profit as a percentage of net sales.
(2) EBITDA margin is EBITDA as a percentage of net sales.
Additional Information
The following table presents a reconciliation from EBITDA to net income:
(in thousands)
2024
2023
2022
Segment EBITDA
Automotive
$ 1,283,531 $ 1,339,134 $ 1,374,201
Industrial
1,102,188
1,132,921
938,654
Corporate EBITDA (1)
(389,217)
(314,709)
(313,526)
Interest expense, net
(96,827)
(64,469)
(73,887)
Depreciation and amortization
(407,978)
(350,529)
(347,819)
Other unallocated costs
(315,729)
—
(5,021)
Income before income taxes
1,175,968
1,742,348
1,572,602
Income taxes
271,892
425,824
389,901
Net Income
$
904,076 $ 1,316,524 $ 1,182,701
(1) Corporate EBITDA consists of costs related to our corporate headquarter’s broad support to our business units
and other costs that are managed centrally and not allocated to business segments. These include personnel
and other costs for company-wide functions such as executive leadership, human resources, technology,
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51
cybersecurity, legal, corporate finance, internal audit, and risk management, as well as asbestos-related product
liability costs and A/R Sales Agreement fees.
The following table presents a summary of the other unallocated costs:
(in thousands)
2024
2023
2022
Other unallocated costs:
Gain on sales of real estate (2)
$
— $
— $
102,803
Gain on insurance proceeds (3)
—
—
1,507
Product liability adjustment (4)
—
—
(28,730)
Restructuring and other costs (5)
(221,007)
—
—
Acquisition and integration related costs and other (6)
(33,126)
—
—
Inventory rebranding strategic initiative (7)
(61,596)
—
—
Transaction and other costs (8)
—
—
(80,601)
Total other unallocated costs
$
(315,729) $
— $
(5,021)
(2) Amount reflects a gain on the sale of real estate that had been leased to S.P. Richards.
(3) Amount reflects insurance recoveries in excess of losses incurred on inventory, property, plant and equipment
and other fire-related costs.
(4) Adjustment to remeasure product liability for a revised estimate of the number of claims to be incurred in future
periods, among other assumptions.
(5) Amount reflects costs related to our global restructuring initiative which includes a voluntary retirement offer in
the U.S., inventory liquidation costs, and rationalization and optimization of certain distribution centers, stores
and other facilities. The inventory liquidation costs, recognized in cost of goods sold, total $7 million and arise
from facility closures. Refer to the Restructuring and Other Costs footnote in our Notes to Consolidated
Financial Statements for more information.
(6) Amount primarily reflects ongoing acquisition and integration costs related to the acquisitions of MPEC in April
2024 and Walker in July 2024, including professional services costs, personnel costs, and lease and other exit
costs. Refer to the Acquisitions footnote in our Notes to Consolidated Financial Statements for more
information.
(7) Adjustment reflects a charge to write down certain existing inventory associated with a new global rebranding
and relaunch of a key tool and equipment offering. The existing inventory that will be liquidated is comprised of
otherwise saleable inventory, and the liquidation does not arise from our normal, recurring operational activities.
(8) Amount for 2022 primarily includes costs of $67 million associated with the January 3, 2022 acquisition and
integration of Kaman Distribution Group ("KDG") which includes a $17 million impairment charge. The
impairment charge was driven by a decision to retire certain legacy trade names, classified as other intangible
assets, prior to the end of their estimated useful lives as part of executing our KDG integration and rebranding
strategy. Separately, this adjustment includes an $11 million loss related to an investment.
The following table presents a summary of our reportable segment total assets:
(in thousands)
2024
2023
Assets:
Automotive
$ 10,843,729 $ 9,845,644
Industrial
2,765,504
2,535,404
Corporate
977,171
1,059,812
Goodwill and other intangible assets
4,696,301
4,527,594
Total assets
$ 19,282,705 $ 17,968,454
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The following table presents a summary of select financial information by reportable segment:
(in thousands)
2024
2023
2022
Depreciation and amortization:
Automotive
$
206,536 $
163,517 $
146,819
Industrial
34,818
30,082
29,670
Corporate
23,630
9,752
13,893
Intangible asset amortization
142,994
147,178
157,437
Total depreciation and amortization
$
407,978 $
350,529 $
347,819
Capital expenditures:
Automotive
$
311,704 $
279,943 $
235,182
Industrial
76,730
53,823
33,165
Corporate
178,905
178,909
71,285
Total capital expenditures
$
567,339 $
512,675 $
339,632
Net sales:
United States
$ 15,318,989 $ 15,247,740 $ 14,965,462
Europe
3,839,134
3,611,453
3,071,964
Canada
1,982,719
2,011,343
1,960,227
Australasia
2,258,729
2,149,376
2,044,432
Mexico
86,998
70,698
53,888
Total net sales
$ 23,486,569 $ 23,090,610 $ 22,095,973
Net property, plant and equipment:
United States
$ 1,161,136 $
935,583 $
790,121
Europe
384,161
339,330
200,898
Canada
189,978
147,404
113,574
Australasia
214,677
193,638
220,839
Mexico
808
830
582
Total net property, plant and equipment
$ 1,950,760 $ 1,616,785 $ 1,326,014
Net sales are disaggregated by geographical region for each of our reportable segments, as we deem this
presentation best depicts how the nature, amount, timing and uncertainty of net sales and cash flows are affected
by economic factors. The following table presents disaggregated geographical net sales from contracts with
customers by reportable segment:
(in thousands)
2024
2023
2022
North America:
Automotive
$ 9,212,238 $ 9,010,337 $ 9,015,501
Industrial
8,176,468
8,319,444
7,964,076
Total North America
$ 17,388,706 $ 17,329,781 $ 16,979,577
Australasia:
Automotive
$ 1,717,761 $ 1,624,993 $ 1,579,169
Industrial
540,968
524,383
465,263
Total Australasia
$ 2,258,729 $ 2,149,376 $ 2,044,432
Europe - Automotive
$ 3,839,134 $ 3,611,453 $ 3,071,964
Total net sales
$ 23,486,569 $ 23,090,610 $ 22,095,973
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53
3. Goodwill and Other Intangible Assets
The changes in the carrying amount of goodwill during the years ended December 31, 2024 and 2023 by reportable
segment, as well as other identifiable intangible assets, are summarized as follows:
(in thousands)
Goodwill
Other
Intangible
Assets, Net
Automotive
Industrial
Total
Balance as of January 1, 2023
$
1,579,534 $
1,008,579 $
2,588,113 $
1,812,510
Additions
111,831
8,046
119,877
98,652
Amortization
—
—
—
(147,178)
Foreign currency translation
26,068
623
26,691
28,929
Balance as of December 31, 2023
1,717,433
1,017,248
2,734,681
1,792,913
Additions
251,364
32,775
284,139
218,286
Amortization
—
—
—
(142,994)
Foreign currency translation
(104,927)
(16,624)
(121,550)
(69,174)
Balance as of December 31, 2024
$
1,863,870 $
1,033,399 $
2,897,270 $
1,799,031
We completed our annual goodwill impairment testing as of October 1, 2024. We assess the value of our goodwill
under either a quantitative or qualitative assessment for our various reporting units. To complete a qualitative
assessment, we evaluate historical revenue and operating profit growth trends, market conditions and other factors
to determine whether it is more likely than not that the reporting unit's goodwill is impaired. We complete quantitative
assessments for reporting units that fail our qualitative assessments, or otherwise on a periodic basis. To complete
a quantitative assessment, we calculate a reporting unit's fair value using a combination of income and market
approaches, which involve significant unobservable inputs (Level 3). In the income approach, we primarily use
these assumptions: projected revenue growth rates, EBITDA margins, the estimated weighted average cost of
capital, and terminal value. In the market approach, we primarily use benchmark company market multiples. We
believe the inputs and assumptions we use are consistent with those a hypothetical marketplace participant would
use. Once calculated, we verify whether the reporting unit's fair value is higher than its carrying amount. If the fair
value is lower, we recognize an impairment, generally for the difference. Based on these assessments, we did not
recognize any goodwill impairments during 2024 or 2023.
Accumulated impairment losses for the Automotive segment were $506,721 as of December 31, 2024 and 2023.
We have not incurred any accumulated impairment losses for the Industrial segment.
If there are sustained declines in macroeconomic or business conditions in future periods affecting the projected
earnings and cash flows at our reporting units, among other things, there can be no assurance that goodwill at one
or more reporting units may not be impaired.
In June 2022, we recognized a $17 million non-cash impairment charge related to our decision to retire certain
legacy Industrial trade names, classified as other intangible assets, prior to the end of their estimated useful lives as
part of the KDG integration and rebranding strategy. We evaluate other intangible assets for potential impairment
indicators annually, or more frequently if circumstances change.
Other Intangible Assets
The gross carrying amounts and accumulated amortization relating to other intangible assets at December 31, 2024
and 2023 are as follows:
(in thousands)
2024
2023
Gross
Carrying
Amount
Accumulated
Amortization
Net
Gross
Carrying
Amount
Accumulated
Amortization
Net
Customer relationships
$ 2,350,241 $
(778,707) $ 1,571,534 $ 2,252,553 $
(695,934) $ 1,556,619
Other intangibles
369,744
(142,246)
227,497
354,641
(118,347)
236,294
$ 2,719,985 $
(920,953) $ 1,799,031 $ 2,607,194 $
(814,281) $ 1,792,913
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54
The valuation of identifiable intangible assets utilizes significant unobservable inputs and, therefore, represents a
Level 3 fair value measurement. The estimated fair value of the identifiable intangible assets is generally
determined using an income approach. Amortization expense for other intangible assets totaled $143 million,
$147 million, and $157 million for the years ended December 31, 2024, 2023, and 2022, respectively. Estimated
other intangible assets amortization expense for the succeeding five years is as follows (in thousands):
2025
$
140,000
2026
140,000
2027
140,000
2028
130,000
2029
130,000
$
680,000
4. Property, Plant and Equipment
Property, plant and equipment as of December 31, 2024 and December 31, 2023, consisted of the following:
(in thousands)
2024
2023
Land
$
90,989 $
95,865
Buildings and leasehold improvements
1,028,101
901,341
Machinery, equipment and other
1,675,312
1,195,950
Furniture and fixtures
649,352
633,557
Construction in progress
278,791
382,730
Property, plant and equipment, at cost
3,722,545
3,209,443
Less: accumulated depreciation
1,771,785
1,592,658
Property, plant and equipment, net
$
1,950,760 $
1,616,785
We capitalize interest costs as a component of construction in progress, based on the weighted-average interest
rates incurred on our borrowings. Total interest costs capitalized for the years ended December 31, 2024 and 2023
were $10.9 million and $7.9 million, respectively.
5. Accounts Receivable Sales Agreement
We have an A/R Sales Agreement to sell short-term receivables from certain customer trade accounts to the
unaffiliated financial institutions on a revolving basis. The A/R Sales Agreement has a 1 year term.
As part of the A/R Sales Agreement, we routinely sell designated pools of receivables as they are originated by it
and certain U.S. subsidiaries to a separate bankruptcy-remote special purpose entity (“SPE”). The assets of the
SPE would be first available to satisfy the creditor claims of the unaffiliated financial institutions. We control and
therefore consolidate the SPE in our consolidated financial statements.
The SPE transferred ownership and control of certain receivables that met certain qualifying conditions to the
unaffiliated financial institutions in exchange for cash. We account for transactions with the unaffiliated financial
institutions as sales of financial assets, with the associated receivables derecognized from our consolidated balance
sheet. The remaining receivables held by the SPE were pledged to secure the collectability of the sold receivables.
The amount of receivables pledged as collateral as of December 31, 2024 and December 31, 2023 is approximately
$1.3 billion and $1.2 billion, respectively.
We continue to be involved with the receivables transferred by the SPE to the unaffiliated financial institutions by
providing collection services. As cash is collected on sold receivables, the SPE continuously transfers ownership
and control of new qualifying receivables to the unaffiliated financial institutions so that the total principal amount
outstanding of receivables sold is approximately $1.0 billion at any point in time (which is the maximum amount
allowed under the agreement). The future amount of receivables outstanding as sold could decrease, based on the
level of activity and other factors. Total principal amount outstanding of receivables sold is approximately $1.0 billion
and $1.0 billion as of December 31, 2024 and December 31, 2023, respectively.
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55
The following table summarizes the activity and amounts outstanding under the A/R Sales Agreement as of period
end:
(in thousands)
December 31, 2024
December 31, 2023
Receivables sold to the financial institutions and derecognized
$
8,541,986 $
8,673,477
Cash collected on sold receivables
$
8,542,008 $
8,673,472
Continuous cash activity related to the A/R Sales Agreement is reflected in cash from operating activities in the
consolidated statement of cash flows.
The SPE incurs fees due to the unaffiliated financial institutions related to the accounts receivable sales
transactions. Those fees, which totaled $61 million, $60 million, and $27 million in 2024, 2023, and 2022,
respectively, are recorded within other non-operating expense (income) in the consolidated statements of income.
The SPE has a recourse obligation to repurchase from the unaffiliated financial institutions any previously sold
receivables that are not collected due to the occurrence of certain events, including credit quality deterioration and
customer sales returns. The reserve recognized for this recourse obligation as of December 31, 2024 and
December 31, 2023 is not material. The servicing liability related to our collection services also is not material, given
the high quality of the customers underlying the receivables and the anticipated short collection period.
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56
6. Debt
The following table summarizes our debt outstanding as of December 31, 2024 and December 31, 2023:
(in thousands)
December 31,
2024
December 31,
2023
June 30, 2019, Series A Senior Unsecured Notes, A$155,000, 3.10% fixed, due
June 30, 2024
$
— $
105,571
October 30, 2017, Series J Senior Unsecured Notes, €225,000, 1.40% fixed, due
October 30, 2024
—
248,355
January 6, 2022, Senior Unsecured Notes, $500,000, 1.75% fixed, due February
1, 2025
500,000
500,000
June 30, 2019, Series B Senior Unsecured Notes, A$155,000, 3.43% fixed, due
June 30, 2026
96,426
105,571
November 30, 2016, Series H Senior Unsecured Notes, $250,000, 3.24% fixed,
due November 30, 2026
250,000
250,000
October 30, 2017, Series K Senior Unsecured Notes, €250,000, 1.81% fixed, due
October 30, 2027
260,150
275,950
October 30, 2017, Series I Senior Unsecured Notes, $120,000, 3.70% fixed, due
October 30, 2027
120,000
120,000
November 1, 2023 Senior Unsecured Notes, $425,000, 6.50% fixed, due
November 1, 2028
425,000
425,000
May 31, 2019, Series A Senior Unsecured Notes, €50,000, 1.55% fixed, due May
31, 2029
52,030
55,190
August 7, 2024, Senior Unsecured Notes, $750,000, 4.95% fixed, due August 15,
2029
750,000
—
October 30, 2017, Series L Senior Unsecured Notes, €125,000, 2.02% fixed, due
October 30, 2029
130,075
137,975
October 27, 2020, Senior Unsecured Notes, $500,000, 1.88% fixed, due
November 1, 2030
500,000
500,000
May 31, 2019, Series B Senior Unsecured Notes, €100,000, 1.74% fixed, due
May 31, 2031
104,060
110,380
January 6, 2022, Senior Unsecured Notes, $500,000, 2.75% fixed, due February
1, 2032
500,000
500,000
October 30, 2017, Series M Senior Unsecured Notes, €100,000, 2.32% fixed, due
October 30, 2032
104,060
110,380
November 1, 2023 Senior Unsecured Notes, $375,000, 6.88% fixed, due
November 1, 2033
375,000
375,000
May 31, 2019, Series C Senior Unsecured Notes, €100,000, 1.95% fixed, due
May 31, 2034
104,060
110,380
Other unsecured debt
43,619
4,622
Total unsecured debt
4,314,480
3,934,374
Unamortized discount and debt issuance cost
(30,135)
(28,146)
Total debt
4,284,345
3,906,228
Less debt due within one year
541,705
355,298
Long-term debt, excluding current portion
$
3,742,640 $
3,550,930
The following table summarizes scheduled maturities of our debt for the years succeeding December 31, 2024 (in
thousands):
2025
$
541,705
2026
348,340
2027
380,150
2028
425,000
2029
932,105
Thereafter
1,687,180
$ 4,314,480
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57
Unsecured Revolving Credit Facility
On October 30, 2020, we entered into a $1.5 billion Syndicated Facility Agreement (as amended, the "Unsecured
Revolving Credit Facility"). The Unsecured Revolving Credit Facility is scheduled to mature on September 30, 2026.
We had no outstanding borrowings under the Unsecured Revolving Credit Facility as of December 31, 2024 or
December 31, 2023.
Commercial Paper Program
On November 29, 2023, we established a commercial paper program that allows us to issue unsecured commercial
paper notes up to $1.5 billion outstanding. The maturities of the commercial paper notes vary but may not exceed
364 days from the date of issuance. The commercial paper notes are sold under customary terms in the commercial
paper market and will rank pari passu with unsecured and unsubordinated indebtedness. The notes are issued at
par less a discount representing an interest factor or, if interest bearing, at par. The net proceeds of issuances of the
commercial paper notes are expected to be used for general corporate purposes. We had no outstanding
borrowings under our commercial paper program as of December 31, 2024 or December 31, 2023.
In the Consolidated Statement of Cash Flows, we present commercial paper activity with original maturities of three-
months or less on a net basis given their short-term nature.
Notes and Other Borrowings
On August 7, 2024, we issued $750 million of unsecured 4.950% Senior Notes due 2029. Interest is payable on
February 15 and August 15 of each year, beginning February 15, 2025.
On November 1, 2023, we issued $425 million of unsecured 6.500% Senior Notes due 2028. Simultaneously, we
issued $375 million of unsecured 6.875% Senior Notes due 2033. For both offerings, interest is payable semi-
annually on November 1 and May 1 of each year, beginning on May 1, 2024.
Covenants
Certain borrowings require us to comply with a financial covenant with respect to a maximum debt to EBITDA ratio.
At December 31, 2024, we were in compliance with all such covenants.
7. Supply Chain Finance Programs
Several global financial institutions offer voluntary supply chain finance (“SCF”) programs which enable our
suppliers (generally those that grant extended terms), at their sole discretion, to sell their receivables from us to
these financial institutions on a non-recourse basis at a rate that takes advantage of our credit rating and may be
beneficial to them. We and our suppliers agree on commercial terms for the goods and services we procure,
including prices, quantities and payment terms, regardless of whether the supplier elects to participate in the SCF
program. Our current payment terms with the majority of our suppliers range from 30 to 360 days. The suppliers sell
goods or services, as applicable, to us and they issue the associated invoices to us based on the agreed-upon
contractual terms. Then, if they are participating in the SCF program, our suppliers, at their sole discretion,
determine which invoices, if any, they want to sell to the financial institutions. In turn, we direct payment to the
financial institutions, rather than the suppliers, for the invoices sold to the financial institutions. No guarantees are
provided by us or any of our subsidiaries on third-party performance under the SCF program; however, we
guarantee the payment by our subsidiaries to the financial institutions participating in the SCF program for the
applicable invoices. We have no economic interest in a supplier’s decision to participate in the SCF program, and
we have no direct financial relationship with the financial institutions, as it relates to the SCF program. Accordingly,
amounts due to our suppliers that elected to participate in the SCF program are included in the line item accounts
payable in our consolidated balance sheets.
All activity related to amounts due to suppliers that elected to participate in the SCF program is reflected in cash
flows from operating activities in our consolidated statement of cash flows.
(in thousands)
December 31, 2024
December 31, 2023
Obligations outstanding at the beginning of the year
$
3,020,465 $
3,106,713
Invoices confirmed during the year
4,293,489
3,987,656
Confirmed invoices paid during the year
(3,982,569)
(4,073,904)
Confirmed obligations outstanding at the end of the year
$
3,331,385 $
3,020,465
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58
8. Derivatives and Hedging
Net Investment Hedges
We have designated certain derivative instruments and a portion of our foreign currency denominated debt, a non-
derivative financial instrument, as hedges of the foreign currency exchange rate exposure of our Euro-denominated
net investment in a European subsidiary. We also designated certain derivative instruments as hedges of our CAD-
denominated net investment in a Canadian subsidiary. We apply the spot method to assess the hedge effectiveness
of the derivative instruments and this assessment for each instrument excludes the initial value related to the
difference at contract inception between the foreign exchange spot rate and the forward rate (i.e., the forward
points). The initial value of this excluded component is recognized as a reduction to interest expense in a systematic
and rational manner over the term of the derivative instrument. All other changes in value for the net investment
hedges are included in AOCL within foreign currency translation and would only be reclassified to earnings if the
European or Canadian subsidiary were liquidated, or otherwise disposed. Upon settlement, the cash paid or
received generally is reflected in investing activities in the statement of cash flows.
The following table summarizes the location and carrying amounts of the derivative instruments and the foreign
currency denominated debt, a non-derivative financial instrument, that are designated and qualify as part of hedging
relationships (in thousands):
Instrument
Balance sheet location
December 31, 2024
December 31, 2023
Notional
Balance
Notional
Balance
Net investment hedges:
Forward contracts
Prepaid expenses and
other current assets
$ 1,867,966 $
85,834 $
606,950 $
37,676
Forward contract
Other current liabilities
$
— $
— $
106,800 $
4,383
Foreign currency debt
Current portion of debt
and long-term debt
€
475,000 $
494,285 €
700,000 $
772,660
The table below presents pre-tax gains and losses related to net investment hedges for the year ended December
31:
(in thousands)
(Loss) Gain Recognized in AOCL
Before Reclassifications
Gain Recognized in Interest
Expense For Excluded Components
2024
2023
2022
2024
2023
2022
Net Investment Hedges:
Forward contracts
$ 49,625 $ (22,946) $ 103,240 $ 18,905 $
12,634 $
27,923
Foreign currency debt
34,948
(23,380)
43,540
—
—
—
Total
$ 84,573 $ (46,326) $ 146,780 $ 18,905 $
12,634 $
27,923
9. Leased Properties
We primarily lease real estate for retail stores, branches, distribution centers, office space and land. We also lease
equipment (primarily vehicles).
Most real estate leases include one or more options to renew, with renewal terms that generally can extend the
lease term from one to 20 years or more. The exercise of lease renewal options is at our discretion. We evaluate
renewal options at lease inception and on an ongoing basis, and we include renewal options that we are reasonably
certain to exercise in the expected lease terms when classifying leases and measuring lease liabilities. We elected
a policy of not recording leases on the consolidated balance sheets when the leases have a term of 12 months or
less and we are not reasonably certain to elect an option to purchase the leased asset. Lease agreements generally
do not require material variable lease payments, residual value guarantees or restrictive covenants.
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59
The table below presents the locations of the operating lease assets and liabilities on the consolidated balance
sheets:
(in thousands)
Balance Sheet Line Item
December 31, 2024
December 31, 2023
Operating lease assets
Operating lease assets
$
1,769,720 $
1,268,742
Operating lease liabilities:
Current operating lease liabilities
Other current liabilities
$
343,276 $
298,415
Noncurrent operating lease liabilities
Operating lease liabilities
1,458,391
979,938
Total operating lease liabilities
$
1,801,667 $
1,278,353
The depreciable lives of operating lease assets and leasehold improvements are limited by the expected lease
term.
Our leases generally do not provide an implicit rate, and therefore we use our incremental borrowing rate as the
discount rate when measuring operating lease liabilities. The incremental borrowing rate represents an estimate of
the interest rate we would incur at lease commencement to borrow an amount equal to the lease payments on a
collateralized basis over the term of a lease within a particular currency environment. We used incremental
borrowing rates as of January 1, 2019 for operating leases that commenced prior to that date.
Our weighted average remaining lease term and weighted average discount rate for operating leases are:
December 31, 2024
December 31, 2023
Weighted average remaining lease term (in years)
7.79
6.34
Weighted average discount rate
4.28 %
3.67 %
The table below reconciles the undiscounted future minimum lease payments (displayed by year and in the
aggregate) under noncancelable operating leases with terms of more than one year to the total operating lease
liabilities recognized on the consolidated balance sheets as of December 31, 2024 (in thousands):
2025
$
436,600
2026
394,282
2027
310,407
2028
233,215
2029
155,557
Thereafter
682,913
Total undiscounted future minimum lease payments
2,212,974
Less: Difference between undiscounted lease payments and discounted operating lease liabilities
411,307
Total operating lease liabilities
$ 1,801,667
Future minimum lease payments include $53 million related to options to extend lease terms that we are reasonably
certain to exercise. Future minimum lease payments exclude $9 million related to an operating lease that has not
yet commenced. This lease is expected to commence in 2025 with a lease term of 15 years.
The table below presents operating lease costs and supplemental cash flow information related to leases for the
year ended December 31:
(in thousands)
2024
2023
2022
Operating lease costs
$ 459,654 $ 380,730 $ 350,025
Cash paid for amounts included in the measurement of operating lease
liabilities
$ 449,374 $ 389,610 $ 358,767
Operating lease assets obtained in exchange for new operating lease
liabilities
$ 966,796 $ 493,039 $ 411,052
Operating lease costs are included within selling, administrative and other expenses on the consolidated statements
of income. Short-term lease costs, variable lease costs and sublease income were not material for the periods
presented. Cash paid for amounts included in the measurement of operating lease liabilities is included in operating
activities in the consolidated statements of cash flows.
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60
10. Employee Benefit Plans
Our defined benefit pension plans cover employees in the U.S., Canada, and Europe who meet eligibility
requirements. The plan covering U.S. employees is noncontributory, and our U.S. qualified defined benefit plan was
frozen as of December 31, 2013. No further benefits were provided after this date for additional credited service or
earnings, and all participants became fully vested as of December 31, 2013.
On April 29, 2024, our Board of Directors approved the termination of the frozen U.S. qualified defined benefit plan
(pension plan), effective September 30, 2024. We intend to transfer the management and delivery of continuing
benefits associated with the pension plan to a third-party insurance company. The pension plan settlement process
involves several regulatory steps and approvals. Subject to completion of these steps and approvals, settlement is
expected between late 2025 and early 2026. As part of the plan settlement process, pension plan participants not
currently receiving payments will have the opportunity to select a single lump sum payment or an annuity from the
insurance company that will pay and administer future benefit payments.
Upon settlement, we expect to recognize a non-cash, pre-tax pension settlement charge in late 2025 or early 2026
equal to the actuarial losses accumulated in AOCI, which totaled approximately $735 million ($540 million, net of
tax) as of December 31, 2024. The actual amount of the settlement charges will depend on the valuation of the
pension obligation at the settlement date, which is dependent upon interest rates, the lump sum election rate, the
cost to purchase annuities, U.S. pension plan asset returns, and other factors. Once settled, we will be fully relieved
of all obligations under the U.S. pension plan.
The Canadian plan is contributory, and benefits are based on career average compensation. Our funding policy is to
contribute an amount equal to the minimum required contribution under applicable pension legislation. For the plans
in the U.S. and Canada, we may increase our contribution above the minimum, if appropriate to our tax and cash
position and the plans’ funded position. The European plans are funded in accordance with local regulations.
We also sponsor supplemental retirement plans covering employees in the U.S. and Canada. We use a
measurement date of December 31 for our pension and supplemental retirement plans.
Several assumptions are used to determine the benefit obligations, plan assets, and net periodic income. Prior to
December 31, 2024, the discount rate for the U.S. pension plan was calculated using a bond matching approach to
select specific bonds that would satisfy the projected benefit payments. As a result of the decision to terminate the
U.S. pension plan, as of December 31, 2024, the benefit obligation for the U.S. pension plan was determined based
on the amount expected to be required to settle the obligations. Assumptions utilized included the portion of the
obligations expected to be settled through elections of lump sum payments or annuities and the cost to purchase
annuities, what are subject to change upon actual plan settlement.
The discount rate for non U.S. plans are set by using Willis Towers Watson's RATE:Link model. For non-U.S. plans
and the U.S. pension plan prior to December 31, 2024, this approach reflects yields available on high quality
corporate bonds that would generate the cash flow necessary to pay the plan's benefits when due. The expected
return on plan assets is based on a calculated market-related value of plan assets, where gains and losses on plan
assets are amortized over a five year period and accumulate in other comprehensive income. Other non-investment
unrecognized gains and losses are amortized in future net income based on a “corridor” approach, where the
corridor is equal to 10% of the greater of the benefit obligation or the market-related value of plan assets at the
beginning of the year. The unrecognized gains and losses in excess of the corridor criteria are amortized over the
average future lifetime or service of plan participants, depending on the plan. These assumptions are updated at
each annual measurement date.
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61
Changes in benefit obligations for the years ended December 31, 2024 and 2023 were:
(in thousands)
2024
2023
Changes in benefit obligation
Benefit obligation at beginning of year
$ 1,981,783 $ 1,923,163
Service cost
6,842
5,991
Interest cost
101,289
104,490
Plan participants’ contributions
1,547
1,765
Actuarial loss
51,940
76,072
Foreign currency exchange rate changes
(19,128)
5,580
Gross benefits paid
(142,721)
(137,742)
Plan amendments
—
2,464
Benefit obligation at end of year
$ 1,981,552 $ 1,981,783
The benefit obligations for our U.S. pension plans included in the above were $1.7 billion at both December 31,
2024 and 2023. The total accumulated benefit obligation for our defined benefit pension plans in the U.S., Canada,
and Europe was approximately $2.0 billion and $2.0 billion at December 31, 2024 and 2023, respectively.
For the U.S. pension plan, there was a net actuarial liability loss of $61 million and an asset loss of $61 million. The
liability loss was comprised primarily from the cost associated with measuring the plan on a termination basis and
the valuation of expected lump sum payments to be made in 2025 prior to the settlement of the plan. For the U.S.
supplemental retirement plan, there was a net actuarial liability gain of $6 million. The liability gain is the result of a
$8 million gain associated with an increase in the discount rate, a $2 million gain related to updates to the salary
growth and bonus payout assumptions, and an offsetting $4 million demographic loss for participant experience.
The assumptions used to measure the pension benefit obligations for the plans at December 31, 2024 and
2023, were:
2024
2023
Weighted average discount rate
5.15 %
5.30 %
Rate of increase in future compensation levels
2.85 %
3.18 %
Changes in plan assets for the years ended December 31, 2024 and 2023 were:
(in thousands)
2024
2023
Changes in plan assets
Fair value of plan assets at beginning of year
$ 2,233,079 $ 2,129,058
Actual return on plan assets
137,603
217,767
Foreign currency exchange rate changes
(20,733)
5,407
Employer contributions
15,104
16,824
Plan participants’ contributions
1,547
1,765
Benefits paid
(142,721)
(137,742)
Fair value of plan assets at end of year
$ 2,223,879 $ 2,233,079
The fair values of plan assets for our U.S. pension plans included in the above were $2.0 billion at both
December 31, 2024 and 2023.
For the years ended December 31, 2024 and 2023, the aggregate projected benefit obligation and aggregate fair
value of plan assets for plans with projected benefit obligations in excess of plan assets were as follows:
(in thousands)
2024
2023
Aggregate projected benefit obligation
$ 229,602 $ 231,741
Aggregate fair value of plan assets
$
— $
—
Table of Contents
For the years ended December 31, 2024 and 2023, the aggregate accumulated benefit obligation and aggregate
fair value of plan assets for plans with accumulated benefit obligations in excess of plan assets were as follows:
(in thousands)
2024
2023
Aggregate accumulated benefit obligation
$ 219,165 $ 215,380
Aggregate fair value of plan assets
$
— $
—
The asset allocations for our funded pension plans at December 31, 2024 and 2023, and the target allocation for
2025, by asset category were:
Target Allocation
Percentage of Plan Assets at
December 31
2025
2024
2023
Asset Category
Equity securities
10 %
13 %
58 %
Debt securities
30 %
30 %
42 %
Other
60 %
57 %
— %
100 %
100 %
100 %
Our benefit plan committees in the U.S. and Canada establish investment policies and strategies and regularly
monitor the performance of the funds. Our U.S. plan, our largest pension plan, is well-funded, with a funded status
of 128% at December 31, 2024. The plans in Europe are unfunded and, therefore, there are no plan assets.
Beginning in 2024, the U.S. pension plan strategy implemented by our management is to minimize funded status
volatility through the plan termination process. Our investment strategy with respect to U.S. pension plan assets is
to fully hedge plan obligations on a termination basis. In connection with the planned U.S. pension plan termination
process, we acquired certain guaranteed annuity contracts from an insurance company using existing plan assets to
fund on-going obligations under the U.S. pension plan prior to our planned termination.
The Canadian pension plan strategy implemented by our management is to achieve long-term objectives and invest
the pension assets in accordance with the applicable pension legislation in Canada as well as fiduciary standards.
The long-term primary investment objectives for the Canadian pension plan is to provide for a reasonable amount of
long-term growth of capital, without undue exposure to risk, protect the assets from erosion of purchasing power,
and provide investment results that meet or exceed the pension plans’ actuarially assumed long-term rates of
return. The Company's Investment Strategy with respect to Canadian pension plan assets is to generate a return in
excess of the passive portfolio benchmark (50% Equity, 40% Fixed Income, 10% Other).
The fair values of the plan assets as of December 31, 2024 and 2023, by asset category, are shown in the tables
below. Various inputs are considered when determining the value of our pension plan assets. The inputs or
methodologies used for valuing securities are not necessarily an indication of the risk associated with investing in
these securities. Level 1 represents observable market inputs that are unadjusted quoted prices for identical assets
or liabilities in active markets. Level 2 represents other significant observable inputs (including quoted prices for
similar securities, interest rates, credit risk, etc.). Level 3 represents significant unobservable inputs (including our
own assumptions in determining the fair value of investments). Certain investments are measured at fair value using
the net asset value ("NAV") per share as a practical expedient and have not been classified in the fair value
hierarchy.
The valuation methods may produce a fair value calculation that may not be indicative of net realizable value or
reflective of future fair values. Furthermore, while we believe our valuation methods are appropriate and consistent
with other market participants, the use of different methodologies or assumptions to determine the fair value of
certain financial instruments could result in a different fair value measurement at the reporting date. Equity
securities are valued at the closing price reported on the active market on which the individual securities are traded
on the last day of the calendar plan year. Debt securities including corporate bonds, U.S. Government securities,
and asset-backed securities are valued using price evaluations reflecting the bid and/or ask sides of the market for
an investment as of the last day of the calendar plan year. The guaranteed annuity contract was valued based on
the transaction price adjusted for changes in interest rates and actual benefit payments.
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(in thousands)
2024
Total
Assets
Measured at
NAV
Quoted Prices
in Active
Markets for
Identical
Assets
(Level 1)
Significant
Observable
Input
s (Level 2)
Significant
Unobservable
Inputs
(Level 3)
Equity Securities
Common stocks — mutual funds —
equity
$
54,256 $
— $
54,256 $
— $
—
Genuine Parts Company common
stock
176,640
—
176,640
—
—
Other stocks
72,749
—
72,749
—
—
Debt Securities
Short-term investments
1,422
—
1,422
—
—
Cash and equivalents
12,365
—
12,365
—
—
Government bonds
52,381
—
329
52,052
—
Corporate bonds
66,321
—
—
66,321
—
Mutual funds-fixed income
201,247
—
201,247
—
—
Short Term Collective Trust
345,064
—
—
345,064
—
Other
Investment Contracts, at Contract
Value
1,241,434
—
—
—
1,241,434
Total
$ 2,223,879 $
— $
519,008 $
463,437 $
1,241,434
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(in thousands)
2023
Total
Assets
Measured at
NAV
Quoted Prices
in Active
Markets for
Identical
Assets
(Level 1)
Significant
Observable
Inputs
(Level 2)
Significant
Unobservable
Inputs
(Level 3)
Equity Securities
Common stocks — mutual funds —
equity
$
318,418 $
53,876 $
264,542 $
— $
—
Genuine Parts Company common
stock
209,384
—
209,384
—
—
Other stocks
763,451
—
763,451
—
—
Debt Securities
Short-term investments
38,235
—
38,235
—
—
Cash and equivalents
6,608
—
6,608
—
—
Government bonds
389,199
—
536
388,663
—
Corporate bonds
436,418
—
—
436,418
—
Asset-backed and mortgage-
backed securities
10,396
—
—
10,396
—
Convertible Securities
1,720
—
—
1,720
—
Other-international
45,059
—
—
45,059
—
Municipal bonds
14,295
—
—
14,295
—
Other
Options and Futures
(104)
—
—
(105)
1
Total
$ 2,233,079 $
53,876 $
1,282,756 $
896,446 $
1
Equity securities include Genuine Parts Company common stock in the amounts of $177 million (8% of total plan
assets) and $209 million (9% of total plan assets) at December 31, 2024 and 2023, respectively. Dividend payments
received by the plan on company stock totaled approximately $6 million and $6 million in 2024 and 2023,
respectively. Fees paid during the year for services rendered by parties in interest were based on customary and
reasonable rates for such services.
Based on the investment policy for the pension plans, as well as an asset study that was performed based on our
asset allocations and future expectations, our expected rate of return on plan assets for measuring 2025 pension
income is 5.33% for the plans. The asset study forecasted expected rates of return for the approximate duration of
our benefit obligations, using capital market data and historical relationships.
The following table sets forth the funded status of the plans and the amounts recognized in the consolidated
balance sheets at December 31:
(in thousands)
2024
2023
Other long-term asset
$ 471,929 $ 483,037
Other current liability
(14,402)
(13,039)
Pension and other post-retirement liabilities
(218,629)
(219,644)
$ 238,898 $ 250,354
Amounts recognized in accumulated other comprehensive loss consist of:
(in thousands)
2024
2023
Net actuarial loss
$ 772,785 $ 697,794
Prior service cost
7,919
9,044
$ 780,704 $ 706,838
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The following table reflects the total benefits expected to be paid from the pension plans’ or our assets. Of the
pension benefits expected to be paid in 2025, approximately $14 million is expected to be paid from employer
assets. Expected employer contributions below reflect amounts expected to be contributed to funded plans.
Information about the expected cash flows for the pension plans follows (in thousands):
Employer contribution:
2025 (expected)
$
513
Expected benefit payments:
2025
$
438,756
2026
$
27,669
2027
$
28,888
2028
$
30,097
2029
$
31,146
2030 through 2034
$
158,619
Net periodic benefit income included the following components:
(in thousands)
2024
2023
2022
Service cost
$
6,842 $
5,991 $
10,204
Interest cost
101,289
104,490
75,248
Expected return on plan assets
(177,474)
(164,984)
(150,318)
Amortization of prior service cost
1,127
692
691
Amortization of actuarial loss
14,281
9,361
37,065
Net periodic benefit income
$
(53,935) $
(44,450) $
(27,110)
Service cost is recorded in selling, administrative and other expenses in the consolidated statements of income
while all other components are recorded within other non-operating expenses (income). Pension benefits also
include amounts related to supplemental retirement plans.
Other changes in plan assets and benefit obligations recognized in other comprehensive income (loss) are
as follows:
(in thousands)
2024
2023
2022
Current year actuarial loss
$ 101,991 $
23,289 $
97,412
Recognition of actuarial loss
(14,281)
(9,361)
(37,065)
Recognition of prior service cost
(1,127)
(692)
(691)
Recognition of curtailment loss
—
—
—
Other
—
2,464
68
Total recognized in other comprehensive income loss
$
86,583 $
15,700 $
59,724
Total recognized in net periodic benefit income and other comprehensive
loss (income)
$
32,648 $
(28,750) $
32,614
The assumptions used in measuring the net periodic benefit income for the plans follow:
2024
2023
2022
Weighted average discount rate
5.30 %
5.61 %
3.04 %
Rate of increase in future compensation levels
3.18 %
3.16 %
3.13 %
Expected long-term rate of return on plan assets
7.60 %
7.09 %
6.34 %
We have one defined contribution plan in the U.S. that covers substantially all of our domestic employees.
Employees receive a matching contribution of 100% of the first 5% of the employees’ salary. Total plan expense was
approximately $75 million in 2024, $77 million in 2023, and $69 million in 2022.
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11. Acquisitions
For each acquisition, we allocate the purchase price to the assets acquired and the liabilities assumed based on
their fair values as of their respective acquisition dates. The results of operations for acquired businesses are
included in our consolidated statements of income beginning on their respective acquisition dates.
2024
We acquired various businesses for approximately $1.2 billion, which includes certain non-cash consideration and is
net of cash acquired, during the year ended December 31, 2024. We recognized approximately $500 million and
$30 million of revenue for the year ended December 31, 2024 for our Automotive and Industrial acquisitions,
respectively.
The following table summarizes the aggregate estimated fair values of the assets acquired and liabilities assumed
at the acquisition dates for these businesses during the year ended December 31, 2024. The fair values of the
assets acquired and liabilities assumed are preliminary and may be subject to additional adjustments, particularly to
inventory and intangible assets during the measurement period, which may be up to one year from the respective
acquisition dates.
(in thousands)
As of Acquisition
Dates
Trade accounts receivable
$
100,000
Merchandise inventories
620,000
Prepaid expenses and other current assets
10,000
Other intangible assets
210,000
Property, plant and equipment
100,000
Operating lease assets
250,000
Other assets
10,000
Total identifiable assets acquired
1,300,000
Current liabilities
(120,000)
Operating lease liabilities
(240,000)
Deferred tax liabilities
(40,000)
Other long-term liabilities
(10,000)
Total liabilities assumed
(410,000)
Net identifiable assets acquired
890,000
Goodwill
280,000
Net assets acquired
$
1,170,000
Other intangible assets acquired, totaling approximately $210 million, consisted primarily of customer relationships
and trade names with weighted average amortization lives of 18 years.
The estimated goodwill recognized as part of the acquisitions is generally not tax deductible. Goodwill of
$250 million and $30 million has been assigned to the Automotive and Industrial segments, respectively. This
goodwill is attributable primarily to the expected synergies and assembled work forces of the acquired businesses.
The businesses acquired included two of the largest independent owners of NAPA Auto Parts Stores in the U.S.,
Motor Parts & Equipment Corporation ("MPEC") in April 2024 and Walker Automotive Group in July 2024. We
recognized approximately $100 million of goodwill and other intangible assets associated with the MPEC and
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Walker acquisitions. Approximate values of other assets acquired and liabilities assumed included inventory of
$290 million, operating lease assets of $240 million and operating lease liabilities of $250 million.
We did not recognize any significant measurement period adjustments related to finalizing acquisition accounting
during the year ended December 31, 2024.
2023
We acquired several businesses for approximately $322 million, net of cash acquired, during the year ended
December 31, 2023. Approximately $300 million was related to our Automotive segment and $22 million was related
to Industrial. During the year we recognized approximately $389 million and $48 million of sales, net of store
closures, related to our 2023 Automotive and Industrial acquisitions, respectively. We recognized approximately
$219 million of goodwill and other intangible assets associated with these acquisitions. Other intangible assets
acquired of $99 million consisted of customer relationships with a weighted average amortization life of 20 years.
We did not recognize any significant measurement period adjustments related to finalizing acquisition accounting
during the year ended December 31, 2023.
2022
We acquired several businesses for approximately $1.6 billion, net of cash acquired, during the year ended
December 31, 2022. Approximately $1.3 billion was related to our Industrial segment, primarily the acquisition of
KDG and $300 million was related to Automotive.
We recognized approximately $562 million of sales, net of store closures, and $239 million of goodwill and other
intangible assets related to our Automotive acquisitions during the year ended December 31, 2022. The other
intangible assets acquired consisted of customer relationships of $76 million, trademarks of $9 million, and other
intangibles of $4 million with weighted average amortization lives of 18, 15, and 3 years, respectively.
On January 3, 2022, the company, through our wholly-owned subsidiary, Motion Industries, Inc., acquired all of the
equity interests in KDG for a purchase price of approximately $1.3 billion in cash, net of cash acquired of
approximately $30 million. KDG contributed approximately 5% of net sales included in our consolidated statement of
income from January 3, 2022 to December 31, 2022. The KDG acquisition was financed using a combination of
borrowing under the existing unsecured revolving credit facility, proceeds of $200 million from the selling of
additional receivables under our amended A/R Sales Agreement, and $109 million of cash.
For the twelve months ended December 31, 2022, approximately $5 million of inventory amortization step-up cost
related to this acquisition was included in cost of goods sold. Further, $62 million of transaction and other one-time
costs, inclusive of an impairment charge, were included in selling, administrative, and other expenses in the
consolidated statements of income for the year ended December 31, 2022. Refer to the Goodwill and Other
Intangible Assets Footnote for more information on the impairment charge.
12. Share-Based Compensation
Share-based compensation costs of $44 million, $57 million, and $38 million, were recorded for the years ended
December 31, 2024, 2023, and 2022, respectively. The total income tax benefits recognized in the consolidated
statements of income for share-based compensation arrangements were approximately $12 million, $15 million, and
$10 million for 2024, 2023, and 2022, respectively. At December 31, 2024, total compensation cost related to
nonvested awards not yet recognized was approximately $68 million. There have been no modifications to valuation
methodologies or methods during the years ended December 31, 2024, 2023, or 2022.
As of December 31, 2024, there were 6 million shares of common stock available for issuance pursuant to future
equity-based compensation awards.
A summary of our restricted stock units activity and related information is as follows:
Nonvested Share Awards (RSUs)
Shares
Weighted
Average Grant
Date Fair Value
Weighted Average
Remaining
Contractual Life (Years)
Aggregate
Intrinsic Value
Nonvested at beginning of year
888 $
144.46
Granted
460 $
155.62
Vested
(370) $
135.29
Forfeited
(97) $
149.31
Nonvested at end of year
881 $
152.71
1.6 $
102,853
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A summary of our stock appreciation rights activity and related information is as follows:
Stock Appreciation Rights (SARs)
Shares
Weighted
Average Exercise
Price
Weighted Average
Remaining
Contractual Life (Years)
Aggregate
Intrinsic Value
Outstanding at beginning of year
224 $
93.36
Granted
— $
—
Exercised
(119) $
91.71
Forfeited
(2) $
90.34
Outstanding at end of year
103 $
95.32
1.20 $
2,211
Exercisable at end of year
103 $
95.32
1.20 $
2,211
The aggregate intrinsic value of SARs exercised and RSUs vested during the years ended December 31, 2024,
2023, and 2022 was $68 million, $89 million, and $62 million, respectively. The fair value of RSUs is based on the
price of our stock on the date of grant. The fair value of SARs is estimated using a Black-Scholes option pricing
model. We ceased issuing SARs in 2017. The total fair value of SARs and RSUs vested during the years ended
December 31, 2024, 2023, and 2022 were $51 million, $41 million, and $29 million, respectively.
13. Accumulated Other Comprehensive Loss
The following tables present the changes in AOCL by component:
(in thousands)
Changes in Accumulated Other Comprehensive Loss
by Component, Net of Income Taxes
Pension and
Other Post-
Retirement
Benefits
Cash Flow
Hedges
Foreign
Currency
Translation
Total
Beginning balance, January 1, 2022
$ (463,227) $
(15,042) $ (379,470) $ (857,739)
Other comprehensive income (loss) before
reclassifications
(71,258)
—
(143,890)
(215,148)
Amounts reclassified from accumulated other
comprehensive loss
27,875
12,470
—
40,345
Ending balance, December 31, 2022
(506,610)
(2,572)
(523,360)
(1,032,542)
Other comprehensive income (loss) before
reclassifications
(18,965)
2,765
64,429
48,229
Amounts reclassified from accumulated other
comprehensive loss
7,634
(193)
—
7,441
Ending balance, December 31, 2023
(517,941)
—
(458,931)
(976,872)
Other comprehensive income (loss) before
reclassifications
(74,604)
—
(221,812)
(296,416)
Amounts reclassified from accumulated other
comprehensive loss
11,545
—
—
11,545
Ending balance, December 31, 2024
$ (581,000) $
— $ (680,743) $ (1,261,743)
The AOCL components related to the pension benefits are included in the computation of net periodic benefit
income in the Employee Benefit Plans Footnote. The nature of the cash flow hedges are discussed in the
Derivatives and Hedging Footnote. Generally, tax effects in AOCL are established at the currently enacted tax rate
and reclassified to net income in the same period that the related pre-tax AOCL reclassifications are recognized.
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14. Income Taxes
Significant components of our deferred tax assets and liabilities are as follows:
(in thousands)
2024
2023
Deferred tax assets related to:
Expenses not yet deducted for tax purposes
$ 344,858 $ 327,946
Operating lease liabilities
622,732
354,594
Pension liability not yet deducted for tax purposes
201,971
175,643
Net operating loss
59,154
49,270
1,228,715
907,453
Deferred tax liabilities related to:
Employee and retiree benefits
257,640
242,132
Inventory
67,437
92,383
Operating lease assets
635,041
351,821
Other intangible assets
495,227
472,222
Property, plant and equipment
135,073
113,115
Other
52,330
40,264
1,642,748
1,311,937
Net deferred tax liability before valuation allowance
(414,033)
(404,484)
Valuation allowance
(25,758)
(30,273)
Total net deferred tax liability
$ (439,791) $ (434,757)
We currently hold approximately $259 million in gross net operating losses, of which approximately $98 million will
carry forward indefinitely. The remaining net operating losses of approximately $161 million will begin to expire in
2025.
The components of income before income taxes are as follows:
(in thousands)
2024
2023
2022
United States
$ 761,230 $ 1,164,914 $ 1,100,584
Foreign
414,738
577,434
472,018
Income before income taxes
$ 1,175,968 $ 1,742,348 $ 1,572,602
The components of income tax expense are as follows:
(in thousands)
2024
2023
2022
Current:
Federal
$ 129,542 $ 201,929 $ 196,634
State
41,344
51,244
70,453
Foreign
123,048
130,538
120,594
Deferred:
Federal
(3,774)
26,166
12,727
State
(1,477)
10,241
4,981
Foreign
(16,791)
5,706
(15,488)
$ 271,892 $ 425,824 $ 389,901
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The reasons for the difference between total tax expense and the amount computed by applying the statutory
Federal income tax rate to income before income taxes are as follows:
(in thousands)
2024
2023
2022
Statutory rate applied to income (1)
$ 246,953 $ 365,892 $ 330,246
Plus state income taxes, net of Federal tax benefit
31,495
48,573
59,593
Taxation of foreign operations, net (2)
3,201
4,666
3,347
Valuation allowance
412
2,911
(7,153)
Other (3)
(10,169)
3,782
3,868
$ 271,892 $ 425,824 $ 389,901
(1) U.S. statutory rates applied to income are as follows: 2024, 2023 and 2022 at 21%.
(2) Our effective tax rate reflects the impact of having operations outside of the U.S. which are taxed at statutory
rates different from the U.S. statutory rate, with some income being fully or partially exempt from income taxes
due to various operating and financing activities.
(3) Includes investment benefits and associated unrecognized tax benefits.
We account for Global Intangible Low Taxed income in the year the tax is incurred as a period cost.
We, or one of our subsidiaries, file income tax returns in the U.S., various states, and foreign jurisdictions. With few
exceptions, we are no longer subject to federal, state and local tax examinations by tax authorities for years before
2020 or subject to foreign income tax examinations for years ended prior to 2013. We are currently under audit in
some of our state and foreign jurisdictions. Some audits may conclude in the next 12 months and the unrecognized
tax benefits recognized in relation to the audits may differ from actual settlement amounts. It is not possible to
estimate the effect, if any, of the amount of such change during the next 12 months to previously recognized
uncertain tax positions in connection with the audits; however, we do not anticipate that total unrecognized tax
benefits will significantly change in the next 12 months.
A reconciliation of the beginning and ending amounts of unrecognized tax benefits is as follows:
(in thousands)
2024
2023
2022
Balance at beginning of year
$
20,527 $
19,621 $
19,501
Additions based on tax positions related to the current year
15,493
2,584
1,475
Additions for tax positions of prior years
3,462
1,752
89
Reductions for tax positions for prior years
(542)
(70)
(523)
Reduction for lapse in statute of limitations
(2,203)
(2,713)
(921)
Settlements
(547)
(647)
—
Balance at end of year
$
36,190 $
20,527 $
19,621
The amount of gross unrecognized tax benefits, including interest and penalties, as of December 31, 2024 and
2023 was approximately $37 million and $22 million, respectively, of which approximately $35 million and $20
million, respectively, if recognized, would affect the effective tax rate.
During the tax years ended December 31, 2024, 2023 and 2022, we paid, received refunds, or accrued insignificant
interest and penalties. We recognize potential interest and penalties related to unrecognized tax benefits as a
component of income tax expense.
As of December 31, 2024, we estimate that we have an outside basis difference in certain foreign subsidiaries of
approximately $1.4 billion, which includes the cumulative undistributed earnings from our foreign subsidiaries. We
continue to be indefinitely reinvested in this outside basis difference. Determining the amount of net unrecognized
deferred tax liability related to any additional outside basis difference in these entities is not practicable. This is due
to the complexities associated with the calculation to determine residual taxes on the undistributed earnings,
including the availability of foreign tax credits, applicability of any additional local withholding tax and other indirect
tax consequences that may arise due to the distribution of these earnings.
15. Guarantees
We guarantee the borrowings of certain independently controlled automotive parts stores and businesses
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(“independents”) and certain other affiliates in which we have a noncontrolling equity ownership interest (“affiliates”).
Presently, the independents are generally consolidated by unaffiliated enterprises that have controlling financial
interests through ownership of a majority voting interest in the independents. We have no voting interest or equity
conversion rights in any of the independents. We do not control the independents or the affiliates but receive a fee
for the guarantees. We have concluded that the independents are variable interest entities, but that we are not the
primary beneficiary. Specifically, the equity holders of the independents have the power to direct the activities that
most significantly impact the entities’ economic performance including, but not limited to, decisions about hiring and
terminating personnel, local marketing and promotional initiatives, pricing and selling activities, credit decisions,
monitoring and maintaining appropriate inventories, and store hours. Separately, we concluded that the affiliates are
not variable interest entities. During the year ended December 31, 2024, we acquired all of the remaining affiliates,
which are consolidated in our financial statements. Our maximum exposure to loss as a result of its involvement
with these independents and affiliates is generally equal to the total borrowings subject to our guarantees. While
such borrowings of the independents and affiliates are outstanding, we are required to maintain compliance with
certain covenants. At December 31, 2024, we were in compliance with all such covenants.
At December 31, 2024, the total borrowings of the independents subject to guarantee by us were approximately
$575 million, a decrease from $954 million at December 31, 2023. These loans generally mature over periods from
one to six years. We regularly monitor the performance of these loans and the ongoing operating results, financial
condition and ratings from credit rating agencies of the independents that participate in the guarantee programs. In
the event that we are required to make payments in connection with these guarantees, we would obtain and
liquidate certain collateral pledged by the independents (e.g., accounts receivable and inventory) to recover all or a
substantial portion of the amounts paid under the guarantees. We recognize a liability equal to current expected
credit losses over the lives of the loans in the guaranteed loan portfolio, based on a consideration of historical
experience, current conditions, the nature and expected value of any collateral, and reasonable and supportable
forecasts. To date, we have had no significant losses in connection with guarantees of independents’ borrowings
and the current expected credit loss reserve is not material. As of December 31, 2024, there are no material
guaranteed loans for which the borrower is experiencing financial difficulty and recovery is expected to be provided
substantially through the operation or sale of the collateral.
We have recognized certain assets and liabilities amounting to $41 million and $59 million for the guarantees
related to the independents’ and affiliates’ borrowings at December 31, 2024 and 2023, respectively. These assets
and liabilities are included in other assets and other long-term liabilities in the consolidated balance sheets. The
liabilities relate to our noncontingent obligation to stand ready to perform under the guarantee programs and they
are distinct from our current expected credit loss reserve.
16. Commitments and Contingencies
Legal Matters
We are subject to various claims and lawsuits, principally in the United States, and regulatory proceedings
worldwide. The liabilities recognized on these claims and other matters are based on the best available information
and assumptions that we believe are reasonable. While litigation of any type contains an element of uncertainty, we
believe that our insurance coverage and our defense, and ultimate resolution of pending and reasonably anticipated
claims will not have a material adverse effect on our business, results of operations or financial condition.
Asbestos-Related Product Liability and Insurance Receivable
We maintain a liability for probable and estimable claims and settlements associated with our distribution and sales
of asbestos-containing brake and friction products sold primarily before 1991. These claims and settlements are
unrelated to our ongoing operations, revenue generating activities, and business strategy.
We regularly conduct a comprehensive legal review of our asbestos liability. We review recent and historical claims
data, including, (i) the number of pending claims filed, (ii) the nature and mix of those claims (e.g., disease type,
plaintiff type, geography), (iii) the costs to resolve pending claims, and (iv) trends in filing rates and in costs to
resolve claims (collectively, the “Claims Data”). We also consider the known latency periods for common asbestos
diseases when projecting future filing trends and claims. We provide the Claims Data to a third-party actuarial
specialist with expertise in determining the impact of Claim Data on future filing trends and costs. The actuarial
specialist assists us in estimating the costs to resolve pending and future claims. We use this analysis to develop
our estimate of probable liability on a discounted basis, using risk-free interest rates derived from market data about
monetary assets with maturities comparable to those of the projected liability.
Developments may occur that could affect our estimate of asbestos-related product liability and actual results may
differ under different assumptions or conditions. These developments include, but are not limited to, significant
changes in (i) the key assumptions underlying the estimate, including the number of future claims, the nature and
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mix of those claims, and the average cost of resolving claims (ii) trial and appellate outcomes, (iii) the law and
procedure applicable to these claims, and (iv) the financial viability of other codefendants and insurers. Complaints
nearly always assert claims against multiple defendants where the damages alleged are typically not attributed to
individual defendants so that a defendant’s share of liability may turn on the law of joint and several liability, which
can vary by state. Our estimate has been impacted by adverse inflation trends, a backlog of claims building up from
court closures during the COVID-19 pandemic, and an evolving legal and product liability environment.
As a result of our comprehensive legal review, we increased the liability by $57 million in 2024. We have 2,768
pending asbestos lawsuits as of December 31, 2024. The amount accrued for pending and future claims was $256
million as of December 31, 2024, which represented our best estimate of the liability within our calculated range of
$219 million to $313 million, discounted using a discount rate of 4.58%. The amount accrued for pending and future
claims was $244 million as of December 31, 2023, which represented our best estimate of the liability within our
calculated range of $196 million to $277 million, discounted using a discount rate of 3.88%. Our undiscounted
product liability was $336 million and $308 million as of December 31, 2024 and December 31, 2023, respectively.
We hold insurance policies that cover some asbestos settlements and defense costs. Annually, we conduct an
insurance exhaustion study to model expected recoveries for pending and future claims, and we adjust the
insurance receivable balance to reflect the present value of these recoveries. Our receivable for estimated
insurance recoveries related to pending and future claims was $44 million and $46 million as of December 31, 2024
and December 31, 2023, respectively.
Environmental Liabilities
Item 103 of SEC Regulation S-K requires disclosure of certain environmental matters when a governmental
authority is a party to the proceedings and such proceedings involve potential monetary sanctions that we
reasonably believe will exceed an applied threshold not to exceed $1 million. Applying this threshold, there are no
environmental matters to disclose for this period.
17. Restructuring and Other Costs
In February 2024, we approved and initiated a global restructuring initiative designed to better align our assets and
further improve the efficiency of the business. This initiative includes an announced voluntary retirement offer in the
U.S., along with a rationalization and optimization of certain distribution centers, stores and other facilities. The
initiative was approved and funded by our corporate office and therefore these costs are not allocated to our
segments. We expect to substantially complete the initiative by the end of 2025.
For the year ended 2024, we incurred total costs of $221 million related to our global restructuring initiative. The
table below summarizes the activity related to these costs for the year ended December 31, 2024.
(in thousands)
Year Ended December 31, 2024
Cost of goods sold
$
7,487
Restructuring and other costs
213,520
Total costs
$
221,007
In light of evolving business and market conditions, we are expanding our restructuring initiatives and now expect to
incur an additional $150 to $180 million of costs in 2025 as we complete this initiative. In total, we expect to incur
costs of between $370 million and $400 million related to our global restructuring initiative in 2024 and 2025.
The estimated charges that we expect to incur are subject to a number of assumptions, and actual amounts may
differ materially from such estimates. We may also incur additional charges not currently contemplated due to
unanticipated events that may occur, including in connection with the implementation of these initiatives.
(in thousands)
Severance and
other employee
costs
Other
restructuring
costs (1)
Total
Liability as of January 1, 2024
$
— $
— $
—
Restructuring and other costs
90,851
122,669
213,520
Cash payments
(69,739)
(100,433)
(170,172)
Non-cash charges
3,198
(21,311)
(18,113)
Translation
(480)
1
(479)
Liability as of December 31, 2024
$
23,830 $
926 $
24,756
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(1) Amount reflects professional fees, accelerated rent, facility closure costs, moving expenses and asset
impairment costs that are attributable to our restructuring. Amount excludes a $7 million non-cash charge
reflected in cost of goods sold for inventory liquidated rather than moved during facility consolidation in
connection with the restructuring.
18. Subsequent Events
A/R Sales Agreement
On January 3, 2025, GPC amended its A/R Sales Agreement to renew the $1 billion facility for one year. The
benchmark rate, Bloomberg Short-term Bank Yield Index, was replaced with the Secured Overnight Financing Rate.
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ITEM 9.
CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
FINANCIAL DISCLOSURE.
Not applicable.
ITEM 9A.
CONTROLS AND PROCEDURES.
Management’s conclusion regarding the effectiveness of disclosure controls and procedures
As of the end of the period covered by this report, an evaluation was performed under the supervision and
with the participation of our management, including the Chief Executive Officer ("CEO") and Chief Financial Officer
("CFO"), of the effectiveness of our disclosure controls and procedures, as such term is defined in SEC
Rule 13a-15(e). Based on that evaluation, our management, including the CEO and CFO, concluded that our
disclosure controls and procedures were effective, as of December 31, 2024, to ensure that material information
was accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial
Officer, as appropriate to allow timely decisions regarding required disclosure.
Management’s report on internal control over financial reporting
The management of Genuine Parts Company and its Subsidiaries (the “company”) is responsible for
establishing and maintaining adequate internal control over financial reporting as defined in Rule 13a-15(f) under
the Securities Exchange Act of 1934.
Our internal control system was designed to provide reasonable assurance to our management and to the
board of directors regarding the preparation and fair presentation of our published consolidated financial
statements. Our internal control over financial reporting includes those policies and procedures that:
i. pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions
and dispositions of the assets of the company;
ii. provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial
statements in accordance with U.S. generally accepted accounting principles, and that receipts and expenditures of
the company are being made only in accordance with authorizations of management and directors of the
company; and
iii. provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or
disposition of our assets that could have a material effect on the financial statements.
During the year ended December 31, 2024, we acquired Motor Parts & Equipment Corporation ("MPEC") and
have included their balances as of December 31, 2024 in our consolidated balance sheet and the results of their
operations in our consolidated statement of income and comprehensive income. As permitted by the Securities and
Exchange Commission, we elected to exclude this acquisition, which constituted approximately 1.3% of total assets
as of December 31, 2024 and 0.8% of net sales for the year ended December 31, 2024, from our assessment of
internal control over financial reporting as of December 31, 2024. Our integration of the systems and processes of
this business could cause changes to our internal controls over financial reporting in future periods.
All internal control systems, no matter how well designed, have inherent limitations and may not prevent or
detect misstatements. Therefore, even those systems determined to be effective can provide only reasonable
assurance with respect to financial statement preparation and presentation. Also, projections of any evaluation of
effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in
conditions or that the degree of compliance with the policies or procedures may deteriorate.
Our management, including our CEO and CFO, assessed the effectiveness of our internal control over financial
reporting as of December 31, 2024. In making this assessment, it used the criteria set forth by the Committee of
Sponsoring Organizations of the Treadway Commission (2013 framework) ("COSO") in “Internal Control-Integrated
Framework.” Based on this assessment, management concluded that our internal control over financial reporting
was effective as of December 31, 2024.
Changes in internal control over financial reporting
There have been no changes in our internal control over financial reporting during our fourth fiscal quarter
ended December 31, 2024 that have materially affected, or are reasonably likely to materially affect, our internal
control over financial reporting.
The effectiveness of our internal control over financial reporting as of December 31, 2024 has been audited by
Ernst & Young LLP, an independent registered public accounting firm, which also audited our Consolidated Financial
Statements for the year ended December 31, 2024. Ernst & Young LLP's report on our internal control over financial
reporting is set forth below.
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Report of Independent Registered Public Accounting Firm
To the Shareholders and the Board of Directors of Genuine Parts Company
Opinion on Internal Control Over Financial Reporting
We have audited Genuine Parts Company and Subsidiaries’ internal control over financial reporting as of December
31, 2024, based on criteria established in Internal Control—Integrated Framework issued by the Committee of
Sponsoring Organizations of the Treadway Commission (2013 framework) (the COSO criteria). In our opinion,
Genuine Parts Company and Subsidiaries (the Company) maintained, in all material respects, effective internal
control over financial reporting as of December 31, 2024, based on the COSO criteria.
As indicated in the accompanying Management’s report on internal control over financial reporting, management’s
assessment of and conclusion on the effectiveness of internal control over financial reporting did not include the
internal controls of Motor Parts & Equipment Corporation (MPEC), which is included in the 2024 consolidated
financial statements of the Company and constituted 1.3% of total assets as of December 31, 2024 and 0.8% of net
sales for the year then ended. Our audit of internal control over financial reporting of the Company also did not
include an evaluation of the internal control over financial reporting of MPEC.
We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United
States) (PCAOB), the consolidated balance sheets of the Company as of December 31, 2024 and 2023, the related
consolidated statements of income, comprehensive income, equity and cash flows for each of the three years in the
period ended December 31, 2024, and the related notes and our report dated February 21, 2025 expressed an
unqualified opinion thereon.
Basis for Opinion
The Company’s management is responsible for maintaining effective internal control over financial reporting and for
its assessment of the effectiveness of internal control over financial reporting included in the accompanying
Management’s report on internal control over financial reporting. Our responsibility is to express an opinion on the
Company’s internal control over financial reporting based on our audit. We are a public accounting firm registered
with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S.
federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the
PCAOB.
We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and
perform the audit to obtain reasonable assurance about whether effective internal control over financial reporting
was maintained in all material respects.
Our audit included obtaining an understanding of internal control over financial reporting, assessing the risk that a
material weakness exists, testing and evaluating the design and operating effectiveness of internal control based on
the assessed risk, and performing such other procedures as we considered necessary in the circumstances. We
believe that our audit provides a reasonable basis for our opinion.
Definition and Limitations of Internal Control Over Financial Reporting
A company’s internal control over financial reporting is a process designed to provide reasonable assurance
regarding the reliability of financial reporting and the preparation of financial statements for external purposes in
accordance with generally accepted accounting principles. A company’s internal control over financial reporting
includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail,
accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable
assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance
with generally accepted accounting principles, and that receipts and expenditures of the company are being made
only in accordance with authorizations of management and directors of the company; and (3) provide reasonable
assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s
assets that could have a material effect on the financial statements.
Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements.
Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may
become inadequate because of changes in conditions, or that the degree of compliance with the policies or
procedures may deteriorate.
Signature of Ernst & Young LLP
Atlanta, Georgia
February 21, 2025
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ITEM 9B.
OTHER INFORMATION.
During the fiscal quarter ended December 31, 2024, none of our directors or executive officers adopted,
modified or terminated any contract, instruction or written plan for the purchase or sale of Company securities that
was intended to satisfy the affirmative defense conditions of Rule 10b5-1(c) or any “non-Rule 10b5-1 trading
arrangement.”.
ITEM 9C.
DISCLOSURE REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTIONS
Not applicable.
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PART III.
ITEM 10.
DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE.
INFORMATION ABOUT OUR EXECUTIVE OFFICERS.
Executive officers of the company are appointed by the Board of Directors and each serves at the pleasure of
the Board of Directors until his or her successor has been elected and qualified, or until his or her earlier death,
resignation, removal, retirement or disqualification. The current executive officers of the company are:
William P. Stengel, II, age 47, was appointed President and Chief Executive Officer of the company on June 3,
2024. Mr. Stengel previously served as President and Chief Operating Officer of the company from January 2023,
President of the company from January 2021 and Executive Vice President and Chief Transformation Officer of the
company from November 2019. Previously, Mr. Stengel worked for HD Supply, an Atlanta-based industrial
distributor, where he served as President and Chief Executive Officer of HD Supply Facilities Maintenance, from
June of 2017 to October of 2018. Prior to his role as President/CEO, he served as Chief Operating Officer for HD
Supply Facilities Maintenance from September of 2016 to May of 2017 and prior to that role, he served as Chief
Commercial Officer of HD Supply Facilities Maintenance from January of 2016 to September of 2016. Mr. Stengel
served as Senior Vice President, Strategic Business Development and Investor Relations of HD Supply from June
of 2013 to January of 2016. Prior to HD Supply, Mr. Stengel worked in the Strategic Business Development group at
The Home Depot as well as at Bank of America and Stonebridge Associates in various investment banking roles.
Bert Nappier, age 50, was appointed Executive Vice President and Chief Financial Officer on May 2, 2022. Mr.
Nappier served as Executive Vice President, Finance and Treasurer at FedEx Corporation (“FedEx”) from June
2020 to January 2022, where he led teams responsible for corporate finance, cash management, global tax
planning and strategy, risk management and corporate development. Prior to that date, Mr. Nappier served in
various other roles at FedEx, including as President, FedEx Express Europe and Chief Executive Officer, TNT
Express, Senior Vice President, International Chief Financial Officer and Staff Vice President, Staff Vice President
and Corporate Controller. Before joining FedEx in 2005, Mr. Nappier served as Director of SEC Reporting and
Accounting for Wright Medical Technology, Inc. and an Audit Manager at Ernst & Young LLP.
Jenn Hulett, age 45, was appointed New Executive Vice President, Chief People Officer in August 2024. Ms.
Hulett most recently served as Executive Vice President and Chief Human Resources Officer for Dollar Tree, Inc.
from 2022 through 2024, where she oversaw all aspects of human resources, as well as internal and external
communications, community engagement and diversity, equity and inclusion initiatives. Prior to Dollar Tree, Ms.
Hulett served as Executive Vice President and Chief Human Resources Officer at Core-Mark from 2020 through
2022 and, prior to 2020, she held various HR roles at Ericsson and General Electric.
Randall P. Breaux, age 62, was appointed Group President, GPC North America on July 1, 2023. Mr. Breaux
was President of Motion Industries from January 2019 until his appointment to Group President of GPC. Previously,
Mr. Breaux served as Executive Vice President of Marketing, Distribution, and Strategic Planning at Motion from
2018 to 2019 and, Senior Vice President of Marketing, Distribution, and Purchasing from 2015 to 2017. Mr. Breaux
joined Motion in 2011 as Senior Vice President of Marketing, Product Management, and Strategic Planning.
James F. Howe, age 54, was appointed as the President of Motion, the company's industrial business, effective
April 1, 2024. Mr. Howe most recently served as Motion's Executive Vice President and Chief Commercial and
Technology Officer, – with oversight over eCommerce, IT, Sales Excellence, Corporate Accounts, Strategic Pricing
and Human Resources from 2022 to 2024. Mr. Howe played a pivotal role in shaping the corporate trajectory of
Motion. He has more than 30 years of experience in the industrial distribution market. Mr. Howe has held numerous
other management roles since he joined Motion in 1993.
Naveen Krishna, age 57, was appointed Executive Vice President, and Chief Information and Digital Officer on
June 21, 2021. Prior to that date, Mr. Krishna served as Executive Vice President and Chief Technology and
Information Officer at Macy's, Inc. Prior to Macy's, Mr. Krishna was Vice President of Technology for The Home
Depot, Inc. where he was responsible for all digital platforms, user experience design, marketing technologies and
customer care. Previously, he held a variety of roles with Target Corporation, FedEx Office and Print Services, Inc.
and Federal Express Corporation and spent a number of years leading technology consulting engagements with
Deloitte & Touche LLP.
Christopher T. Galla, age 50, was appointed Senior Vice President, General Counsel and Corporate Secretary
on February 13, 2024. Prior to that, Mr. Galla served as Senior Vice President and General Counsel from 2022 to
2024, Vice President and General Counsel from 2020 to 2022, Vice President and Assistant General Counsel from
2015 to 2020, and various other legal roles since he joined the Company in 2005. Mr. Galla spent six years in
private practice before joining the Company.
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Further information required by this item is set forth under the heading “Nominees for Director”, under the
heading “Corporate Governance - Code of Conduct”, under the heading “Corporate Governance - Boar
d Committees - Audit Committee”, and under the heading “Corporate Governanc e - Director Nominating Process”
of the Proxy Statement and is incorporated herein by reference. We have adopted a Code of Conduct, which
is available on the “Investor Relations” section of our website. Any amendments to, or waivers of, the Code of Cond
uct will be disclosed on our website promptly following the date of such amendment or waiver.
ITEM 11.
EXECUTIVE COMPENSATION.
Information required by this item is set forth under the headings “Executive Compensation”, “Additional
Information Regarding Executive Compensation”, “2024 Grants of Plan-Based Awards”, “2024 Outstanding Equity
Awards at Fiscal Year-End”, “2024 Option Exercises and Stock Vested”, “2024 Pension Benefits”, “2024
Nonqualified Deferred Compensation”, “Post Termination Payments and Benefits”, “Compensation, Nominating and
Governance Committee Report”, “Compensation, Nominating and Governance Committee Interlocks and Insider
Participation”, "Policies and Practices Related to the Timing of Equity Awards" and “Compensation of Directors” of
the Proxy Statement and is incorporated herein by reference.
ITEM 12.
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND
RELATED STOCKHOLDER MATTERS.
Certain information required by this item is set forth below. Additional information required by this item is set
forth under the headings “Security Ownership of Certain Beneficial Owners” and “Security Ownership of
Management” of the Proxy Statement and is incorporated herein by reference.
Equity Compensation Plan Information
The following table gives information as of December 31, 2024 about the common stock that may be issued
under all of the company’s existing equity compensation plans:
Plan Category
(a)
Number of Securities to be Issued upon Exercise of Outstanding Options, Warrants and Rights
(1)
(b)
Weighted Average
Exercise Price of Outstanding Options, Warrants and Rights
(c) Number of Securities
Remaining Available for
Future Issuance Under
Equity Compensation
Plans (Excluding Securities
Reflected in Column (a))
Equity Compensation
Plans Approved by
Shareholders:
15,950 (2) $
91.75
—
1,056,898 (3) $
95.97 (5)
6,218,250 (6)
Equity Compensation
Plans Not Approved by
Shareholders:
89,613 (4)
n/a
848,724
Total
1,162,461
—
7,066,974
(1) Reflects the maximum number of shares issuable pursuant to the exercise or conversion of stock options, stock
appreciation rights, restricted stock units and common stock equivalents. The actual number of shares issued
upon exercise of stock appreciation rights is calculated based on the excess of fair market value of our common
stock on date of exercise and the grant price of the stock appreciation rights.
(2) Genuine Parts Company 2006 Long-Term Incentive Plan
(3) Genuine Parts Company 2015 Incentive Plan, as amended
(4) Genuine Parts Company Directors' Deferred Compensation Plan, as amended
(5) The weighted average exercise price of outstanding options, warrants and rights is calculated based solely on
the exercise price of outstanding options and does not take into account outstanding restricted stock units,
which have no exercise price.
(6) All of these shares are available for issuance pursuant to grants of full-value stock awards.
ITEM 13.
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR
INDEPENDENCE.
Information required by this item is set forth under the headings “Corporate Governance — Independent
Directors” and “Transactions with Related Persons” of the Proxy Statement and is incorporated herein by reference.
ITEM 14.
PRINCIPAL ACCOUNTANT FEES AND SERVICES.
78
Information required by this item is set forth under the heading “Ratification of Selection of Independent
Auditors” of the Proxy Statement and is incorporated herein by reference.
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Table of Contents
PART IV.
ITEM 15.
EXHIBITS AND FINANCIAL STATEMENT SCHEDULES.
(a) Documents filed as part of this report
(1) Financial Statements
The following consolidated financial statements of Genuine Parts Company and Subsidiaries are incorporated
in this Item 15 by reference from Part II-Item 8. Financial Statements and Supplemental Data included in this Annual
Report on Form 10-K. See Index to Consolidated Financial Statements.
Report of independent registered public accounting firm on the financial statements
Consolidated balance sheets — December 31, 2024 and 2023
Consolidated statements of income — Years ended December 31, 2024, 2023 and 2022
Consolidated statements of comprehensive income — Years ended December 31, 2024, 2023 and 2022
Consolidated statements of equity — Years ended December 31, 2024, 2023 and 2022
Consolidated statements of cash flows — Years ended December 31, 2024, 2023 and 2022
Notes to consolidated financial statements — December 31, 2024
(2) Financial Statement Schedules
Schedules are omitted because the information is not required or because the information required is
included in the financial statements or notes thereto.
(3) Exhibits
The following exhibits are filed as part of or incorporated by reference in this report. Exhibits that are
incorporated by reference to documents filed previously by the company under the Securities Exchange Act of
1934, as amended, are filed with the Securities and Exchange Commission under File No. 1-5690. The company
will furnish a copy of any exhibit upon request to the company’s Corporate Secretary.
Instruments with respect to long-term debt where the total amount of securities authorized there under does
not exceed 10% of the total assets of the Registrant and its subsidiaries on a consolidated basis have not been
filed. The Registrant agrees to furnish to the Commission a copy of each such instrument upon request.
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Exhibit Number
Description
Exhibit 2.1
Interest Purchase Agreement, by and among Ruby Holdings II, LLC, as the company, Ruby
Topco LLC, as the Seller, Motion Industries, Inc., as the Buyer and Genuine Parts Company,
as the Parent, dated as of December 15, 2021 (Incorporated herein by reference from the
company's annual report on Form 10-K dated February 17, 2022.)
Exhibit 3.1
Amended and Restated Articles of Incorporation of the Company, as amended April 23, 2007.
(Incorporated herein by reference from the company’s current report on Form 8-K, dated
April 23, 2007.)
Exhibit 3.2
By-Laws of the company, as amended and restated November 19, 2018. (Incorporated herein
by reference from the company’s current report on Form 8-K, dated November 19, 2018.)
Exhibit 4.1
Description of Genuine Parts Company common stock.
Exhibit 4.2
Specimen Common Stock Certificate. (Incorporated herein by reference from the company’s
Registration Statement on Form S-1, Registration No. 33-63874.)
Exhibit 4.3
Indenture, dated October 29, 2020, between the company and U.S. Bank National
Association (Incorporated herein by reference from the company’s current report on Form 8-
K, dated October 27, 2020)
Exhibit 4.4
Officer’s Certificate, dated October 29, 2020, pursuant to Sections 3.01 and 3.03 of the
Indenture, dated October 29, 2020, setting forth the terms of the 1.875% Senior Notes due
2030 (Incorporated herein by reference from the company’s current report on Form 8-K,
dated October 27, 2020)
Exhibit 4.5
Form of 1.875% Senior Notes due 2030 (included in Exhibit 4.4)
Exhibit 4.6
Officer’s Certificate, dated January 10, 2022, pursuant to Sections 3.01 and 3.03 of the
Indenture, dated October 29, 2020, setting forth the terms of the 1.750% Senior Notes due
2025 and 2.750% Senior Notes due 2032 (incorporated herein by reference from Exhibit 4.2
to the company’s current report on Form 8-K dated January 10, 2022)
Exhibit 4.7
Form of 1.750% Senior Notes due 2025 (included in Exhibit 4.6)
Exhibit 4.8
Form of 2.750% Senior Notes due 2032 (included in Exhibit 4.6)
Exhibit 4.9
Officer’s Certificate, dated November 1, 2023, pursuant to Sections 3.01 and 3.03 of the
Indenture, dated October 29, 2020, setting forth the terms of the 6.500% Senior Notes due
2028 and 6.875% Senior Notes due 2033 (incorporated herein by reference from the
company’s current report on Form 8-K dated November 1, 2023)
Exhibit 4.10
Form of 6.500% Senior Notes due 2028 (included in Exhibit 4.9)
Exhibit 4.11
Form of 6.875% Senior Notes due 2033 (included in Exhibit 4.9)
Exhibit 4.12
Officer’s Certificate, dated August 9, 2024, pursuant to Sections 3.01 and 3.03 of the
Indenture, dated October 29, 2020, setting forth the terms of the 4.950% Senior Notes due
2029 (Incorporated herein by reference from the company’s current report on Form 8-K dated
August 9, 2024)
Exhibit 4.13
Form of 4.950% Senior Notes due 2029 (included in Exhibit 4.12)
Exhibit 10.1*
The Genuine Parts Company Tax-Deferred Savings Plan, effective January 1, 1993.
(Incorporated herein by reference from the Company’s Annual Report on Form 10-K, dated
March 3, 1995.)
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Exhibit 10.2*
Amendment No. 1 to the Genuine Parts Company Tax-Deferred Savings Plan, dated June 1,
1996, effective June 1, 1996. (Incorporated herein by reference from the company’s Annual
Report on Form 10-K, dated March 7, 2005.)
Exhibit 10.3*
Amendment No. 2 to the Genuine Parts Company Tax-Deferred Savings Plan, dated April 19,
1999, effective April 19, 1999. (Incorporated herein by reference from the company’s Annual
Report on Form10-K, dated March 10, 2000.)
Exhibit 10.4*
Amendment No. 3 to the Genuine Parts Company Tax-Deferred Savings Plan, dated
November 28, 2001, effective July 1, 2001. (Incorporated herein by reference from the
company’s Annual Report on Form 10-K, dated March 7, 2002.)
Exhibit 10.5*
Amendment No. 4 to the Genuine Parts Company Tax-Deferred Savings Plan, dated June 5,
2003, effective June 5, 2003. (Incorporated herein by reference from the company’s Annual
Report on Form 10-K, dated March 8, 2004.)
Exhibit 10.6*
Amendment No. 5 to the Genuine Parts Company Tax-Deferred Savings Plan, dated
December 28, 2005, effective January 1, 2006. (Incorporated herein by reference from the
company’s Annual Report on Form 10-K, dated March 3, 2006.)
Exhibit 10.7*
Amendment No. 6 to the Genuine Parts Company Tax-Deferred Savings Plan, dated
November 28, 2007, effective January 1, 2008. (Incorporated herein by reference from the
company’s Annual Report on Form 10-K, dated February 29, 2008.)
Exhibit 10.8*
Amendment No. 7 to the Genuine Parts Company Tax-Deferred Savings Plan, dated
November 16, 2010, effective January 1, 2011. (Incorporated herein by reference from the
company’s Annual Report on Form 10-K, dated February 25, 2011.)
Exhibit 10.9*
Amendment No. 8 to the Genuine Parts Company Tax-Deferred Savings Plan, dated
December 7, 2012, effective December 7, 2012. (Incorporated herein by reference from the
company’s Annual Report on Form 10-K, dated February 26, 2013.)
Exhibit 10.10*
The Genuine Parts Company Original Deferred Compensation Plan, as amended and
restated as of August 19, 1996. (Incorporated herein by reference from the company’s Annual
Report on Form 10-K, dated March 8, 2004.)
Exhibit 10.11*
Amendment to the Genuine Parts Company Original Deferred Compensation Plan, dated
April 19, 1999, effective April 19, 1999. (Incorporated herein by reference from the company’s
Annual Report on Form 10-K, dated March 10, 2000.)
Exhibit 10.12*
Genuine Parts Company Supplemental Retirement Plan, as amended and restated as of
January 1, 2009. (Incorporated herein by reference from the company’s Annual Report on
Form 10-K, dated February 27, 2009.)
Exhibit 10.13*
Amendment No. 1 to the Genuine Parts Company Supplemental Retirement Plan, as
amended and restated as of January 1, 2009, dated August 16, 2010, effective August 16,
2010. (Incorporated herein by reference from the company’s Annual Report on Form 10-K,
dated February 25, 2011.)
Exhibit 10.14*
Amendment No. 2 to the Genuine Parts Company Supplemental Retirement Plan, as
amended and restated as of January 1, 2009, dated November 16, 2010, effective January 1,
2011. (Incorporated herein by reference from the company’s Annual Report on Form 10-K,
dated February 25, 2011.)
Exhibit 10.15*
Amendment No. 3 to the Genuine Parts Company Supplemental Retirement Plan, as
amended and restated as of January 1, 2009, dated December 7, 2012, effective December
31, 2013. (Incorporated herein by reference from the company’s Annual Report on Form 10-K,
dated February 26, 2013.)
Exhibit 10.16*
Genuine Parts Company Directors’ Deferred Compensation Plan, as amended and restated
effective January 1, 2003, and executed November 11, 2003. (Incorporated herein by
reference from the company’s Annual Report on Form 10-K, dated March 8, 2004.)
Exhibit 10.17*
Amendment No. 1 to the Genuine Parts Company Directors’ Deferred Compensation Plan,
dated November 19, 2007, effective January 1, 2008. (Incorporated herein by reference from
the company’s Annual Report on Form 10-K, dated February 29, 2008.)
Exhibit 10.18*
Amendment No. 2 to the Genuine Parts Company Director’s Deferred Compensation Plan,
dated December 7, 2012, effective December 7, 2012. (Incorporated herein by reference from
the company’s Annual Report on Form 10-K, dated February 26, 2013.)
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Exhibit 10.19*
Genuine Parts Company 2006 Long-Term Incentive Plan, effective April 17, 2006.
(Incorporated herein by reference from the company’s current report on Form 8-K, dated April
18, 2006.)
Exhibit 10.20*
Amendment to the Genuine Parts Company 2006 Long-Term Incentive Plan, dated November
20, 2006, effective November 20, 2006. (Incorporated herein by reference from the
company’s Annual Report on Form 10-K, dated February 28, 2007.)
Exhibit 10.21*
Amendment No. 2 to the Genuine Parts Company 2006 Long-Term Incentive Plan, dated
November 19, 2007, effective November 19, 2007. (Incorporated herein by reference from the
company’s Annual Report on Form 10-K, dated February 29, 2008.)
Exhibit 10.22*
Genuine Parts Company 2015 Incentive Plan, effective November 17, 2014. (Incorporated
herein by reference from the company’s current report on Form 8-K, dated April 28, 2015.)
Exhibit 10.23*
Amendment to the Genuine Parts Company 2015 Incentive Plan, effective April 29, 2024
(Incorporated herein by reference from the company’s definitive proxy statement, dated March
1, 2024.)
Exhibit 10.24*
Genuine Parts Company Performance Restricted Stock Unit Award Agreement. (Incorporated
herein by reference from the company’s quarterly report on Form 10-Q, dated May 7, 2014.)
Exhibit 10.25*
Genuine Parts Company Stock Appreciation Rights Agreement. (Incorporated herein by
reference from the company’s Annual Report on Form 10-K, dated February 26, 2013.)
Exhibit 10.26*
Form of Executive Officer Change in Control Agreement. (Incorporated herein by reference
from the company's Annual Report on Form 10-K, dated February 26, 2015.)
Exhibit 10.27
Genuine Parts Company Note Purchase Agreement dated October 30, 2017 by and among
Genuine Parts Company, J.P. Morgan Securities, LLC and Merill Lynch, Pierce, Fenner &
Smith Incorporated, as agents, and the other Lender Parties. (Incorporated herein by
reference from the company's Annual Report on Form 10-K dated February 27, 2018.)
Exhibit 10.28
First Amendment, dated as of May 28, 2019, to Genuine Parts Company Note Purchase
Agreement dated as of October 30, 2017 by and among Genuine Parts Company and each
holder of Original Notes party thereto (Incorporated herein by reference from the company's
Annual Report on Form 10-K, dated February 19, 2021).
Exhibit 10.29
Second Amendment, dated as of May 1, 2020, to Genuine Parts Company Note Purchase
Agreement dated as of October 30, 2017 by and among Genuine Parts Company and each
holder of Original Notes party thereto. (Incorporated herein by reference to the company’s
quarterly report on Form 10-Q dated July 30, 2020).
Exhibit 10.30*
Genuine Parts Company Form of Restricted Stock Unit Award Certificate. (Incorporated
herein by reference from the company's Annual Report on Form 10-K, dated February 25,
2019.)
Exhibit 10.31*
Genuine Parts Company Form of Performance Restricted Stock Unit Award Certificate.
(Incorporated herein by reference from the company's Annual Report on Form 10-K, dated
February 25, 2019.)
Exhibit 10.32*
Description of Director Compensation (Incorporated herein by reference from the company's
quarterly report on Form 10-Q, dated July 22, 2021).
Exhibit 10.33
Syndicated Facility Agreement dated October 30, 2020 among Genuine Parts Company, UAP,
Inc., and Certain Designated Subsidiaries as Borrowers, JPMorgan Chase Bank, N.A., as
Administrative Agent, Domestic Swing Line Lender and L/C Issuer, JPMorgan Chase Bank,
N.A., acting through its Toronto Branch, as Canadian Swing Line Lender and the other
Lenders and L/C Issuers party thereto. (Incorporated herein by reference from the company's
current report on Form 8-K dated November 2, 2020.)
Exhibit 10.34
First Amendment, dated as of September 30, 2021, to Genuine Parts Company Syndicated
Facility Agreement dated October 30, 2020 among Genuine Parts Company, UAP, Inc., and
Certain Designated Subsidiaries as Borrowers, JPMorgan Chase Bank, N.A., as
Administrative Agent, Domestic Swing Line Lender and L/C Issuer, JPMorgan Chase Bank,
N.A., acting through its Toronto Bank, as Canadian Swing Line Lender and the other Lenders
and L/C Issuers party thereto. (Incorporated herein by reference from the company's quarterly
report on Form 10-Q dated October 21, 2021.)
Exhibit 10.35*
Offer Letter, dated January 21, 2022 (incorporated herein by reference from Exhibit 10.1 to
the company’s current report on Form 8-K dated January 25, 2022)
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Exhibit 10.36*
Separation Agreement and General Release between James R. Neill and Genuine Parts
Company (Incorporated herein by reference from Exhibit 10.1 to the company’s quarterly
report on Form 10-Q dated April 18, 2024.)
Exhibit 10.37*
Consulting Agreement between James R. Neill and Genuine Parts Company, executed April
10, 2024 (Incorporated herein by reference from Exhibit 10.2 to the company’s quarterly
report on Form 10-Q dated April 18, 2024.)
Exhibit 10.38
Third Amendment to Genuine Parts Company Syndicated Facility Agreement, dated as of
November 17, 2023 made by and among Genuine Parts Company, UAP Inc., a corporation
existing under the laws of Quebec (“UAP”), the other Designated Borrowers party to the
Syndicated Facility Agreement (together with the Company and UAP, the Lenders party
hereto, and acknowledged by JPMorgan Chase Bank, N.A., acting through its Toronto branch,
as Canadian Swing Line Lender, and JPMorgan Chase Bank, N.A., as administrative agent
(in such capacity, the “Administrative Agent”) and Domestic Swing Line Lender (Incorporated
herein by reference from Exhibit 10.35 to the company’s annual report on Form 10-K dated
February 22, 2024.)
Exhibit 19
Insider Trading Policy for Employees, Contract and/or Temporary Workers, Officers, and
Directors of Genuine Parts Company (Incorporated herein by reference from Exhibit 10.35 to
the company’s annual report on Form 10-K dated February 22, 2024.)
Exhibit 21
Subsidiaries of the company.
Exhibit 23
Consent of Independent Registered Public Accounting Firm.
Exhibit 31.1
Certification signed by Chief Executive Officer pursuant to SEC Rule 13a-14(a).
Exhibit 31.2
Certification signed by Chief Financial Officer pursuant to SEC Rule 13a-14(a).
Exhibit 32#
Certification Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the
Sarbanes-Oxley Act of 2002, signed by the Chief Executive Officer and Chief Financial Officer
(furnished herewith)
Exhibit 97
Genuine Parts Company Dodd-Frank Clawback Policy (Incorporated herein by reference from
Exhibit 10.35 to the company’s annual report on Form 10-K dated February 22, 2024.)
Exhibit 101.INS
XBRL Instance Document - The instance document does not appear in the interactive data file because its XBRL tags are embedded within the inline XBRL document.
Exhibit 101.SCH
XBRL Taxonomy Extension Schema Document
Exhibit 101.CAL
XBRL Taxonomy Extension Calculation Linkbase Document
Exhibit 101.DEF
XBRL Taxonomy Extension Definition Linkbase Document
Exhibit 101.LAB
XBRL Taxonomy Extension Labels Linkbase Document
Exhibit 101.PRE
XBRL Taxonomy Extension Presentation Linkbase Document
Exhibit 104
The cover page from this Annual Report on Form 10-K for the year ended December 31, 2024
formatted in Inline XBRL
*
Indicates management contracts and compensatory plans and arrangements.
#
Furnished, not filed.
ITEM 16.
FORM 10-K SUMMARY.
Not applicable.
84
Table of Contents
SIGNATURES.
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the Registrant has
duly caused this Report to be signed on its behalf by the undersigned, thereunto duly authorized.
Genuine Parts Company
(Registrant)
Date: February 21, 2025
Signature of William P. Stengel, II
William P. Stengel, II
President and Chief Executive Officer
Date: February 21, 2025
Signature of Bert Nappier
Bert Nappier
Executive Vice President and Chief Financial Officer
(Duly Authorized Officer and Principal Financial and
Accounting Officer)
85
Table of Contents
Pursuant to the requirements of the Securities Exchange Act of 1934, this Report has been signed below by the
following persons on behalf of the Registrant and in the capacities and on the dates indicated.
Signature of William P. Stengel, II
William P. Stengel, II
President and Chief Executive
Officer
2/11/2025
(Date)
Signature of Paul D. Donahue
Paul D. Donahue
Director
Executive Chairman
2/11/2025
(Date)
Signature of Richard Cox, Jr.
Richard Cox, Jr.
Director
2/11/2025
(Date)
Signature of P. Russell Hardin
P. Russell Hardin
Director
2/11/2025
(Date)
Signature of Donna W. Hyland
Donna W. Hyland
Director
2/11/2025
(Date)
Signature of Jean-Jacques Lafont
Jean-Jacques Lafont
Director
2/11/2025
(Date)
Signature of Wendy B. Needham
Wendy B. Needham
Director
2/11/2025
(Date)
Signature of Darren Rebelez
Darren Rebelez
Director
2/11/2025
(Date)
Signature of Bert Nappier
Bert Nappier
Executive Vice President and Chief
Financial Officer
(Duly Authorized Officer and Principal
Financial and
Accounting Officer)
2/11/2025
(Date)
Signature of Elizabeth W. Camp
Elizabeth W. Camp
Director
2/11/2025
(Date)
Signature of Gary P. Fayard
Gary P. Fayard
Director
2/11/2025
(Date)
Signature of John R. Holder
John R. Holder
Director
2/11/2025
Signature of John D. Johns
John D. Johns
Director
2/11/2025
(Date)
Signature of Robert C. Loudermilk, Jr.
Robert C. Loudermilk, Jr.
Director
2/11/2025
(Date)
Signature of Juliette W. Pryor
Juliette W. Pryor
Director
2/11/2025
(Date)
Signature of Charles K. Stevens, III
Charles K. Stevens, III
Director
2/11/2025
(Date)
86
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EXHIBIT 21
SUBSIDIARIES OF THE COMPANY
(as of December 31, 2024)
Subsidiary
Jurisdiction of Incorporation
NATIONAL AUTOMOTIVE PARTS ASSOCIATION, LLC
100.0% GEORGIA
MOTION INDUSTRIES, INC.
100.0%
DELAWARE
UAP INC.
100.0% QUEBEC, CANADA
GPC ASIA PACIFIC HOLDINGS PTY LTD
100.0% VICTORIA, AUSTRALIA
GPC EUROPE AUTOMOTIVE GROUP LTD.
100.0%
LONDON, UNITED KINGDOM
MOTION ASIA PACIFIC PTY LTD
100.0% SOUTH AUSTRALIA, AUSTRALIA
EXHIBIT 23
Consent of Independent Registered Public Accounting Firm
We consent to the incorporation by reference in the following Registration Statements:
(1)
Registration Statement (Form S-8 No. 333-21969) pertaining to the Directors’ Deferred
Compensation Plan of Genuine Parts Company and Subsidiaries,
(2)
Registration Statement (Form S-8 No. 333-133362) pertaining to the 2006 Long-Term Incentive
Plan of Genuine Parts Company and Subsidiaries,
(3)
Registration Statement (Form S-8 No. 333-204390) pertaining to the 2015 Incentive Plan of
Genuine Parts Company and Subsidiaries,
(4)
Registration Statement (Form S-3 No. 333-249625) of Genuine Parts Company, and
(5)
Registration Statement (Form S-3 No, 333-275097) of Genuine Parts Company;
of our reports dated February 21,2025, with respect to the consolidated financial statements of Genuine Parts
Company and Subsidiaries and the effectiveness of internal control over financial reporting of Genuine Parts
Company and Subsidiaries included in this Annual Report (Form 10-K) of Genuine Parts Company for the year
ended December 31,2024.
Signature of Ernst & Young LLP
Atlanta, Georgia
February 21,2025
EXHIBIT31.1
CERTIFICATIONS
1, William P. Stengel, II, certify that:
1. I have reviewed this annual report on Form 10-K of Genuine Parts Company;
2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to
state a material fact necessary to make the statements made, in light of the circumstances under which
such statements were made, not misleading with respect to the period covered by this report;
3. Based on my knowledge, the financial statements, and other financial information included in this report,
fairly present in all material respects the financial condition, results of operations and cash flows of the
registrant as of, and for, the periods presented in this report;
4. The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure
controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control
over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and
have:
a) Designed such disclosure controls and procedures, or caused such disclosure controls and
procedures to be designed under our supervision, to ensure that material information relating to the
registrant, including its consolidated subsidiaries, is made known to us by others within those entities,
particularly during the period in which this report is being prepared;
b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented
in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the
end of the period covered by this report based on such evaluation; and
d) Disclosed in this report any change in the registrant’s internal control over financial reporting that
occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of
an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s
internal control over financial reporting; and
5. The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of
internal control over financial reporting, to the registrant’s auditors and the audit committee of the
registrant’s board of directors (or persons performing the equivalent functions):
a) All significant deficiencies and material weaknesses in the design or operation of internal control
over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record,
process, summarize and report financial information; and
b) Any fraud, whether or not material, that involves management or other employees who have a
significant role in the registrant’s internal control over financial reporting.
Date: February 21,2025
Signature of William P. Stengel, II
William P. Stengel, II
President and Chief Executive Officer
EXHIBIT 31.2
CERTIFICATIONS
1, Bert Nappier, certify that:
1.I have reviewed this annual report on Form 10-K of Genuine Parts Company;
2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to
state a material fact necessary to make the statements made, in light of the circumstances under which
such statements were made, not misleading with respect to the period covered by this report;
3. Based on my knowledge, the financial statements, and other financial information included in this report,
fairly present in all material respects the financial condition, results of operations and cash flows of the
registrant as of, and for, the periods presented in this report;
4. The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure
controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control
over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and
have:
a) Designed such disclosure controls and procedures, or caused such disclosure controls and
procedures to be designed under our supervision, to ensure that material information relating to the
registrant, including its consolidated subsidiaries, is made known to us by others within those entities,
particularly during the period in which this report is being prepared;
b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented
in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the
end of the period covered by this report based on such evaluation; and
d) Disclosed in this report any change in the registrant’s internal control over financial reporting that
occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of
an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s
internal control over financial reporting; and
5. The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of
internal control over financial reporting, to the registrant’s auditors and the audit committee of the
registrant’s board of directors (or persons performing the equivalent functions):
a) All significant deficiencies and material weaknesses in the design or operation of internal control
over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record,
process, summarize and report financial information; and
b) Any fraud, whether or not material, that involves management or other employees who have a
significant role in the registrant’s internal control over financial reporting.
Date: February 21,2025
Signature of Bert Nappier
Bert Nappier
Executive Vice President and Chief Financial Officer
EXHIBIT 32
STATEMENT OF CHIEF EXECUTIVE OFFICER AND CHIEF FINANCIAL OFFICER OF
GENUINE PARTS COMPANY
PURSUANT TO 18 U.S.C. SECTION 1350,
AS ADOPTED PURSUANT T
O Section 906 OF THE SARBANES-OXLEY ACT OF 2002
In connection with the Annual Report of Genuine Parts Company (the “Company”) on Form 10-K for the year ended
December 31, 2024 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Paul
D. Donahue, Chairman and Chief Executive Officer of the Company, and, I, Bert Nappier, Executive Vice President
and Chief Financial Officer of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Sec
tion 906 of the Sarbanes-Oxley Act of2002, that to the best of my knowledge:
1) The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act
ofl934; and
2) The information contained in the Report fairly presents, in all material respects, the financial condition
and results of operations of the Company.
Signature of William P. Stengel, II
William P. Stengel, II
President and Chief Executive Officer
February 21,
2025
Signature of Bert Nappier
Bert Nappier
Executive Vice President and Chief Financial Officer
February 21,
2025
Table of Contents
®
Table of Contents
®
BOARD OF DIRECTORS
Elizabeth W. “Betsy” Camp
President and Chief Executive Officer
of DF Management, Inc.
Richard Cox, Jr.
Senior Vice President -
Airport Customer Service
at Delta Airlines
Paul D. Donahue
Non-Executive Chairman
Gary P. Fayard
Retired Chief Financial Officer
of The Coca-Cola Company
P. Russell Hardin
Trustee of the
Robert W. Woodruff Foundation
John R. Holder
Chairman of Holder Properties
Donna W. Hyland
President and Chief Executive Officer
of Children’s Healthcare of Atlanta
John D. Johns
Retired Chairman and
Chief Executive Officer
of Protective Life Corporation
Jean-Jacques Lafont
Executive Chairman
of Alliance Automotive Group
Robert C. “Robin” Loudermilk, Jr.
President and Chief Executive Officer
of The Loudermilk Companies, LLC
Wendy B. Needham
Retired Managing Director of
Global Automotive Research
at Credit Suisse First Boston
Juliette W. Pryor
Executive Vice President,
Chief Legal Officer and
Corporate Secretary
of Lowe’s Companies, Inc.
Darren M. Rebelez
Chairman, President and Chief Executive
Officer of Casey’s General Stores, Inc.
William P. Stengel, ll
President and Chief Executive Officer
Charles K. Stevens, lll
Retired Executive Vice President
and Chief Financial Officer
of General Motors Company
GLOBAL LEADERSHIP TEAM
William P. Stengel, ll
President and Chief Executive Officer
Herbert C. “Bert” Nappier
Executive Vice President and
Chief Financial Officer
Naveen Krishna
Executive Vice President and
Chief Information and Digital Officer
Jenn M. Hulett
Executive Vice President and
Chief People Officer
Christopher T. Galla
Senior Vice President – General Counsel
and Corporate Secretary
Randall P. Breaux
Group President, GPC North America
James Howe
President, Motion
Alain Masse
President, Canadian Automotive
Franck Baduel
Chief Executive Officer, European Automotive
Rob Cameron
Managing Director and
Group Chief Executive Officer, Australasia
Stock Listing
Genuine Parts Company’s common stock is
traded on the New York Stock Exchange under the
symbol “GPC”.
Stock Transfer Agent, Registrar of Stock,
Dividend Disbursing Agent and Other
Shareholder Services
Communications concerning share transfer
requirements, duplicate mailings, direct deposit
of dividends, lost certificates or dividend checks
or change of address should be directed to
the company’s transfer agent via mail or the
shareholder website provided at the bottom of
this page.
By Regular Mail
Computershare
PO BOX 43006
Providence, RI 02940-3006 UNITED STATES
By Overnight Delivery
Computershare
150 Royall Street
Suite 101
Canton, MA 02021 UNITED STATES
Dividend Reinvestment Plan
Shareholders can build their investments in
Genuine Parts Company through a low-cost plan
for automatically reinvesting dividends and by
making optional cash purchases of the company’s
stock. For plan and enrollment information,
write to the stock transfer agent or visit the plan
website provided at the bottom of this page.
Investor And Media Relations
Investor and media inquiries should be directed to
the following contacts at
678-934-5000:
Investor Contact:
Timothy Walsh
Sr. Director - Investor Relations
Media Contact:
Heather Ross
VP - Global Strategic Communications
Executive Offices
Genuine Parts Company
2999 Wildwood Parkway
Atlanta, Georgia 30339
678-934-5000
Annual Meeting Of Shareholders
The 2025 Annual Meeting will be held at
10:00 a.m. eastern time on April 28, 2025.
Detailed directions on how to access the
meeting can be found in our Notice of 2025
Annual Meeting and Proxy Statement.
Sustainability
In September 2024, we issued our Sustainability
Report, which highlights the strides we have
made in our ongoing journey. We’re committed
to minimizing our environmental impact,
fostering a culture of inclusion, supporting
our communities and operating with integrity
in everything we do. Looking ahead, we are
focused on improving our carbon footprint,
enhancing our supply chain sustainability and
advancing our social impact initiatives. We
invite you to learn more about our progress
on our website.
SHAREHOLDER WEBSITE: www-us.computershare.com/Investor
SHAREHOLDER ONLINE INQUIRIES: www-us.computershare.com/Investor/Contact
DIVIDEND REINVESTMENT PLAN & ENROLLMENT INQUIRIES: www-us.computershare.com/Investor/#DirectStock
OUR PURPOSE
OUR MISSION
Be the Employer
of Choice
Be the Supplier
of Choice
Be a Valued Customer
Be a Good
Corporate Citizen
Be the Investment
of Choice
OUR VISION
Be the leading
global automotive
and industrial parts
distributor and
solutions provider
OUR VALUES
Serve
Perform
Influence
Respect
Innovate
Team
2999 WILDWOOD PARKWAY
ATLANTA, GA 30339
678-934-5000
GENPT.COM