STANDARD MOTOR PRODUCTS, INC. Q1 FY2025 earnings call

• Strong Q1 performance with top and bottom lines exceeding expectations; sales up nearly 25% (excluding Nissens, up nearly 5%). - North American aftermarket segments (Vehicle Control and Temperature Control) set all-time first quarter sales records; Vehicle Control up 3.7%, Temperature Control up 24.1%. - Engineered Solutions saw sales down 11.2% but adjusted EBITDA up due to favorable product mix and currency. - Nissens acquisition contributed strongly, with sales and profits exceeding expectations. - Tariff mitigation efforts underway, including working with suppliers, supply chain optimization, and pricing actions to pass through costs.

Vehicle Control: Net sales of $192.3 million in Q1, up 3.7%; adjusted EBITDA 11.6%, up 120 basis points. Temperature Control: Net sales $88.9 million, up 24.1%; adjusted EBITDA 10.6%. Engineered Solutions: Net sales down 11.2%, but adjusted EBITDA 9.7% (up from last year) due to favorable product mix and currency. Nissens Automotive: First full quarter, added $66.2 million net sales and $11.5 million adjusted EBITDA, with 17.3% adjusted EBITDA for the quarter.

• Consolidated net sales increased 24.7% and adjusted EBITDA increased to 10.4% of net sales in Q1. - Full-year 2025 guidance: mid-teens net sales growth, adjusted EBITDA margin 10%-11% of net sales, including Nissens. - Tariff impact not included in current guidance, with intent to pass through tariff costs to customers.

• Tariff uncertainties that could impact cost structure and pricing. - Cyclical nature of the Engineered Solutions segment leading to lumpy customer demand. - Currency fluctuations affecting manufacturing costs and profitability.

Q: Could you size up the POS in Vehicle Control and whether there's an acceleration?

A: POS in Vehicle Control was low-single digits growth in the quarter, with positive gains.

Q: Any relief for Chinese aftermarket parts due to tariff announcements?

A: Announcement is more geared towards automakers, expected to have minimal impact on us.

Q: Cross-pollination wins or growth with Nissens?

A: Nissens continues to perform well, with teams working on catalog expansion, but sales lift expected in 2026.

Q: How does tariff exposure stack up vs competition?

A: Believes manufacturing footprint provides structural advantage over competitors.

Q: European aftermarket trends and Nissens' position?

A: Similar trends to North America with hard failure items outperforming, Nissens well-positioned to benefit.

Q: Q1 orders and tariffs pull-forward?

A: No evidence of pull-forward due to tariffs; Temperature Control preseason orders not related to tariffs.

Q: Retailer response to tariff passes?

A: Negotiations ongoing, but process developed to share mitigation efforts and adjust accordingly.

Q: Current tariff impact in Q1?

A: No significant impact on Q1 numbers, cost impact to come later in the year.

Q: Benefits in Q1 not rolling through and guidance?

A: Pre-season ordering in Temperature Control was an outsized Q1 impact, guidance maintained.

Q: Status of Kansas facility move?

A: Automation project in testing, plan to move product in mid-2025, costs still in $6M-$8M range.