Standard Motor Products, Inc. Q4 FY2025 earnings call

• Strong performance continued into Q4 with top line growth. • All segments performed well: North American Vehicle Control had strong sales despite wire set decline; Temperature Control had robust sales with elongation of air conditioning season and success of A/C kit program; Nissens Automotive had strong sales and adjusted EBITDA margin in first full year of ownership; Engineered Solutions saw sequential improvement after sluggish demand. • Tariff-related costs in Q4 offset by price, and diverse global footprint provides competitive advantage. • Identified material weakness in internal controls in Nissens segment over financial reporting related to general information technology controls, and taking action to remediate.

North American Vehicle Control: Net sales $193.7 million in Q4, up 3.3%; adjusted EBITDA even with last year at 11.1%. Temperature Control: Net sales $61.5 million in Q4, up 5.9%; adjusted EBITDA 13% in Q4. Nissens Automotive: Q4 net sales $64 million, adjusted EBITDA 10.1% of net sales; full-year adjusted EBITDA margin 15.9%. Engineered Solutions: Q4 sales up 6.3%, adjusted EBITDA up from last year. Overall top line grew over 12% in quarter and over 22% for year, excluding Nissens up about 4% for quarter and year.

• Expect sales growth in 2026 in low- to mid-single-digit percentage range driven by momentum in North America and Europe and stable Engineered Solutions segment. • Adjusted EBITDA margin outlook 11% - 12% of net sales, considering margin benefits of sales growth, tariff pass-through, and business investment. • Total operating expenses inclusive of factoring expected $106 million - $114 million each quarter in 2026. • Interest expense expected about $30 million for full year 2026; depreciation and amortization to increase to $45 million - $50 million. • Seasonal aspect to business with Temp Control products, Q1 2026 to face difficult comp due to large Q1 2025 growth, so focus on first half of year sales cadence.

• Material weakness in internal controls in Nissens segment over financial reporting related to general information technology controls. • Uncertainty in U.S. tariffs on imported goods and their impact on business. • Supply chain complexity which could affect operations.

Q: In Vehicle Control, about filter or POS being in line with first three quarters, ask about growth outside wire.

A: Vehicle Control offering is broad, expanding categories with SKU opportunities and replacement rates on newer technologies.

Q: Talk about cross-selling, new customers, cross-pollination of products.

A: Looked at gaps to expand coverage, added categories like ignition coils, excited about complementary categories.

Q: On cost side, still comfortable with $8M - $12M run-rate savings by 2026?

A: Comfortable, ahead of plan, savings spread across enterprise.

Q: Timing of remediation of internal control issue in Europe?

A: Making good progress, will update as soon as can.

Q: Color on cooling season in Temperature Control?

A: Ongoing good preseason order requirements, inventories tracking with sales readiness.

Q: Can be private label supplier via Nissens and pick up share if distributors gain share with private label?

A: Do some private label, emphasize brands, will capitalize on opportunities if they arise.

Q: Opportunity for tariff rebate collection?

A: Unclear, same boat as others, will avail of opportunities if arise