Napa Auto Parts 2014 Annual Report Download - page 26

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Net sales for Automotive were $7.5 billion in 2013, an increase of 18.5% from 2012. The increase in sales
for the year was primarily due to the April 1, 2013 acquisition of GPC Asia Pacific, formerly Exego, and the
May 1, 2012 acquisition of Quaker City Motor Parts Co. (“Quaker City”). Combined, these acquisitions con-
tributed approximately 15% to sales. Additionally, Automotive achieved a positive comparable store sales
increase of approximately 4%, offset slightly by the 0.5% negative impact of currency associated with our Cana-
dian business. Automotive sales were not materially impacted by product inflation or the effect of currency asso-
ciated with our Mexican businesses. In 2013, Automotive revenues were up 3% in the first quarter, then up 22%
in the second and third quarters and up 25% in the fourth quarter.
Industrial Group
Net sales for Motion Industries, our Industrial Group (“Industrial”), were $4.8 billion in 2014, an increase of
8% from 2013. Sales volumes in Industrial were up approximately 4.5% from the prior year, while higher trans-
action values associated with product inflation added 1.5% and acquisitions contributed approximately 3% to
sales in 2014. These items were offset by a 1% negative impact of currency associated with our Canadian busi-
ness. Industrial revenues were up 4% in the first quarter of 2014, up 7% in the second quarter and up 10% in the
third and fourth quarters. We expect the internal growth initiatives and relatively healthy industry conditions to
provide us additional growth opportunities for our Industrial business in 2015.
Net sales for Industrial were $4.4 billion in 2013, down slightly compared to 2012. Sales volumes in this
business were down approximately 1% from the prior year, while higher transaction values associated with prod-
uct inflation added 1% to sales in 2013. The slight positive impact on sales from acquisitions was offset by the
slight negative impact of currency associated with our Canadian business. Industrial revenues were down 2% in
the first quarter of 2013, down 1% in the second quarter, down 2.5% in the third quarter and up 3% in the fourth
quarter of 2013.
Office Group
Net sales for S. P. Richards, our Office Products Group (“Office”), were $1.8 billion in 2014, an increase of
10% from 2013. The increase in sales reflects a 4% increase in sales volume, a 1.4% increase in higher trans-
action values associated with price inflation and a 5% contribution from acquisitions. These items were offset by
the slight negative impact of currency associated with our Canadian operations. In 2014, Office experienced
improving industry conditions, as evidenced by consistently stronger new jobs reports relative to 2013 as well as
a strengthening U.S. GDP. These conditions combined with new business with a primary customer, effective
July 1, 2014, served to drive the increased sales volume for the year. Sales were unchanged in the first quarter, up
4% in the second quarter, up 15% in the third quarter and up 22% in the fourth quarter of 2014. We will continue
to focus on our growth initiatives, including the ongoing diversification of product and customer portfolios,
market share gains and acquisitions to further improve the Office business in 2015.
Net sales for Office were $1.6 billion in 2013, a 3% decrease in sales from 2012. The industry-wide weak-
ness in office products consumption, driven by the ongoing elevated levels of white collar unemployment, and
the declining demand for paper and paper- based office products due to workplace digitization, continued to
pressure this segment throughout 2013. Overall, sales volume in Office declined by approximately 3.5% for the
year, offset by the benefit of slightly higher transaction values associated with price inflation of 0.5%. Sales
decreased by 1% in the first quarter, 3% in the second and third quarters and 4% in the fourth quarter of 2013.
Electrical/Electronic Group
Net sales for EIS, our Electrical and Electronic Group (“Electrical/Electronic”), were $739 million in 2014,
an increase of 30% from 2013. The increase in sales consists of an increase in sales volume of approximately 1%
and a 29% sales contribution from acquisitions. The benefit of higher transaction values associated with slight
price inflation for the year was offset by the negative sales impact of copper pricing. Sales for Electrical/
Electronic increased by 30% in the first quarter, 32% in the second quarter, 35% in the third quarter and 23% in
the fourth quarter. We expect a gradually improving customer climate to support stronger underlying sales
growth for the Electrical/Electronic business in 2015.
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