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Auto Recycling eNewsletter
For immediate release - November 2004
Written and published by Mike Gibson and Ron Sturgeon, autosalvageconsultant.com, email to email Mike Gibson
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LKQ Corp cuts Q3, 2004 earns forecast, by Jennifer Inez Ward, Last Updated: 10/14/2004 11:58:00 PM
SAN FRANCISCO (CBS.MW) -- LKQ Corp. cut its third-quarter earnings outlook late Thursday, citing the effect of hurricanes and higher motor fuel prices for the revision. LKQ (LKQX) said it now expects third-quarter earnings to be 20 cents a share. On July 29, the company said it was looking for earnings in the range of 22 cents and 24 cents a share. Analysts polled by Thomson First Call are currently expecting third-quarter earnings of 22 cents a share. The automotive parts company also lowered its 2004 earnings outlook to 88 cents a share to 92 cents a share from a previous range of 92 cents a share to 97 cents a share. Analysts are expecting 2004 earnings of 93 cents a share. "We have been adversely affected by a number of factors, including the hurricanes that disrupted our business and our customers' businesses in Florida and other Eastern seaboard states, the decrease in automobile travel and accidents due to, among other factors, higher gas prices, and the higher costs we have seen to procure replacement parts," said Joe Holsten, the president and chief executive. Ahead of the news Thursday, LKQ shares closed down 24 cents to $17.26.
The stock nose dived following the announcement to a low of $13.28, but has enjoyed a high of over $20.00 in the last 52 weeks. It closed at $17.75 Wednesday, November 11th, close to where it was before the reduced earnings announcement.
LKQ has purchased Portland-based Foster Auto Parts Inc. for $19 million. Foster is a recycled automotive replacement parts business with seven primary locations including three self-service facilities. It has annual revenue of approximately $28 million. The purchaser, publicly traded LKQ Corp., buys wrecked cars at auction and distributes the reusable parts to collision repair shops nationwide. It had 2003 revenue of $328 million and net income of $14.6 million. The company expects 2004 revenue of between $423 million and $427 million, and net income of $19.7 million to $20.8 million. It employs approximately 1,900 people. Joe Holsten, president and CEO of LKQ, said the Foster purchase "significantly adds to our asset base and facilitates our growth in the Oregon and Washington markets."
Interestingly, the purchase price was about 67% of annual sales.
Insurance Auto Swings to 3Q Profit, Associated Press, October 22, 2004, 11:02 AM
Insurance Auto Auctions Inc., a provider of car salvage and claims services, on Friday said it swung a profit for the third quarter ended Sept. 25 on higher revenue from double-digit volume growth. The company earned $3.4 million, or 28 cents per share, after posting a loss of $600,000, or 5 cents, in the year-ago period. In the latest quarter, total revenue was $60.8 million, up 24 percent from $49.1 million last year. Fee income grew 32 percent to $53.3 million, while vehicle sales lagged 15 percent to $7.5 million during the period. Shares of Insurance Auto jumped on the report, rising 3.8 percent, or 66 cents, to $18.17 during recent activity on the NASDAQ.
How’s Business?
“Willingness
to change is a strength, even if it means plunging part of the
Company
into total confusion for a while.”
Jack Welch
In today's business world, nothing is more constant than change. And in our cyber-savvy age ... where major industry changes can occur in the blink of an eye ... nothing is more integral to your organization's continued success than its willingness to embrace change as an opportunity rather than reject it as a threat. There's no time like the present to review the past year, make changes and set some solid goals for your growing business. Give us a call or send us an e-mail, we can help.
AutoSalvageconsultant.com was formed in 2001 to help recyclers improve their businesses. With over 50 years of experience in 3 staff members, the group is THE definitive source for recyclers’ management and training needs. Mike Gibson and Tammy Sturgeon joined the team in 2003, and bring a wealth of experience to the team, plus more resources, as there have been more requests for help than Ron could meet. The founder, Ron Sturgeon is past owner of AAA Small Car World. In 1999, he sold his six Texas locations, with 140 employees, to Greenleaf. In 2001, he founded North Texas Insurance Auction, which he sold to Copart in 2002. In 2002, his book “Salvaging Millions” was published to help small business owners achieve significant success, and was recently reprinted and published in Chinese. In June 2003, he joined the new ownership and management team of GreenLeaf. He also manages his real estate holdings and investments. You can learn more about how to help your business at www.autosalvageconsultant.com. Mike can be reached at 1409 Carson, Haltom City, TX 76117, (preferably) email Mike Gibson, or 817-872-1491.