Genuine Parts Investor Presentation March 2021 Safe Harbor Statement
FORWARD-LOOKING STATEMENTS: Some of the comments made during this conference call and information contained in our presentation constitute forward-looking statements that are subject to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. All statements in the future tense and all statements accompanied by words such as “expect,” “likely,” “outlook,” “forecast,” “preliminary,” “would,” “could,” “should,”, “position”, “will,” “project,” “intend,” “plan,” “on track,” “anticipate,” “to come,” “may,” “possible,” “assume,” and variations of such words and similar expressions are intended to identify such forward-looking statements. These forward-looking statements include, without limitation, our expected ability to operate and protect our workforce during the COVID-19 pandemic, our strategies for growing our automotive and industrial businesses, the execution and effect of our cost savings initiatives, our efforts and initiatives to help us emerge from the pandemic well-positioned, our ongoing efforts to maintain compliance and flexibility under our debt covenants, our liquidity position and actions to maximize cash flow to continue to operate during these highly uncertain times and plans for future cost savings. The Company cautions that its 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 as a result of various important factors. Such factors may include, among other things, the extent and duration of the disruption to our business operations caused by the global health crisis associated with the COVID-19 outbreak, including the effects on the financial health of our business partners and customers, on supply chains and our suppliers, on vehicle miles driven as well as other metrics that affect our business, and on access to capital and liquidity provided by the financial and capital markets; the Company’s ability to maintain compliance with its debt covenants; the Company's ability to successfully integrate acquired businesses into the Company and to realize the anticipated synergies and benefits; the Company's ability to successfully divest businesses and realize the expected benefits of those divestitures; the Company's ability to successfully implement its business initiatives in its two business segments; changes in demand for the Company's products; the ability to maintain favorable supplier arrangements and relationships; disruptions in our suppliers' operations, including the impact of COVID-19 on our suppliers as well as our supply chain; changes in national and international legislation or government regulations or policies, including changes to import tariffs, short term government subsidies, and the unpredictability of such changes and their impact to the Company and its suppliers and customers, data security policies and requirements as well as privacy legislation; changes in general economic conditions, including unemployment, inflation (including the impact of tariffs) or deflation and the United Kingdom's exit from the European Union and the unpredictability of the impact following such exit; changes in tax laws, regulations, treaties and policies, including the interpretation and enforcement of any of the foregoing; volatile exchange rates; volatility in oil prices; significant cost increases, such as rising fuel and freight expenses; the Company's ability to successfully attract and retain employees in the current labor market; uncertain credit markets and other macroeconomic conditions; competitive product, service and pricing pressures; failure or weakness in our disclosure controls and procedures and internal controls over financial reporting, including as a result of the work from home environment; the uncertainties and costs of litigation; disruptions caused by a failure or breach of the Company's information systems, and the other risks and uncertainties discussed in the Company’s latest SEC filings. The statements are only as of the date they are made, and the Company undertakes no duty to update its forward-looking statements made during this presentation or in these materials except as required by law. Actual results may vary materially and, as such, you are cautioned not to place undue reliance on these forward-looking statements.
NON-GAAP MEASURES: This presentation contains adjusted net income from continuing operations, adjusted diluted earnings per share from continuing operations, adjusted tax rate, adjusted gross profit, adjusted operating and non-operating expenses, net sales excluding divestitures, segment profit excluding divestitures, segment profit margin excluding divestitures, and free cash flow, which are financial measures that are not derived in accordance with United States generally accepted accounting principles ("GAAP"). The Company considers these non- GAAP measures useful to investors because they provide greater transparency into management’s view and assessment of the Company’s core operating performance. These measures are widely used by analysts, investors and competitors in our industry, although our calculation of the measure may not be comparable to similar measures disclosed by other companies, because not all companies and analysts calculate these measures in the same manner. The Company does not, nor does it suggest investors should, consider non-GAAP financial measures superior to, in isolation from, or as a substitute for, GAAP financial information. The Company has included reconciliations of this additional information to the most comparable GAAP measure in the appendix of this presentation.
GPC INVESTOR PRESENTATION | 2 Key Messages
01 Leading global distributor with scale and brand strength to capture market share
Strong track record of strategic acquisitions to drive growth in large, fragmented addressable 02 markets
03 Leverage distribution expertise, efficiencies and shared services across portfolio of businesses
Optimized portfolio and organizational structure for profitable growth in both global Automotive 04 and Industrial
05 Strong balance sheet, cash flow, disciplined capital allocation and history of consistent dividends
Focused on Maximizing Shareholder Value
GPC INVESTOR PRESENTATION | 3 Operating Through the Challenges of COVID-19
Focused on prioritizing the safety and well-being of our employees and their families, customers, suppliers and communities
Remained fully operational to fulfill critical customer needs
Executed with agility through the pandemic, working as one team to quickly and effectively adopt new safety protocols to ensure a safe work environment
Intensified approach to managing operations enabled us to enhance balance sheet strength and flexibility, achieve meaningful cost savings and advance operational excellence
Advanced ESG initiatives, including commitment to diversity and inclusion
Sale of S.P. Richards marks a culmination of a multi-year series of acquisitions and divestitures as part of our strategy to simplify and optimize our portfolio
Working Together As One GPC Team
GPC INVESTOR PRESENTATION | 4 Genuine Parts Company Snapshot (NYSE: GPC)
KEY STATISTICS1 GLOBAL FOOTPRINT 2020 Revenue by Region1,2 Founded 1928 Headquarters Atlanta, GA Countries Served 14 Locations ~10,400 • Warehouses 840 • Distribution Facilities 181 • Retail (Owned/Independent) 9,400 75% Employees ~50,000 North America 15% 10% Market Capitalization ~$14.5B Europe Australasia 2020 FINANCIAL HIGHLIGHTS1
Revenue2 $16.5B • Automotive 66% • Industrial 34%
Segment Profit Margin2 8.2% Free Cash Flow3 ~$1.9B Dividend Yield4 3.1%
Leading Global Distributor in Diversified End Markets
1 2 3 4 As of 12/31/20, Continuing operations Refer to Reconciliation of Non-GAAP measures Calculated based on annual dividend per share divided by share price as of 12/31/20 GPC INVESTOR PRESENTATION | 5 Long Track Record of Disciplined Execution to Drive Profitable Growth
Strong History of Sales 2020 1928 1968 1976 2013 2018 and Profit Growth Founded Begin trading on Acquired Acquired GPC Inenco NYSE: GPC Asia Pacific Rebranding Sales and Profit Have Increased in 87 and 76 Years of 93-Year History, Respectively
2017 Dividend Growth 2019 Acquired 2021 Marks GPC’s 65th Consecutive Year 1925 1948 1975 1998 Acquired 2020 of Dividend Increases Established IPO Acquired Acquired Sold S.P. Richards Sold Auto Todo and EIS
Revenues ($B) Adjusted EBITDA ($M)
$20.0
$17.5 $1,600 $18.0 $16.8 $16.5 $16.3 $1,350 $1,378 $1,378 $15.3 $15.3 $15.3 $1,400 $16.0 $1,290 $1,286 $1,265 $14.1 $1,203 $1,241 $1,137 $14.0 $12.5 $13.0 $1,200 $1,004
$12.0 $11.2 $1,000 $879
$10.0
$800
$8.0
$600
$6.0
$400
$4.0
$200
$2.0 7.8% 8.0% 8.7% 8.5% 8.4% 8.4% 8.1% 7.8% 8.0% 7.9% 8.3%
$0.0 $0 2010 2011 2012 2013 2014 2015 2016 2017 2018* 2019* 2020* 2010 2011 2012 2013 2014 2015 2016 2017 2018* 2019* 2020*
* 2018 – 2020 continuing operations only; all prior years are as originally reported; Adjusted EBITDA for these periods exclude restructuring, inventory adjustment and transaction and other certain costs. These amounts are non-GAAP measures (See Reconciliation of Non-GAAP Measures) 1 2010 adjusted to exclude discontinued and divested operations GPC INVESTOR PRESENTATION | 6 Automotive Snapshot
Business Highlights • Largest global auto parts network Revenue ($B) Adj. Op Income ($B) & Margin (%) • 157 global distribution centers and ~9,500 stores, $12.00 $10.98 20.0% $1,000 30.0% ~2,500 company owned / ~7,000 independents $10.53 $10.86 $854 $868 $900 $832
$10.00 25.0% • 25,000+ global repair center partnerships (AutoCare, $8.04 $8.58 15.0% $800 $715 $720 $700 AutoPro, RAS, GroupAuto), inclusive of 19,500 NAPA $8.00 20.0% North American AutoCare Centers 6.2% 10.0% $600 $6.00 4.8% $500 15.0% • 90% of NA NAPA Sales are private label products 2.1% 5.0% $400 8.8% 8.4% 8.1% 8.0% $4.00 1.3% 7.6% 10.0% • Rolling out the NAPA brand across Europe and -1.2% $300 0.0% $200
$2.00 5.0%
Australasia $100 • Global Sales by segment: $- -5.0% $- 0.0% 2016 2017 2018 2019 2020 2016 2017 2018 2019 2020 ‒ ~80% Commercial / DIFM Revenue % Change Adj. Operating Income Operating Margin ‒ ~20% Retail / DIY
Growth Opportunities Program Partnerships & Major Accounts Select Store & Product Banners • Sales Team Effectiveness • Commercial sales programs and promotions • Improve inventory availability North America • Strengthening supply chain • Omni-channel investments – B2B & B2C • Strategic pricing initiatives • Maximize value of NAPA and other key brands • Expand global footprint Europe 2020 Sales by Region
22% North America Australasia 12% Australasia 66% Europe
GPC INVESTOR PRESENTATION | 7 Industrial Snapshot
Revenue ($B) Adj. Op Income ($B) & Margin (%)
Business Highlights $600
$7.00 $6.30 $6.53 20.0% $487 $481 $482 • Leading industrial parts MRO distributor in North $5.81 $5.68 $500 $440 $6.00 $5.40 15.0% $397
America and Australasia $400 $5.00 9.4% 8.6% • Acquired Mi Asia Pac in July 2019 10.0% 8.5% $4.00 3.2% $300 5.0% 8.1% • Broad network across North America and $3.00 -0.1% $200
Australasia 1 0.0% 7.7% $2.00 -4.5% 7.6% $100 7.4%
-5.0% • 24 distribution centers $1.00
$- • 51 Service Centers $- -10.0% • ~650 branches 2016 2017 2018 2019 2020 2016 2017 2018 2019 2020 • Access to a broad portfolio of 10M+ parts Revenue % Change Adj. Operating Income Operating Margin
Growth Opportunities Industries Served 2020 Sales by Product Category
• Omni-channel buildout / e-commerce acceleration • Equipment & Machinery • Fabricated Metal Products Bearings / Power Transmission 33% • Expand industrial services and solutions capabilities • Food & Beverage • Aggregate & Cement Industrial / Safety Supplies 21% • M&A to further boost products/services offering Processing • Rubber & Plastic Hydraulics / Pneumatics 13% • Enhance pricing and product category management • Pulp & Paper Products Seals, Pumps & Hoses • Network optimization and automation for improved 10% productivity • Iron & Steel • Equipment Rentals / Material Handling 9% Leasing • Automotive Electrical & Automation 8% 2020 Sales by Region • Oil & Gas Extraction • Chemical & Allied Products Linear 3% • Mining • Lumber & Wood Products Misc. Products & Services 3% 7% • Distribution/Logistics Select Customers North America
Australasia 93%
1 Excludes Impact of Divestitures GPC INVESTOR PRESENTATION | 8 The Power of One GPC
Leading Brands
Value Add Synergies
Business Practices Systems Facilities Talent
Technology Transport Freight Global Suppliers
Leveraging Leading Brands, Common Distribution Processes and Logistical Expertise Across Platforms
GPC INVESTOR PRESENTATION | 9 We Strive to be a World-Class Service Organization
Employer of Choice
Supplier of Choice
Valued Customer
Good Corporate Citizen
Investment of Choice
GPC INVESTOR PRESENTATION | 10 Our Transformational Journey…
2021+
2017 - 2020 • Focus on profitable growth and execution of strategic initiatives 2013 • Evolved to two segments: • Further expand North American, Automotive and Industrial Australasian and European operations • Four segments: Automotive, • Expanded operations in Europe in Industrial, Office Products, Electrical addition to North America and • Focus on market leading Australasia automotive and industrial • North American and Australasian businesses operations • Created global transformation office under new leadership • Drive efficient and productive • Expanded distribution footprint cost structure • Strengthened omni-channel capabilities • Enhanced shared services platform across businesses • Increased capabilities in advanced data analytics
Focus on Execution of Strategic Initiatives for our Streamlined Operations
GPC INVESTOR PRESENTATION | 11 Experienced Leadership Team with Deep Industry Expertise
Paul Donahue Carol Yancey Will Stengel Chairman, CEO EVP, CFO President Joined GPC: 2003 1991 2019 Current Role: 2016 2013 2021
Rob Milstead Jim Neill Treg Brown Interim CIO & SVP, Digital EVP, CHRO EVP, M&A 2015 2006 1994 2021 2013 1999
Kevin Herron Alain Masse Frank Baduel President, U.S. Automotive President, Canadian Automotive COO, European Automotive 1983 2011 1999 2019 2015 2020
Rob Cameron Randy Breaux Roger Jowett Managing Director, Australasia Automotive President, North America Industrial President, Australasia Industrial 2003 2011 2014 2017 2019 2019
Driving a Culture of Continuous Improvement, Accountability and Integrity
GPC INVESTOR PRESENTATION | 12 Supportive Board with Diverse Expertise and Experience
Paul Donahue Board Composition (2012) 85% Independent Directors Chairman & CEO Genuine Parts Company 31% Women; 46% Diverse1 7.5 Years Average Tenure Elizabeth Camp Richard Cox, Jr. Gary Fayard Expertise and Experience (2015) (2020) (2014) President & CEO Chief Information Officer Retired CFO DF Management, Inc. Cox Enterprises The Coca-Cola Company CEO / Leadership Position 85%
Government / Regulatory P. Russell Hardin John Holder Donna Hyland 54% (2017) (2011) (2015) President Chairman & CEO President & CEO Robert W. Woodruff Holder Properties Children's Healthcare of Finance and Accounting 46% Foundation Atlanta
Automotive 31% Jean-Jacques Lafont Robert Loudermilk, Jr Wendy Needham (2020) (2010) (2003) Co-Founder & Executive President & CEO Retired Managing Director International 31% Chairman The Loudermilk Global Auto Research Alliance Automotive Companies Credit Suisse First Boston Distribution / Supply 31% Chain John Johns E. Jenner Wood Juliette Pryor (2002) (2014) (2021) Retired Chairman & CEO Retired Executive Vice General Counsel & Legal 31% Protective Life Corporation President Corporate Secretary SunTrust Banks, Inc Albertsons Companies
1 Gender, race, ethnicity, and/or nationality GPC INVESTOR PRESENTATION | 13 Engrained ESG Best Practices Throughout Organization
Responsibility to innovate and provide for our environment, our employees and the communities in which we operate
ESG disclosures, including as human capital management and diversity and inclusion, discussed in 2020 Corporate Sustainability Report Adoption of Human Rights Policy, communicating the Company’s commitment to upholding human rights
Continuous monitoring of environmental metrics including GHG emissions, fuel consumption, and recycling programs
On-going engagement with stakeholder groups to ensure alignment with their expectations
Sustainability initiatives integrated into corporate growth strategy
Commitment to Sustainability and ESG Best Practices
GPC INVESTOR PRESENTATION | 14 Progress in our ESG Journey
Environmental Social Governance
• Completed hundreds of retail location and • Donated time, resources and $5M+ in • Diversity & Inclusion Committee formed to distribution center lighting retrofits 2019 to: advance initiatives supportive of an
offsetting 60M lbs of CO2 (2015-19) ‒ United Way environment built on respect, equality, and ‒ Intrepid Fallen Heroes inclusion • Our fleet management program reduced ‒ City of Hope fuel consumption by 15% saving 1.6 • Formalizing our sustainability governance, ‒ American Cancer Society million gallons of gasoline (2017-19), including ongoing shareholder engagement which reduced carbon emissions by 19% ‒ Starlight Children’s Foundation and routine updates to the Board of Directors • Recycled 6,397 tons of material in 2019 • Provided health and wellness benefits to through comprehensive waste recycling employees, including biometric screenings, • Continued disclosure on ESG topics using program fitness challenges, eLearning modules and the SASB framework counseling/recovery assistance programs • Vendors meet strict supply chain • Safety Council serves as an internal advisory sustainability standards • Increased spend with diverse suppliers group approving policy, actions and by 8% in 2018 from 5,200 diversity supplier communications partners
Published 2020 Sustainability Report Highlighting Significant Progress Made on Our ESG Journey
GPC INVESTOR PRESENTATION | 15 Our Sustainability Commitment
ENERGY FLEET COMMUNITY WATER WASTE PEOPLE
LED lighting conversion Rail vs truck conversion Sustainability Low-flow devices Diversion for waste Training and (18 mpg) ambassadors streams Alternative sources Natural water retention development programs to (solar, battery, wind) Improved fuel economy/ Awareness at local level treatment vs runoff Recycle programs ensure personal growth vehicle selection criteria policy at source 500+ active projects Volunteer support Wellness programs to (10%) programs Usage reduction Packaging conversion/ support physical, 15M BTU Route optimizations programs reduction emotional, and financial reduction (25%) Structured give back health of our employees Reduction of millions of campaigns Closed loop systems Fiber recycle miles Diversity and Inclusion Executive non-profit initiatives to foster an board service environment where there is sense of belonging and all voices are valued
Building a More Sustainable Organization
GPC INVESTOR PRESENTATION | 16 Favorable Long-Term Macro Trends Across Our Businesses
Automotive Industrial
• Total vehicle fleet growth • ISM Purchasing Managers Index • Increasing average age of fleet • Industrial production/Capacity utilization rates Industry Drivers • Affordable gas prices • Capital expenditure budget expansion • Positive long-term growth outlook for miles driven • Manufacturing employment growth in U.S.
• Strengthening industrial economy in 2H 2020 and early 2021 • Solid growth in operating profit and margin expansion in 2020 due to significant cost savings • Solid growth in operating profit and margin expansion North America • B2C on-line sales up 100%+ through the COVID-19 pandemic • Gross margin improvement and cost savings • Positive long-term growth prospects for DIFM and DIY • Strong sales momentum in December 2020 • Positive outlook for NA aftermarket sales in 2021 as markets re- • Expectations for continued recovery in 2021 and positive sales open outlook for the full year
• High-single digit comp growth and significant growth in operating profit in 2020 • Mi Asia Pac performed inline with expectations in first full year of ownership Australasia • B2C on-line sales +300% • Solid growth in operating profit and margin expansion • Positive 2021 outlook • Significant improvement in sales and operating profit in 2H 2020 Europe • European markets recovering following lockdowns and restrictions and positive 2021 outlook
Well-Positioned to Benefit from Economic Recovery
GPC INVESTOR PRESENTATION | 17 Addressable Market of $430B+
Automotive Industrial $230B+ Global Market $200B+ Global Market
6 9 7 10
United States Europe North America Canada 82 125 Australasia Australasia Mexico
190
Regions Market Share Industry Growth Regions Market Share Industry Growth United States 7% +2-3% North America 3% +2-3% Europe 5% +1-2% Australasia 4% +2-3% Canada 14% +2-3% Total 3% +2-3% Australasia 20% +2-3% Mexico 1% +5-6% Total 8% +2-3%
Proven Ability to Consolidate and Grow within Large and Fragmented Markets
GPC INVESTOR PRESENTATION | 18 Sustainable Competitive Advantages
Global Presence Best-in-Class Operating Enhanced and Brand Strength and Distribution Efficiencies Technology Solutions
• Long and Successful Company history • Shared services and technologies • Improved omni-channel capabilities to meet customers’ needs and accelerate • Largest global automotive aftermarket • Automation/Productivity improvements digital growth and industrial businesses • Purchasing scale with shared • Agile development of digital • Expanding the NAPA and Mi brands suppliers across automotive and technologies to innovate our supply globally industrial chains • Strategically co-located facilities • Utilizing the power of data analytics to • Acquisition and integration expertise make better decisions about how we price for our customers
Well Positioned as a Leading Global Distributor
GPC INVESTOR PRESENTATION | 19 Strategic Areas of Focus
Key value drivers – profitable growth, operating leverage, cash conversion and disciplined capital allocation – with the dividend an important part of the GPC capital allocation strategy
Leadership positions in attractive, fragmented markets with scale and capabilities to win; leading global brands and long-standing relationships based on customer service and expertise
Unique culture, based on core values and purpose, serves as important common foundation
Current Priorities – Profitable organic growth, operating productivity, disciplined and strategic capital deployment and investments in talent to develop and build capabilities
Advancing longer-term strategic roadmap and excited for numerous opportunities with new technologies and emerging trends
Align Resources with Priority Focus Areas to Execute Initiatives and Deliver Value as a Team
GPC INVESTOR PRESENTATION | 20 History of Strong Cash Flow Supporting Growth and Capital Allocation
Working Capital
$90.00 85 60% 79 78
$80.00
69 50% Working Capital Initiatives $70.00 61
$60.00 55 40% 47 48 • Sale of accounts receivables $50.00 41 38 30%
$40.00 22% 22% 18% • Sophisticated inventory management $30.00 14% 13% 25 20% 11% 11% 11% 9% $20.00 8% 7% 10% • Extended terms and programs with vendors
$10.00
$- 0% 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 Cash Conversion Cycle (Days) Working Capital (% of Sales) Cost Savings Initiatives • Reinvestment in core businesses to enhance Cash from Operations ($M) efficiencies and productivity • Significant progress in improving cost structure $2,015
Cash Flows $1,057 $1,159 $1,145 $906 $946 $790 $815 $833 • Steady and consistent cash generation $679 $625 • Resilient cash flow in economic downturns
2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020
Driving Improved Working Capital and Strong Cash Flow
GPC INVESTOR PRESENTATION | 21 Strong Balance Sheet and Financial Flexibility
BALANCE SHEET HIGHLIGHTS1 ($B) LIQUIDITY PROFILE1 ($B)DEBT MATURITY SCHEDULE1 ($M)
Cash / Cash Equivalents $1.0 Total Credit Capacity3 $4.6 2.65% 4Q20 Average Interest Rate $865 Accounts Receivable $1.6 Less Total Debt: ($2.7) Inventory $3.5 Unused Credit Capacity $1.9 Total Assets $13.4 Cash $1.0 $428 Accounts Payable $4.1 $394 $367
Total Debt $2.7 Total Available Liquidity $2.9 $248 $215 $160 Total Liabilities $10.2 Working Capital2 $1.2 Total Debt to Adj EBITDA 1.9x ($M) 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030+
• Reduced debt by $749M, or 22%, for 2020 • Total debt to adjusted EBITDA improved to 1.9x from 2.5x as of December 31, 2020 • Improved liquidity to $2.9 billion from $1.3 billion at December 31, 2019
Ample Liquidity and Financial Strength to Support Growth Strategy
1 As of 12/31/2020 2 Working capital is defined as current assets less current liabilities 3 Total credit capacity represents total committed capacity under the revolving credit facility plus the amount of all other debt outstanding GPC INVESTOR PRESENTATION | 22 Disciplined Capital Allocation
Current Priorities 2017-2020 Capital Deployment Reinvestment
• Projecting 2021 CapEx of $275-$325M 9% M&A
18% 37% • Targeting strategic bolt-on acquisitions for 2021
~$4.7B1 Share Repurchases • Reinstating plan for opportunistic share repurchases
Dividend 36% • Announced 2021 annual cash dividend of $3.26 per share, up 3% from 2020 • 65th consecutive year of increased dividends paid to our shareholders
M&A Dividend Reinvestment Share Repurchases
Resuming Normalized Levels of Capital Allocation in 2021
1 Includes proceeds from divestitures. GPC INVESTOR PRESENTATION | 23 Strategic Approach to M&A
Strategic Filters Financial Criteria
Key Product Category Extension Accretive Sales Growth Rates
Market Leadership Accretive to EPS within First Year
Geographic / Market Expansion ROIC at 15% within 3 Years
Post-Synergy Purchase Price Capability Enhancements Multiple Below Our Trading Multiple
Operating and Cost Synergies Financed to preserve Investment Grade rating
Talent Acquisition / Retention Dedicated Investment Committee provides oversight and discipline on capital allocation practices including Capex and M&A
Core Competency with a Proven History of Successful Acquisitive Growth
GPC INVESTOR PRESENTATION | 24 65 Consecutive Years of Dividend Growth
Dividend History $3.26 • 2021 annual dividend of $3.26/share, a 3.2% increase • Consistent 3%+ dividend yield • Targeted payout range of 50% to 55% • Among “2021 Dividend Kings” - with 50+ years of increasing dividends
$0.23
'81 '82 '83 '84 '85 '86 '87 '88 '89 '90 '91 '92 '93 '94 '95 '96 '97 '98 '99 '00 '01 '02 '03 '04 '05 '06 '07 '08 '09 '10 '11 '12 '13 '14 '15 '16 '17 '18 '19 20 21
Strong Track Record of Paying Consistent Dividends
GPC INVESTOR PRESENTATION | 25 Compelling Investment Thesis
Leading global Automotive and Industrial distributor with scale to grow market leading positions in large fragmented 01 markets with favorable long-term trends
Leveraging sustainable competitive advantages including global presence, brand strength, best in class operating and 02 distribution efficiencies and enhanced technology solutions
Solid track record of consistent sales and earnings growth with strategic framework to enhance profitability through 03 increased productivity and margin expansion
04 Streamlined portfolio to focus on key Automotive and Industrial markets with well defined M&A criteria for expansion
Strong balance sheet, ample liquidity and significant free cash flow combined with disciplined capital allocation 05 maximizes shareholder value creation
GPC INVESTOR PRESENTATION | 26 Appendix
GPC INVESTOR PRESENTATION | 27 Segment Data Appendix A
2020 2019 2018 (in thousands) Net sales: Automotive $10,860,695 $10,993,902 $10,533,021 Industrial 5,676,738 6,528,332 6,298,584 Total net sales 16,537,433 17,522,234 16,831,605 Segment profit: Automotive 867,743 831,951 856,014 Industrial 481,854 521,830 487,360 Total segment profit 1,349,597 1,353,781 1,343,374 Interest expense, net (91,048) (91,405) (93,281) Intangible asset amortization (94,962) (92,206) (83,489) Corporate expense (149,754) (140,815) (137,036) Other unallocated costs (634,465) (170,072) (34,930) Income (Loss) before income taxes from continuing operations 379,368 859,283 994,638 Income taxes from continuing operations (215,973) (212,808) (245,104) Net income from continuing operations $ 163,395 $ 646,475 $ 749,534
GPC INVESTOR PRESENTATION | 28 Reconciliation of Non-GAAP Financial Measures Appendix B
Adjusted Net Income from Continuing Operations
2020 2019 2018 (in thousands) GAAP net income (loss) from continuing operations $ 163,395 $ 646,475 $ 749,534
Adjustments: Goodwill impairment charge (1) 506,721 — — Restructuring costs (2) 50,019 142,780 — Realized currency loss on divestitures (3) 11,356 34,701 — Gain on insurance proceeds related to SPR Fire (4) (13,448) — — Gain in equity investment (5) — (38,663) — Inventory adjustment (6) 40,000 — — Transaction and other costs (7) 39,817 31,254 34,930 Total adjustments 634,465 170,072 34,930 Tax impact of adjustments (32,822) (39,704) (10,170) Adjusted net income from continuing operations $ 765,038 $ 776,843 $ 774,294
2020 2019 2018 (in thousands, except per share and per share data) Diluted net income (loss) from continuing operations per common share $ 1.13 $ 4.42 $ 5.09
Adjustments: Goodwill impairment charge (1) 3.49 — — Restructuring costs (2) 0.34 0.98 — Realized currency loss on divestitures (3) 0.08 0.24 — Gain on insurance proceeds related to SPR Fire (4) (0.09) — — Gain in equity investment (5) — (0.26) — Inventory adjustment (6) 0.28 — — Transaction and other costs (7) 0.27 0.20 0.24 Total adjustments 4.37 1.16 0.24 Tax impact of adjustments (0.23) (0.27) (0.07) Adjusted net income from continuing operations $ 5.27 $ 5.31 $ 5.26 Weighted average common shares outstanding — assuming dilution 145,115 146,417 147,241
GPC INVESTOR PRESENTATION | 29 Reconciliation of Non-GAAP Financial Measures (Cont.) Appendix B
Adjusted EBIT and Adjusted EBITDA
2020 2019 2018 (in thousands) GAAP net income (loss) from continuing operations $ 163,395 $ 646,475 $ 749,534 interest expense, net 91,048 91,405 93,281 Income taxes from continuing operations 215,973 212,808 245,104 EBIT 470,416 950,688 1,087,919 Goodwill impairment charge (1) 506,721 — — Restructuring costs (2) 50,019 142,780 — Realized currency loss on divestitures (3) 11,356 34,701 — Gain on insurance proceeds related to SPR Fire (4) (13,448) — — Gain in equity investment (5) — (38,663) — Inventory adjustment (6) 40,000 — — Transaction and other costs (7) 39,817 31,254 34,930 Adjusted EBIT $ 1,104,881 $ 1,120,760 $ 1,122,849
2020 2019 2018 (in thousands) GAAP net income (loss) from continuing operations $ 163,395 $ 646,475 $ 749,534 Depreciation and amortization 272,842 257,263 227,584 interest expense, net 91,048 91,405 93,281 Income taxes from continuing operations 215,973 212,808 245,104 EBITDA 743,258 1,207,951 1,315,503 Goodwill impairment charge (1) 506,721 — — Restructuring costs (2) 50,019 142,780 — Realized currency loss on divestitures (3) 11,356 34,701 — Gain on insurance proceeds related to SPR Fire (4) (13,448) — — Gain in equity investment (5) — (38,663) — Inventory adjustment (6) 40,000 — — Transaction and other costs (7) 39,817 31,254 34,930 Adjusted EBITDA $ 1,377,723 $ 1,378,023 $ 1,350,433
GPC INVESTOR PRESENTATION | 30 Reconciliation Tables Appendix C
Free Cash Flow
Twelve Months Ended December 31, (in thousands) 2020 2019 Net cash provided by operating activities from continuing operations $ 2,014,522 $ 832,519 Purchases of property, plant and equipment (153,502) (277,873) Free Cash Flow $ 1,861,020 $ 554,646
GPC INVESTOR PRESENTATION | 31