Antioch, Tennessee-based LKQ Corp., an automotive dismantling and parts firm, says its third quarter 2024 revenue of $3.6 billion marks a 0.5 percent increase compared with the same period in 2023. The company’s net income of $192 million, however, was down by 7.7 percent compared with the $207 million earned in the summer months of 2024.
“Our third quarter results reflect softer overall volumes,” says Justin Jude, president and CEO of LKQ. “Our focus on managing our operating expenses is critically important, especially in a period when the top line is facing uncontrollable market headwinds.”
Adds the CEO, “We remain confident in the long-term earnings potential of our businesses as we navigate short-term industry dynamics and a difficult macro-economic environment that will continue to affect the business in the fourth quarter.”
Year to date after nine months, LKQ has posted revenue of just under $11 billion, a 6.1 percent increase from the $10.365 billion in revenue garnered in the first nine months of 2023.
The company’s year-to-date net income of $536 million, however, is down by 29.5 percent compared with $760 million it earned from January through September of 2023.
In its most recently completed quarter, LKQ says its “parts and services organic revenue” decreased 2.8 percent, but “the net impact of acquisitions and divestitures increased revenue by 3.1 percent.”
Adds LKQ, “Other revenue fell 2.2 percent primarily due to lower commodities prices and volumes relative to the same period in 2023,” likely referring to prices in the ferrous scrap market into which it sells its auto hulks.
In comments accompanying its results, LKQ mentions two divestments in Europe. “In July 2024, we divested our operations in Poland to Mekonomen and we closed on the divestiture of our Bosnia operations in September 2024,” writes the company.
Looking ahead, LKQ’s chief financial officer Rick Galloway comments, “The revenue headwinds we experienced across our global operations have been more impactful than projected in our prior guidance, and we currently do not expect these headwinds to abate in the fourth quarter.”
He adds, “We are holding [to] our prior cash flow guidance despite the decrease in profitability as we expect to mitigate the impact through working capital and capital expenditure management.”
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