Thu, Apr 24, 5:23 PM (18 days ago)
**LKQ Corporation (LKQ) Q1 2025 Financial Summary** **Financial Health and Performance:** - **Revenue:** $3,463 million, down 6.5% YoY due to organic revenue decrease, foreign exchange fluctuations, and net impact of acquisitions/divestitures. - **Profit Margins:** Gross margin at 39.8%, operating margin at 8.3%, and net margin at 4.9%. - **Cash Flow:** Net cash used in operating activities was $3 million, a decrease from $253 million in Q1 2024. - **Earnings:** Net income of $169 million, up 6.9% YoY. Earnings per share (EPS) were $0.65, up 9.5% YoY. **Segment Performance:** - **Wholesale - North America:** Revenue down 6.0% YoY, Segment EBITDA down 8.6% YoY. - **Europe:** Revenue down 7.4% YoY, Segment EBITDA down 1.4% YoY. - **Specialty:** Revenue down 6.8% YoY, Segment EBITDA down 23.3% YoY. - **Self Service:** Revenue down 2.2% YoY, Segment EBITDA up 25.0% YoY. **Trends and Uncertainties:** - **Revenue Decline:** Driven by organic revenue decrease, foreign exchange fluctuations, and net impact of acquisitions/divestitures. - **Cost Management:** SG&A expenses decreased by 5.3% YoY. - **Restructuring:** Ongoing restructuring plans to enhance profitability, with expected total costs between $130 million and $140 million. - **Market Risks:** Exposure to market risks from adverse changes in foreign exchange rates, interest rates, commodity prices, and inflation. **Future Operations Impact:** - **Liquidity:** $1,289 million in available liquidity as of March 31, 2025. - **Capital Allocation:** Focus on growth-driven capital projects, stockholder value through dividends and share repurchases, and highly synergistic tuck-in acquisitions. - **Debt Management:** Compliance with debt covenants and plans to extend or refinance the $500 million term loan due in January 2026. **Conclusion:** LKQ Corporation faced revenue declines in Q1 2025 due to various factors, including organic revenue decrease and foreign exchange fluctuations. However, the company managed costs effectively and maintained profitability. LKQ continues to focus on strategic initiatives, including restructuring, cost management, and capital allocation, to drive future growth and shareholder value. The company's liquidity position and compliance with debt covenants provide a solid foundation for navigating market uncertainties and pursuing growth opportunities.