LKQ Corp. today reported fourth quarter and full year 2023 financial results.
“The fourth quarter was a strong finish to a successful year for LKQ. I am proud of how the entire team worked through challenging macroeconomic conditions, persistent inflation and declining commodity prices to deliver solid organic revenue growth, year over year improvement in Segment EBITDA, and strong cash flow generation. I look forward to collaborating with Justin Jude, my successor as chief executive officer, over the coming months to continue enhancing LKQ’s industry leading business,” stated Dominick Zarcone, president and CEO.
“Operational excellence will remain at the forefront in 2024 as we look to drive organic revenue growth, productivity, strong margins and excellent free cash flow,” said Justin Jude, executive vice president and chief operating officer.
Fourth quarter and full year 2023 financial results:
Revenue for the fourth quarter of 2023 was $3.5 billion, an increase of 16.6% compared to $3 billion for the fourth quarter of 2022. For the fourth quarter of 2023, parts and services organic revenue increased 2.8% (3.4% on a per day basis), foreign exchange rates increased revenue by 2.7% and the net impact of acquisitions and divestitures increased revenue by 13.1% year over year, for a total parts and services revenue increase of 18.7%. Other revenue for the fourth quarter of 2023 fell 16.4% primarily due to weaker precious metals prices relative to the same period in 2022.
Net income for the fourth quarter of 2023 was $184 million compared to $193 million for the same period of 2022. Diluted earnings per share2 for the fourth quarter of 2023 was $0.69 compared to $0.72 for the same period of 2022, a decrease of 4.2%.
Revenue for the full year of 2023 was $13.9 billion, an increase of 8.4% compared to $12.8 billion for the full year of 2022. For the full year of 2023, parts and services organic revenue increased 4.7% (5.1% on a per day basis), foreign exchange rates increased revenue by 0.9% and the net impact of acquisitions and divestitures increased revenue by 4.8% year over year, for a total parts and services revenue increase of 10.4%. Other revenue for the full year of 2023 fell 19.6% primarily due to weaker commodity prices relative to 2022.
Net income for the full year of 2023 was $0.94 billion compared to $1.14 billion for the same period of 2022. Diluted earnings per share for the full year of 2023 was $3.51 compared to $4.11 for the same period of 2022, a decrease of 14.6%.
On Feb. 20, the Board of Directors declared a quarterly cash dividend of $0.30 per share of common stock, payable on March 28 to stockholders of record at the close of business on March 14.
“Our annual guidance reflects our emphasis on profitable revenue growth and free cash flow generation. We expect organic revenue growth from each of our operating segments. We also believe that in 2024, our margin enhancement initiatives will boost profitability, including a return to double digit Europe Segment EBITDA margins,” said Rick Galloway, senior vice president and chief financial officer.
For 2024, management is anticipating the following outlook:
“Our outlook for the full year 2024 is based on current conditions and recent trends, and assumes a global effective tax rate of 26.8%, the prices of scrap and precious metals hold near the December average, and no further deterioration due to the Ukraine/Russia conflict.”
