dorm-10q_20220326.htm

Large accelerated filer

Accelerated filer

Non-accelerated filer

Smaller reporting company

Emerging growth company

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

(Mark One)

☒	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 26, 2022

☐	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

Commission file number: 0-18914

Dorman Products, Inc.

(Exact name of registrant as specified in its charter)

Pennsylvania		23-2078856
(State or other jurisdiction of		(I.R.S. Employer
incorporation or organization)		Identification No.)

3400 East Walnut Street, Colmar, Pennsylvania		18915
(Address of principal executive offices)		(Zip Code)

(215) 997-1800

(Registrant’s telephone number, including area code)

N/A

(Former name, former address and former fiscal year, if changed since last report)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class		Trading Symbol(s)		Name of each exchange on which registered
Common stock, par value $0.01 per share		DORM		NASDAQ Global Select Market

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. ☒ Yes ☐ No

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). ☒ Yes ☐ No

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). ☐ Yes ☒ No

As of April 21, 2022 the registrant had 31,448,214 shares of common stock, par value $0.01 per share, outstanding.

DORMAN PRODUCTS, INC. AND SUBSIDIARIES

INDEX TO QUARTERLY REPORT ON FORM 10-Q

March 26, 2022

		Page
PART I — FINANCIAL INFORMATION

ITEM 1.	Financial Statements (unaudited)

	Condensed Consolidated Statements of Operations	3

	Condensed Consolidated Balance Sheets	4

	Condensed Consolidated Statements of Shareholders’ Equity	5

	Condensed Consolidated Statements of Cash Flows	6

	Notes to Condensed Consolidated Financial Statements	7

ITEM 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	14

ITEM 3.	Quantitative and Qualitative Disclosures About Market Risk	20

ITEM 4.	Controls and Procedures	20

PART II — OTHER INFORMATION

ITEM 1.	Legal Proceedings	22

ITEM 1A.	Risk Factors	22

ITEM 2.	Unregistered Sales of Equity Securities and Use of Proceeds	22

ITEM 3.	Defaults Upon Senior Securities	22

ITEM 4.	Mine Safety Disclosures	22

ITEM 5.	Other Information	23

ITEM 6.	Exhibits	23

Exhibit Index		24

Signatures		25

PART I. FINANCIAL INFORMATION

ITEM 1. Financial Statements

DORMAN PRODUCTS, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(UNAUDITED)

	Three Months Ended
(in thousands, except per share data)	March 26, 2022			March 27, 2021
Net sales	$	401,579		$	288,012
Cost of goods sold		268,339			183,492
Gross profit		133,240			104,520
Selling, general and administrative expenses		86,528			62,869
Income from operations		46,712			41,651
Interest expense, net		1,231			121
Other income, net		(84	)		(85	)
Income before income taxes		45,565			41,615
Provision for income taxes		10,358			8,885
Net income	$	35,207		$	32,730
Other comprehensive income:
Change in foreign currency translation adjustment	$	1,696		$	—
Comprehensive Income	$	36,903		$	32,730

Earnings per share:
Basic	$	1.12		$	1.02
Diluted	$	1.11		$	1.02
Weighted average shares outstanding:
Basic		31,499			32,048
Diluted		31,601			32,184

See accompanying Notes to Condensed Consolidated Financial Statements

DORMAN PRODUCTS, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

(UNAUDITED)

(in thousands, except for share data)	March 26, 2022		December 25, 2021
Assets
Current assets:
Cash and cash equivalents	$	53,427	$	58,782
Accounts receivable, less allowance for doubtful accounts of $1,357 and $1,326		456,070		472,764
Inventories		565,200		531,988
Prepaids and other current assets		13,507		13,048
Total current assets		1,088,204		1,076,582
Property, plant and equipment, net		116,225		114,864
Operating lease right-of-use assets		98,149		59,029
Goodwill		198,110		197,332
Intangible assets, net		176,088		178,809
Other assets		47,525		46,503
Total assets	$	1,724,301	$	1,673,119
Liabilities and shareholders’ equity
Current liabilities:
Accounts payable	$	165,840	$	177,389
Accrued compensation		16,616		26,636
Accrued customer rebates and returns		195,289		188,080
Revolving credit facility		229,360		239,360
Other accrued liabilities		45,513		33,583
Total current liabilities		652,618		665,048
Long-term operating lease liabilities		88,881		52,443
Other long-term liabilities		5,450		4,916
Deferred tax liabilities, net		17,952		17,976
Commitments and contingencies (Note 8)
Shareholders’ equity:
Common stock, $0.01 par value; 50,000,000 shares authorized; 31,479,916 and 31,607,509 shares issued and outstanding in 2022 and 2021, respectively		315		316

SEC Form 10-Q filed by Dorman Products Inc.