Net sales increased by 1.4% year-over-year to $5.87 billion in Q1 2025. This growth was primarily a 3.0% benefit from prior-year acquisitions, which largely offset a 0.8% decrease in comparable sales and a 0.8% unfavorable impact from foreign currency.

The company acquired several businesses for approximately $152 million in Q1 2025, following $132 million in acquisitions in Q1 2024. These acquisitions contributed $8 million in Automotive and $13 million in Industrial segment revenue during the quarter, enhancing market reach and customer service capabilities.

Total capital expenditures rose to $119.8 million in Q1 2025, up from $115.7 million in Q1 2024. These investments are specifically directed towards planned technology and supply chain initiatives, supporting long-term growth and efficiency objectives.

Restructuring and other costs decreased by $28 million to $55 million in Q1 2025 compared to $83 million in Q1 2024, reflecting progress on the global restructuring initiative approved in February 2024. These efforts contributed $27 million in benefits, partially offsetting SG&A increases.

Selling, administrative and other expenses (SG&A) increased 8.6% year-over-year to $1.71 billion in Q1 2025, rising to 29.1% of sales from 27.2% in Q1 2024. This increase was primarily due to acquired U.S. automotive stores and cost deleveraging from lower organic sales growth, challenging overall operational efficiency.

The Board approved the termination of the frozen U.S. qualified defined benefit pension plan, effective September 30, 2024. This strategic decision involved adjusting the investment strategy to fully hedge plan obligations, aiming to minimize funded status volatility and de-risk future liabilities.

The U.S. imposed new tariffs in Q1 2025, including an additional 20% on China imports and 25% on Mexico and Canada imports. This dynamic tariff policy environment creates uncertainty and could lead to higher costs, supply chain disruptions, or retaliatory trade measures.

The company reported 2,814 pending asbestos lawsuits as of March 31, 2025, with an accrued liability of $252 million. While insurance receivables cover some costs, the evolving legal environment and potential for adverse developments continue to present a material risk.

The 21.9% decline in net income was primarily attributed to softer market conditions and one less selling day in the U.S. The Purchasing Managers' Index (PMI) also showed mixed signals, contracting in March after early Q1 improvement, indicating an uncertain operating environment.

The company's gross margin improved by 120 basis points to 37.1% year-over-year, driven by successful strategic pricing and sourcing initiatives. This indicates an ability to maintain or improve profitability despite a challenging market and competitive pressures.

Automotive comparable sales decreased by 0.8% in Q1 2025, primarily due to one less selling day in the U.S. This led to a 10.7% decline in Automotive EBITDA to $285.5 million and a decrease in EBITDA margin to 7.8% from 8.9%, highlighting challenges in organic growth.

The Industrial segment's EBITDA remained flat year-over-year at $278.7 million, despite a 0.4% sales decline and one less selling day. This performance highlights effective cost management and benefits from global restructuring efforts, maintaining profitability in an uncertain economic environment.

The global restructuring initiative, approved in February 2024, resulted in a $28 million year-over-year decrease in restructuring and other costs to $55 million in Q1 2025. These efforts contributed $27 million in benefits, helping to offset other expense increases and improve the overall cost structure.

Selling, administrative and other expenses (SG&A) as a percentage of sales increased to 29.1% in Q1 2025 from 27.2% in Q1 2024. This rise was primarily due to increased personnel and rent costs from acquired U.S. automotive stores and cost deleveraging from lower organic sales growth, indicating a decline in operational leverage.

Depreciation and amortization expenses increased by $25 million year-over-year in Q1 2025. This increase is directly related to planned investments in technology and supply chain initiatives, indicating a commitment to modernizing operational infrastructure for long-term efficiency gains.

Depreciation and amortization expenses rose by $25 million year-over-year in Q1 2025, reflecting planned investments in technology initiatives. This highlights the company's commitment to modernizing its supply chain and operational capabilities.

Corporate EBITDA loss increased to $(91.1) million in Q1 2025, partly due to ongoing investments in technology. This indicates a strategic allocation of resources towards digital transformation efforts and enhancing company-wide functions.

Management explicitly states a strategic priority to 'modernize our supply chain and technology through digital innovation, and data-driven strategies to enhance our competitive edge.' This forward-looking statement underscores a commitment to leveraging technology for future growth.

The company amended its Unsecured Revolving Credit Facility and Commercial Paper Program in March 2025, expanding borrowing capacity for both to $2.0 billion each. This provides significant undrawn capacity and liquidity, enhancing the company's ability to fund operations and strategic initiatives.

The Board approved a 3% increase in the regular quarterly cash dividend for 2025, bringing the annual rate to $4.12 per share. This marks the 69th consecutive year of increased dividends, demonstrating a consistent return of capital to shareholders and confidence in future cash flow generation.

Net cash used in investing activities totaled $155 million in Q1 2025, including $74.1 million for acquisitions and $119.8 million in capital expenditures. In contrast, no stock repurchases were made during the quarter, indicating a strategic focus on reinvestment and growth initiatives.

The Board approved the termination of the frozen U.S. qualified defined benefit pension plan, effective September 30, 2024. This action, coupled with an adjusted investment strategy to fully hedge plan obligations, demonstrates responsible governance and commitment to employee benefits.

The company continues to manage 2,814 pending asbestos lawsuits and maintains an accrued liability of $252 million as of March 31, 2025. This reflects a commitment to addressing historical social responsibility issues through active monitoring and estimation of costs.

The CEO and CFO concluded that disclosure controls and procedures were effective as of March 31, 2025, providing reasonable assurance that required information is recorded, processed, summarized, and reported accurately. This indicates robust governance practices.

The company's Q1 2025 performance was impacted by a 'challenging operating environment,' with net sales growth of 1.4% partially offset by a 0.8% decrease in comparable sales and one less selling day in the U.S., reflecting broader market softness.

The Purchasing Managers' Index (PMI) showed sequential improvement in early Q1 2025 but contracted in March, indicating an uncertain outlook for the industrial segment. This volatility contributes to the company's cautious stance on its 2025 outlook.

The filing highlights ongoing geopolitical conflicts (e.g., Russia-Ukraine, Gaza) and new U.S. tariffs on imports from China (20%), Mexico, and Canada (25%) as significant external factors. These risks could materially affect future results through higher costs or supply chain disruptions.