Good day. Thank you for standby. Welcome to the Motorcar Parts of America's Fiscal 2021 Fourth Quarter Year End Conference Call. At this time, all participants are in listen-only mode. Later, we will conduct a question-and-answer session and instructions will follow at that time. [Operator Instructions] As a reminder, this conference call is being recorded.

I would now like to turn the call over to Gary Maier, Investor Relations. Please go ahead.

Gary S. Maier - Vice President, Corporate Communications and Investor Relations

Thank you. Thank you, Charlie. Thanks. Thanks everyone for joining us for our call today. Before we begin and I turn the call over to Selwyn Joffe, Chairman, President and Chief Executive Officer and David Lee, the Company's Chief Financial Officer, I'd like to remind everyone of the Safe Harbor statement included in today's press release. The Private Securities Litigation Reform Act of 1995 provides a safe harbor for certain forward-looking statements, including statements made during today's conference call. Such forward-looking statements are based on the Company's current expectations and beliefs concerning future developments and their potential effects on the Company. There can be no assurance that future developments affecting the Company will be those anticipated by Motorcar Parts of America. Actual results may differ from those projected in the forward-looking statements. These forward-looking statements involve significant risk and uncertainties, some of which are beyond control of the Company and are subject to change based upon various factors. The Company undertakes no obligation to publicly update or revise any forward-looking statements whether as a result of new information, future events or otherwise. For a more detailed discussion of some of the ongoing risks and uncertainties of the business, I refer you to the Company's various filings with the Securities and Exchange Commission.

With that, I would like to begin the call and turn the call over to Selwyn for some remarks.

Selwyn Joffe - Chairman, President and Chief Executive Officer

Thank you, Gary. I appreciate everyone joining us today for our year-end call. I hope everyone is safe and healthy and starting to venture out as vaccinations are more readily available. We are excited to be able to resume personal interaction with our customers and team members.

As noted in this morning's press release, we achieved record sales for our fiscal fourth quarter and full year notwithstanding the sharp drop in the first quarter of fiscal 2021. Equally significant, net income was up sharply for both periods and the new fiscal year is off to a strong start with strong demand for our products.

I will now address our Company's current position and outlook for our business and then David will then address our financial results in detail. The outlook for hard parts replacement continues to be positive and we are excited about the Company's position in the market. In addition, the electric vehicle marketplace is fast evolving and our electric vehicle subsidiary should substantially benefit from the momentum. Let me provide some color to these dynamics.

Demand for automotive hard parts is strong as drivers return to the roads. The availability of vaccines across the country is clearly helping and it appears that people are getting back to more normal routines and rely on their vehicles for everyday activities and vacation travel.

Overall, we are benefiting from our investments from multi-growth platforms in our hard parts business. We expect each of our product lines to grow and we are focused on meeting the increased demand in all categories. Our newest product line, brake calipers, continues to gain traction and we are focused on meeting the increasing demand in the brake category. The market for our current categories for internal combustion engines represents more than $6 billion at the retail level. There are approximately 287 million vehicles on the road with an average age of 12.1 years in the United States alone which fuels our optimism about the growth opportunities in our aftermarket hard parts business. This will fuel growth in aftermarket parts replacement industries well beyond 2030.

You've heard me say before that people are keeping their vehicles longer. In recent months news reports have indicated that used car sales are at record levels resulting in increased miles driven by OKVs, our kind of vehicle. Obviously, this bodes well for the aftermarket parts replacement industry and our nondiscretionary product offerings. And in fact, we are seeing demand increase.

As these vehicles age, the rate of replacement of parts increases substantially. For example cars in the zero to three year age group have a replacement rate for alternators of 2.42% compared with 6.65% in the 12-year-and-above age group. Though new car sales should return at some point, we expect to benefit because used car scrap rates are lower than new car sales, resulting in an increase in the average age and the number of cars on the road, generating further increases in demand for parts replacement. Of course, any new car sales will drive aftermarket - after aftermarket parts replacement in the future.

As I emphasized last quarter, our facility expansion in Malaysia is now complete and we are focused on utilizing this increased capacity and productivity across multiple product lines to reduce dependence on outsourcing. While COVID and related supply chain challenges continue in Malaysia and throughout Asia, we see tremendous opportunities to leverage our presence in Malaysia and support our customers. In short, our strategy before and since the pandemic has been to leverage our significant channel relationships for aftermarket parts and offer superior parts and solutions to our customers and consumers.

We are equally excited about our opportunities in the EV space. Our strategic position in the EV space is gaining momentum. For example, let me highlight several exciting developments we recently announced. Orders from two global electrical - global electric vehicle manufacturers in China and Europe for advanced power hardware-in-the-loop testbeds and inverter test systems. The establishment of a collaboration agreement with National Instruments, also known as NI, which has a strong offering for development and production of electric vehicles. It will seamlessly integrate D&V's technology supported by global sales force to market our products and technology.

We also recently announced the opening of our first state-of-the-art technical center in the Detroit area, providing automobile manufacturers with a convenient location for electric powertrain testing solutions and onsite engineering support. We also announced the development program of an extremely fast EV charger spearheaded by Delta Electronics' automotive division and sponsored by the US Department of Energy that utilizes our emulated technology. In short, we believe our EV subsidiary provides us with meaningful opportunities for growth while complementing our leadership presence within the automotive hard parts market. We believe both of these businesses provide our shareholders with exciting opportunities as transportation needs and driving options evolve. In short, all our initiatives continue to enhance our position as a valued premier supplier of automotive aftermarket parts in North America and the rapidly-emerging electric vehicle and aerospace markets.

Certainly there are challenges facing the aftermarket industry today, including supply chain, freight and other pandemic-related headwinds. We continue to experience supply chain challenges for steel, semiconductors and packaging to mention a few items. We think these are short-term issues and we are working hard with our global team to manage production while working with our suppliers and logistic providers to address the challenges. Market dynamics and rational economics, including price increases, supported by customers, will contribute to overcoming these challenges as we continue to focus on taking full advantage of our competitive strengths.

In summary, our entire Company is well positioned for sustainable top and bottom line growth for parts and solutions that move our world today and tomorrow. Our footprint for the future has become a reality. We are now focused on benefiting from this move in the following ways. Increased sales due to higher capacity, better gross margins due to economies of scale from consolidation of operations, including the brake caliper launch, pricing initiatives and other product line transition activities. In short, we are excited about the continuing growth opportunities and utilizing our highly-efficient footprint.

As noted in today's earnings release, given the ongoing global pandemic and near-term related considerations, the Company believes it is still not prudent at this time to provide specific annual sales and gross margin guidance. We will reevaluate this policy as fiscal 2022 evolves. However, we are currently experiencing strong customer demand for our aftermarket parts and our EV solutions.

I will now turn the call over to David to review the results for the fourth quarter and fiscal 2021 year-end.

David Lee - Chief Financial Officer

Thank you, Selwyn. To begin I encourage everyone to read the 8-K filed this morning with respect to our March 31st, 2021 earnings press release for more detailed explanations of the result. For information about the items that impacted the results, see exhibits 1 through 5 of the press release.

Let me take a moment to review the financial highlights, including record sales for both our fiscal '21 fourth quarter and fiscal year. Net sales for the fiscal '21 fourth quarter increased 11.5% to $168.1 million from $150.7 million for the same period a year earlier. Gross profit for the fiscal '21 fourth quarter was $32.1 million compared with $36.6 million a year earlier. Gross profit as a percentage of net sales for the fiscal '21 fourth quarter was 19.1% compared with 24.3% a year earlier. Gross margin for the fiscal '21 fourth quarter was negatively impacted by an aggregate of 6.4% by the following, 2.8% for brake caliper start-up costs and relocation and transition expenses, 1.4% due to higher freight costs and expenses related to COVID, 1.4% non-cash core premium amortization impacting sales, 0.6% non-cash revaluation of cores on customers' shelves and 0.2% customer allowances related to new business and the impact of tariffs.

Let me provide a little more color to the factors impacting gross margin. Brake caliper start-up costs and relocation transition expenses are part of our footprint expansion in Mexico. As you may recall, we completed the construction of our buildings in Mexico this past fiscal year and are focused on increasing production of brake calipers, including core sorting and related activities to meet current and future demand. We anticipate that these costs and expenses will diminish significantly in the first half of the current fiscal year. We also incurred higher freight costs due to a freight shortage - a shortage of freight caused by COVID as Selwyn noted earlier.

With regard to additional COVID-related expenses, we have addressed health and safety initiatives that also impacted the gross margins. Fortunately, these COVID-related expenses have been slowly decreasing. Core premium amortization and revaluation of cores on customers' shelves that impacted gross margins are non-cash, non-economic. For a summary of items impacting gross profit, please see Exhibit 3 in this morning's earnings press release.

We also incurred higher costs for raw materials and supplies. I should also mention that we experienced offshore wage inflation, which further impacted results. We have mitigated these expenses along with higher freight costs with price increases that have been implemented and will be realized shortly.

Total operating expenses decreased approximately $15.4 million for the fiscal fourth quarter on a year-over-year basis. This decrease includes $17.1 million of foreign currency related net gains, which are non-economic and relate to lease liability remeasurement and Mexican peso forward contracts. This was partially offset by higher expenses such as COVID-related expenses of $520,000.

Interest expense was $3.7 million for the fourth quarter compared with $5.5 million last year. The decrease in interest expense was primarily due to lower interest rates and lower net debt. Income tax expense for the fourth quarter was $939,000 compared with income tax benefit of $2.8 million for the prior-year period. Net income for the fiscal '21 fourth quarter was $835,000 or $0.04 per diluted share compared with a net loss of $8.2 million or $0.43 per share a year ago. Prior year fourth quarter results include the unfavorable foreign exchange impact of lease liabilities and forward contract totaling $20.7 million. Additional details of items impacting net income are in Exhibit 1 in this morning's earnings press release.

Net sales for fiscal '21 were $540.8 million compared with $535.8 million a year earlier impacted by a sharp drop in demand in April due to the global pandemic. In addition, net sales were impacted by current pandemic supply chain challenges. This was partially offset by the benefit of $12.8 million due to a realignment of inventory at two customer distribution centers with expected future sales benefits as product mix changes.

Gross profit for fiscal '21 was $109.5 million compared with $118.4 million a year earlier. Gross profit as a percentage of net sales for fiscal '21 was 20.2% compared with 22.1% a year earlier. Gross margin was negatively impacted by 5.5% including brake caliper start-up costs, relocation transition expenses and higher costs related to COVID-19 as I previously discussed. A summary of factors impacting gross profit are in Exhibit 4 in this morning's earnings press release.

Net income for fiscal '21 was $21.5 million or $1.11 per diluted share compared with a net loss of $7.3 million or $0.39 per share a year ago. Additional details of items impacting net income are in Exhibit 2 in this morning's earnings press release.

Net cash used in operating activities during the fiscal year '21 fourth quarter was $16.4 million, reflecting working capital requirement to support the Company's record sales and inventory increases for anticipated business growth in fiscal '22. This compares with cash provided by operating activities of $23.2 million for the prior year - prior fiscal year fourth quarter. Net debt was $88.9 million at March 31st, 2021 compared with $67.6 million at December 31st, 2020.

Net cash provided by operating activities during fiscal '21 was $56.1 million compared with net cash provided by operating activities of $18.8 million for the prior fiscal year. Net debt during fiscal '21 was reduced to $88.9 million at March 31st, 2021 from $126.5 million at March 31st, 2020.

As you know, there are various methods to calculate return on invested capital. For our purposes, we calculate ROIC by taking operating income and adding back noncash expenses and certain onetime expenses. We believe this metric, considered together with GAAP measures, provides useful information to investors and to management regarding the Company's return on invested capital. In short, we take this metric which was approximately $77.1 million for the 12 months ended March 31st, 2021 which included an extraordinarily weak fiscal first quarter as a result of the COVID-19 shutdown across the country and divided by the average equity and net debt balance of $403 million resulting in a 19.1% pre-tax return on invested capital. We are just starting to realize the benefits of expanding our Mexico operations and the launch of our new brake categories with the expectation of increased returns from both new and existing product lines. This should result in higher ROIC as the benefits of our strategic expansion are more fully realized.

During the fourth quarter ended March 31st, 2021, the Company repurchased 1.1 million of shares at an average price of approximately $20.70. Under the authorized share repurchase program as of March 31st, 2021 $16.8 million of the $37 million common stock authorization has been repurchased and $20.2 million remain available to repurchase shares.

As I mentioned, at March 31st, 2021 our net debt was approximately $88.9 million. Total cash and availability on the revolver credit facility was approximately $140.8 million at March 31st, 2021 based on a total of $238.6 million revolver credit facility and subject to certain limitations. At March 31st, 2021, the Company had approximately $848 million in total assets. Current assets were $423 million and current liabilities were $326 million. We recently announced that the Company extended its credit facility with PNC Bank for five years through May of 2026, including amendments which further increase the Company's strong liquidity base. For the reconciliation of items that impacted results and non-GAAP financial measures, please refer to Exhibits 1 through 5 in this morning's earnings press release.

I will now open the call for questions and Selwyn will then provide some closing remarks.

Question & Answers

Operator

[Operator Instructions] Your first question comes from the line of Scott Stember with CL King. Your line is now open.

Scott Stember - CL King & Associates - Analyst

Hi. Good afternoon, guys and thanks for taking my questions.

Selwyn Joffe - Chairman, President and Chief Executive Officer

Hey, Scott.

David Lee - Chief Financial Officer

Hi, Scott.

Scott Stember - CL King & Associates - Analyst

Coming out of the third quarter, there was a fair amount, I think it was like $17 million worth of sales that kind of got caught up because of some of the supply chain issues -

David Lee - Chief Financial Officer

Scott, you faded out. I'm not sure if you are on a -

Scott Stember - CL King & Associates - Analyst

- Q4 into Q1?

David Lee - Chief Financial Officer

Yeah, you faded out. But I'll guess your question and I'll restate that. You're asking about the deferral of the revenue that we talked about.

Scott Stember - CL King & Associates - Analyst

Yes.

David Lee - Chief Financial Officer

That deferral continues on.

Scott Stember - CL King & Associates - Analyst

Oh, okay.

David Lee - Chief Financial Officer

That deferral continues on. I mean, there are supply chain challenges in the industry and there are significant deferrals. So the strong revenue is despite the fact that there is still continued deferral.

Scott Stember - CL King & Associates - Analyst

Got it. Could you tell us how much is being deferred or at this point, it's just going to be an ongoing thing that [Speech Overlap]?

David Lee - Chief Financial Officer

It's an ongoing thing. It's going to be an ongoing thing right now, Scott. It's unpredictable. It's hard to measure because some gets caught up and then additional deferrals come in. So I think it's just a fundamental right now in the industry. I think the whole industry is experiencing this. But the industry needs these parts and when the supply chain catches up, we should catch that up.

Scott Stember - CL King & Associates - Analyst

Got it. And just in general, I know that we could all look at the - your customers look at their retail sale what is their comparable sales numbers. They just continue to improve. Can you talk about what you're seeing do-it-for-me versus do-it-yourself? I know that miles driven have - definitely improving, continually. Just what are you seeing, the strengths - the pockets of strength that you're seeing right now?

David Lee - Chief Financial Officer

Yeah. So it started out as a big recovery in the DIY and a boom in the DIY, but we're now seeing it in the DIFM as well. So you've got just a lot more people relying on their vehicles. Used cars that were in parking lots that are now being driven and the professional stores are busy. Just come off a couple of professional store conferences and they're doing very well. Professional stores are happy. So it's both right now.

Scott Stember - CL King & Associates - Analyst

Right. And just lastly before I jump back in the queue, I appreciate that a lot of volatility right now, hence no guidance. But is there anything you can give us just as high-level expectations - expectations of growth in 2022 just from a sales perspective, margins, earnings, just some high-level data that we can kind of run with for the trajectory of the business?

David Lee - Chief Financial Officer

We expect our margins to be accretive as the year progresses based on the things we mentioned in the call, price increases, and hopefully we'll have more stability in the supply chain. The supply chain is very unpredictable. As you know there is ships stuck in ports, product is not being manufactured, there is re-outbreaks of COVID in Southeast Asia. So very - significant - demand is predictably very strong. The question is is the supply going to be strong enough to keep up with the demand. We are in a great position - if we can get enough inventory to meet our demand we're in a great position. But we'll have to see how it unfolds over the next few months.

Scott Stember - CL King & Associates - Analyst

Got it. Thanks a lot.

David Lee - Chief Financial Officer

Thank you.

Operator

Your next question comes from the line - pardon me. Your next question comes from the line of Brian Nagel with Oppenheimer. Your line is now open.

Brian W. Nagel - Oppenheimer & Co. - Analyst

Hi. Good afternoon. Good morning, I guess. Nice quarter. Congratulations.

Selwyn Joffe - Chairman, President and Chief Executive Officer

Thank you.

David Lee - Chief Financial Officer

Thank you.

Brian W. Nagel - Oppenheimer & Co. - Analyst

So my first question. I think it's a bit of a follow-up to the - to prior question, but I'm asking this, I guess, more from a color standpoint. But we got [Phonetic] the economy market by market has been opening now and we're heading towards this hopefully post-COVID world. What are you seeing as far as demand trends? And again what I'm getting at is for your business, obviously, we do see the very strong results at your retail partners. But what are you seeing that could basically help us think about the sustainability of this demand particularly relative to like pre-pandemic levels?

Selwyn Joffe - Chairman, President and Chief Executive Officer

Yeah. What's interesting is, again, without announcing specific customers, I had a cross-section of conversations with various suppliers to the professional installer market and some of them are quoting 70% gains over prior pre-COVID revenue levels. Some of it's hard to explain, to be honest with you, but I think we've been talking about for years the statistics where the average cars are aging. This morning's newspapers were covered everywhere with average age went from 11.9 to 12.1 in the last year and a half. Number of cars are up on the road.

New car sales, a little slower than they have been. I think a lot of these used cars are getting back on the road, so cars that were perhaps in the car population that weren't being driven. So we see a resurrection of miles. It looks like the fundamentals are really strong. Whether the sustainability at the - I mean, current demand levels are a record. Is that sustainable? I don't know that. But I don't anticipate it being softer than pre-COVID level. So I do see more dependence on the vehicle and even - and just people spending more money on their cars across the board.

Brian W. Nagel - Oppenheimer & Co. - Analyst

That's very helpful, Selwyn.

Selwyn Joffe - Chairman, President and Chief Executive Officer

I hope that just gives you color, Brian. I don't - I can't give you any stats because I don't - I haven't seen any out there. But the color wherever I turn and whatever conversation I had in the marketplace, and I'm talking much more granularly with the consumer sort of statistics, just people - the demand is up.

Brian W. Nagel - Oppenheimer & Co. - Analyst

Okay. That's very helpful. The second question I have, this is also bigger picture in nature, but we've talked a lot about the portion of the part of your Company turning to EV and talked a little bit more today about it. At what point does that become a real needle mover for MPAA, this EV portion?

Selwyn Joffe - Chairman, President and Chief Executive Officer

I'll tell you, I expect 100% growth in that business this year. Again, it's not - it doesn't move the needle. But we've got some exciting things in the works. We haven't announced them publicly. So I'll stay away from any specifics. But we think that there is an opportunity to keep that growth rate going. It's a little more unpredictable because of two reasons. Number one, on the global basis, it's a brand new market that's evolving and number two, it's brand new for us. So we are a little bit in learning mode, look-and-listen mode, but indications for what we have are very positive.

Brian W. Nagel - Oppenheimer & Co. - Analyst

Got it. And then just one final question for me. And I didn't catch if you talked about this in your prepared comments, but I was looking at the consumer broadly, I mean, inflation is a massive topic right now. What are you seeing in terms of your business as far as inflation either from your cost perspective or what your - or potentially pricing changes you've made to your customers and any reaction to that?

Selwyn Joffe - Chairman, President and Chief Executive Officer

Yeah. So - I mean, I will tell you our margins are lower than [Technical Issues] a little bit this quarter even when you look at the various considerations that affected it. And so we've implemented price increases and we're one of everyone that's implemented price increases. Costs are up and it's my expectation there'll be some - the consumers are going to have to pay a little more for their part. I mean, that's real cost and it's real - it's real inflation, to be honest. And there is no choice. I mean, the industry is taking - has taken price increases. And I think we just got to keep our eye on the Producer Price Index and see how that evolves. But for now the outlook is fairly inflationary and certainly as a company we intend to keep our eye on our pricing.

Brian W. Nagel - Oppenheimer & Co. - Analyst

Well, thank you and congrats again.

Selwyn Joffe - Chairman, President and Chief Executive Officer

Thanks so much. Appreciate the questions.

David Lee - Chief Financial Officer

Thank you.

Operator

Your next question comes from the line of Sarkis Sherbetchyan with B. Riley. Your line is now open.

Sarkis Sherbetchyan - B. Riley FBR - Analyst

Hey. Good afternoon and thank you for taking my question here. Selwyn, it looks like you're - it looks like you're building working capital and clearly that's - it's going to look like a drag on operating cash flow. So - and you're highlighting you have inventory increases for the anticipated business growth in this fiscal year. And I appreciate kind of not providing guidance here in the near term and you will reevaluate that. But help us understand the magnitude of inventory growth expected and also linked to that, if you expect the business to generate free cash flow this fiscal year.

Selwyn Joffe - Chairman, President and Chief Executive Officer

Yeah. Well, I'll start with the free cash flow. We definitely expect free cash flow this year. It will come a little later in the year. As you can see, we invested fairly significantly in inventory in the quarter. Our receivables are growing because of the increased sales. We expect bigger demand for the year. I mean, Sarkis I'd love to give guidance. I'm just concerned of the unpredictability of when this is all going to happen and how this is going to unfold. I mean, we've got, I would say, over 1 million units tied up between - stuck in ports, whether it'd be in the United States ports, whether it'd be in Asian ports and accidents that have happened in ports, I mean, we have closures in Malaysia right now, mandatory two-week closures. So it's very unpredictable. But what is predictable is that the demand is there. What's unpredictable is how fast we can meet that demand.

Having said that, we are meeting most of it and we are doing well, but we could be - we have strong numbers, but these numbers could be even much stronger, I mean, based on demand, if we could meet all demand. So I think inventory should plateau barring some additional big ones, which we always look for and I'm confident we will generate positive cash flow for the year still. Hopefully, that gives you color. I'm not sure I was very specific, but -

Sarkis Sherbetchyan - B. Riley FBR - Analyst

Yeah. No - that's helpful. I think another interesting point is, you said inventory should plateau barring some big wins. I guess, can you maybe talk about which categories you're maybe gunning to win some more business? I think your traditional kind of core business that we're aware of, right? Probably more of a market share story, but from - the brake calipers and related products and certainly the diagnostics, it seems like there could be a little bit more of an open and larger opportunity. I guess, any comments on magnitude of what you're pursuing there?

Selwyn Joffe - Chairman, President and Chief Executive Officer

Yeah. I mean, I would say that first of all, all the categories have big opportunities for growth. I think brake calipers, we're probably looking at 70%, 80% growth for this year. So a lot going on there. We are busy ramping up. There was inefficiencies in the ramp-up in the beginning, but lots of opportunity there and lots in all the other product lines. So, it's a tough market out there as always, hard to predict. But we feel, again, pretty good about demand. We just - again, one more time, we just got to make sure we can get the supply. And so whatever we can get our hands on and inventory, we're getting our hands on. We may - if we're going to make a mistake now, we're going to make a mistake on having more inventory than less just because the supply - and I don't know what's going to happen. There has - there seems to be a resurgence of the COVID issues in Asian countries and certainly India, Malaysia, Thailand, Taiwan, certain cities in China. I mean, all sort of having some type of resurgence. But we've got our eye on it closely and I expect it to be a positive year still, but giving guidance is a little difficult right now.

Sarkis Sherbetchyan - B. Riley FBR - Analyst

Okay. No worries. I'll hop back in the queue. Thank you.

Selwyn Joffe - Chairman, President and Chief Executive Officer

Thank you.

David Lee - Chief Financial Officer

Thank you.

Operator

Your next question comes from Matthew Koranda with Roth Capital. Your line is now open.

Michael Zabran - Roth Capital Partners - Analyst

Hey, guys. This is Mike Zabran on for Matt Koranda. Thanks for taking my question.

Selwyn Joffe - Chairman, President and Chief Executive Officer

Hi.

David Lee - Chief Financial Officer

Hi.

Selwyn Joffe - Chairman, President and Chief Executive Officer

First, could you guys provide some color on the revenue build-up for the quarter and maybe talk about the momentum you're seeing in the rotating electrical category specifically?

David Lee - Chief Financial Officer

So I can start out with the allocation of the sales by product line. This will all be available in the 10-K filed later today. For the fourth quarter about 67% was rotating electrical, wheel hubs was about 19%, brake-related products was 11% and other products was 3%.

Michael Zabran - Roth Capital Partners - Analyst

Okay. Great. And in the fourth quarter we saw new product start-up cost at $5.2 million. Assuming that the Mexico move is mostly complete, should we expect this line item to move to zero and if so how soon?

David Lee - Chief Financial Officer

Good question. So as I prepared in the - as I said in the prepared remarks, in this new fiscal year they're going to be diminishing significantly. So it will definitely go down to zero a little bit later in the fiscal year.

Michael Zabran - Roth Capital Partners - Analyst

Great. That's all. Thanks, guys.

Selwyn Joffe - Chairman, President and Chief Executive Officer

Thank you.

David Lee - Chief Financial Officer

Thank you.

Operator

[Operator Instructions] Your question comes from the line of Matt Dhane with Tieton Capital Management. Your line is now open.

Matt Dhane - Tieton Capital Management - Analyst

Great. Thank you. That's Tieton Capital Management. So I wanted to ask - I know you just highlighted that you expect brake calipers to grow at 60% to 70% rate this year. Just wanted to take a step back and ask if we were to look at the biggest dollar revenue growth drivers as you look at what do you expect here this fiscal year, what product lines or offerings do you expect to be the biggest dollar driver in revenue growth?

Selwyn Joffe - Chairman, President and Chief Executive Officer

Again, that's going to be hard to predict for the year. But we certainly - again I mentioned the brake calipers, I mentioned the 100% growth in our EV business and we expect solid growth in the other categories.

Matt Dhane - Tieton Capital Management - Analyst

Is there any category that you're not expecting growth in at this point in time, Selwyn?

Selwyn Joffe - Chairman, President and Chief Executive Officer

No.

Matt Dhane - Tieton Capital Management - Analyst

Okay. That's helpful. Thank you.

Operator

And we have no further question at this time. Presenters, please continue.

Selwyn Joffe - Chairman, President and Chief Executive Officer

Great. Well, I appreciate everybody's interest. I want to thank all our team members firstly for their ongoing commitment and customer-centric focus on incredible service during these challenging times. Their health and safety are our top priority and I'm excited about the number of people that have been vaccinated and especially as we move into some of the third-world countries that we're in. We remain extremely vigilant to protect our global team from this horrible virus and we are working diligently to get even more of our employees and their family members vaccinated.

In fact, this Friday, June 18th, we will be hosting a Pfizer mobile vaccine clinic, which is open to our employees, neighbors and we encourage everybody to attempt. For the most part, our corporate team is continuing to work remotely though we remain committed to gradually and safely returning our team back to the office as conditions permit. As a result of everyone's contributions, our operations have continued largely uninterrupted and I am extremely, extremely proud of our Company.

In summary, our investments are bearing fruit. We have reached important inflection points with strong positive cash flow, solid earnings performance, debt reduction and meaningful opportunities to enhance shareholder value in the dynamic $130 billion automotive aftermarket industry and the emerging electric vehicle industry. We are proud of our more than 50-year history in the aftermarket industry and are excited about our emerging presence in the electric vehicle space and all of us are committed to our vision of being the global leader for parts and solutions that move our world today and tomorrow.

We appreciate your continued support and thank you again for joining us on the call. We look forward to speaking with you when we host our fiscal 2022 first quarter conference call in August and at investor conferences and hopefully in person sometime in the future. Thank you.

Operator

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MOTORCAR PARTS OF AMERICA INC

Q4 2021

Earnings Transcript

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