8-K

 

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of Earliest Event Reported): October 28, 2013

Penske Automotive Group, Inc.
__________________________________________
(Exact name of registrant as specified in its charter)

Delaware	1-12297	22-3086739
_____________________ (State or other jurisdiction	_____________ (Commission	______________ (I.R.S. Employer
of incorporation)	File Number)	Identification No.)
2555 Telegraph Road, Bloomfield Hills, Michigan		48302
_________________________________ (Address of principal executive offices)		___________ (Zip Code)

Registrant’s telephone number, including area code: 248-648-2500

Not Applicable
______________________________________________
Former name or former address, if changed since last report

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

[  ]  Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
[  ]  Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
[  ]  Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
[  ]  Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 2.02 Results of Operations and Financial Condition.

On October 29, 2013, we issued a press release announcing our third quarter 2013 financial results and other information. A copy of the press release is furnished as Exhibit 99.1.

Item 7.01 Regulation FD Disclosure.

The following information is furnished pursuant to Item 7.01 "Regulation FD Disclosure."


Acquisition

On October 28, 2013, we acquired two franchises, Jaguar and Land Rover Annapolis. The acquired dealerships are expected to contribute annualized revenues of approximately $40 million.

Earnings Press Release

On October 29, 2013, we issued a press release announcing our third quarter 2013 financial results and other information. A copy of the press release is furnished as Exhibit 99.1.

Item 8.01 Other Events.

Investors and others should note that we announce material financial information using our company website (www.penskeautomotive.com), our investor relations website (investors.penskeautomotive.com), SEC filings, press releases, public conference calls and webcasts. Information about Penske Automotive, its business, and its results of operations may also be announced by posts on the following social media channels:

• Penske Automotive Twitter feed (www.twitter.com/penskecarscorp)
• Penske Automotive’s Facebook page (www.facebook.com/penskecars)

The information that we post on these social media channels could be deemed to be material information. As a result, we encourage investors, the media, and others interested in Penske Automotive to review the information that we post on these social media channels. These channels may be updated from time to time on Penske Automotive’s investor relations website.

Item 9.01 Financial Statements and Exhibits.

99.1 Press Release

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

	Penske Automotive Group, Inc.
October 29, 2013	By:	/s/Shane M. Spradlin
		Name: Shane M. Spradlin
		Title: Executive Vice President

Exhibit Index

Exhibit No.	Description
99.1	Press Release.

EX-99.1

FOR IMMEDIATE RELEASE

PENSKE AUTOMOTIVE REPORTS THIRD QUARTER AND NINE MONTHS RESULTS

Record Third Quarter Income from Continuing Operations and Earnings per Share
Operating Margin Increases 30 Basis Points
Earnings per Share from Continuing Operations Rises 21.7% to $0.73 Compared to Adjusted 2012

Third Quarter 2013 Nine Months 2013

• Revenue Increases 14.6% to $3.8 Billion

• Revenue Increases 11.3% to $10.9 Billion

•	Same-store Retail Revenue Increases
12.0%
•	Same-store Retail Revenue Increases 10.3%
•	Income from Continuing Operations Up
•	Income from Continuing Operations Up
21.0% to $66.0 Million Compared to Adjusted 20.9% to $186.9 Million Compared to Adjusted
2012 2012
•	EPS from Continuing Operations Rises
•	EPS from Continuing Operations Rises
21.7% to $0.73 per Share Compared to Adjusted 21.1% to $2.07 per Share Compared to Adjusted
2012 2012
•	EBITDA Increases 25.7% to $126.1Million
•	EBITDA Increases 19.6% to $364.7 Million
Compared to Adjusted 2012 Compared to Adjusted 2012
BLOOMFIELD HILLS, MI, October 29, 2013 – Penske Automotive Group, Inc. (NYSE:PAG), an
international transportation services company, announced today the highest third quarter and nine
months income from continuing operations and related earnings per share in company history. For
the third quarter 2013, income from continuing operations attributable to common shareholders
increased 21.0% to $66.0 million and related earnings per share increased 21.7% to $0.73 per share
when compared to adjusted figures for the same period last year which exclude debt redemption costs
of $13.0 million after taxes, or $0.14 per share, as shown in the attached tables. Income from
continuing operations and related earnings per share for the third quarter 2013 includes
approximately $1.9 million, or $0.014 per share, of acquisition-related costs associated with the
company’s commercial vehicle group acquisition.

Total revenue increased 14.6% to $3.8 billion, including a same-store retail revenue increase of 12.0%. The revenue increase was driven by a 13.5% increase in total retail unit sales, including an 11.9% increase on a same-store basis. Gross profit improved 15.6% to $579.9 million while operating income increased 25.3% to $109.9 million.

“Our business produced another outstanding quarter. We remain confident in our ability to continue growing our business, and we expect both the U.S. and U.K. markets to continue to perform well,” said Chairman Roger Penske. “On a same-store basis, retail revenue improved 11.3% in the U.S. and 13.3% in our international markets demonstrating the strength and resiliency of our key markets. We improved service and parts margin by 230 basis points and continued to demonstrate expense leverage as the ratio of selling, general and administrative expenses as a percentage of gross profit improved by 150 basis points, contributing to a 30 basis point increase in operating margin.”

Highlights of the Third Quarter

• Total Retail Unit Sales increased 13.5% to 97,027

• +13.8% in the United States; +13.0% Internationally

• New unit retail sales +13.4%

• Used unit retail sales +13.7%

• Same-store Retail Revenue increased 12.0%

• New +13.8%; Used +11.5%; Finance & Insurance +17.4%; Service and Parts +3.4%

• +11.3% in the United States; +13.3% Internationally

• Average Transaction Price Per Unit

• New $37,299; +1.3%

• Used $25,242; -0.3%

• Average Gross Profit Per Unit

• New $2,791, -$58/unit; Gross Margin 7.5%, -20 basis points

• Used $1,870, $19/unit; Gross Margin 7.4%, +10 basis points

• Finance & Insurance $1,028, +$49/unit

For the nine months ended September 30, 2013, total revenue increased 11.3% to $10.9 billion, income from continuing operations attributable to common shareholders increased 20.9% to $186.9 million and related earnings per share increased 21.1% to $2.07 per share when compared to adjusted figures for the same period last year as shown in the attached tables.

Conference Call

Penske Automotive will host a conference call discussing financial results relating to the third quarter of 2013 on October 29, 2013, at 2:00 p.m. Eastern Daylight Time. To listen to the conference call, participants must dial (800) 700-7414 [International, please dial (651) 291-0618]. The call will also be simultaneously broadcast over the Internet through the Investors Relations section of the Penske Automotive Group website. Additionally, an investor presentation relating to the third quarter 2013 financial results has been posted to the company’s website. To access the presentation or to listen to the company’s webcast, please refer to www.penskeautomotive.com.

About Penske Automotive

Penske Automotive Group, Inc., (NYSE:PAG) headquartered in Bloomfield Hills, Michigan, is an international transportation services company, operating retail automotive dealerships, Hertz car rental franchises and commercial vehicle distribution. The company currently operates principally in the United States, Western Europe, Australia and New Zealand, employs approximately 17,000 people worldwide and is a member of the Fortune 500 and Russell 2000. For additional information, visit the company’s website at www.penskeautomotive.com.

Non-GAAP Financial Measures

This release contains certain non-GAAP financial measures as defined under SEC rules, such as adjusted income from continuing operations, earnings before interest, taxes, depreciation and amortization (“EBITDA” and adjusted “EBITDA”). The company has reconciled these measures to the most directly comparable GAAP measures in the release. The company believes that these widely accepted measures of operating profitability improve the transparency of the company’s disclosures and provide a meaningful presentation of the company’s results from its core business operations excluding the impact of items not related to the company’s ongoing core business operations, and improve the period-to-period comparability of the company’s results from its core business operations. These non-GAAP financial measures are not substitutes for GAAP financial results, and should only be considered in conjunction with the company’s financial information that is presented in accordance with GAAP.

Caution Concerning Forward Looking Statements

Statements in this press release may involve forward-looking statements, including forward-looking statements regarding Penske Automotive Group, Inc.’s future sales potential and potential earnings outlook. Actual results may vary materially because of risks and uncertainties that are difficult to predict. These risks and uncertainties include, among others: economic conditions generally, conditions in the credit markets and changes in interest rates, adverse conditions affecting a particular manufacturer, including the adverse impact to the vehicle and parts supply chain due to natural disasters or other disruptions that interrupt the supply of vehicles or parts to us; changes in consumer credit availability, the outcome of legal and administrative matters, completion of closing conditions, and other factors over which management has limited control. These forward-looking statements should be evaluated together with additional information about Penske Automotive’s business, markets, conditions and other uncertainties, which could affect Penske Automotive’s future performance. These risks and uncertainties are addressed in Penske Automotive’s Form 10-K for the year ended December 31, 2012, and its other filings with the Securities and Exchange Commission (“SEC”). This press release speaks only as of its date, and Penske Automotive disclaims any duty to update the information herein.

Find a vehicle: http://www.penskecars.com
Engage Penske Automotive: http://www.penskesocial.com
Like Penske Automotive on Facebook: https://facebook.com/PenskeCars
Follow Penske Automotive on Twitter: https://twitter.com/#!/Penskecarscorp
Visit Penske Automotive on YouTube: http://www.youtube.com/penskecars

Inquiries should contact:

David K. Jones
Executive Vice President and
Chief Financial Officer
Penske Automotive Group, Inc.
248-648-2800
dave.jones@penskeautomotive.com Anthony R. Pordon
Executive Vice President Investor Relations
and Corporate Development
Penske Automotive Group, Inc.
248-648-2540
tpordon@penskeautomotive.com

# # #

PENSKE AUTOMOTIVE GROUP, INC.
Consolidated Condensed Statements of Income
(Amounts In Thousands, Except Per Share Data)
(Unaudited)

	Three Months Ended						Nine Months Ended
	September 30,						September 30,
	2013			2012			2013			2012
Revenues:
New Vehicle	$	1,995,836		$	1,736,131		$	5,674,658		$	4,997,923
Used Vehicle		1,098,484			969,130			3,182,822			2,841,403
Finance and Insurance, Net		99,758			83,650			282,353			242,892
Service and Parts		381,485			365,351			1,158,404			1,088,665
Fleet and Wholesale		182,629			181,758			541,924			643,901
Commercial Vehicle and Car Rental		65,951			—			87,756			—
Total Revenues	$	3,824,143		$	3,336,020		$	10,927,917		$	9,814,784
Cost of Sales:
New Vehicle	$	1,846,504		$	1,601,762		$	5,245,533		$	4,596,274
Used Vehicle		1,017,109			898,264			2,941,273			2,622,055
Service and Parts		152,033			154,203			469,229			457,205
Fleet and Wholesale		180,162			180,307			532,391			637,831
Commercial Vehicle and Car Rental		48,427			—			56,353			—
Total Cost of Sales	$	3,244,235		$	2,834,536		$	9,244,779		$	8,313,365
Gross Profit		579,908			501,484			1,683,138			1,501,419
SG&A Expenses		454,188			400,039			1,308,958			1,188,658
Depreciation		15,784			13,704			45,300			40,014
Operating Income		109,936			87,741			328,880			272,747
Floor Plan Interest Expense		(10,840	)		(9,951	)		(32,008	)		(29,319	)
Other Interest Expense		(12,370	)		(11,583	)		(36,163	)		(35,155	)
Equity in Earnings of Affiliates		11,240			8,814			22,489			21,392
Debt Redemption Costs		—			(17,753	)		—			(17,753	)
Income from Continuing Operations Before Income Taxes		97,966			57,268			283,198			211,912
Income Taxes		(31,692	)		(15,421	)		(95,263	)		(69,347	)
Income from Continuing Operations		66,274			41,847			187,935			142,565
Loss from Discontinued Operations, Net of Tax		(742	)		(534	)		(1,889	)		(4,634	)
Net Income		65,532			41,313			186,046			137,931
Less: Income Attributable to Non-Controlling Interests		(257	)		(282	)		(1,065	)		(990	)
Net Income Attributable to Common Shareholders	$	65,275		$	41,031		$	184,981		$	136,941
Income from Continuing Operations Per Share	$	0.73		$	0.46		$	2.07		$	1.57
Income Per Share	$	0.72		$	0.45		$	2.05		$	1.52
Weighted Average Shares Outstanding		90,237			90,296			90,334			90,362
Amounts Attributable to Common Shareholders:
Reported Income from Continuing Operations	$	66,274		$	41,847		$	$187,935		$	142,565
Less: Income Attributable to Non-Controlling Interests		(257	)		(282	)		(1,065	)		(990	)
Income from Continuing Operations, net of tax	$	66,017		$	41,565		$	186,870		$	141,575
Loss from Discontinued Operations, net of tax		(742	)		(534	)		(1,889	)		(4,634	)
Net Income	$	65,275		$	41,031		$	184,981		$	136,941

PENSKE AUTOMOTIVE GROUP, INC.
Consolidated Condensed Balance Sheets
(Amounts In Thousands)
(Unaudited)

	September 30,		December 31,
	2013		2012
Assets
Cash and Cash Equivalents	$	71,101	$	43,447
Accounts Receivable, Net		588,311		554,851
Inventories		2,293,390		2,000,206
Other Current Assets		83,508		90,485
Assets Held for Sale		1,065		73,398
Total Current Assets		3,037,375		2,762,387
Property and Equipment, Net		1,211,020		1,031,188
Intangibles		1,401,497		1,261,299
Other Long-Term Assets		360,912		324,116
Total Assets	$	6,010,804	$	5,378,990
Liabilities and Equity
Floor Plan Notes Payable	$	1,537,185	$	1,408,362
Floor Plan Notes Payable – Non-Trade		802,051		725,526
Accounts Payable		380,000		263,881
Accrued Expenses		275,483		223,972
Current Portion Long-Term Debt		46,894		19,493
Liabilities Held for Sale		2,592		51,279
Total Current Liabilities		3,044,205		2,692,513
Long-Term Debt		1,014,070		918,024
Other Long-Term Liabilities		495,138		452,132
Total Liabilities		4,553,413		4,062,669
Equity		1,457,391		1,316,321
Total Liabilities and Equity	$	6,010,804	$	5,378,990

PENSKE AUTOMOTIVE GROUP, INC.
Consolidated Condensed Statements of Income
(Amounts In Thousands, Except Per Share Data)
(Unaudited)

	Three Months Ended
	September 30,
								% Increase/
	2013			2012				(Decrease)
Revenues:
New Vehicle	$	1,995,836		$	1,736,131				15.0	%
Used Vehicle		1,098,484			969,130				13.3	%
Finance and Insurance, Net		99,758			83,650				19.3	%
Service and Parts		381,485			365,351				4.4	%
Fleet and Wholesale		182,629			181,758				0.5	%
Commercial Vehicle and Car Rental		65,951			—			NM
Total Revenues	$	3,824,143		$	3,336,020				14.6	%
Cost of Sales:
New Vehicle	$	1,846,504		$	1,601,762				15.3	%
Used Vehicle		1,017,109			898,264				13.2	%
Service and Parts		152,033			154,203				-1.4	%
Fleet and Wholesale		180,162			180,307			—
Commercial Vehicle and Car Rental		48,427			—			NM
Total Cost of Sales	$	3,244,235		$	2,834,536				14.5	%
Gross Profit		579,908			501,484				15.6	%
SG&A Expenses		454,188			400,039				13.5	%
Depreciation		15,784			13,704				15.2	%
Operating Income		109,936			87,741				25.3	%
Floor Plan Interest Expense		(10,840	)		(9,951	)			8.9	%
Other Interest Expense		(12,370	)		(11,583	)			6.8	%
Equity in Earnings of Affiliates		11,240			8,814				27.5	%
Debt Redemption Costs		—			(17,753	)		NM
Income from Continuing Operations Before Income Taxes		97,966			57,268				71.1	%
Income Taxes		(31,692	)		(15,421	)	(		105.5	%
Income from Continuing Operations		66,274			41,847				58.4	%
Loss from Discontinued Operations, Net of Tax		(742	)		(534	)			39.0	%
Net Income		65,532			41,313				58.6	%
Less: Income Attributable to Non-Controlling Interests		(257	)		(282	)			-8.9	%
Net Income Attributable to Common Shareholders	$	65,275		$	41,031				59.1	%
Income from Continuing Operations Per Share	$	0.73		$	0.46				58.7	%
Income Per Share	$	0.72		$	0.45				60.0	%
Weighted Average Shares Outstanding		90,237			90,296			—
Amounts Attributable to Common Shareholders:
Reported Income from Continuing Operations	$	66,274		$	41,847				58.4	%
Less: Income Attributable to Non-Controlling Interests		(257	)		(282	)			-8.9	%
Income from Continuing Operations, net of tax	$	66,017		$	41,565				58.8	%
Loss from Discontinued Operations, net of tax		(742	)		(534	)			39.0	%
Net Income	$	65,275		$	41,031				59.1	%

NM – not meaningful

PENSKE AUTOMOTIVE GROUP, INC.
Consolidated Condensed Statements of Income
(Amounts In Thousands, Except Per Share Data)
(Unaudited)

	Nine Months Ended
	September 30,
							% Increase/
	2013			2012			(Decrease)
Revenues:
New Vehicle	$	5,674,658		$	4,997,923			13.5	%
Used Vehicle		3,182,822			2,841,403			12.0	%
Finance and Insurance, Net		282,353			242,892			16.2	%
Service and Parts		1,158,404			1,088,665			6.4	%
Fleet and Wholesale		541,924			643,901			-15.8	%
Commercial Vehicle and Car Rental		87,756			—		NM
Total Revenues	$	10,927,917		$	9,814,784			11.3	%
Cost of Sales:
New Vehicle	$	5,245,533		$	4,596,274			14.1	%
Used Vehicle		2,941,273			2,622,055			12.2	%
Service and Parts		469,229			457,205			2.6	%
Fleet and Wholesale		532,391			637,831			-16.5	%
Commercial Vehicle and Car Rental		56,353			—		NM
Total Cost of Sales	$	9,244,779		$	8,313,365			11.2	%
Gross Profit		1,683,138			1,501,419			12.1	%
SG&A Expenses		1,308,958			1,188,658			10.1	%
Depreciation		45,300			40,014			13.2	%
Operating Income		328,880			272,747			20.6	%
Floor Plan Interest Expense		(32,008	)		(29,319	)		9.2	%
Other Interest Expense		(36,163	)		(35,155	)		2.9	%
Equity in Earnings of Affiliates		22,489			21,392			5.1	%
Debt Redemption Costs		—			(17,753	)	NM
Income from Continuing Operations Before Income Taxes		283,198			211,912			33.6	%
Income Taxes		(95,263	)		(69,347	)		37.4	%
Income from Continuing Operations		187,935			142,565			31.8	%
Loss from Discontinued Operations, Net of Tax		(1,889	)		(4,634	)		-59.2	%
Net Income		186,046			137,931			34.9	%
Less: Income Attributable to Non-Controlling Interests		(1,065	)		(990	)		7.6	%
Net Income Attributable to Common Shareholders	$	184,981		$	136,941			35.1	%
Income from Continuing Operations Per Share	$	2.07		$	1.57			31.8	%
Income Per Share	$	2.05		$	1.52			34.9	%
Weighted Average Shares Outstanding		90,334			90,362		—
Amounts Attributable to Common Shareholders:
Reported Income from Continuing Operations	$	187,935		$	142,565			31.8	%
Less: Income Attributable to Non-Controlling Interests		(1,065	)		(990	)		7.6	%
Income from Continuing Operations, net of tax	$	186,870		$	141,575			32.0	%
Loss from Discontinued Operations, net of tax		(1,889	)		(4,634	)		-59.2	%
Net Income	$	184,981		$	136,941			35.1	%

NM – not meaningful

PENSKE AUTOMOTIVE GROUP, INC.
Consolidated Selected Data
(Unaudited)

	Three Months Ended						Nine Months Ended
	September 30,						September 30,
	2013			2012			2013			2012
Revenue Mix:
Premium:
BMW		24	%		25	%		24	%		25	%
Audi		12	%		13	%		12	%		12	%
Mercedes-Benz		10	%		11	%		11	%		11	%
Lexus		4	%		4	%		4	%		4	%
Land Rover		4	%		4	%		4	%		4	%
Porsche		4	%		4	%		4	%		4	%
Ferrari / Maserati		3	%		3	%		3	%		3	%
Acura		2	%		2	%		2	%		2	%
Other		4	%		3	%		4	%		4	%
Total Premium		67	%		69	%		68	%		69	%
Foreign:
Toyota		11	%		10	%		11	%		10	%
Honda		10	%		11	%		10	%		11	%
Nissan		2	%		2	%		2	%		2	%
Volkswagen		2	%		2	%		2	%		2	%
Other		2	%		2	%		2	%		2	%
Total Foreign		27	%		27	%		27	%		27	%
Domestic Big 3:
General Motors / Chrysler / Ford		4	%		4	%		4	%		4	%
Commercial Vehicle and Car Rental		2	%		—			1	%	—
Revenue Mix:
U.S.		63	%		64	%		64	%		63	%
U.K.		35	%		35	%		34	%		35	%
Other International		2	%		1	%		2	%		2	%
Total		100	%		100	%		100	%		100	%
Gross Profit Mix:
New Vehicles		25.8	%		26.8	%		25.5	%		26.8	%
Used Vehicles		14.0	%		14.1	%		14.4	%		14.6	%
Service and Parts		39.6	%		42.1	%		40.9	%		42.1	%
Finance and Insurance		17.2	%		16.7	%		16.8	%		16.2	%
Fleet and Wholesale		0.4	%		0.3	%		0.6	%		0.3	%
Commercial Vehicle and Car Rental		3.0	%		—			1.8	%	—
Total		100.0	%		100.0	%		100.0	%		100.0	%

PENSKE AUTOMOTIVE GROUP, INC.
Consolidated Selected Data
(Unaudited)

	Three Months Ended							Nine Months Ended
	September 30,							September 30,
	2013			2012			Increase/ (Decrease)	2013			2012			Increase/ (Decrease)
Operating items as a percentage of revenue:
New Vehicle Gross Profit		7.5	%		7.7	%	-20 bps		7.6	%		8.0	%	-40 bps
Used Vehicle Gross Profit		7.4	%		7.3	%	10 bps		7.6	%		7.7	%	-10 bps
Service and Parts Gross Profit		60.1	%		57.8	%	230 bps		59.5	%		58.0	%	150 bps
Fleet and Wholesale Gross Profit		1.4	%		0.8	%	60 bps		1.8	%		0.9	%	90 bps
Commercial Vehicle and Car Rental Gross Profit		26.6	%		—		NM		35.8	%		—		NM
Total Gross Profit		15.2	%		15.0	%	20 bps		15.4	%		15.3	%	10 bps
Selling, General and Admin. Expenses		11.9	%		12.0	%	-10 bps		12.0	%		12.1	%	-10 bps
Operating Income		2.9	%		2.6	%	30 bps		3.0	%		2.8	%	20 bps
Inc. From Cont. Ops. Before Inc. Taxes		2.6	%		1.7	%	90 bps		2.6	%		2.2	%	40 bps
Operating items as a percentage of total gross profit:
Selling, General and Administrative Expenses		78.3	%		79.8	%	-150 bps		77.8	%		79.2	%	-140 bps
Operating Income		19.0	%		17.5	%	150 bps		19.5	%		18.2	%	130 bps

	Three Months Ended							Nine Months Ended
	September 30,							September 30,
					% Increase/							% Increase/
	2013		2012		(Decrease)			2013		2012		(Decrease)
Other (Amounts in Thousands):
EBITDA*	$	126,120	$	82,555		52.8	%	$	364,661	$	287,081		27.0	%
Adjusted EBITDA*		126,120		100,308		25.7	%		364,661		304,834		19.6	%
Rent Expense		45,753		43,330		5.6	%		135,213		129,451		4.5	%
Floorplan Credits		7,575		5,842		29.7	%		20,220		17,047		18.6	%

* See the following Non-GAAP reconciliation tables

NM – not meaningful

PENSKE AUTOMOTIVE GROUP, INC.
Automotive Retail Operations Selected Data
(Unaudited)

	Three Months Ended									Nine Months Ended
	September 30,									September 30,
							% Increase/									% Increase/
	2013			2012			(Decrease)			2013			2012			(Decrease)
Total Retail Units:
New Retail		53,509			47,166			13.4	%		150,779			135,080			11.6	%
Used Retail		43,518			38,287			13.7	%		125,947			110,806			13.7	%
Total Retail		97,027			85,453			13.5	%		276,726			245,886			12.5	%
Same-Store Retail Units:
New Same-Store Retail		52,327			46,684			12.1	%		145,947			133,002			9.7	%
Used Same-Store Retail		42,231			37,783			11.8	%		121,139			109,271			10.9	%
Total Same-Store Retail		94,558			84,467			11.9	%		267,086			242,273			10.2	%
Same-Store Retail Revenue:
(Amounts in thousands)
New Vehicles	$	1,953,386		$	1,716,232			13.8	%	$	5,503,322		$	4,922,867			11.8	%
Used Vehicles		1,071,757			960,866			11.5	%		3,084,186			2,815,415			9.5	%
Finance and Insurance, Net		97,918			83,398			17.4	%		275,636			240,799			14.5	%
Service and Parts		372,608			360,314			3.4	%		1,120,400			1,075,410			4.2	%
Total Same-Store Retail	$	3,495,669		$	3,120,810			12.0	%	$	9,983,544		$	9,054,491			10.3	%
Retail Revenue Mix:
New Vehicles		55.8	%		55.0	%	80 bps				55.1	%		54.5	%	60 bps
Used Vehicles		30.7	%		30.7	%		—			30.9	%		31.0	%	-10 bps
Finance and Insurance, Net		2.8	%		2.7	%	10 bps				2.7	%		2.6	%	10 bps
Service and Parts		10.7	%		11.6	%	-90 bps				11.3	%		11.9	%	-60 bps
Average Revenue per Vehicle Retailed:
New Vehicles	$	37,299		$	36,809			1.3	%	$	37,636		$	37,000			1.7	%
Used Vehicles		25,242			25,312			-0.3	%		25,271			25,643			-1.5	%
Gross Profit per Vehicle Retailed:
New Vehicles	$	2,791		$	2,849			-2.0	%	$	2,846		$	2,973			-4.3	%
Used Vehicles		1,870			1,851			1.0	%		1,918			1,980			-3.1	%
Finance and Insurance		1,028			979			5.0	%		1,020			988			3.3	%

PENSKE AUTOMOTIVE GROUP, INC.
Consolidated Non-GAAP Reconciliation
(Unaudited)

Reconciliation of reported income from continuing operations net of taxes and earnings per share to adjusted income from continuing operations net of taxes and earnings per share for the three months and nine months ended September 30, 2013 and 2012:

	Income				Earnings Per Share
	Three Months Ended				Three Months Ended
	September 30,				September 30,
				% Increase/				% Increase/
(Amounts in Thousands)	2013	2012		(Decrease)	2013	2012		(Decrease)
Income from Continuing Operations Net of Tax and Earnings per share	$66,017	$41,565		58.8%	$0.73	$0.46		58.7%
Debt Redemption Costs (1)	—		12,974	NM	—		0.14	NM
Adjusted Income from Continuing Operations and Adjusted Earnings Per Share	$66,017	$54,539		21.0%	$0.73	$0.60		21.7%

	Income				Earnings Per Share
	Nine Months Ended				Nine Months Ended
	September 30,				September 30,
				% Increase/				% Increase/
(Amounts in Thousands)	2013	2012		(Decrease)	2013	2012		(Decrease)
Income from Continuing Operations Net of Tax and Earnings per Share	$186,870	$141,575		32.0%	$2.07	$1.57		31.8%
Debt Redemption Costs (1)	—		12,974	NM	—		0.14	NM
Adjusted Income from Continuing Operations and Adjusted Earnings Per Share	$186,870	$154,549		20.9%	$2.07	$1.71		21.1%

(1) Costs associated with the redemption of the Company’s $375 million of 7.75% senior subordinated notes due 2016 of $17,753 million ($12,974 million net of taxes), or $0.14 per share.

NM – not meaningful

PENSKE AUTOMOTIVE GROUP, INC.
Consolidated Non-GAAP Reconciliation
(Unaudited)

Reconciliation of reported net income to earnings before interest, taxes, depreciation and amortization (“EBITDA) and adjusted EBITDA for the three months and nine months ended September 30, 2013 and 2012:

	Three Months Ended							Nine Months Ended
	September 30,							September 30,
					% Increase/							% Increase/
(Amounts in Thousands)	2013		2012		(Decrease)			2013		2012		(Decrease)
Net Income	$	65,532	$	41,313		58.6	%	$	186,046	$	137,931		34.9	%
Depreciation		15,784		13,704		15.2	%		45,300		40,014		13.2	%
Other Interest Expense		12,370		11,583		6.8	%		36,163		35,155		2.9	%
Income Taxes		31,692		15,421		105.5	%		95,263		69,347		37.4	%
Loss from Discontinued Operations, net	742		534		39.0%			1,889		4,634		-59.2%
EBITDA	$	126,120	$	82,555		52.8	%	$	364,661	$	287,081		27.0	%
Add Back: Debt redemption costs (1)	—		17,753		NM			—		17,753		NM
Adjusted EBITDA	$	126,120	$	100,308		25.7	%	$	364,661	$	304,834		19.6	%

(1) Costs associated with the redemption of the Company’s $375 million of 7.75% senior subordinated notes due 2016 of $17,753 million ($12,974 million net of taxes), or $0.14 per share.

NM – not meaningful

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