-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, UkdoLEGC2bOiUTx4hdMD0+L1iuewbncjgDch+dhBCUGuTnmsQZMjFChZq4VQJxGs YcW9VGxiGKx6BoQ85CRhpg== 0000950129-99-000392.txt : 19990208 0000950129-99-000392.hdr.sgml : 19990208 ACCESSION NUMBER: 0000950129-99-000392 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19990203 ITEM INFORMATION: ITEM INFORMATION: FILED AS OF DATE: 19990205 FILER: COMPANY DATA: COMPANY CONFORMED NAME: GROUP 1 AUTOMOTIVE INC CENTRAL INDEX KEY: 0001031203 STANDARD INDUSTRIAL CLASSIFICATION: RETAIL-AUTO DEALERS & GASOLINE STATIONS [5500] IRS NUMBER: 760506313 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: SEC FILE NUMBER: 001-13461 FILM NUMBER: 99522556 BUSINESS ADDRESS: STREET 1: 950 ECHO LANE STREET 2: STE 350 CITY: HOUSTON STATE: TX ZIP: 77024 BUSINESS PHONE: 7134676268 MAIL ADDRESS: STREET 1: 950 ECHO LANE STREET 2: STE 350 CITY: HOUSTON STATE: TX ZIP: 77024 8-K 1 GROUP 1 AUTOMOTIVE, INC. - DATED 02/03/99 1 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): February 3, 1999 GROUP 1 AUTOMOTIVE, INC. (Exact name of registrant as specified in its charter) DELAWARE 1-13461 76-0506313 (State of Incorporation) (Commission File Number) (I.R.S. Employer Identification Number) 950 ECHO LANE, SUITE 350 HOUSTON, TEXAS 77024 (Address of principal executive offices) (Zip Code) Registrant's telephone number, including area code: (713) 467-6268 2 ITEM 5. OTHER EVENTS On February 3, 1999, Group 1 Automotive, Inc., a Delaware corporation (the "Company"), announced its financial results for the three months and year ended December 31, 1998. On February 3, 1999, the Company issued a press release relating to such financial results. A copy of the press release is attached hereto as Exhibit 99.1 and is incorporated herein by reference. ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS Exhibit No. Description of Exhibit 99.1 Press Release of Group 1 Automotive, Inc. dated February 3, 1999 reporting on financial results. 2 3 SIGNATURE Pursuant to the requirements of Section 12 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. Dated: February 5, 1999 GROUP 1 AUTOMOTIVE, INC. By: /s/ SCOTT L. THOMPSON ------------------------------------------------- Name: Scott L. Thompson Title: Senior Vice President -- Chief Financial Officer and Treasurer 3 4 EXHIBIT INDEX
EXHIBIT NUMBER DESCRIPTION ------ ----------- 99.1 Press Release of Group 1 Automotive, Inc. dated February 3, 1999 reporting on financial results.
EX-99.1 2 PRESS RELEASE, DATED 02/03/99 1 EXHIBIT 99.1 GROUP 1 FOURTH-QUARTER REVENUES, NET INCOME MORE THAN DOUBLE; 1998 REVENUES UP 81%, NET INCOME 82% HOUSTON, Feb. 3 /PRNewswire/ -- Group 1 Automotive, Inc. (NYSE: GPI - news), a leading operator and consolidator in the automotive retailing industry, today reported significant gains in revenues and net income for the fourth quarter and for the year ended December 31, 1998. Revenue growth across all dealership offerings, coupled with improved operating margins and contributions from acquisitions, drove the company's strong performance. Strong Results for Core and Acquired Dealerships For the fourth quarter ended December 31, 1998, revenues accelerated to $472.5 million from $213.2 million for the same period last year. Net income increased to $5.5 million from $2.3 million while earnings per diluted share grew to $0.29 from $0.15 a year ago. Gross margin expanded to 14.6 percent from 13.8 percent during the year-ago period due to an increase in new vehicle gross margin and a shift in the merchandising mix, as parts and service and other dealership revenue increased more rapidly than lower-margin revenues. Income from operations rose sharply to $14.4 million from $5.3 million, resulting in the operating margin expanding to 3.0 percent from 2.5 percent in the year-ago period. According to B.B. Hollingsworth Jr., Group 1's chairman, president and chief executive officer, revenue gains were attributed to strong internal growth as well as contributions from acquisitions. Sales were especially strong at the company's Oklahoma and Houston platforms. The significant gain in other dealership revenue, which includes high-margin vehicle service, finance and insurance contracts, was attributed to new training programs and enhanced economics. "One of the key elements of our long-term growth strategy is to increase revenues from our high-margin products," Hollingsworth said. "We will continue to provide our co-workers with the skills and products necessary to generate revenues that boost gross margins, and ultimately, shareholder value." Smooth Integration of Acquisitions Drives 1998 Results 2 For the year, revenues accelerated to $1.6 billion from $902.3 million in 1997. Net income increased to $20.7 million, or $1.16 per diluted share, compared with $11.4 million, or $0.76 per diluted share. Gross margin for 1998 was 14.5 percent compared with 14.1 percent a year ago. Income from operations more than doubled, rising to $52.0 million from $25.4 million. The operating margin expanded to 3.2 percent from 2.8 percent in 1997. "We are very proud of our achievements and are confident in our abilities to continue to execute our business plan," Hollingsworth said. "Our operating leverage has been significant and demonstrates that we have been successful in integrating both our platform and tuck-in acquisitions. We have proven that select acquisitions executed under a disciplined strategy can produce earnings growth and enhance shareholder value." Recently Announced Acquisitions Enhance Brand, Geographic Diversity Group 1 recently announced that it had agreed to acquire 16 dealership franchises in seven markets. Upon completion, the company's annualized revenue run rate will increase to over $2.2 billion, representing 92,000 retail car and truck sales. Hollingsworth confirmed that the company would continue to seek acquisitions that enhance brand and geographic diversity, as well as provide synergy and add value. Group 1 is a leading operator and consolidator in the highly fragmented automotive retailing industry. Upon completion of all announced acquisitions, Group 1 will own 71 dealership franchises comprised of 23 different brands, and 16 collision service centers located in Texas, Oklahoma, New Mexico, Colorado, Florida and Georgia. Through its dealerships the company sells new and used cars and light trucks, provides maintenance and repair services, sells replacement parts and arranges related financing, insurance and vehicle service contracts. This press release contains certain forward-looking statements within the meaning of the Securities Act of 1933 and the Securities Exchange Act of 1934, which are subject to known and unknown risks, uncertainties or other factors not under Group 1's control that may cause the actual results, performance or achievements of Group 1 to be materially different from the results, performance or other expectations implied by these forward-looking statements. Some of these risks, uncertainties and other factors include those disclosed in Group 1's filings with the Securities and Exchange Commission. Group 1 Automotive, Inc. can be reached on the Internet at www.group1auto.com. 3 GROUP 1 AUTOMOTIVE, INC. Statements of Operations (Unaudited) (In thousands of dollars, except share amounts)
Three Months Ended Twelve Months Ended December 31, December 31, 1998 1997 1998 1997 REVENUES: New vehicle sales $268,883 $121,936 $931,205 $513,864 Used vehicle sales 147,097 67,275 510,192 288,010 Parts & service sales 41,879 18,827 139,144 77,215 Other dealership revenue, net 14,683 5,207 49,516 23,206 Total revenues 472,542 213,245 1,630,057 902,295 COST OF SALES 403,369 183,714 1,393,547 775,164 Gross Profit 69,173 29,531 236,510 127,131 SELLING, GENERAL AND ADMINISTRATIVE EXPENSES 52,756 23,475 178,038 98,967 DEPRECIATION AND AMORTIZATION 2,051 708 6,426 2,752 Income from operations 14,366 5,348 52,046 25,412 OTHER INCOME (EXPENSE): Floorplan interest expense (3,842) (1,267) (12,837) (5,194) Other interest expense, net (1,322) (242) (4,027) (926) Other income, net 46 106 39 88 INCOME BEFORE INCOME TAXES 9,248 3,945 35,221 19,380 PROVISION FOR INCOME TAXES 3,779 1,634 14,502 7,967 NET INCOME $5,469 $2,311 $20,719 $11,413 Basic earnings per share $0.30 $0.16 $1.20 $0.78 Diluted earnings per share $0.29 $0.15 $1.16 $0.76 Weighted average shares outstanding: Basic 18,242,118 14,672,073 17,281,165 14,672,804 Diluted 18,992,225 15,089,327 17,904,878 15,098,594 Other Data: Gross margin 14.6% 13.8% 14.5% 14.1% Operating margin 3.0% 2.5% 3.2% 2.8% Pretax income margin 2.0% 1.8% 2.2% 2.1% Retail new vehicles sold 11,182 5,278 39,822 23,201 Retail used vehicles sold 8,817 4,207 31,248 18,130 Total retail sales 19,999 9,485 71,070 41,331
4 GROUP 1 AUTOMOTIVE, INC. Condensed Consolidated Balance Sheets (In thousands)
December 31, December 31, 1998 1997 (unaudited) (audited) ASSETS Current assets: Cash and cash equivalents $66,443 $35,092 Inventories 219,176 105,421 Other assets 41,303 21,169 Total current assets 326,922 161,682 Property and equipment, net 21,960 21,586 Goodwill, net 123,587 27,078 Other assets 5,241 2,803 Total assets $477,710 $213,149 LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities: Floorplan notes payable $193,405 $58,488 Other liabilities 85,266 47,720 Total current liabilities 278,671 106,208 Debt, net of current maturities 42,821 7,053 Other liabilities 20,034 10,516 Total stockholders' equity 136,184 89,372 Total liabilities and stockholders' equity $477,710 $213,149
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