-----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, OYF5hau7eTos71E6Ff5rN4DlLMIs6MyL8weMB4s1TnBG/0WGDpOa1NuQmhlNlTWM k9JasRST2UeTltoDMPEuyg== 0000950129-99-004802.txt : 19991108 0000950129-99-004802.hdr.sgml : 19991108 ACCESSION NUMBER: 0000950129-99-004802 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19991027 ITEM INFORMATION: ITEM INFORMATION: FILED AS OF DATE: 19991105 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: 99741891 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 OCTOBER 27, 1999 1 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 27, 1999 GROUP 1 AUTOMOTIVE, INC. (Exact name of Registrant as specified in its charter) Delaware 76-0506313 (State or other jurisdiction of (I.R.S. Employer incorporation or organization) Identification No.) 950 Echo Lane, Suite 100 Houston, Texas 77024 (Address of principal executive offices) (Zip code) (713) 647-5700 (Registrant's telephone number including area code) 2 ITEM 5. OTHER EVENTS On October 27, 1999, Group 1 Automotive, Inc., a Delaware corporation (the "Company"), announced its financial results for the three months and nine months ended September 30, 1999. On October 27, 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. EXHIBITS (c) 99.1 Press Release of Group 1 Automotive, Inc., dated as of October 27, 1999, reporting on financial results. 3 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, thereunto duly authorized. Group 1 Automotive, Inc. October 5, 1999 By: /s/ Scott L. Thompson - -------------------- --------------------------------------- Date Scott L. Thompson, Senior Vice President, Chief Financial Officer and Treasurer 4 INDEX TO EXHIBITS Exhibit No. Description - ----------- ----------- 99.1(c) Press Release of Group 1 Automotive, Inc., dated as of October 27, 1999, reporting on financial results. EX-99.1 2 PRESS RELEASE - DATED OCTOBER 27, 1999 1 NEWS BULLETIN GROUP 1 AUTOMOTIVE INC From: The Financial Relations Board Inc 950 Echo Lane, Suite 350 Houston, TX 77024 - -------------------------------------------------------------------------------- AT GROUP 1: Chairman, President and CEO B. B. Hollingsworth, Jr. (713) 647-5700 Sr. VP, CFO and Treasurer Scott L. Thompson (713) 647-5700 AT FRB: General Inquiries Marilyn Windsor (312) 640-6692 Analyst Inquiries Bill Schmidle (312) 640-6753 Media Inquiries Bob Schwaller (972) 830-2295 - -------------------------------------------------------------------------------- FOR IMMEDIATE RELEASE WEDNESDAY, OCTOBER 27, 1999 GROUP 1 RECORDS DOUBLE-DIGIT GAINS IN REVENUES, OPERATING EARNINGS, NET INCOME FOR 1999 THIRD QUARTER, NINE MONTHS THIRD-QUARTER NET INCOME UP 62% ON 49% REVENUE GROWTH; OPERATING MARGIN CONTINUES TO INCREASE HIGHLIGHTS: O Q3 DILUTED EPS UP 37% TO $0.48 ON 17% MORE SHARES O NINE-MONTH DILUTED EPS $1.21, A 39% GAIN ON 22% SHARE INCREASE O Q3, NINE-MONTH OPERATING MARGINS CONTINUE TO EXPAND SUMMARY RESULTS OF OPERATIONS (UNAUDITED) (IN MILLIONS, EXCEPT PER SHARE AMOUNTS)
- --------------------------------------------------------------------------------------------------------------- THREE MONTHS ENDED NINE MONTHS ENDED SEPTEMBER 30, SEPTEMBER 30, ------------------------ ----------------------------- 1999 1998 1999 1998 --------- --------- ----------- ----------- REVENUES $ 701.8 $ 472.1 $ 1,816.5 $ 1,157.5 GROSS PROFIT $ 105.1 $ 71.0 $ 274.9 $ 167.3 INCOME FROM OPERATIONS $ 25.7 $ 16.4 $ 64.1 $ 37.7 NET INCOME $ 10.5 $ 6.5 $ 25.9 $ 15.3 DILUTED EARNINGS PER SHARE $ 0.48 $ 0.35 $ 1.21 $ 0.87 - ---------------------------------------------------------------------------------------------------------------
HOUSTON, OCTOBER 27, 1999--GROUP 1 AUTOMOTIVE, INC. (NYSE: GPI), a leading operator and consolidator in the automotive retailing industry, today reported double-digit gains in revenues, income from operations, net income and earnings per share for the third quarter and first nine months of 1999. Significant revenue growth in all categories, as well as continued improvement in operating margin, drove the company's record performance. -MORE- 2 GROUP 1 AUTOMOTIVE ADD-1- ENHANCED REVENUES AND OPERATING MARGIN BOOST EARNINGS For the third quarter ended September 30, 1999, revenues grew 49 percent to $701.8 million from $472.1 million for the same period last year. Net income increased 62 percent to $10.5 million from $6.5 million, while diluted earnings per share grew 37 percent to $0.48 from $0.35 a year ago. Cash flow per share (net income plus depreciation and amortization) increased to $0.60 from $0.45 in the 1998 period. The increases in earnings and cash flow per share were achieved despite being calculated on 22.1 million shares compared with 18.9 million shares last year, a 17 percent higher number of shares outstanding. The gross margin was steady at 15.0 percent. Income from operations rose 57 percent to $25.7 million from $16.4 million, resulting in the operating margin expanding to 3.7 percent from 3.5 percent in the year-ago period. Group 1 has achieved year-over-year improvements in operating margin since going public. "I am pleased to announce another exceptionally strong quarter," said B.B. Hollingsworth Jr., Group 1's chairman, president and chief executive officer. "We saw solid internal growth as well as contributions from acquisitions. We are benefiting from internal operating initiatives, the successful integration of our acquisitions and a robust new vehicle market." NINE-MONTH PERFORMANCE SURPASSES FULL-YEAR 1998 RESULTS For the first nine months, revenues accelerated 57 percent to $1.8 billion from $1.2 billion in the 1998 period. Net income increased 70 percent to $25.9 million, or $1.21 per diluted share, compared with $15.3 million, or $0.87 per diluted share. Cash flow per share was $1.56 compared with $1.12. Per-share amounts for the 1999 period were calculated on 21.4 million shares compared with 17.5 million shares last year. Gross margin was 15.1 percent compared with 14.5 percent a year ago as margins expanded in all categories. Income from operations rose 70 percent to $64.1 million from $37.7 million. The operating margin expanded to 3.5 percent from 3.3 percent in the year-ago period. "We are very proud of our achievements in expanding operating income and margin," Hollingsworth said. "Our operating leverage has been significant. We have proven that select acquisitions executed under a disciplined strategy can produce solid earnings growth." AMARILLO OPERATIONS EXPAND Lone Star Chrysler-Plymouth-Mitsubishi, with operations in Amarillo, Texas, has been acquired and added to Group 1's West Texas platform. This tuck-in acquisition is expected to generate approximately $30 million annually in revenues. Since the beginning of 1999, Group 1 has closed previously announced acquisitions comprised of 23 franchises with revenues of over $550 million. Another 24 franchise acquisitions are pending which, when completed, will boost the company's annual revenue run rate to over $3 billion. Hollingsworth confirmed the company would continue to seek acquisitions that meet its standards. CREDIT FACILITY DOUBLED The company recently announced that its revolving credit facility was doubled to $1 billion, including a $220 million tranche for acquisitions, and extended to December 31, 2003. Lending syndicate members include 11 banks, as well as five automotive captive finance companies. The acquisition portion of the facility is not drawn. -MORE- 3 GROUP 1 AUTOMOTIVE ADD-2- "This transaction will provide the resources to support our disciplined acquisition strategy of high-quality growth, and expands our relationships with automobile manufacturers," Hollingsworth said. Group 1 is a leading operator and consolidator in the highly fragmented automotive retailing industry. Upon completion of the announced acquisitions, Group 1 will have an annualized revenue run rate of over $3 billion, and will own 104 dealership franchises comprised of 31 different brands, and 18 collision service centers located in Texas, Oklahoma, Florida, New Mexico, Colorado, Georgia, Louisiana and Massachusetts. Through its dealerships and Internet sites, the company sells new and used cars and light trucks, provides maintenance and repair services, sells replacement parts and arranges related financing, vehicle service and insurance 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. FOR ADDITIONAL INFORMATION REGARDING GROUP 1 AUTOMOTIVE FREE OF CHARGE VIA FAX, DIAL 1-800-PRO-INFO AND USE THE COMPANY'S STOCK SYMBOL, "GPI." GROUP 1 AUTOMOTIVE, INC. CAN BE REACHED ON THE INTERNET AT WWW.GROUP1AUTO.COM FINANCIAL TABLES TO FOLLOW... -MORE- 4 GROUP 1 AUTOMOTIVE ADD-3- GROUP 1 AUTOMOTIVE, INC. STATEMENTS OF OPERATIONS (UNAUDITED) (IN THOUSANDS OF DOLLARS, EXCEPT SHARE AMOUNTS)
THREE MONTHS ENDED NINE MONTHS ENDED SEPTEMBER 30, SEPTEMBER 30, --------------------------------------- --------------------------------------- 1999 1998 1999 1998 ------------------ ------------------ ------------------- ------------------ REVENUES: New vehicles $ 418,244 $ 273,282 $ 1,050,771 $ 662,323 Used vehicles 203,059 142,351 554,398 363,096 Parts & service 58,188 41,542 153,460 97,264 Other dealership revenue, net 22,299 14,875 57,911 34,833 ------------------ ------------------ ------------------- ------------------ Total revenues 701,790 472,050 1,816,540 1,157,516 COST OF SALES: New vehicles 382,941 251,038 963,229 609,918 Used vehicles 187,070 130,722 508,855 335,180 Parts & service 26,684 19,327 69,511 45,081 ------------------ ------------------ ------------------- ------------------ Total cost of sales 596,695 401,087 1,541,595 990,179 Gross Profit 105,095 70,963 274,945 167,337 SELLING, GENERAL AND ADMINISTRATIVE EXPENSES 76,558 52,502 203,457 125,282 DEPRECIATION EXPENSE 1,220 1,127 3,397 2,650 AMORTIZATION EXPENSE 1,605 913 4,028 1,725 ------------------ ------------------ ------------------- ------------------ Income from operations 25,712 16,421 64,063 37,680 OTHER INCOME (EXPENSE): Floorplan interest expense (5,438) (3,690) (13,623) (8,994) Other interest expense, net (2,904) (1,767) (7,705) (2,705) Other income (expense), net 104 40 209 (8) ------------------ ------------------ ------------------- ------------------ INCOME BEFORE INCOME TAXES 17,474 11,004 42,944 25,973 PROVISION FOR INCOME TAXES 6,955 4,489 17,092 10,723 ------------------ ------------------ ------------------- ------------------ NET INCOME $ 10,519 $ 6,515 $ 25,852 $ 15,250 ================== ================== =================== ================== Basic earnings per share $ 0.49 $ 0.36 $ 1.27 $ 0.90 Diluted earnings per share $ 0.48 $ 0.35 $ 1.21 $ 0.87 Diluted cash flow per share $ 0.60 $ 0.45 $ 1.56 $ 1.12 Weighted average shares outstanding: Basic 21,253,799 18,199,646 20,383,000 16,957,327 Diluted 22,106,027 18,855,004 21,359,645 17,538,446 Other Data: Gross margin 15.0% 15.0% 15.1% 14.5% Operating margin 3.7% 3.5% 3.5% 3.3% Pretax income margin 2.5% 2.3% 2.4% 2.2% Retail new vehicles sold 17,259 11,901 43,629 28,640 Retail used vehicles sold 12,454 9,086 34,126 22,431 ------------------ ------------------ ------------------- ------------------ Total retail sales 29,713 20,987 77,755 51,071
-MORE- 5 GROUP 1 AUTOMOTIVE ADD-4- GROUP 1 AUTOMOTIVE, INC. CONDENSED CONSOLIDATED BALANCE SHEETS (IN THOUSANDS)
SEPTEMBER 30, DECEMBER 31, 1999 1998 ----------------- ------------------ (UNAUDITED) (AUDITED) ASSETS Current assets: Cash and cash equivalents $103,947 $66,443 Inventories, net 289,314 219,176 Other assets, net 48,843 41,303 --------------- -------------- Total current assets 442,104 326,922 --------------- -------------- Property and equipment, net 36,492 21,960 Goodwill, net 200,468 123,587 Other assets 10,201 5,241 --------------- -------------- Total assets $689,265 $477,710 --------------- -------------- LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities: Floorplan notes payable $246,241 $193,405 Other interest-bearing liabilities 1,101 2,966 Accounts payable and accrued expenses 100,228 82,300 --------------- -------------- Total current liabilities 347,570 278,671 --------------- -------------- Debt 102,032 42,821 Other liabilities 19,368 20,034 Total stockholders' equity 220,295 136,184 --------------- -------------- Total liabilities and stockholders' equity $689,265 $477,710 =============== ============== OTHER DATA: Working capital $94,534 $48,251 Current ratio 1.27 1.17 Long-term debt to capitalization 32% 25%
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