001-31262 | 01-0609375 | |||
(Commission File Number) | (IRS Employer Identification No.) | |||
2905 Premiere Parkway NW Suite 300 Duluth, GA | 30097 | |||
(Address of principal executive offices) | (Zip Code) |
o | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
o | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
o | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
o | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Exhibit No. | Description | ||
99.1 | Press Release dated July 25, 2017. |
ASBURY AUTOMOTIVE GROUP, INC. | |||
Date: July 25, 2017 | By: | /s/ Sean D. Goodman | |
Name: | Sean D. Goodman | ||
Title: | Senior Vice President and Chief Financial Officer |
Exhibit No. | Description | |
99.1 | Press Release dated July 25, 2017. |
• | Total revenues increased 2%; gross profit increased 2% |
• | New vehicle revenue remained flat; gross profit decreased 14% |
• | Used vehicle retail revenue increased 5%; gross profit decreased 6% |
• | Finance and insurance revenue increased 8% |
• | Parts and service revenue increased 6%; gross profit increased 6% |
• | SG&A as a percentage of gross profit increased 140 basis points to 69.5% |
• | Total company adjusted income from operations (a non-GAAP measure) as a percentage of revenue was 4.5%, down 30 bps from the prior year |
• | Adjusted EPS from continuing operations decreased 4% |
For the Three Months Ended June 30, | Increase (Decrease) | % Change | ||||||||||||
2017 | 2016 | |||||||||||||
REVENUE: | ||||||||||||||
New vehicle | $ | 882.9 | $ | 897.0 | $ | (14.1 | ) | (2 | )% | |||||
Used vehicle: | ||||||||||||||
Retail | 430.2 | 418.3 | 11.9 | 3 | % | |||||||||
Wholesale | 49.0 | 51.9 | (2.9 | ) | (6 | )% | ||||||||
Total used vehicle | 479.2 | 470.2 | 9.0 | 2 | % | |||||||||
Parts and service | 200.8 | 195.3 | 5.5 | 3 | % | |||||||||
Finance and insurance, net | 68.9 | 64.9 | 4.0 | 6 | % | |||||||||
TOTAL REVENUE | 1,631.8 | 1,627.4 | 4.4 | — | % | |||||||||
GROSS PROFIT: | ||||||||||||||
New vehicle | 41.0 | 47.5 | (6.5 | ) | (14 | )% | ||||||||
Used vehicle: | ||||||||||||||
Retail | 32.5 | 34.8 | (2.3 | ) | (7 | )% | ||||||||
Wholesale | 0.2 | (0.6 | ) | 0.8 | 133 | % | ||||||||
Total used vehicle | 32.7 | 34.2 | (1.5 | ) | (4 | )% | ||||||||
Parts and service | 124.5 | 121.0 | 3.5 | 3 | % | |||||||||
Finance and insurance, net | 68.9 | 64.9 | 4.0 | 6 | % | |||||||||
TOTAL GROSS PROFIT | 267.1 | 267.6 | (0.5 | ) | — | % | ||||||||
OPERATING EXPENSES (INCOME): | ||||||||||||||
Selling, general and administrative | 185.6 | 182.3 | 3.3 | 2 | % | |||||||||
Depreciation and amortization | 8.0 | 7.7 | 0.3 | 4 | % | |||||||||
Other operating expenses (income), net | 1.9 | (0.5 | ) | 2.4 | NM | |||||||||
INCOME FROM OPERATIONS | 71.6 | 78.1 | (6.5 | ) | (8 | )% | ||||||||
OTHER EXPENSES: | ||||||||||||||
Floor plan interest expense | 6.1 | 5.0 | 1.1 | 22 | % | |||||||||
Other interest expense, net | 13.4 | 13.4 | — | — | % | |||||||||
Swap interest expense | 0.6 | 0.8 | (0.2 | ) | (25 | )% | ||||||||
Total other expenses, net | 20.1 | 19.2 | 0.9 | 5 | % | |||||||||
INCOME FROM CONTINUING OPERATIONS BEFORE INCOME TAXES | 51.5 | 58.9 | (7.4 | ) | (13 | )% | ||||||||
Income tax expense | 19.6 | 22.3 | (2.7 | ) | (12 | )% | ||||||||
INCOME FROM CONTINUING OPERATIONS | 31.9 | 36.6 | (4.7 | ) | (13 | )% | ||||||||
Discontinued operations, net of tax | — | 0.1 | (0.1 | ) | (100 | )% | ||||||||
NET INCOME | $ | 31.9 | $ | 36.7 | $ | (4.8 | ) | (13 | )% | |||||
EARNINGS PER COMMON SHARE: | ||||||||||||||
Basic— | ||||||||||||||
Continuing operations | $ | 1.53 | $ | 1.66 | $ | (0.13 | ) | (8 | )% | |||||
Discontinued operations | — | — | — | — | % | |||||||||
Net income | $ | 1.53 | $ | 1.66 | $ | (0.13 | ) | (8 | )% | |||||
Diluted— | ||||||||||||||
Continuing operations | $ | 1.52 | $ | 1.65 | $ | (0.13 | ) | (8 | )% | |||||
Discontinued operations | — | — | — | — | % | |||||||||
Net income | $ | 1.52 | $ | 1.65 | $ | (0.13 | ) | (8 | )% | |||||
WEIGHTED AVERAGE COMMON SHARES OUTSTANDING: | ||||||||||||||
Basic | 20.8 | 22.1 | (1.3 | ) | (6 | )% | ||||||||
Stock options | 0.1 | — | 0.1 | — | % | |||||||||
Restricted stock | 0.1 | 0.1 | — | — | % | |||||||||
Performance share units | 21.0 | 22.2 | (1.2 | ) | (5 | )% | ||||||||
Diluted |
For the Three Months Ended June 30, | Increase (Decrease) | % Change | ||||||||||||
2017 | 2016 | |||||||||||||
Unit sales | ||||||||||||||
New vehicle: | ||||||||||||||
Luxury | 5,504 | 5,782 | (278 | ) | (5 | )% | ||||||||
Import | 14,833 | 14,808 | 25 | — | % | |||||||||
Domestic | 4,794 | 5,175 | (381 | ) | (7 | )% | ||||||||
Total new vehicle | 25,131 | 25,765 | (634 | ) | (2 | )% | ||||||||
Used vehicle retail | 20,263 | 19,612 | 651 | 3 | % | |||||||||
Used to new ratio | 80.6 | % | 76.1 | % | 450 bps | |||||||||
Average selling price | ||||||||||||||
New vehicle | $ | 35,132 | $ | 34,815 | $ | 317 | 1 | % | ||||||
Used vehicle retail | 21,231 | 21,329 | (98 | ) | — | % | ||||||||
Average gross profit per unit | ||||||||||||||
New vehicle: | ||||||||||||||
Luxury | $ | 3,307 | $ | 3,615 | $ | (308 | ) | (9 | )% | |||||
Import | 944 | 1,189 | (245 | ) | (21 | )% | ||||||||
Domestic | 1,836 | 1,739 | 97 | 6 | % | |||||||||
Total new vehicle | 1,631 | 1,844 | (213 | ) | (12 | )% | ||||||||
Used vehicle | 1,604 | 1,774 | (170 | ) | (10 | )% | ||||||||
Finance and insurance, net | 1,518 | 1,430 | 88 | 6 | % | |||||||||
Front end yield (1) | 3,137 | 3,244 | (107 | ) | (3 | )% | ||||||||
Gross margin | ||||||||||||||
New vehicle: | ||||||||||||||
Luxury | 6.3 | % | 6.9 | % | (60) bps | |||||||||
Import | 3.4 | % | 4.3 | % | (90) bps | |||||||||
Domestic | 4.9 | % | 4.8 | % | 10 bps | |||||||||
Total new vehicle | 4.6 | % | 5.3 | % | (70) bps | |||||||||
Used vehicle retail | 7.6 | % | 8.3 | % | (70) bps | |||||||||
Parts and service | 62.0 | % | 62.0 | % | — | |||||||||
Total gross profit margin | 16.4 | % | 16.4 | % | — | |||||||||
SG&A metrics | ||||||||||||||
Rent expense | $ | 6.8 | $ | 7.6 | $ | (0.8 | ) | (11 | )% | |||||
Total SG&A as a percentage of gross profit | 69.5 | % | 68.1 | % | 140 bps | |||||||||
SG&A, excluding rent expense as a percentage of gross profit | 66.9 | % | 65.3 | % | 160 bps | |||||||||
Operating metrics | ||||||||||||||
Income from operations as a percentage of revenue | 4.4 | % | 4.8 | % | (40) bps | |||||||||
Income from operations as a percentage of gross profit | 26.8 | % | 29.2 | % | (240) bps | |||||||||
Adjusted income from operations as a percentage of revenue | 4.5 | % | 4.8 | % | (30) bps | |||||||||
Adjusted income from operations as a percentage of gross profit | 27.6 | % | 29.2 | % | (160) bps | |||||||||
Revenue mix | ||||||||||||||
New vehicle | 54.1 | % | 55.1 | % | ||||||||||
Used vehicle retail | 26.4 | % | 25.7 | % | ||||||||||
Used vehicle wholesale | 3.0 | % | 3.2 | % | ||||||||||
Parts and service | 12.3 | % | 12.0 | % | ||||||||||
Finance and insurance | 4.2 | % | 4.0 | % | ||||||||||
Total revenue | 100.0 | % | 100.0 | % | ||||||||||
Gross profit mix | ||||||||||||||
New vehicle | 15.4 | % | 17.8 | % | ||||||||||
Used vehicle retail | 12.1 | % | 12.9 | % | ||||||||||
Used vehicle wholesale | 0.1 | % | (0.2 | )% | ||||||||||
Parts and service | 46.6 | % | 45.2 | % | ||||||||||
Finance and insurance | 25.8 | % | 24.3 | % | ||||||||||
Total gross profit | 100.0 | % | 100.0 | % |
(1) | Front end yield is calculated as gross profit from new vehicles, used retail vehicles and finance and insurance (net), divided by combined new and used retail unit sales. |
For the Three Months Ended June 30, | Increase (Decrease) | % Change | ||||||||||||
2017 | 2016 | |||||||||||||
Revenue | ||||||||||||||
New vehicle: | ||||||||||||||
Luxury | $ | 291.1 | $ | 294.9 | $ | (3.8 | ) | (1 | )% | |||||
Import | 402.7 | 388.2 | 14.5 | 4 | % | |||||||||
Domestic | 163.2 | 175.5 | (12.3 | ) | (7 | )% | ||||||||
Total new vehicle | 857.0 | 858.6 | (1.6 | ) | — | % | ||||||||
Used Vehicle: | ||||||||||||||
Retail | 416.4 | 396.4 | 20.0 | 5 | % | |||||||||
Wholesale | 47.4 | 49.7 | (2.3 | ) | (5 | )% | ||||||||
Total used vehicle | 463.8 | 446.1 | 17.7 | 4 | % | |||||||||
Parts and service | 197.1 | 185.6 | 11.5 | 6 | % | |||||||||
Finance and insurance | 66.8 | 61.9 | 4.9 | 8 | % | |||||||||
Total revenue | $ | 1,584.7 | $ | 1,552.2 | $ | 32.5 | 2 | % | ||||||
Gross profit | ||||||||||||||
New vehicle: | ||||||||||||||
Luxury | $ | 18.2 | $ | 20.4 | $ | (2.2 | ) | (11 | )% | |||||
Import | 13.8 | 17.0 | (3.2 | ) | (19 | )% | ||||||||
Domestic | 7.6 | 8.4 | (0.8 | ) | (10 | )% | ||||||||
Total new vehicle | 39.6 | 45.8 | (6.2 | ) | (14 | )% | ||||||||
Used Vehicle: | ||||||||||||||
Retail | 31.1 | 33.1 | (2.0 | ) | (6 | )% | ||||||||
Wholesale | 0.2 | (0.8 | ) | 1.0 | 125 | % | ||||||||
Total used vehicle | 31.3 | 32.3 | (1.0 | ) | (3 | )% | ||||||||
Parts and service: | ||||||||||||||
Customer pay | 67.9 | 65.1 | 2.8 | 4 | % | |||||||||
Warranty | 20.4 | 16.6 | 3.8 | 23 | % | |||||||||
Wholesale parts | 5.2 | 4.8 | 0.4 | 8 | % | |||||||||
Parts and service, excluding reconditioning and preparation | 93.5 | 86.5 | 7.0 | 8 | % | |||||||||
Reconditioning and preparation | 28.5 | 29.0 | (0.5 | ) | (2 | )% | ||||||||
Total parts and service | 122.0 | 115.5 | 6.5 | 6 | % | |||||||||
Finance and insurance | 66.8 | 61.9 | 4.9 | 8 | % | |||||||||
Total gross profit | $ | 259.7 | $ | 255.5 | $ | 4.2 | 2 | % | ||||||
SG&A expense | $ | 180.4 | $ | 174.0 | $ | 6.4 | 4 | % | ||||||
SG&A expense as a percentage of gross profit | 69.5 | % | 68.1 | % | 140 bps |
For the Three Months Ended June 30, | Increase (Decrease) | % Change | ||||||||||||
2017 | 2016 | |||||||||||||
Unit sales | ||||||||||||||
New vehicle: | ||||||||||||||
Luxury | 5,504 | 5,672 | (168 | ) | (3 | )% | ||||||||
Import | 14,572 | 14,166 | 406 | 3 | % | |||||||||
Domestic | 4,293 | 4,770 | (477 | ) | (10 | )% | ||||||||
Total new vehicle | 24,369 | 24,608 | (239 | ) | (1 | )% | ||||||||
Used vehicle retail | 19,531 | 18,465 | 1,066 | 6 | % | |||||||||
Used to new ratio | 80.1 | % | 75.0 | % | 510 bps | |||||||||
Average selling price | ||||||||||||||
New vehicle | $ | 35,168 | $ | 34,891 | $ | 277 | 1 | % | ||||||
Used vehicle retail | 21,320 | 21,468 | (148 | ) | (1 | )% | ||||||||
Average gross profit per unit | ||||||||||||||
New vehicle: | ||||||||||||||
Luxury | $ | 3,307 | $ | 3,597 | $ | (290 | ) | (8 | )% | |||||
Import | 947 | 1,200 | (253 | ) | (21 | )% | ||||||||
Domestic | 1,770 | 1,761 | 9 | 1 | % | |||||||||
Total new vehicle | 1,625 | 1,861 | (236 | ) | (13 | )% | ||||||||
Used vehicle retail | 1,592 | 1,793 | (201 | ) | (11 | )% | ||||||||
Finance and insurance, net | 1,522 | 1,437 | 85 | 6 | % | |||||||||
Front end yield (1) | 3,132 | 3,269 | (137 | ) | (4 | )% | ||||||||
Gross margin | ||||||||||||||
New vehicle: | ||||||||||||||
Luxury | 6.3 | % | 6.9 | % | (60) bps | |||||||||
Import | 3.4 | % | 4.4 | % | (100) bps | |||||||||
Domestic | 4.7 | % | 4.8 | % | (10) bps | |||||||||
Total new vehicle | 4.6 | % | 5.3 | % | (70) bps | |||||||||
Used vehicle retail | 7.5 | % | 8.4 | % | (90) bps | |||||||||
Parts and service: | ||||||||||||||
Parts and service, excluding reconditioning and preparation | 47.4 | % | 46.6 | % | 80 bps | |||||||||
Parts and service, including reconditioning and preparation | 61.9 | % | 62.2 | % | (30) bps | |||||||||
Total gross profit margin | 16.4 | % | 16.5 | % | (10) bps |
(1) | Front end yield is calculated as gross profit from new vehicles, used retail vehicles and finance and insurance (net), divided by combined new and used retail unit sales. |
For the Six Months Ended June 30, | Increase (Decrease) | % Change | ||||||||||||
2017 | 2016 | |||||||||||||
REVENUE: | ||||||||||||||
New vehicle | $ | 1,715.4 | $ | 1,735.4 | $ | (20.0 | ) | (1 | )% | |||||
Used vehicle: | ||||||||||||||
Retail | 845.6 | 831.4 | 14.2 | 2 | % | |||||||||
Wholesale | 95.4 | 99.7 | (4.3 | ) | (4 | )% | ||||||||
Total used vehicle | 941.0 | 931.1 | 9.9 | 1 | % | |||||||||
Parts and service | 392.3 | 384.5 | 7.8 | 2 | % | |||||||||
Finance and insurance, net | 134.8 | 127.2 | 7.6 | 6 | % | |||||||||
TOTAL REVENUE | 3,183.5 | 3,178.2 | 5.3 | — | % | |||||||||
GROSS PROFIT: | ||||||||||||||
New vehicle | 81.4 | 92.2 | (10.8 | ) | (12 | )% | ||||||||
Used vehicle: | ||||||||||||||
Retail | 65.5 | 69.5 | (4.0 | ) | (6 | )% | ||||||||
Wholesale | 1.1 | 0.5 | 0.6 | 120 | % | |||||||||
Total used vehicle | 66.6 | 70.0 | (3.4 | ) | (5 | )% | ||||||||
Parts and service | 244.4 | 239.0 | 5.4 | 2 | % | |||||||||
Finance and insurance, net | 134.8 | 127.2 | 7.6 | 6 | % | |||||||||
TOTAL GROSS PROFIT | 527.2 | 528.4 | (1.2 | ) | — | % | ||||||||
OPERATING EXPENSES (INCOME): | ||||||||||||||
Selling, general and administrative | 366.7 | 363.5 | 3.2 | 1 | % | |||||||||
Depreciation and amortization | 15.9 | 15.2 | 0.7 | 5 | % | |||||||||
Other operating expenses (income), net | 0.7 | 2.7 | (2.0 | ) | (74 | )% | ||||||||
INCOME FROM OPERATIONS | 143.9 | 147.0 | (3.1 | ) | (2 | )% | ||||||||
OTHER EXPENSES: | ||||||||||||||
Floor plan interest expense | 11.3 | 9.4 | 1.9 | 20 | % | |||||||||
Other interest expense, net | 26.8 | 26.8 | — | — | % | |||||||||
Swap interest expense | 1.2 | 1.6 | (0.4 | ) | (25 | )% | ||||||||
Total other expenses, net | 39.3 | 37.8 | 1.5 | 4 | % | |||||||||
INCOME FROM CONTINUING OPERATIONS BEFORE INCOME TAXES | 104.6 | 109.2 | (4.6 | ) | (4 | )% | ||||||||
Income tax expense | 38.7 | 41.5 | (2.8 | ) | (7 | )% | ||||||||
INCOME FROM CONTINUING OPERATIONS | 65.9 | 67.7 | (1.8 | ) | (3 | )% | ||||||||
Discontinued operations, net of tax | — | — | — | — | % | |||||||||
NET INCOME | $ | 65.9 | $ | 67.7 | $ | (1.8 | ) | (3 | )% | |||||
EARNINGS PER COMMON SHARE: | ||||||||||||||
Basic— | ||||||||||||||
Continuing operations | $ | 3.15 | $ | 2.92 | $ | 0.23 | 8 | % | ||||||
Discontinued operations | — | — | — | — | % | |||||||||
Net income | $ | 3.15 | $ | 2.92 | $ | 0.23 | 8 | % | ||||||
Diluted— | ||||||||||||||
Continuing operations | $ | 3.12 | $ | 2.91 | $ | 0.21 | 7 | % | ||||||
Discontinued operations | — | — | — | — | % | |||||||||
Net income | $ | 3.12 | $ | 2.91 | $ | 0.21 | 7 | % | ||||||
WEIGHTED AVERAGE COMMON SHARES OUTSTANDING: | ||||||||||||||
Basic | 20.9 | 23.2 | (2.3 | ) | (10 | )% | ||||||||
Restricted stock | 0.1 | — | 0.1 | — | % | |||||||||
Performance share units | 0.1 | 0.1 | — | — | % | |||||||||
Diluted | 21.1 | 23.3 | (2.2 | ) | (9 | )% |
For the Six Months Ended June 30, | Increase (Decrease) | % Change | ||||||||||||
2017 | 2016 | |||||||||||||
Unit sales | ||||||||||||||
New vehicle: | ||||||||||||||
Luxury | 10,618 | 11,408 | (790 | ) | (7 | )% | ||||||||
Import | 28,507 | 28,292 | 215 | 1 | % | |||||||||
Domestic | 9,472 | 10,094 | (622 | ) | (6 | )% | ||||||||
Total new vehicle | 48,597 | 49,794 | (1,197 | ) | (2 | )% | ||||||||
Used vehicle retail | 40,330 | 39,348 | 982 | 2 | % | |||||||||
Used to new ratio | 83.0 | % | 79.0 | % | 400 bps | |||||||||
Average selling price | ||||||||||||||
New vehicle | $ | 35,298 | $ | 34,852 | $ | 446 | 1 | % | ||||||
Used vehicle retail | 20,967 | 21,129 | (162 | ) | (1 | )% | ||||||||
Average gross profit per unit | ||||||||||||||
New vehicle: | ||||||||||||||
Luxury | $ | 3,419 | $ | 3,559 | $ | (140 | ) | (4 | )% | |||||
Import | 993 | 1,223 | (230 | ) | (19 | )% | ||||||||
Domestic | 1,774 | 1,684 | 90 | 5 | % | |||||||||
Total new vehicle | 1,675 | 1,852 | (177 | ) | (10 | )% | ||||||||
Used vehicle | 1,624 | 1,766 | (142 | ) | (8 | )% | ||||||||
Finance and insurance, net | 1,516 | 1,427 | 89 | 6 | % | |||||||||
Front end yield (1) | 3,168 | 3,241 | (73 | ) | (2 | )% | ||||||||
Gross margin | ||||||||||||||
New vehicle: | ||||||||||||||
Luxury | 6.4 | % | 6.9 | % | (50) bps | |||||||||
Import | 3.6 | % | 4.4 | % | (80) bps | |||||||||
Domestic | 4.7 | % | 4.7 | % | — | |||||||||
Total new vehicle | 4.7 | % | 5.3 | % | (60) bps | |||||||||
Used vehicle retail | 7.7 | % | 8.4 | % | (70) bps | |||||||||
Parts and service | 62.3 | % | 62.2 | % | 10 bps | |||||||||
Total gross profit margin | 16.6 | % | 16.6 | % | — | |||||||||
SG&A metrics | ||||||||||||||
Rent expense | $ | 13.7 | $ | 15.4 | $ | (1.7 | ) | (11 | )% | |||||
Total SG&A as a percentage of gross profit | 69.6 | % | 68.8 | % | 80 bps | |||||||||
SG&A, excluding rent expense as a percentage of gross profit | 67.0 | % | 65.9 | % | 110 bps | |||||||||
Operating metrics | ||||||||||||||
Income from operations as a percentage of revenue | 4.5 | % | 4.6 | % | (10) bps | |||||||||
Income from operations as a percentage of gross profit | 27.3 | % | 27.8 | % | (50) bps | |||||||||
Adjusted income from operations as a percentage of revenue | 4.6 | % | 4.7 | % | (10) bps | |||||||||
Adjusted income from operations as a percentage of gross profit | 27.5 | % | 28.5 | % | (100) bps | |||||||||
Revenue mix | ||||||||||||||
New vehicle | 53.9 | % | 54.6 | % | ||||||||||
Used vehicle retail | 26.6 | % | 26.2 | % | ||||||||||
Used vehicle wholesale | 3.0 | % | 3.1 | % | ||||||||||
Parts and service | 12.3 | % | 12.1 | % | ||||||||||
Finance and insurance | 4.2 | % | 4.0 | % | ||||||||||
Total revenue | 100.0 | % | 100.0 | % | ||||||||||
Gross profit mix | ||||||||||||||
New vehicle | 15.4 | % | 17.4 | % | ||||||||||
Used vehicle retail | 12.4 | % | 13.2 | % | ||||||||||
Used vehicle wholesale | 0.2 | % | 0.1 | % | ||||||||||
Parts and service | 46.4 | % | 45.2 | % | ||||||||||
Finance and insurance | 25.6 | % | 24.1 | % | ||||||||||
Total gross profit | 100.0 | % | 100.0 | % |
(1) | Front end yield is calculated as gross profit from new vehicles, used retail vehicles and finance and insurance (net), divided by combined new and used retail unit sales. |
For the Six Months Ended June 30, | Increase (Decrease) | % Change | ||||||||||||
2017 | 2016 | |||||||||||||
Revenue | ||||||||||||||
New vehicle: | ||||||||||||||
Luxury | $ | 564.0 | $ | 579.6 | $ | (15.6 | ) | (3 | )% | |||||
Import | 780.1 | 743.9 | 36.2 | 5 | % | |||||||||
Domestic | 328.1 | 340.5 | (12.4 | ) | (4 | )% | ||||||||
Total new vehicle | 1,672.2 | 1,664.0 | 8.2 | — | % | |||||||||
Used Vehicle: | ||||||||||||||
Retail | 822.3 | 785.9 | 36.4 | 5 | % | |||||||||
Wholesale | 92.3 | 95.5 | (3.2 | ) | (3 | )% | ||||||||
Total used vehicle | 914.6 | 881.4 | 33.2 | 4 | % | |||||||||
Parts and service | 386.1 | 364.8 | 21.3 | 6 | % | |||||||||
Finance and insurance | 131.4 | 121.1 | 10.3 | 9 | % | |||||||||
Total revenue | $ | 3,104.3 | $ | 3,031.3 | $ | 73.0 | 2 | % | ||||||
Gross profit | ||||||||||||||
New vehicle: | ||||||||||||||
Luxury | $ | 36.3 | $ | 39.7 | $ | (3.4 | ) | (9 | )% | |||||
Import | 28.0 | 33.4 | (5.4 | ) | (16 | )% | ||||||||
Domestic | 14.7 | 15.9 | (1.2 | ) | (8 | )% | ||||||||
Total new vehicle | 79.0 | 89.0 | (10.0 | ) | (11 | )% | ||||||||
Used Vehicle: | ||||||||||||||
Retail | 63.0 | 65.6 | (2.6 | ) | (4 | )% | ||||||||
Wholesale | 1.1 | 0.5 | 0.6 | 120 | % | |||||||||
Total used vehicle | 64.1 | 66.1 | (2.0 | ) | (3 | )% | ||||||||
Parts and service: | ||||||||||||||
Customer pay | 133.2 | 128.2 | 5.0 | 4 | % | |||||||||
Warranty | 40.5 | 33.1 | 7.4 | 22 | % | |||||||||
Wholesale parts | 10.4 | 9.8 | 0.6 | 6 | % | |||||||||
Parts and service, excluding reconditioning and preparation | 184.1 | 171.1 | 13.0 | 8 | % | |||||||||
Reconditioning and preparation | 56.1 | 56.8 | (0.7 | ) | (1 | )% | ||||||||
Total parts and service | 240.2 | 227.9 | 12.3 | 5 | % | |||||||||
Finance and insurance | 131.4 | 121.1 | 10.3 | 9 | % | |||||||||
Total gross profit | $ | 514.7 | $ | 504.1 | $ | 10.6 | 2 | % | ||||||
SG&A expense | $ | 357.7 | $ | 346.2 | $ | 11.5 | 3 | % | ||||||
SG&A expense as a percentage of gross profit | 69.5 | % | 68.7 | % | 80 bps |
For the Six Months Ended June 30, | Increase (Decrease) | % Change | ||||||||||||
2017 | 2016 | |||||||||||||
Unit sales | ||||||||||||||
New vehicle: | ||||||||||||||
Luxury | 10,618 | 11,189 | (571 | ) | (5 | )% | ||||||||
Import | 28,138 | 27,080 | 1,058 | 4 | % | |||||||||
Domestic | 8,574 | 9,357 | (783 | ) | (8 | )% | ||||||||
Total new vehicle | 47,330 | 47,626 | (296 | ) | (1 | )% | ||||||||
Used vehicle retail | 39,086 | 36,912 | 2,174 | 6 | % | |||||||||
Used to new ratio | 82.6 | % | 77.5 | % | 510 bps | |||||||||
Average selling price | ||||||||||||||
New vehicle | $ | 35,331 | $ | 34,939 | $ | 392 | 1 | % | ||||||
Used vehicle retail | 21,038 | 21,291 | (253 | ) | (1 | )% | ||||||||
Average gross profit per unit | ||||||||||||||
New vehicle: | ||||||||||||||
Luxury | $ | 3,419 | $ | 3,548 | $ | (129 | ) | (4 | )% | |||||
Import | 995 | 1,233 | (238 | ) | (19 | )% | ||||||||
Domestic | 1,714 | 1,699 | 15 | 1 | % | |||||||||
Total new vehicle | 1,669 | 1,869 | (200 | ) | (11 | )% | ||||||||
Used vehicle retail | 1,612 | 1,777 | (165 | ) | (9 | )% | ||||||||
Finance and insurance, net | 1,521 | 1,432 | 89 | 6 | % | |||||||||
Front end yield (1) | 3,164 | 3,261 | (97 | ) | (3 | )% | ||||||||
Gross margin | ||||||||||||||
New vehicle: | ||||||||||||||
Luxury | 6.4 | % | 6.8 | % | (40) bps | |||||||||
Import | 3.6 | % | 4.5 | % | (90) bps | |||||||||
Domestic | 4.5 | % | 4.7 | % | (20) bps | |||||||||
Total new vehicle | 4.7 | % | 5.3 | % | (60) bps | |||||||||
Used vehicle retail | 7.7 | % | 8.3 | % | (60) bps | |||||||||
Parts and service: | ||||||||||||||
Parts and service, excluding reconditioning and preparation | 47.7 | % | 46.9 | % | 80 bps | |||||||||
Parts and service, including reconditioning and preparation | 62.2 | % | 62.5 | % | (30) bps | |||||||||
Total gross profit margin | 16.6 | % | 16.6 | % | — |
(1) | Front end yield is calculated as gross profit from new vehicles, used retail vehicles and finance and insurance (net), divided by combined new and used retail unit sales. |
June 30, 2017 | December 31, 2016 | Increase (Decrease) | % Change | |||||||||||
SELECTED BALANCE SHEET DATA | ||||||||||||||
Cash and cash equivalents | $ | 2.7 | $ | 3.4 | $ | (0.7 | ) | (21 | )% | |||||
New vehicle inventory | 740.5 | 720.6 | 19.9 | 3 | % | |||||||||
Used vehicle inventory | 147.1 | 132.7 | 14.4 | 11 | % | |||||||||
Parts inventory | 42.8 | 41.6 | 1.2 | 3 | % | |||||||||
Total current assets | 1,318.0 | 1,332.4 | (14.4 | ) | (1 | )% | ||||||||
Floor plan notes payable | 820.7 | 781.8 | 38.9 | 5 | % | |||||||||
Total current liabilities | 1,103.2 | 1,104.9 | (1.7 | ) | — | % | ||||||||
CAPITALIZATION: | ||||||||||||||
Long-term debt (including current portion) | $ | 919.4 | $ | 926.7 | $ | (7.3 | ) | (1 | )% | |||||
Shareholders' equity | 318.1 | 279.7 | 38.4 | 14 | % | |||||||||
Total | $ | 1,237.5 | $ | 1,206.4 | $ | 31.1 | 3 | % |
June 30, 2017 | December 31, 2016 | ||||
DAYS SUPPLY | |||||
New vehicle inventory | 74 | 61 | |||
Used vehicle inventory | 35 | 30 |
For the Six Months Ended June 30, | |||||
2017 | 2016 | ||||
Luxury: | |||||
Mercedes-Benz | 7 | % | 7 | % | |
Lexus | 6 | % | 7 | % | |
BMW | 5 | % | 7 | % | |
Acura | 4 | % | 4 | % | |
Infiniti | 3 | % | 3 | % | |
Other luxury | 8 | % | 6 | % | |
Total luxury | 33 | % | 34 | % | |
Imports: | |||||
Honda | 18 | % | 17 | % | |
Nissan | 12 | % | 10 | % | |
Toyota | 11 | % | 12 | % | |
Other imports | 5 | % | 6 | % | |
Total imports | 46 | % | 45 | % | |
Domestic: | |||||
Ford | 11 | % | 14 | % | |
Chevrolet | 4 | % | 2 | % | |
Dodge | 3 | % | 2 | % | |
Other domestics | 3 | % | 3 | % | |
Total domestic | 21 | % | 21 | % | |
Total New Vehicle Revenue | 100 | % | 100 | % |
For the Twelve Months Ended | |||||||
June 30, 2017 | March 31, 2017 | ||||||
(Dollars in millions) | |||||||
Adjusted leverage ratio: | |||||||
Long-term debt (including current portion) | $ | 919.4 | $ | 923.0 | |||
Calculation of earnings before interest, taxes, depreciation and amortization ("EBITDA"): | |||||||
Income from continuing operations | $ | 165.4 | $ | 170.2 | |||
Add: | |||||||
Depreciation and amortization | 31.5 | 31.0 | |||||
Income tax expense | 97.8 | 100.4 | |||||
Swap and other interest expense | 55.9 | 56.0 | |||||
Earnings before interest, taxes, depreciation and amortization ("EBITDA") | $ | 350.6 | $ | 357.6 | |||
Non-core items - (income) expense: | |||||||
Legal settlements | $ | (7.5 | ) | $ | (7.5 | ) | |
Real estate-related charges | 5.2 | 2.3 | |||||
Gain on divestitures | (45.5 | ) | (45.5 | ) | |||
Investment income | (0.8 | ) | |||||
Total non-core items | (48.6 | ) | (50.7 | ) | |||
Adjusted EBITDA | $ | 302.0 | $ | 306.9 | |||
Adjusted leverage ratio | 3.0 | 3.0 |
For the Three Months Ended June 30, | |||||||
2017 | 2016 | ||||||
(In millions, except per share data) | |||||||
Adjusted income from operations: | |||||||
Income from operations | $ | 71.6 | $ | 78.1 | |||
Real estate-related charges | 2.9 | — | |||||
Investment income | (0.8 | ) | — | ||||
Adjusted income from operations | $ | 73.7 | $ | 78.1 | |||
Adjusted income from continuing operations: | |||||||
Income from continuing operations | $ | 31.9 | $ | 36.6 | |||
Non-core items - (income) expense: | |||||||
Real estate-related charges | 2.9 | — | |||||
Investment income | (0.8 | ) | — | ||||
Income tax (benefit) expense on non-core items above | (0.8 | ) | — | ||||
Total non-core items | 1.3 | — | |||||
Adjusted income from continuing operations | $ | 33.2 | $ | 36.6 | |||
Adjusted diluted earnings per share (EPS) from continuing operations: | |||||||
Net income | $ | 1.52 | $ | 1.65 | |||
Discontinued operations, net of tax | — | — | |||||
Income from continuing operations | $ | 1.52 | $ | 1.65 | |||
Total non-core items | 0.06 | — | |||||
Adjusted diluted EPS from continuing operations | $ | 1.58 | $ | 1.65 | |||
Weighted average common shares outstanding - diluted | 21.0 | 22.2 |
For the Six Months Ended June 30, | |||||||
2017 | 2016 | ||||||
(In millions, except per share data) | |||||||
Adjusted income from operations: | |||||||
Income from operations | $ | 143.9 | $ | 147.0 | |||
Real estate-related charges | 2.9 | 3.4 | |||||
Investment income | (0.8 | ) | — | ||||
Legal settlements | (0.9 | ) | — | ||||
Adjusted income from operations | $ | 145.1 | $ | 150.4 | |||
Adjusted income from continuing operations: | |||||||
Income from continuing operations | $ | 65.9 | $ | 67.7 | |||
Non-core items - (income) expense: | |||||||
Real estate-related charges | 2.9 | 3.4 | |||||
Investment income | (0.8 | ) | — | ||||
Legal settlements | (0.9 | ) | — | ||||
Income tax (benefit) expense on non-core items above | (0.5 | ) | (1.3 | ) | |||
Total non-core items | 0.7 | 2.1 | |||||
Adjusted income from continuing operations | $ | 66.6 | $ | 69.8 | |||
Adjusted diluted earnings per share (EPS) from continuing operations: | |||||||
Net income | $ | 3.12 | $ | 2.91 | |||
Discontinued operations, net of tax | — | — | |||||
Income from continuing operations | $ | 3.12 | $ | 2.91 | |||
Total non-core items | 0.04 | 0.09 | |||||
Adjusted diluted EPS from continuing operations | $ | 3.16 | $ | 3.00 | |||
Weighted average common shares outstanding - diluted | 21.1 | 23.3 |