0000350698-18-000028.txt : 20180201 0000350698-18-000028.hdr.sgml : 20180201 20180201073831 ACCESSION NUMBER: 0000350698-18-000028 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 3 CONFORMED PERIOD OF REPORT: 20180201 ITEM INFORMATION: Results of Operations and Financial Condition ITEM INFORMATION: Financial Statements and Exhibits FILED AS OF DATE: 20180201 DATE AS OF CHANGE: 20180201 FILER: COMPANY DATA: COMPANY CONFORMED NAME: AUTONATION, INC. CENTRAL INDEX KEY: 0000350698 STANDARD INDUSTRIAL CLASSIFICATION: RETAIL-AUTO DEALERS & GASOLINE STATIONS [5500] IRS NUMBER: 731105145 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 001-13107 FILM NUMBER: 18564662 BUSINESS ADDRESS: STREET 1: 200 SW 1ST AVE STREET 2: SUITE 1600 CITY: FORT LAUDERDALE STATE: FL ZIP: 33301 BUSINESS PHONE: 9547696000 MAIL ADDRESS: STREET 1: 200 SW 1ST AVE STREET 2: SUITE 1600 CITY: FORT LAUDERDALE STATE: FL ZIP: 33301 FORMER COMPANY: FORMER CONFORMED NAME: AUTONATION, INC. /FL DATE OF NAME CHANGE: 20090827 FORMER COMPANY: FORMER CONFORMED NAME: AutoNation, Inc. /FL DATE OF NAME CHANGE: 20090827 FORMER COMPANY: FORMER CONFORMED NAME: AUTONATION INC /FL DATE OF NAME CHANGE: 19990407 8-K 1 an8kearningsrelease123117.htm FORM 8-K Document


 
 
 
 
 
 
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 1, 2018
 
AutoNation, Inc.
(Exact name of registrant as specified in its charter)
 
  
Delaware
 
1-13107   
 
73-1105145
(State or other jurisdiction
of incorporation)
 
(Commission     
File Number)     
 
(IRS Employer
Identification No.)
200 SW 1st Ave
Fort Lauderdale, Florida 33301
(Address of principal executive offices, including zip code)
Registrant's telephone number, including area code (954) 769-6000
 
(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 (see General Instruction A.2. below):
 
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))
 

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
 
Emerging growth company o
 
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. o
 
 
 
 
 






Item 2.02
Results of Operations and Financial Condition.
On February 1, 2018, AutoNation, Inc. (the “Company”) issued a press release announcing its results of operations for the fiscal quarter and year ended December 31, 2017. A copy of the press release is furnished as Exhibit 99.1 to this Current Report on Form 8-K.
The information furnished pursuant to this Item 2.02, including Exhibit 99.1, shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities under that Section and shall not be deemed to be incorporated by reference into any filing of the Company under the Securities Act of 1933, as amended, or the Exchange Act, except as shall be expressly set forth by specific reference in such filing.
Item 9.01
Financial Statements and Exhibits.
(d) Exhibits

99.1






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.

 
 
 
AUTONATION, INC.
 
 
 
 
 
Date:
February 1, 2018
 
By:
/s/ C. Coleman Edmunds
 
 
 
 
C. Coleman Edmunds
 
 
 
 
Executive Vice President, General Counsel and Corporate Secretary



 EX-99.1 2 an8kearningsrelease123117e.htm PRESS RELEASE Exhibit


Exhibit 99.1
 
anlogobluepinka03.jpg
 
 
 
Contact: Marc Cannon
(954) 769-3146
cannonm@autonation.com
 
Robert Quartaro
(954) 769-7342
quartaror@autonation.com
AutoNation Reports All-Time Record Quarterly EPS
 
•
EPS from continuing operations was an all-time record $1.64, up 44% compared to fourth quarter 2016 EPS from continuing operations of $1.14
•
Total revenue of $5.7 billion increased by 4% compared to the year-ago period. Same store revenue of $5.6 billion increased by 4% compared to the year-ago period
•
Same store gross profit of $851 million increased by 7% compared to the year-ago period, driven by an all-time record same store Customer Financial Services gross profit per vehicle retailed of $1,732, an increase of 11%, and strong same store Customer Care gross profit growth of 6%
•
The recent tax reform bill positively impacted fourth quarter 2017 net income from continuing operations by $41 million, or $0.45 per share
FORT LAUDERDALE, Fla., (February 1, 2018) —AutoNation, Inc. (NYSE: AN), America’s largest automotive retailer, today reported fourth quarter 2017 net income from continuing operations of $152 million, or $1.64 per share, up 44% compared to the fourth quarter 2016 net income from continuing operations of $116 million, or $1.14 per share. Fourth quarter 2017 EPS from continuing operations included a benefit of $0.45 per share from the recent tax reform bill and a net gain of $0.17 per share related to business/property divestitures. Fourth quarter 2016 EPS from continuing operations included gains of $0.19 per share related to a business divestiture and $0.09 per share related to a legal settlement.
Fourth quarter 2017 revenue totaled $5.7 billion compared to $5.5 billion in the year-ago period. Same store fourth quarter 2017 revenue totaled $5.6 billion compared to $5.4 billion in the year-ago period, an increase of 4%. Same store fourth quarter 2017 gross profit of $851 million increased by 7% compared to $794 million in the year-ago period, driven by increases in used vehicle gross profit of 16%, Customer Financial Services gross profit of 14%, and Customer Care gross profit of 6%. Same store Customer Financial Services gross profit per vehicle retailed was an all-time record $1,732.

Share Repurchase
During 2017, AutoNation repurchased 10.1 million shares of common stock for an aggregate purchase price of $435 million. As of January 31, 2018, AutoNation has approximately $114 million remaining Board authorization for share repurchase and 92 million shares outstanding.
Segment Results
Segment results(1) for the fourth quarter 2017 were as follows:

•
Domestic – Domestic segment income(2) was $67 million compared to year-ago segment income of $64 million, an increase of 4%.
•
Import – Import segment income(2) was $75 million compared to year-ago segment income of $67 million, an increase of 13%.
•
Premium Luxury – Premium Luxury segment income(2) was $106 million compared to year-ago segment income of $93 million, an increase of 13%.

For the full year ended December 31, 2017, AutoNation reported net income from continuing operations of $435 million, or $4.43 per share, compared to net income from continuing operations of $432 million, or $4.16 per share, for the same period in the prior year, an increase of 6% on a per-share basis. AutoNation’s revenue for full year 2017 totaled $21.5 billion, which was down slightly compared to $21.6 billion for the same period in the prior year.




The fourth quarter conference call may be accessed by telephone at (888) 769-8515 (password: AutoNation) at 11:00 a.m. Eastern Time today or on AutoNation’s investor relations website at http://investors.autonation.com.
The webcast will also be available on AutoNation’s website under “Events & Presentations” following the call. A playback of the conference call will be available after 1:00 p.m. Eastern Time on February 1, 2018, through February 22, 2018, by calling (888) 437-4641 (passcode: 2871).
  
(1) 
AutoNation has three operating segments: Domestic, Import, and Premium Luxury. The Domestic segment is comprised of stores that sell vehicles manufactured by General Motors, Ford, and FCA US; the Import segment is comprised of stores that sell vehicles manufactured primarily by Toyota, Honda, Nissan, and Hyundai; and the Premium Luxury segment is comprised of stores that sell vehicles manufactured primarily by Mercedes-Benz, BMW, Lexus, and Audi.
(2) 
Segment income represents income for each of our reportable segments and is defined as operating income less floorplan interest expense.
About AutoNation, Inc.
AutoNation, America’s largest automotive retailer, through its bold leadership, innovation and its comprehensive brand extensions, is transforming the automotive industry. As of December 31, 2017, AutoNation owned and operated 360 new vehicle franchises from coast to coast. AutoNation has sold over 11 million vehicles, the first automotive retailer to reach this milestone. AutoNation’s success is driven by a commitment to delivering a peerless experience through customer-focused sales and service processes. Through its Drive Pink initiative, AutoNation is committed to drive out cancer, create awareness and support critical research. AutoNation continues to be a proud supporter of the Breast Cancer Research Foundation and other cancer-related charities.
Please visit investors.autonation.com, www.autonation.com, www.autonationdrive.com, www.twitter.com/autonation, www.twitter.com/CEOMikeJackson, www.facebook.com/autonation, and www.facebook.com/CEOMikeJackson, where AutoNation discloses additional information about the Company, its business, and its results of operations.

FORWARD-LOOKING STATEMENTS
This news release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. All statements other than statements of historical fact are, or may be deemed to be, forward-looking statements. Words such as “anticipates,” “expects,” “intends,” “goals,” “plans,” “believes,” “continues,” “may,” “will,” “could,” and variations of such words and similar expressions are intended to identify such forward-looking statements. Statements regarding our strategic initiatives, including our brand extension strategies, open safety recalls, and expectations for future results and the future performance of our franchises (including with respect to sales of used vehicles and parts and accessories) and the automotive retail industry, as well as other statements that describe our objectives, goals, or plans are forward-looking statements. Our forward-looking statements reflect our current expectations concerning future results and events, and they involve known and unknown risks, uncertainties and other factors that are difficult to predict and may cause our actual results, performance or achievements to be materially different from any future results, performance and achievements expressed or implied by these statements. These risks, uncertainties and other factors include, among others: economic conditions, including conditions in the credit markets and changes in interest rates; new and used vehicle margins; the success and financial viability and the incentive and marketing programs of vehicle manufacturers and distributors with which we hold franchises; our ability to successfully implement, and customer adoption of, our brand extension strategies; our ability to identify, acquire, and build out suitable locations in a timely manner; our ability to maintain and enhance our retail brands and reputation and to attract consumers to our own digital channels; our ability to integrate successfully acquired and awarded franchises and to attain planned sales volumes within our expected time frames; restrictions imposed by vehicle manufacturers and our ability to obtain manufacturer approval for acquisitions; natural disasters and other adverse weather events; the resolution of legal and administrative proceedings; regulatory factors affecting our business, including fuel economy requirements; the announcement of safety recalls; factors affecting our goodwill and other intangible asset impairment testing; and other factors described in our news releases and filings made under the securities laws, including, among others, our Annual Reports on Form 10-K, our Quarterly Reports on Form 10-Q and our Current Reports on Form 8-K. Forward-looking statements contained in this news release speak only as of the date of this news release, and we undertake no obligation to update these forward-looking statements to reflect subsequent events or circumstances.









AUTONATION, INC.
UNAUDITED CONDENSED CONSOLIDATED INCOME STATEMENTS
(In millions, except per share data)
 
 
Three Months Ended December 31,
 
Twelve Months Ended December 31,
 
2017
 
2016
 
2017
 
2016
Revenue:
 
 
 
 
 
 
 
New vehicle
$
3,345.3

 
$
3,187.8

 
$
12,180.8

 
$
12,255.8

Used vehicle
1,208.1

 
1,217.5

 
4,878.4

 
4,995.3

Parts and service
854.1

 
822.5

 
3,398.3

 
3,321.4

Finance and insurance, net
247.2

 
216.5

 
939.2

 
894.6

Other
28.8

 
36.2

 
137.9

 
141.9

Total revenue
5,683.5

 
5,480.5

 
21,534.6

 
21,609.0

Cost of sales:
 
 
 
 
 
 
 
New vehicle
3,184.2

 
3,022.2

 
11,592.4

 
11,620.0

Used vehicle
1,130.1

 
1,152.1

 
4,563.2

 
4,677.7

Parts and service
479.4

 
467.9

 
1,907.6

 
1,886.7

Other
22.6

 
29.2

 
112.4

 
111.4

Total cost of sales
4,816.3

 
4,671.4

 
18,175.6

 
18,295.8

Gross profit
867.2

 
809.1

 
3,359.0

 
3,313.2

Selling, general, and administrative expenses
622.1

 
584.2

 
2,436.2

 
2,349.4

Depreciation and amortization
40.6

 
36.4

 
158.6

 
143.4

Other income, net
(24.8
)
 
(48.1
)
 
(79.2
)
 
(69.1
)
Operating income
229.3

 
236.6

 
843.4

 
889.5

Non-operating income (expense) items:
 
 
 
 
 
 
 
Floorplan interest expense
(26.3
)
 
(20.1
)
 
(97.0
)
 
(76.5
)
Other interest expense
(32.2
)
 
(29.6
)
 
(120.2
)
 
(115.5
)
Interest income
0.2

 
0.3

 
1.0

 
1.1

Other income, net
2.9

 
0.3

 
9.3

 
3.7

Income from continuing operations before income taxes
173.9

 
187.5

 
636.5

 
702.3

Income tax provision
22.4

 
71.9

 
201.5

 
270.6

Net income from continuing operations
151.5

 
115.6

 
435.0

 
431.7

Loss from discontinued operations, net of income taxes
(0.2
)
 
(0.3
)
 
(0.4
)
 
(1.2
)
Net income
$
151.3

 
$
115.3

 
$
434.6

 
$
430.5

Diluted earnings (loss) per share*:
 
 
 
 
 
 
 
Continuing operations
$
1.64

 
$
1.14

 
$
4.43

 
$
4.16

Discontinued operations
$
—

 
$
—

 
$
—

 
$
(0.01
)
Net income
$
1.64

 
$
1.14

 
$
4.43

 
$
4.15

Weighted average common shares outstanding
92.3

 
101.5

 
98.2

 
103.8

Common shares outstanding, net of treasury stock, at period end
91.6

 
100.7

 
91.6

 
100.7


*
Earnings per share amounts are calculated discretely and therefore may not add up to the total due to rounding.




AUTONATION, INC.
UNAUDITED SUPPLEMENTARY DATA
($ in millions, except per vehicle data)
Operating Highlights
 
Three Months Ended December 31,
 
Twelve Months Ended December 31,
 
 
2017
 
2016
 
$ Variance
 
% Variance
 
2017
 
2016
 
$ Variance
 
% Variance
Revenue:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
New vehicle
 
$
3,345.3

 
$
3,187.8

 
$
157.5

 
4.9

 
$
12,180.8

 
$
12,255.8

 
$
(75.0
)
 
(0.6
)
Retail used vehicle
 
1,138.4

 
1,111.3

 
27.1

 
2.4

 
4,577.1

 
4,481.7

 
95.4

 
2.1

Wholesale
 
69.7

 
106.2

 
(36.5
)
 
(34.4
)
 
301.3

 
513.6

 
(212.3
)
 
(41.3
)
Used vehicle
 
1,208.1

 
1,217.5

 
(9.4
)
 
(0.8
)
 
4,878.4

 
4,995.3

 
(116.9
)
 
(2.3
)
Finance and insurance, net
 
247.2

 
216.5

 
30.7

 
14.2

 
939.2

 
894.6

 
44.6

 
5.0

Total variable operations
 
4,800.6

 
4,621.8

 
178.8

 
3.9

 
17,998.4

 
18,145.7

 
(147.3
)
 
(0.8
)
Parts and service
 
854.1

 
822.5

 
31.6

 
3.8

 
3,398.3

 
3,321.4

 
76.9

 
2.3

Other
 
28.8

 
36.2

 
(7.4
)
 
 
 
137.9

 
141.9

 
(4.0
)
 
 
Total revenue
 
$
5,683.5

 
$
5,480.5

 
$
203.0

 
3.7

 
$
21,534.6

 
$
21,609.0

 
$
(74.4
)
 
(0.3
)
Gross profit:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
New vehicle
 
$
161.1

 
$
165.6

 
$
(4.5
)
 
(2.7
)
 
$
588.4

 
$
635.8

 
$
(47.4
)
 
(7.5
)
Retail used vehicle
 
75.2

 
69.8

 
5.4

 
7.7

 
308.0

 
334.9

 
(26.9
)
 
(8.0
)
Wholesale
 
2.8

 
(4.4
)
 
7.2

 
 
 
7.2

 
(17.3
)
 
24.5

 
 
Used vehicle
 
78.0

 
65.4

 
12.6

 
19.3

 
315.2

 
317.6

 
(2.4
)
 
(0.8
)
Finance and insurance
 
247.2

 
216.5

 
30.7

 
14.2

 
939.2

 
894.6

 
44.6

 
5.0

Total variable operations
 
486.3

 
447.5

 
38.8

 
8.7

 
1,842.8

 
1,848.0

 
(5.2
)
 
(0.3
)
Parts and service
 
374.7

 
354.6

 
20.1

 
5.7

 
1,490.7

 
1,434.7

 
56.0

 
3.9

Other
 
6.2

 
7.0

 
(0.8
)
 
 
 
25.5

 
30.5

 
(5.0
)
 
 
Total gross profit
 
867.2

 
809.1

 
58.1

 
7.2

 
3,359.0

 
3,313.2

 
45.8

 
1.4

Selling, general, and administrative expenses
 
622.1

 
584.2

 
(37.9
)
 
(6.5
)
 
2,436.2

 
2,349.4

 
(86.8
)
 
(3.7
)
Depreciation and amortization
 
40.6

 
36.4

 
(4.2
)
 
 
 
158.6

 
143.4

 
(15.2
)
 
 
Other income, net
 
(24.8
)
 
(48.1
)
 
(23.3
)
 
 
 
(79.2
)
 
(69.1
)
 
10.1

 
 
Operating income
 
229.3

 
236.6

 
(7.3
)
 
(3.1
)
 
843.4

 
889.5

 
(46.1
)
 
(5.2
)
Non-operating income (expense) items:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Floorplan interest expense
 
(26.3
)
 
(20.1
)
 
(6.2
)
 
 
 
(97.0
)
 
(76.5
)
 
(20.5
)
 
 
Other interest expense
 
(32.2
)
 
(29.6
)
 
(2.6
)
 
 
 
(120.2
)
 
(115.5
)
 
(4.7
)
 
 
Interest income
 
0.2

 
0.3

 
(0.1
)
 
 
 
1.0

 
1.1

 
(0.1
)
 
 
Other income, net
 
2.9

 
0.3

 
2.6

 
 
 
9.3

 
3.7

 
5.6

 
 
Income from continuing operations before income taxes
 
$
173.9

 
$
187.5

 
$
(13.6
)
 
(7.3
)
 
$
636.5

 
$
702.3

 
$
(65.8
)
 
(9.4
)
Retail vehicle unit sales:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
New
 
87,234

 
84,622

 
2,612

 
3.1

 
329,116

 
337,622

 
(8,506
)
 
(2.5
)
Used
 
55,944

 
55,213

 
731

 
1.3

 
234,148

 
225,713

 
8,435

 
3.7

 
 
143,178

 
139,835

 
3,343

 
2.4

 
563,264

 
563,335

 
(71
)
 
—

Revenue per vehicle retailed:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
New
 
$
38,349

 
$
37,671

 
$
678

 
1.8

 
$
37,011

 
$
36,300

 
$
711

 
2.0

Used
 
$
20,349

 
$
20,128

 
$
221

 
1.1

 
$
19,548

 
$
19,856

 
$
(308
)
 
(1.6
)
Gross profit per vehicle retailed:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
New
 
$
1,847

 
$
1,957

 
$
(110
)
 
(5.6
)
 
$
1,788

 
$
1,883

 
$
(95
)
 
(5.0
)
Used
 
$
1,344

 
$
1,264

 
$
80

 
6.3

 
$
1,315

 
$
1,484

 
$
(169
)
 
(11.4
)
Finance and insurance
 
$
1,727

 
$
1,548

 
$
179

 
11.6

 
$
1,667

 
$
1,588

 
$
79

 
5.0

Total variable operations(1)
 
$
3,377

 
$
3,232

 
$
145

 
4.5

 
$
3,259

 
$
3,311

 
$
(52
)
 
(1.6
)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
(1) Total variable operations gross profit per vehicle retailed is calculated by dividing the sum of new vehicle, retail used vehicle, and finance and insurance gross profit by total retail vehicle unit sales.
 




Operating Percentages
 
Three Months Ended December 31,
 
Twelve Months Ended December 31,
 
 
2017 (%)
 
2016 (%)
 
2017 (%)
 
2016 (%)
Revenue mix percentages:
 
 
 
 
 
 
 
 
New vehicle
 
58.9
 
58.2
 
56.6
 
56.7
Used vehicle
 
21.3
 
22.2
 
22.7
 
23.1
Parts and service
 
15.0
 
15.0
 
15.8
 
15.4
Finance and insurance, net
 
4.3
 
4.0
 
4.4
 
4.1
Other
 
0.5
 
0.6
 
0.5
 
0.7
 
 
100.0
 
100.0
 
100.0
 
100.0
Gross profit mix percentages:
 
 
 
 
 
 
 
 
New vehicle
 
18.6
 
20.5
 
17.5
 
19.2
Used vehicle
 
9.0
 
8.1
 
9.4
 
9.6
Parts and service
 
43.2
 
43.8
 
44.4
 
43.3
Finance and insurance
 
28.5
 
26.8
 
28.0
 
27.0
Other
 
0.7
 
0.8
 
0.7
 
0.9
 
 
100.0
 
100.0
 
100.0
 
100.0
Operating items as a percentage of revenue:
 
 
 
 
 
 
 
 
Gross profit:
 
 
 
 
 
 
 
 
New vehicle
 
4.8
 
5.2
 
4.8
 
5.2
Used vehicle - retail
 
6.6
 
6.3
 
6.7
 
7.5
Parts and service
 
43.9
 
43.1
 
43.9
 
43.2
Total
 
15.3
 
14.8
 
15.6
 
15.3
Selling, general, and administrative expenses
 
10.9
 
10.7
 
11.3
 
10.9
Operating income
 
4.0
 
4.3
 
3.9
 
4.1
Operating items as a percentage of total gross profit:
 
 
 
 
 
 
 
 
Selling, general, and administrative expenses
 
71.7
 
72.2
 
72.5
 
70.9
Operating income
 
26.4
 
29.2
 
25.1
 
26.8







AUTONATION, INC.
UNAUDITED SUPPLEMENTARY DATA
($ in millions)
 
Segment Operating Highlights
 
Three Months Ended December 31,
 
Twelve Months Ended December 31,
 
 
2017
 
2016
 
$ Variance
 
% Variance
 
2017
 
2016
 
$ Variance
 
% Variance
Revenue:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Domestic
 
$
1,895.1

 
$
1,921.8

 
$
(26.7
)
 
(1.4
)
 
$
7,452.8

 
$
7,810.0

 
$
(357.2
)
 
(4.6
)
Import
 
1,749.9

 
1,684.0

 
65.9

 
3.9

 
6,873.4

 
6,886.1

 
(12.7
)
 
(0.2
)
Premium luxury
 
1,937.8

 
1,799.7

 
138.1

 
7.7

 
6,832.7

 
6,665.3

 
167.4

 
2.5

Total
 
5,582.8

 
5,405.5

 
177.3

 
3.3

 
21,158.9

 
21,361.4

 
(202.5
)
 
(0.9
)
Corporate and other
 
100.7

 
75.0

 
25.7

 
34.3

 
375.7

 
247.6

 
128.1

 
51.7

Total consolidated revenue
 
$
5,683.5

 
$
5,480.5

 
$
203.0

 
3.7

 
$
21,534.6

 
$
21,609.0

 
$
(74.4
)
 
(0.3
)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Segment income*:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Domestic
 
$
66.6

 
$
64.2

 
$
2.4

 
3.7

 
$
257.1

 
$
311.1

 
$
(54.0
)
 
(17.4
)
Import
 
75.2

 
66.8

 
8.4

 
12.6

 
303.1

 
296.8

 
6.3

 
2.1

Premium luxury
 
105.5

 
93.4

 
12.1

 
13.0

 
348.8

 
350.2

 
(1.4
)
 
(0.4
)
Total
 
247.3

 
224.4

 
22.9

 
10.2

 
909.0

 
958.1

 
(49.1
)
 
(5.1
)
Corporate and other
 
(44.3
)
 
(7.9
)
 
(36.4
)
 
 
 
(162.6
)
 
(145.1
)
 
(17.5
)
 
 
Add: Floorplan interest expense
 
26.3

 
20.1

 
6.2

 
 
 
97.0

 
76.5

 
20.5

 
 
Operating income
 
$
229.3

 
$
236.6

 
$
(7.3
)
 
(3.1
)
 
$
843.4

 
$
889.5

 
$
(46.1
)
 
(5.2
)
* Segment income represents income for each of our reportable segments and is defined as operating income less floorplan interest expense.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Retail new vehicle unit sales:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Domestic
 
28,263

 
28,711

 
(448
)
 
(1.6
)
 
111,028

 
118,867

 
(7,839
)
 
(6.6
)
Import
 
38,641

 
36,488

 
2,153

 
5.9

 
150,422

 
150,005

 
417

 
0.3

Premium luxury
 
20,330

 
19,423

 
907

 
4.7

 
67,666

 
68,750

 
(1,084
)
 
(1.6
)
 
 
87,234

 
84,622

 
2,612

 
3.1

 
329,116

 
337,622

 
(8,506
)
 
(2.5
)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Brand Mix - New Vehicle Retail Units Sold
 
Three Months Ended December 31,
 
Twelve Months Ended December 31,
 
 
 
 
2017 (%)
 
2016 (%)
 
2017 (%)
 
2016 (%)
 
Domestic:
 
 
 
 
 
 
 
 
 
Ford, Lincoln
 
13.0

 
13.8

 
13.6

 
14.7

 
Chevrolet, Buick, Cadillac, GMC
 
11.1

 
10.7

 
10.7

 
11.1

 
Chrysler, Dodge, Jeep, Ram
 
8.3

 
9.4

 
9.4

 
9.4

 
Domestic total
 
32.4

 
33.9

 
33.7

 
35.2

 
Import:
 
 
 
 
 
 
 
 
 
Toyota
 
17.9

 
17.7

 
18.6

 
17.6

 
Honda
 
12.9

 
12.0

 
13.1

 
12.4

 
Nissan
 
6.6

 
6.6

 
6.8

 
7.6

 
Other Import
 
6.9

 
6.8

 
7.2

 
6.8

 
Import total
 
44.3

 
43.1

 
45.7

 
44.4

 
Premium Luxury:
 
 
 
 
 
 
 
 
 
Mercedes-Benz
 
9.5

 
9.6

 
8.1

 
8.6

 
BMW
 
5.4

 
5.3

 
4.7

 
4.5

 
Lexus
 
2.7

 
3.1

 
2.6

 
2.7

 
Audi
 
2.6

 
2.4

 
2.4

 
2.2

 
Other Premium Luxury (Land Rover, Porsche)
 
3.1

 
2.6

 
2.8

 
2.4

 
Premium Luxury total
 
23.3

 
23.0

 
20.6

 
20.4

 
 
 
100.0

 
100.0

 
100.0

 
100.0

 
.




AUTONATION, INC.
UNAUDITED SUPPLEMENTARY DATA, Continued
($ in millions)
 
Capital Expenditures / Stock Repurchases
 
Three Months Ended December 31,
 
Twelve Months Ended December 31,
 
 
2017
 
2016
 
2017
 
2016
Capital expenditures (1)
 
$
108.3

 
$
71.4

 
$
332.9

 
$
253.2

Cash paid for acquisitions, net of cash acquired (2)
 
$
20.0

 
$
47.9

 
$
76.8

 
$
410.4

Proceeds from exercises of stock options
 
$
15.0

 
$
0.6

 
$
39.7

 
$
8.4

Stock repurchases:
 
 
 
 
 
 
 
 
Aggregate purchase price
 
$
—

 
$
26.4

 
$
434.9

 
$
497.0

Shares repurchased (in millions)
 
—

 
0.6

 
10.1

 
10.5

 
Floorplan Assistance and Expense
 
Three Months Ended December 31,
 
Twelve Months Ended December 31,
 
 
2017
 
2016
 
Variance
 
2017
 
2016
 
Variance
Floorplan assistance earned (included in cost of sales)
 
$
33.4

 
$
31.7

 
$
1.7

 
$
122.1

 
$
124.0

 
$
(1.9
)
New vehicle floorplan interest expense
 
(24.1
)
 
(18.6
)
 
(5.5
)
 
(90.4
)
 
(71.5
)
 
(18.9
)
Net new vehicle inventory carrying benefit
 
$
9.3

 
$
13.1

 
$
(3.8
)
 
$
31.7

 
$
52.5

 
$
(20.8
)
 
Balance Sheet and Other Highlights
 
December 31, 2017
 
December 31, 2016
Cash and cash equivalents
 
$
69.2

 
$
64.8

Inventory
 
$
3,365.6

 
$
3,520.1

Total floorplan notes payable
 
$
3,806.9

 
$
3,849.2

Non-vehicle debt
 
$
2,703.7

 
$
2,720.6

Equity
 
$
2,369.3

 
$
2,310.3

New days supply (industry standard of selling days)
 
53 days

 
61 days

Used days supply (trailing calendar month days)
 
43 days

 
44 days

 
 
Key Credit Agreement Covenant Compliance Calculations (3)
 
 
Leverage ratio
 
2.82
x
Covenant
less than or equal to
4.25
x
 
Capitalization ratio
 
62.4
%
Covenant
less than or equal to
70.0
%
 
(1)
Includes accrued construction in progress and excludes property associated with capital leases entered into during the period.
(2) 
Excludes capital leases and deferred purchase price commitments.
(3) 
Calculated in accordance with our credit agreement as filed with the SEC.







AUTONATION, INC.
UNAUDITED SAME STORE DATA
($ in millions, except per vehicle data)
 
Operating Highlights
 
Three Months Ended December 31,
 
Twelve Months Ended December 31,
 
 
2017
 
2016
 
$ 
Variance
 
% 
Variance
 
2017
 
2016
 
$ 
Variance
 
% 
Variance
Revenue:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
New vehicle
 
$
3,291.5

 
$
3,119.4

 
$
172.1

 
5.5

 
$
11,818.8

 
$
11,886.8

 
$
(68.0
)
 
(0.6
)
Retail used vehicle
 
1,110.7

 
1,086.1

 
24.6

 
2.3

 
4,420.1

 
4,333.7

 
86.4

 
2.0

Wholesale
 
66.0

 
103.2

 
(37.2
)
 
(36.0
)
 
286.1

 
495.1

 
(209.0
)
 
(42.2
)
Used vehicle
 
1,176.7

 
1,189.3

 
(12.6
)
 
(1.1
)
 
4,706.2

 
4,828.8

 
(122.6
)
 
(2.5
)
Finance and insurance, net
 
243.7

 
212.9

 
30.8

 
14.5

 
918.5

 
871.3

 
47.2

 
5.4

Total variable operations
 
4,711.9

 
4,521.6

 
190.3

 
4.2

 
17,443.5

 
17,586.9

 
(143.4
)
 
(0.8
)
Parts and service
 
841.0

 
806.1

 
34.9

 
4.3

 
3,307.3

 
3,220.3

 
87.0

 
2.7

Other
 
28.4

 
35.7

 
(7.3
)
 
 
 
137.0

 
140.8

 
(3.8
)
 
 
Total revenue
 
$
5,581.3

 
$
5,363.4

 
$
217.9

 
4.1

 
$
20,887.8

 
$
20,948.0

 
$
(60.2
)
 
(0.3
)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Gross profit:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
New vehicle
 
$
158.1

 
$
162.7

 
$
(4.6
)
 
(2.8
)
 
$
569.3

 
$
622.8

 
$
(53.5
)
 
(8.6
)
Retail used vehicle
 
73.9

 
68.2

 
5.7

 
8.4

 
299.9

 
323.8

 
(23.9
)
 
(7.4
)
Wholesale
 
0.5

 
(4.2
)
 
4.7

 
 
 
0.6

 
(15.9
)
 
16.5

 
 
Used vehicle
 
74.4

 
64.0

 
10.4

 
16.3

 
300.5

 
307.9

 
(7.4
)
 
(2.4
)
Finance and insurance
 
243.7

 
212.9

 
30.8

 
14.5

 
918.5

 
871.3

 
47.2

 
5.4

Total variable operations
 
476.2

 
439.6

 
36.6

 
8.3

 
1,788.3

 
1,802.0

 
(13.7
)
 
(0.8
)
Parts and service
 
369.1

 
347.3

 
21.8

 
6.3

 
1,451.5

 
1,389.9

 
61.6

 
4.4

Other
 
6.1

 
6.8

 
(0.7
)
 
 
 
24.9

 
29.9

 
(5.0
)
 
 
Total gross profit
 
$
851.4

 
$
793.7

 
$
57.7

 
7.3

 
$
3,264.7

 
$
3,221.8

 
$
42.9

 
1.3

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Retail vehicle unit sales:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
New
 
86,125

 
82,625

 
3,500

 
4.2

 
320,641

 
325,927

 
(5,286
)
 
(1.6
)
Used
 
54,614

 
53,708

 
906

 
1.7

 
225,985

 
216,447

 
9,538

 
4.4

 
 
140,739

 
136,333

 
4,406

 
3.2

 
546,626

 
542,374

 
4,252

 
0.8

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Revenue per vehicle retailed:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
New
 
$
38,218

 
$
37,754

 
$
464

 
1.2

 
$
36,860

 
$
36,471

 
$
389

 
1.1

Used
 
$
20,337

 
$
20,222

 
$
115

 
0.6

 
$
19,559

 
$
20,022

 
$
(463
)
 
(2.3
)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Gross profit per vehicle retailed:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
New
 
$
1,836

 
$
1,969

 
$
(133
)
 
(6.8
)
 
$
1,776

 
$
1,911

 
$
(135
)
 
(7.1
)
Used
 
$
1,353

 
$
1,270

 
$
83

 
6.5

 
$
1,327

 
$
1,496

 
$
(169
)
 
(11.3
)
Finance and insurance
 
$
1,732

 
$
1,562

 
$
170

 
10.9

 
$
1,680

 
$
1,606

 
$
74

 
4.6

Total variable operations(1)
 
$
3,380

 
$
3,255

 
$
125

 
3.8

 
$
3,270

 
$
3,352

 
$
(82
)
 
(2.4
)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
(1) Total variable operations gross profit per vehicle retailed is calculated by dividing the sum of new vehicle, retail used vehicle, and finance and insurance gross profit by total retail vehicle unit sales.
 





Operating Percentages
 
Three Months Ended December 31,
 
Twelve Months Ended December 31,
 
 
2017 (%)
 
2016 (%)
 
2017 (%)
 
2016 (%)
Revenue mix percentages:
 
 
 
 
 
 
 
 
New vehicle
 
59.0
 
58.2
 
56.6
 
56.7
Used vehicle
 
21.1
 
22.2
 
22.5
 
23.1
Parts and service
 
15.1
 
15.0
 
15.8
 
15.4
Finance and insurance, net
 
4.4
 
4.0
 
4.4
 
4.2
Other
 
0.4
 
0.6
 
0.7
 
0.6
 
 
100.0
 
100.0
 
100.0
 
100.0
Gross profit mix percentages:
 
 
 
 
 
 
 
 
New vehicle
 
18.6
 
20.5
 
17.4
 
19.3
Used vehicle
 
8.7
 
8.1
 
9.2
 
9.6
Parts and service
 
43.4
 
43.8
 
44.5
 
43.1
Finance and insurance
 
28.6
 
26.8
 
28.1
 
27.0
Other
 
0.7
 
0.8
 
0.8
 
1.0
 
 
100.0
 
100.0
 
100.0
 
100.0
Operating items as a percentage of revenue:
 
 
 
 
 
 
 
 
Gross profit:
 
 
 
 
 
 
 
 
New vehicle
 
4.8
 
5.2
 
4.8
 
5.2
Used vehicle - retail
 
6.7
 
6.3
 
6.8
 
7.5
Parts and service
 
43.9
 
43.1
 
43.9
 
43.2
Total
 
15.3
 
14.8
 
15.6
 
15.4



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