Penske Automotive (PAG) 8-K Unitedauto Reports Record Fourth Quarter and Year

	Press Release
	UnitedAuto Group, Inc.
	2555 Telegraph Rd.
	Bloomfield Hills MI 48302-0954

Contact:	Roger Penske	Jim Davidson	Tony Pordon
	Chairman	Executive VP – Finance	Vice President – Investor Relations
	248-648-2400	201-325-3303	248-648-2540
		jdavidson@unitedauto.com	tpordon@unitedauto.com

UNITEDAUTO REPORTS RECORD FOURTH QUARTER AND YEAR

Q4 Revenues Increase 18.4%

Q4 Income Increases 44.1% to $20.1 Million

Q4 Earnings Per Share Increases 41.2% to $0.48 Per Share

Q4 Same-Store Retail Revenues Increase 7.1%

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Full Year Earnings Per Share Increases 16.3% to $2.07

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Company to Raise $119.4 Million by Issuing 4,050,000 New Shares In Private Placement

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     BLOOMFIELD HILLS, MI, February 17, 2004 – United Auto Group, Inc. (NYSE: UAG), a FORTUNE 500 automotive specialty retailer, today announced record results for the fourth quarter and full year 2003, including double digit growth in revenues, income and earnings per share.

     Revenues for the fourth quarter increased 18.4% to a record $2.2 billion, driven by a 7.1% increase in same-store retail revenues. Importantly, the Company announced that same-store growth increased in each of its product lines, with new retail vehicle sales, used retail vehicle sales, service and parts sales, and finance and insurance revenues up 7.7%, 5.1%, 8.2% and 3.9%, respectively. Record income from continuing operations was $20.1 million and related earnings per share was $0.48, representing increases of 44.1% and 41.2%, respectively, before the effect of a $22.8 million ($13.6 million after-tax), or $0.33 per share, one-time charge recorded in fourth quarter 2002. Net income for the quarter increased to $20.1 million, or $0.48 per share, from $0.7 million, or $0.02 per share, in the prior year.

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     For the twelve months ended December 31, 2003, revenues increased 20.3% to a record $8.7 billion, driven by a 6.5% increase in same store retail revenues. Income from continuing operations was $85.7 million, up 16.9%, and related earnings per share grew 16.3% to $2.07. Net income was $82.9 million and earnings per share was $2.00. Net income for the twelve months includes the effect of a $3.1 million, or $0.07 per share, charge as a result of the cumulative effect of a change in accounting principle recorded in the first quarter in connection with the adoption of EITF 02-16, “Accounting by a Customer (including a Reseller) for Certain Consideration Received from a Vendor.”

     Chairman Roger Penske commented, “United Auto delivered another record setting quarter, our 19^th consecutive quarter of reporting record results. During the past five years our industry leading same-store retail revenues have increased by an average of 7.9%, including a 7.2% increase in our high margin service and parts revenues. This sustained record of same-store sales growth, particularly in our parts and service operations, demonstrates the returns we are experiencing as a result of our continued investment in high quality franchises and world class facilities.”

     The Company also announced a definitive agreement to sell 4,050,000 shares of common stock to Mitsui & Co. Ltd. and Mitsui & Co. (U.S.A) in a private placement for approximately $119.4 million. The selling price of $29.49 per share is based on the average closing price of the Company’s common stock over the 20 trading days preceding February 16, 2004. The transaction, which is subject to shareholder approval and other customary conditions, is expected to close by the end of the first quarter.

     Commenting on the private placement transaction with Mitsui, Penske added, “The additional capital provided by this transaction strengthens our balance sheet by reducing our leverage, and provides funds for future acquisitions and selected capital investments.”

     Penske continued, “Today I am pleased to provide guidance relating to our 2004 operations. Prior to the transaction with Mitsui, we estimate earnings per share in the range of $2.28-$2.38 per share, based on an average 42.0 million shares outstanding. Adjusted to reflect the closing of the private placement, earnings per share are estimated to be in the range of $2.17-$2.27 per share, based on an average 45.0 million shares outstanding. For the first quarter of 2004, we expect earnings per share in the range of $0.43-$0.47 per share.”

     UnitedAuto will host a conference call discussing financial results relating to fourth quarter 2003 on Tuesday, February 17, 2004 at2P.M.Eastern time. To listen to the conference call, participants must dial(888) 428-4479 (International, please dial (612) 288-0318). The call will also be simultaneously broadcast live over the Internet through the UnitedAuto website at www.unitedauto.com.

     UnitedAuto, which has pursued a strategy based on internal growth from its existing dealerships, as well as from strategic acquisitions, operates 138 franchises in the United States and 83 franchises internationally, primarily in the United Kingdom. UnitedAuto dealerships sell new and used vehicles,

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and market a complete line of aftermarket automotive products and services. Statements in this press release involve forward-looking statements, including forward-looking statements regarding UnitedAuto’s future sales, earnings growth potential and issuance of common stock. Actual results may vary materially because of risks and uncertainties, including external factors such as interest rate fluctuations, changes in consumer spending and other factors over which management has no control. These forward-looking statements should be evaluated together with additional information about UnitedAuto’s business, markets, conditions and other uncertainties which could affect UnitedAuto’s future performance, which are contained in UnitedAuto’s Form 10-K for the year ended December 31, 2002 and its other filings with the Securities and Exchange Commission, and which are incorporated into this press release by reference. This press release speaks only as of its date and UnitedAuto disclaims any duty to update the information herein. The securities expected to be sold to Mitsui will not be, and have not been, registered under the Securities Act of 1933 and may not be offered or sold in the United States absent registration or an applicable exemption from registration requirements.

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UNITED AUTO GROUP, INC.
Consolidated Statements of Income (Unaudited)
(Amounts In Thousands, Except Per Share Data)

	Fourth Quarter
	2003			2002
New Vehicles	$	1,265,731		$	1,084,676
Used Vehicles		441,516			370,747
Finance and Insurance		47,932			43,141
Service and Parts		240,218			202,804
Fleet		21,271			17,537
Wholesale		145,551			107,533
Total Revenues		2,162,219			1,826,438
Cost of Sales		1,850,740			1,561,807
Gross Profit		311,479			264,631
SG&A Expenses		246,135			236,696
Depreciation and Amortization		8,620			6,337
Operating Income		56,724			21,598
Floor Plan Interest Expense		(11,916	)		(9,424	)
Other Interest Expense		(10,632	)		(10,618	)
Income from Continuing Operations Before Minority Interests and Income Tax Provision		34,176			1,556
Minority Interests		(599	)		(580	)
Income Tax Provision		(13,500	)		(635	)
Income from Continuing Operations		20,077			341
Income from Discontinued Operations, Net of Tax		—			311
Net Income	$	20,077		$	652
Income from Continuing Operations Per Diluted Share	$	0.48		$	0.01
Diluted EPS	$	0.48		$	0.02
Diluted Weighted Average Shares Outstanding		42,059			41,037

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UNITED AUTO GROUP, INC.
Consolidated Statements of Income (Unaudited)
(Amounts In Thousands, Except Per Share Data)

	Twelve Months
	2003			2002
New Vehicles	$	5,052,529		$	4,292,108
Used Vehicles		1,847,061			1,432,789
Finance and Insurance		206,903			171,016
Service and Parts		920,454			754,330
Fleet		114,490			108,241
Wholesale		530,048			451,314
Total Revenues		8,671,485			7,209,798
Cost of Sales		7,428,065			6,181,580
Gross Profit		1,243,420			1,028,218
SG&A Expenses		980,011			830,231
Depreciation and Amortization		31,583			21,547
Operating Income		231,826			176,440
Floor Plan Interest Expense		(43,527	)		(34,875	)
Other Interest Expense		(42,847	)		(38,300	)
Income from Continuing Operations Before Minority Interests and Income Tax Provision		145,452			103,265
Minority Interests		(2,305	)		(1,963	)
Income Tax Provision		(57,456	)		(41,598	)
Income from Continuing Operations		85,691			59,704
Income from Discontinued Operations, Net of Tax		296			2,537
Income Before Cumulative Effect of Accounting Change		85,987			62,241
Cumulative Effect of Accounting Change (a)		(3,058	)		—
Net Income	$	82,929		$	62,241
Income from Continuing Operations Per Diluted Share	$	2.07		$	1.45
Diluted EPS before Cumulative Effect of Accounting Change	$	2.08		$	1.51
Cumulative Effect of Accounting Change on Diluted EPS	$	(0.07	)	$	—
Diluted EPS	$	2.00		$	1.51
Diluted Weighted Average Shares Outstanding		41,434			41,161

(a) Represents a cumulative accounting change resulting from the adoption of EITF 02-16, “Accounting by a Customer (including a Reseller) for Certain Consideration Received from a Vendor.”

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UNITED AUTO GROUP, INC.
Consolidated Condensed Balance Sheets
(Amounts In Thousands)

	12/31/03		12/31/02
Assets	(unaudited)
Cash and Cash Equivalents	$	13,845	$	10,641
Accounts Receivable, Net		347,802		310,378
Inventories		1,183,868		942,732
Other Current Assets		43,150		27,230
Total Current Assets		1,588,665		1,290,981
Property and Equipment, Net		371,326		306,234
Intangibles		1,087,052		973,342
Assets of Discontinued Operations		—		53,085
Other Assets		90,138		66,672
Total Assets	$	3,137,181	$	2,690,314
Liabilities and Stockholders’ Equity
Floor Plan Notes Payable	$	1,138,476	$	882,100
Accounts Payable and Accrued Expenses		350,254		271,036
Current Portion Long-Term Debt		8,574		14,979
Total Current Liabilities		1,497,304		1,168,115
Long-Term Debt (a)		643,343		651,176
Other Long-Term Liabilities		168,122		135,036
Liabilities of Discontinued Operations		—		31,545
Total Liabilities		2,308,769		1,985,872
Stockholders’ Equity		828,412		704,442
Total Liabilities and Stockholders’ Equity	$	3,137,181	$	2,690,314

(a) Undrawn capacity under the Company’s credit facilities amounted to approximately $423 million as of December 31, 2003.

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UNITED AUTO GROUP, INC.
Selected Data

	Fourth Quarter						Twelve Months
	2003			2002			2003			2002
Units
New Retail Units		40,336			37,698			170,664			153,730
Used Retail Units		20,422			18,638			88,316			73,944
Total Retail Units		60,758			56,336			258,980			227,674
Same-Store Retail Revenue
New Vehicles	$	1,137,947		$	1,056,132		$	3,906,526		$	3,687,920
Used Vehicles		375,438			357,130			1,119,519			1,043,480
Finance and Insurance		38,243			36,793			147,774			132,802
Service and Parts		212,735			196,629			664,729			619,375
Total Same Store Retail Revenue	$	1,764,366		$	1,646,684		$	5,838,548		$	5,483,577
Same-Store Retail Revenue Growth
New Vehicles		7.7	%		(1.2	)%		5.9	%		5.0	%
Used Vehicles		5.1	%		(4.6	)%		7.3	%		(0.6	)%
Finance and Insurance		3.9	%		9.3	%		11.3	%		10.4	%
Service and Parts		8.2	%		7.5	%		7.3	%		5.9	%
Revenue Mix
New Vehicles		58.6	%		59.4	%		58.3	%		59.5	%
Used Vehicles		20.4	%		20.3	%		21.3	%		19.9	%
Finance and Insurance		2.2	%		2.4	%		2.4	%		2.4	%
Service and Parts		11.1	%		11.1	%		10.6	%		10.5	%
Fleet		1.0	%		1.0	%		1.3	%		1.5	%
Wholesale		6.7	%		5.8	%		6.1	%		6.2	%
Retail Gross Margin — by Product
New Vehicles		8.5	%		8.6	%		8.4	%		8.5	%
Used Vehicles		8.5	%		9.5	%		9.1	%		9.9	%
Finance and Insurance		100.0	%		100.0	%		100.0	%		100.0	%
Service and Parts		49.3	%		47.7	%		48.3	%		47.1	%
Gross Profit per Transaction
New Vehicles	$	2,673		$	2,466		$	2,474		$	2,366
Used Vehicles		1,829			1,889			1,902			1,913
Finance and Insurance		789			766			799			751

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UNITED AUTO GROUP, INC.
Selected Data (Continued)

	Fourth Quarter						Twelve Months
	2003			2002			2003			2002
Brand Mix:
Toyota/Lexus		22	%		22	%		22	%		24	%
BMW		14	%		12	%		13	%		11	%
Mercedes		11	%		10	%		10	%		9	%
Honda/Acura		10	%		12	%		11	%		12	%
General Motors		10	%		13	%		11	%		13	%
Ford Premier Group		8	%		6	%		8	%		6	%
Chrysler		7	%		8	%		7	%		9	%
Nissan/Infiniti		4	%		4	%		4	%		5	%
Ford		4	%		4	%		4	%		5	%
Other		10	%		9	%		10	%		6	%
Debt to Total Capital Ratio		44	%		49	%		44	%		49	%
Adjusted EBITDA (a)	$	53,428		$	18,511		$	219,882		$	163,112
Rent Expense		22,210			18,622			84,342			63,924

(a) Adjusted EBITDA is defined as income from continuing operations before minority interests, income tax provision, other interest expense, depreciation and amortization. While Adjusted EBITDA should not be construed as a substitute for income from continuing operations or as a better measure of liquidity than cash flows from operating activities, each of which is determined in accordance with U.S. GAAP, it is included in this press release to provide additional information regarding the amount of cash our business is generating. This measure may not be comparable to similarly titled measures reported by other companies. Following is a reconciliation of income from continuing operations before minority interests and income tax provision and Adjusted EBITDA:

	Fourth Quarter				Twelve Months
	2003		2002		2003		2002
Income from continuing operations before minority interests and income tax provision	$	34.2	$	1.6	$	145.5	$	103.3
Other interest expense		10.6		10.6		42.8		38.3
Depreciation and amortization		8.6		6.3		31.6		21.5
Adjusted EBITDA	$	53.4	$	18.5	$	219.9	$	163.1