Contact: | Roger Penske | Jim Davidson | Tony Pordon | |||
Chairman 248-648-2400 | Executive VP – Finance 201-325-3303 | Vice President – Investor Relations 248-648-2540 | ||||
jdavidson@unitedauto.com | tpordon@unitedauto.com |
UNITEDAUTO NET INCOME INCREASES 13%
Revenues Increase 14%; Gross Profit Increases 17%
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Earnings Per Share Rises to $0.49 Per Share
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BLOOMFIELD HILLS, MI, April 19, 2005 – United Auto Group, Inc. (NYSE: UAG), a FORTUNE 500 automotive specialty retailer, today announced a 13.3% rise in first quarter net income and its 24th consecutive quarter of record results. Total revenue for the quarter increased 13.8% to $2.6 billion. The growth in revenue includes a 0.6% increase in same-store retail revenue highlighted by a 6.9% increase in service and parts and a 4.7% increase in finance and insurance. Same-store new and used vehicle retail revenues were essentially flat for the quarter. Net income increased to $22.9 million, or $0.49 per share, from $20.2 million, or $0.48 per share, in the prior year. Earnings per share reflects a 10.2% increase in weighted average shares outstanding.
Commenting on the Company’s results, Chairman Roger Penske said, “We are delighted with the performance of our business in the first quarter despite an overall difficult operating environment and challenging weather conditions in certain markets. UnitedAuto’s investments in new facilities and expanded service capacity at many locations contributed to a mix shift towards the higher margin service and parts business in the quarter. Specifically, our overall service and parts business comprised 10.9% of our revenue, an increase of 61 basis points over the first quarter of 2004.” Penske also said, “We have completed two acquisitions so far this year representing approximately $90 million in annual revenues. We expect to add approximately $300 — $500 million in net annual revenue through acquisitions this year.”
Commenting further Penske said, “In the second quarter, we expect the overall retail market to remain competitive. The Company is currently projecting earnings per share in the second quarter in the range of $0.65 to $0.70 based on an estimated average of 47.0 million shares outstanding. Based on our performance in the first quarter, we are raising our 2005 earnings estimate to $2.34 - $2.41 per share.”
UnitedAuto will host a conference call discussing financial results relating to first quarter 2005 on Tuesday, April 19, 2005 at1:30 p.m. ET. To listen to the conference call, participants must dial(800) 611-1148 [International, please dial (612) 332-0345]. The call will also be simultaneously broadcast live over the Internet through the UnitedAuto website atwww.unitedauto.com.
About UnitedAuto
UnitedAuto, which has pursued a strategy based on internal growth from its existing dealerships, as well as from strategic acquisitions, operates 149 franchises in the United States and 100 franchises internationally, primarily in the United Kingdom. UnitedAuto dealerships sell new and used vehicles, 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 and earnings growth potential. 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 is contained in UnitedAuto’s Form 10-K for the year ended December 31, 2004 and its other filings with the Securities and Exchange Commission, and which is 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.
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UNITED AUTO GROUP, INC.
Consolidated Statements of Income
(Amounts In Thousands, Except Per Share Data)
(Unaudited)
First Quarter | ||||||||
2005 | 2004 | |||||||
New Vehicles | $ | 1,433,248 | $ | 1,267,287 | ||||
Used Vehicles | 566,894 | 508,696 | ||||||
Finance and Insurance | 57,799 | 50,901 | ||||||
Service and Parts | 278,519 | 230,820 | ||||||
Fleet | 31,915 | 26,406 | ||||||
Wholesale | 188,495 | 161,931 | ||||||
Total Revenues | 2,556,870 | 2,246,041 | ||||||
Cost of Sales | 2,168,894 | 1,914,060 | ||||||
Gross Profit | 387,976 | 331,981 | ||||||
SG&A Expenses | 315,048 | 265,691 | ||||||
Depreciation and Amortization | 10,560 | 8,523 | ||||||
Operating Income | 62,368 | 57,767 | ||||||
Floor Plan Interest Expense | (13,853 | ) | (12,965 | ) | ||||
Other Interest Expense | (11,481 | ) | (10,765 | ) | ||||
Income from Continuing Operations Before Minority Interests and Income Tax Provision | 37,034 | 34,037 | ||||||
Minority Interests | (143 | ) | (320 | ) | ||||
Income Tax Provision | (13,668 | ) | (13,211 | ) | ||||
Income from Continuing Operations | 23,223 | 20,506 | ||||||
Loss from Discontinued Operations, Net of Tax | (331 | ) | (302 | ) | ||||
Net Income | $ | 22,892 | $ | 20,204 | ||||
Income from Continuing Operations Per Diluted Share | $ | 0.50 | $ | 0.48 | ||||
Diluted EPS | $ | 0.49 | $ | 0.48 | ||||
Diluted Weighted Average Shares Outstanding | 46,875 | 42,521 | ||||||
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UNITED AUTO GROUP, INC.
Consolidated Condensed Balance Sheets
(Amounts In Thousands)
(Unaudited)
3/31/05 | 12/31/04 | |||||||
Assets | ||||||||
Cash and Cash Equivalents | $ | 18,148 | $ | 12,984 | ||||
Accounts Receivable, Net | 392,425 | 366,475 | ||||||
Inventories | 1,381,527 | 1,275,293 | ||||||
Other Current Assets | 56,658 | 44,330 | ||||||
Total Current Assets | 1,848,758 | 1,699,082 | ||||||
Property and Equipment, Net | 415,056 | 411,748 | ||||||
Intangibles | 1,248,399 | 1,231,311 | ||||||
Other Assets | 55,418 | 86,956 | ||||||
Assets of Discontinued Operations | 98,832 | 103,704 | ||||||
Total Assets | $ | 3,666,463 | $ | 3,532,801 | ||||
Liabilities and Stockholders’ Equity | ||||||||
Floor Plan Notes Payable | $ | 1,279,413 | $ | 1,218,837 | ||||
Accounts Payable and Accrued Expenses | 447,869 | 406,497 | ||||||
Current Portion Long-Term Debt | 3,577 | 11,367 | ||||||
Total Current Liabilities | 1,730,859 | 1,636,701 | ||||||
Long-Term Debt | 603,793 | 574,970 | ||||||
Other Long-Term Liabilities | 180,160 | 179,104 | ||||||
Liabilities of Discontinued Operations | 62,196 | 66,991 | ||||||
Total Liabilities | 2,577,008 | 2,457,766 | ||||||
Stockholders’ Equity | 1,089,455 | 1,075,035 | ||||||
Total Liabilities and Stockholders’ Equity | $ | 3,666,463 | $ | 3,532,801 | ||||
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UNITED AUTO GROUP, INC.
Selected Data
First Quarter | ||||||||
2005 | 2004 | |||||||
Units | ||||||||
New Retail Units | 43,760 | 39,919 | ||||||
Used Retail Units | 22,730 | 21,381 | ||||||
Total Retail Units | 66,490 | 61,300 | ||||||
Same-Store Retail Revenue | ||||||||
New Vehicles | $ | 1,248,645 | $ | 1,252,414 | ||||
Used Vehicles | 498,257 | 501,008 | ||||||
Finance and Insurance | 52,989 | 50,613 | ||||||
Service and Parts | 242,419 | 226,737 | ||||||
Total Same-Store Retail Revenue | $ | 2,042,310 | $ | 2,030,772 | ||||
Same-Store Retail Revenue Growth | ||||||||
New Vehicles | (0.3 | %) | 12.1 | % | ||||
Used Vehicles | (0.5 | %) | 7.9 | % | ||||
Finance and Insurance | 4.7 | % | 7.0 | % | ||||
Service and Parts | 6.9 | % | 16.5 | % | ||||
Revenue Mix | ||||||||
New Vehicles | 56.1 | % | 56.4 | % | ||||
Used Vehicles | 22.2 | % | 22.6 | % | ||||
Finance and Insurance | 2.3 | % | 2.3 | % | ||||
Service and Parts | 10.9 | % | 10.3 | % | ||||
Fleet | 1.1 | % | 1.2 | % | ||||
Wholesale | 7.4 | % | 7.2 | % | ||||
Retail Gross Margin — by Product | ||||||||
New Vehicles | 8.8 | % | 8.6 | % | ||||
Used Vehicles | 9.3 | % | 9.0 | % | ||||
Finance and Insurance | 100.0 | % | 100.0 | % | ||||
Service and Parts | 54.1 | % | 54.2 | % | ||||
Gross Profit per Transaction | ||||||||
New Vehicles | $ | 2,867 | $ | 2,736 | ||||
Used Vehicles | 2,329 | 2,129 | ||||||
Finance and Insurance | 869 | 830 |
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UNITED AUTO GROUP, INC.
Selected Data (Continued)
First Quarter | ||||||||
2005 | 2004 | |||||||
Brand Mix: | ||||||||
Toyota/Lexus | 21 | % | 23 | % | ||||
BMW | 14 | % | 15 | % | ||||
Honda/Acura | 13 | % | 10 | % | ||||
Mercedes | 9 | % | 11 | % | ||||
Ford Premier Group | 8 | % | 10 | % | ||||
Audi | 7 | % | 4 | % | ||||
General Motors | 7 | % | 8 | % | ||||
Ford | 5 | % | 4 | % | ||||
Nissan/Infiniti | 4 | % | 3 | % | ||||
Chrysler | 3 | % | 4 | % | ||||
Other | 9 | % | 8 | % | ||||
Debt to Total Capital Ratio | 36 | % | 35 | % | ||||
Adjusted EBITDA(a) | $ | 59,075 | $ | 53,325 | ||||
Rent Expense | $ | 29,231 | $ | 22,649 |
(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: |
First Quarter | ||||||||
2005 | 2004 | |||||||
Income from continuing operations before minority interests and income tax provision | $ | 37.0 | $ | 34.0 | ||||
Other interest expense | 11.5 | 10.8 | ||||||
Depreciation and amortization | 10.6 | 8.5 | ||||||
Adjusted EBITDA | $ | 59.1 | $ | 53.3 | ||||
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