Group 1 Automotive (GPI) 8-K Group 1 Automotive Reports Record Second-quarter Results

Exhibit 99.1

FOR IMMEDIATE RELEASE

GROUP 1 AUTOMOTIVE REPORTS RECORD SECOND-QUARTER RESULTS

Higher Gross Profits, Expense Control Overcome Japanese Brand Supply Shortage

HOUSTON, July 26, 2011 — Group 1 Automotive, Inc. (NYSE: GPI),a Fortune 500 automotive retailer, today reported record second-quarter earnings of $1.06 per diluted share on net income of $24.7 million for the period ended June 30.

“Despite an industry SAAR nearly one million units below the first quarter and severe supply shortages in the 62 percent of our business normally represented by Japanese brands, Group 1’s operating team turned in one of the best profit performances in our company’s history,” said Earl J. Hesterberg, Group 1’s president and chief executive officer. “We were able to generate revenue increases in every business segment, significantly increase our new and used vehicle margins and maintain strong expense controls in a constrained vehicle sales market.”

Group 1 reported second-quarter total revenues of $1.5 billion, a 3.9 percent increase from the prior-year period. Gross profit grew 7.7 percent to $244.2 million, as the company successfully managed through the low-inventory sales environment. Selling, general and administrative expense as a percent of gross profit improved significantly to 75.0 percent, as the combination of continued cost control and expanding gross profit significantly leveraged the cost structure.

Second-Quarter Highlights

• Earnings per diluted share of $1.06 is the best second-quarter results ever posted and the second-best quarter in the history of Group 1.

• Pretax income of $39.7 million is the second highest ever for Group 1.

• New vehicle revenues increased 3.1 percent on 4.0 percent fewer unit sales.

• New vehicle gross profit grew 20.3 percent, as gross profit increased $455 to $2,252 per retail unit sold.

• Retail used vehicle gross profit increased 6.2 percent on 3.8 percent higher revenues, as gross profit increased $164, to $2,009 per retail unit.

• Parts and service revenues increased 5.2 percent, reflecting increases in all segments of the business.

• Finance and insurance gross profit per retail unit increased $125 to $1,126, on higher finance income per contract and vehicle service contract penetration rates.

• Selling, general and administrative expense as a percent of gross profit improved significantly to 75.0 percent, as total gross profit notably outpaced expenses in the quarter.

• Operating margin increased to 3.7 percent — matching the best ever quarterly result.

Year-to-Date Results

On a same-store basis, Group 1 reported 7.1 percent growth in gross profit on 9.1 percent higher revenues, reflecting increases in all operating segments from the prior year. New vehicle gross profit grew 13.8 percent on 10.3 percent higher revenues; used vehicle gross profit was 7.4 percent higher on a 9.1 percent revenue increase; finance and insurance revenues increased 12.3 percent on 3.9 percent more retail unit sales; and, parts and service revenues were 3.7 percent higher. Selling, general and administrative expenses as a percent of revenues improved 60 basis points to 12.5 percent, as expenses grew at a slower pace than revenues.

Share Repurchases

Group 1 Automotive, Inc.

During the second quarter, Group 1 repurchased 381,610 shares of its common stock at an average price of $36.69 under a board-authorized $25.0 million share repurchase program. At the end of the second quarter, $3.5 million remained under the authorization.

Corporate Development Update

As previously announced, in the second quarter Group 1 acquired BMW, MINI, Ford, Buick and GMC franchises that are expected to generate $245.0 million in total estimated annualized revenues. Year to date, the company has acquired seven franchises estimated to generate $340.0 million in annualized revenues including the second-quarter acquisitions.

Group 1 also announced that it disposed of a Mitsubishi and a Lincoln franchise during the second quarter. In total, the two franchises generated $4.1 million in trailing-12-month revenues.

Hesterberg added, “In addition to delivering very strong operating results in the first half of 2011, Group 1 has used its cash to acquire attractive brands in growing markets, increase our dividend and repurchase shares to return value to our shareholders.”

Second-Quarter Earnings Conference Call

Group 1’s senior management will host a conference call today at 10 a.m. ET to discuss the second-quarter financial results and the company’s outlook and strategy.

The conference call will be simulcast live on the Internet at www.group1auto.com, then click on ‘Investor Relations’ and then ‘Events’ or through this link: http://www.group1corp.com/news/events.aspx. A replay will be available for 30 days.

The conference call will also be available live by dialing in 10 minutes prior to the start of the call at:

Domestic:888.395.3241
International:719.457.2647
Participant Passcode:3942401

A telephonic replay will be available following the call through Aug. 25 by dialing:

Domestic:888.203.1112
International:719.457.0820
Replay Passcode:3942401

About Group 1 Automotive, Inc.

Group 1 owns and operates 105 automotive dealerships, 134 franchises, and 28 collision service centers in the United States and the United Kingdom that offer 29 brands of automobiles. Through its dealerships, the company sells new and used cars and light trucks; arranges related financing, vehicle service and insurance contracts; provides maintenance and repair services; and sells replacement parts.

Group 1 Automotive can be reached on the Internet at www.group1auto.com.

This press release contains “forward-looking statements,” which are statements related to future, not past, events and are based on our current expectations and assumptions regarding our business, the economy and other future conditions. In this context, the forward-looking statements often include statements regarding our goals, plans, projections and guidance regarding our financial position, results of operations, market position, pending and potential future acquisitions and business strategy, and often contain words such as “expects,” “anticipates,” “intends,” “plans,” “believes,” “seeks,” “may” or “will” and similar expressions. Any such forward-looking statements are not assurances of future performance and involve risks and uncertainties that may cause actual results to differ materially from those set

Group 1 Automotive, Inc.

forth in the statements. These risks and uncertainties include, among other things, (a) general economic and business conditions, (b) the level of manufacturer incentives, (c) the future regulatory environment, (d) our ability to obtain an inventory of desirable new and used vehicles, (e) our relationship with our automobile manufacturers and the willingness of manufacturers to approve future acquisitions, (f) our cost of financing and the availability of credit for consumers, (g) our ability to complete acquisitions and dispositions and the risks associated therewith, (h) foreign exchange controls and currency fluctuations, and (i) our ability to retain key personnel. These factors, as well as additional factors that could affect our forward-looking statements, are described in our Form 10-K under the headings “Business—Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations.” We urge you to carefully consider this information. We undertake no duty to update our forward-looking statements, including our earnings outlook, whether as a result of new information, future developments or otherwise, except as may be required by law.

SOURCE: Group 1 Automotive, Inc.

Investor contacts:

Kim Paper Canning
Manager, Investor Relations
Group 1 Automotive Inc.
713-647-5741 | kpaper@group1auto.com

Media contacts:

Pete DeLongchamps
V.P. Manufacturer Relations and Public Affairs
Group 1 Automotive Inc.
713-647-5770 | pdelongchamps@group1auto.com
or
Clint Woods
Pierpont Communications, Inc.
713-627-2223 | cwoods@piercom.com

Group 1 Automotive, Inc.

Consolidated Statements of Operations

(Unaudited)

(In thousands, except per share amounts)

	Three Months Ended June 30,									Six Months Ended June 30,
	2011			2010			% Change			2011			2010			% Change
REVENUES:
New vehicle retail sales	$	809,881		$	785,851			3.1	%	$	1,594,595		$	1,431,972			11.4	%
Used vehicle retail sales		353,047			340,142			3.8			676,494			619,751			9.2
Used vehicle wholesale sales		60,607			55,678			8.9			122,558			98,190			24.8
Parts and service		204,091			194,063			5.2			399,041			379,498			5.1
Finance and insurance		46,519			42,775			8.8			90,759			80,251			13.1
Total revenues		1,474,145			1,418,509			3.9			2,883,447			2,609,662			10.5
COST OF SALES:
New vehicle retail sales		755,617			740,740			2.0			1,497,559			1,347,487			11.1
Used vehicle retail sales		318,499			307,596			3.5			613,046			560,768			9.3
Used vehicle wholesale sales		58,940			54,558			8.0			118,397			95,407			24.1
Parts and service		96,878			88,963			8.9			188,459			174,827			7.8
Total cost of sales		1,229,934			1,191,857			3.2			2,417,461			2,178,489			11.0
GROSS PROFIT		244,211			226,652			7.7			465,986			431,173			8.1
SELLING, GENERAL AND ADMINISTRATIVE EXPENSES		183,051			182,465			0.3			358,935			348,871			2.9
DEPRECIATION AND AMORTIZATION EXPENSE		6,581			6,679			(1.5	)		13,036			13,164			(1.0	)
ASSET IMPAIRMENTS		142			1,482			(90.4	)		364			1,482			(75.4	)
OPERATING INCOME		54,437			36,026			51.1			93,651			67,656			38.4
OTHER EXPENSE:
Floorplan interest expense		(6,521	)		(8,633	)		(24.5	)		(13,281	)		(16,199	)		(18.0	)
Other interest expense, net		(8,225	)		(6,267	)		31.2			(16,167	)		(13,371	)		20.9
Loss on redemption of long-term debt		—			—			—			—			(3,872	)		(100.0	)
INCOME BEFORE INCOME TAXES		39,691			21,126			87.9			64,203			34,214			87.7
PROVISION FOR INCOME TAXES		(15,008	)		(8,357	)		79.6			(24,158	)		(13,464	)		79.4
NET INCOME	$	24,683		$	12,769			93.3	%	$	40,045		$	20,750			93.0	%
DILUTED INCOME PER SHARE	$	1.06		$	0.54			96.3	%	$	1.72		$	0.88			95.5	%
Weighted average dilutive shares outstanding		23,183		��	23,638			(1.9	)%		23,223			23,663			(1.9	)%

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Group 1 Automotive, Inc.

Consolidated Balance Sheets

(Dollars in thousands)

	June 30,			December 31,
	2011			2010			% Change
	(Unaudited)
ASSETS:
CURRENT ASSETS:
Cash and cash equivalents	$	12,285		$	19,843			(38.1	)%
Contracts in transit and vehicle receivables, net		105,835			113,846			(7.0	)
Accounts and notes receivable, net		71,504			75,623			(5.4	)
Inventories		779,679			777,771			0.2
Deferred income taxes		15,690			14,819			5.9
Prepaid expenses and other current assets		10,615			17,332			(38.8	)
Total current assets		995,608			1,019,234			(2.3	)
PROPERTY AND EQUIPMENT, net		550,134			506,288			8.7
GOODWILL AND INTANGIBLE FRANCHISE RIGHTS		693,517			666,656			4.0
OTHER ASSETS		8,618			9,786			(11.9	)
Total assets	$	2,247,877		$	2,201,964			2.1	%
LIABILITIES AND STOCKHOLDERS’ EQUITY:
CURRENT LIABILITIES:
Floorplan notes payable — credit facility	$	637,242		$	690,051			(7.7	)%
Offset account related to floorplan notes payable — credit facility		(134,170	)		(129,211	)		3.8
Floorplan notes payable — manufacturer affiliates		136,049			103,345			31.6
Current maturities of long-term debt		12,874			53,189			(75.8	)
Current liabilities from interest rate risk management activities		815			1,098			(25.8	)
Accounts payable		109,079			92,799			17.5
Accrued expenses		95,332			83,663			13.9
Total current liabilities		857,221			894,934			(4.2	)
2.25% CONVERTIBLE SENIOR NOTES (aggregate principal of $182,753 at June 30, 2011 and December 31, 2010)		141,505			138,155			2.4
3.00% CONVERTIBLE SENIOR NOTES (aggregate principal of $115,000 at June 30, 2011 and December 31, 2010)		75,850			74,365			2.0
MORTGAGE FACILITY, net of current maturities		39,938			—			100.0
OTHER REAL ESTATE RELATED AND LONG-TERM DEBT, net of current maturities		157,917			161,611			(2.3	)
CAPITAL LEASE OBLIGATIONS RELATED TO REAL ESTATE, net of current maturities		38,507			38,819			(0.8	)
DEFERRED INCOME TAXES		70,884			58,970			20.2
LIABILITIES FROM INTEREST RATE RISK MANAGEMENT ACTIVITIES		16,381			16,426			(0.3	)
OTHER LIABILITIES		33,436			31,036			7.7
DEFERRED REVENUES		2,332			3,280			(28.9	)
STOCKHOLDERS’ EQUITY:
Common stock		262			261			0.4
Additional paid-in capital		367,303			363,966			0.9
Retained earnings		554,640			519,843			6.7
Accumulated other comprehensive loss		(17,155	)		(18,755	)		(8.5	)
Treasury stock		(91,144	)		(80,947	)		12.6
Total stockholders’ equity		813,906			784,368			3.8
Total liabilities and stockholders’ equity	$	2,247,877		$	2,201,964			2.1	%

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Group 1 Automotive, Inc.

Consolidated Statements of Adjusted Cash Flows from Operating Activities

(Unaudited)

(In thousands)

	Three Months Ended June 30,									Six Months Ended June 30,
	2011			2010			% Change			2011			2010			% Change
Net income	$	24,683		$	12,769			93.3	%	$	40,045		$	20,750			93.0	%
Adjustments to reconcile net income to net cash provided by operating activities:
Asset impairments		142			1,482			(90.4	)		364			1,482			(75.4	)
Depreciation and amortization		6,581			6,679			(1.5	)		13,036			13,164			(1.0	)
Deferred income taxes		7,062			7,832			(9.8	)		14,110			12,162			16.0
Loss on redemption of long-term debt		—			—			—			—			3,872			(100.0	)
(Gain) loss on disposition of assets and franchise		(786	)		4,297			(118.3	)		(786	)		4,452			(117.7	)
Stock-based compensation		2,814			2,479			13.5			5,558			5,176			7.4
Amortization of debt discount and issue costs		2,970			2,322			27.9			5,848			3,957			47.8
Other		71			244			(70.9	)		(102	)		438			(123.3	)
Changes in operating assets and liabilities, net of effects of acquisitions and dispositions:
Accounts payable and accrued expenses		14,453			(7,261	)		299.0			24,889			15,699			58.5
Accounts and notes receivable		(3,315	)		(3,228	)		2.7			3,963			(6,319	)		162.7
Inventories		47,067			(46,143	)		202.0			52,803			(94,377	)		155.9
Contracts-in-transit and vehicle receivables		11,750			(5,684	)		306.7			8,127			(24,781	)		132.8
Prepaid expenses and other assets		(374	)		172			(317.4	)		1,023			1,794			(43.0	)
Floorplan notes payable — credit facility(1)		(69,722	)		39,668			(275.8	)		(73,286	)		107,215			(168.4	)
Floorplan notes payable — manufacturer affiliates(2)		10,829			(4,421	)		344.9			5,866			(14,787	)		139.7
Deferred revenues		(447	)		(45	)		893.3			(948	)		(943	)		0.5
Adjusted net cash provided by operating activities	$	53,778		$	11,162			381.8	%	$	100,510		$	48,954			105.3	%

(1)	Excludes net acquisition/(disposition) related activity of $17,926 and $20,476 for the three and six months ended June 30, 2011, respectively, and $4,729 for the three and six months ended June 30, 2010.
(2)	Excludes net acquisition/(disposition) related activity of $22,419 and $26,578 for the three and six months ended June 30, 2011, respectively, and ($7,463) and $2,210 for the three and six months ended June 30, 2010, respectively.

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Group 1 Automotive, Inc.

Additional Information — Consolidated

(Unaudited)

		Three Months Ended						Six Months Ended
		June 30,						June 30,
		2011			2010			2011			2010
NEW VEHICLE UNIT SALES GEOGRAPHIC MIX:
Region	Geographic Market
Eastern	Massachusetts		11.2	%		14.9	%		12.0	%		15.1	%
	New Jersey		5.9			6.8			5.9			6.6
	New York		4.3			3.9			3.8			3.8
	Georgia		3.2			3.8			3.6			3.8
	New Hampshire		3.0			4.0			3.2			4.2
	Louisiana		3.0			3.2			3.1			3.1
	Mississippi		1.9			1.5			2.0			1.7
	South Carolina		1.2			1.3			1.4			0.8
	Alabama		1.1			1.2			1.2			1.3
	Maryland		1.0			0.8			0.8			0.8
	Florida		0.8			1.6			0.7			1.7
			36.6			43.0			37.7			42.9
Central	Texas		34.6			30.5			33.3			30.7
	Oklahoma		8.2			8.4			8.1			8.1
	Kansas		1.1			0.9			1.0			0.9
			43.9			39.8			42.4			39.7
Western	California		13.9			12.5			14.6			13.1
International	United Kingdom		5.6			4.7			5.3			4.3
			100.0	%		100.0	%		100.0	%		100.0	%
NEW VEHICLE UNIT SALES BRAND MIX:
Toyota/Scion/Lexus			28.5	%		35.1	%		31.5	%		34.9	%
BMW/MINI			14.9			11.5			13.3			11.0
Nissan/Infiniti			12.7			14.1			13.4			14.9
Honda/Acura			11.3			12.3			12.1			12.4
Ford			8.3			8.3			7.7			8.4
Mercedes-Benz			6.4			5.5			5.8			5.6
GM			5.0			4.2			4.8			4.0
Chrysler			4.7			3.0			4.1			2.9
Other			8.2			6.0			7.3			5.9
			100.0	%		100.0	%		100.0	%		100.0	%
NEW VEHICLE UNIT SALES OTHER MIX:
Import			52.2	%		57.8	%		55.5	%		58.1	%
Luxury			30.0			26.9			28.0			26.9
Domestic			17.8			15.3			16.5			15.0
			100.0	%		100.0	%		100.0	%		100.0	%
Car			55.9	%		59.0	%		56.0	%		58.4	%
Truck			44.1			41.0			44.0			41.6
			100.0	%		100.0	%		100.0	%		100.0	%

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Group 1 Automotive, Inc.

Additional Information — Consolidated
(Unaudited)

(Dollars in thousands, except per unit amounts)

	Three Months Ended June 30,										Six Months Ended June 30,
	2011			2010			% Change				2011			2010			% Change
REVENUES:
New vehicle retail sales	$	809,881		$	785,851			3.1	%		$	1,594,595		$	1,431,972			11.4	%
Used vehicle retail sales		353,047			340,142			3.8				676,494			619,751			9.2
Used vehicle wholesale sales		60,607			55,678			8.9				122,558			98,190			24.8
Total used		413,654			395,820			4.5				799,052			717,941			11.3
Parts and service		204,091			194,063			5.2				399,041			379,498			5.1
Finance and insurance		46,519			42,775			8.8				90,759			80,251			13.1
Total	$	1,474,145		$	1,418,509			3.9	%		$	2,883,447		$	2,609,662			10.5	%
GROSS MARGIN:
New vehicle retail sales		6.7	%		5.7	%						6.1	%		5.9	%
Used vehicle retail sales		9.8			9.6							9.4			9.5
Used vehicle wholesale sales		2.8			2.0							3.4			2.8
Total used		8.8			8.5							8.5			8.6
Parts and service		52.5			54.2							52.8			53.9
Finance and insurance		100.0			100.0							100.0			100.0
Total		16.6	%		16.0	%						16.2	%		16.5	%
GROSS PROFIT:
New vehicle retail sales	$	54,264		$	45,111			20.3	%		$	97,036		$	84,485			14.9	%
Used vehicle retail sales		34,548			32,546			6.2				63,448			58,983			7.6
Used vehicle wholesale sales		1,667			1,120			48.8				4,161			2,783			49.5
Total used		36,215			33,666			7.6				67,609			61,766			9.5
Parts and service		107,213			105,100			2.0				210,582			204,671			2.9
Finance and insurance		46,519			42,775			8.8				90,759			80,251			13.1
Total	$	244,211		$	226,652			7.7	%	��	$	465,986		$	431,173			8.1	%
UNITS SOLD:
Retail new vehicles sold		24,097			25,101			(4.0	)%			48,801			45,732			6.7	%
Retail used vehicles sold		17,200			17,636			(2.5	)			33,930			32,629			4.0
Wholesale used vehicles sold		8,494			8,692			(2.3	)			17,549			15,408			13.9
Total used		25,694			26,328			(2.4	)%			51,479			48,037			7.2	%
GROSS PROFIT PER UNIT SOLD:
New vehicle retail sales	$	2,252		$	1,797			25.3	%		$	1,988		$	1,847			7.6	%
Used vehicle retail sales		2,009			1,845			8.9				1,870			1,808			3.4
Used vehicle wholesale sales		196			129			51.9				237			181			30.9
Total used		1,409			1,279			10.2				1,313			1,286			2.1
Finance and insurance (per retail unit)	$	1,126		$	1,001			12.5	%		$	1,097		$	1,024			7.1	%
OTHER(1):
SG&A expenses	$	183,051		$	176,850			3.5	%		$	358,935		$	343,256			4.6	%
SG&A as % revenues		12.4	%		12.5	%						12.4	%		13.2	%
SG&A as % gross profit		75.0	%		78.0	%						77.0	%		79.6	%
Operating margin		3.7	%		3.0	%						3.3	%		2.9	%
Pretax margin		2.7	%		2.0	%						2.2	%		1.7	%
FLOORPLAN EXPENSE:
Floorplan interest	$	(6,521	)	$	(8,633	)		(24.5	)%		$	(13,281	)	$	(16,199	)		(18.0	)%
Floorplan assistance		5,886			6,089			(3.3	)			12,096			11,323			6.8
Net floorplan expense	$	(635	)	$	(2,544	)		(75.0	)%		$	(1,185	)	$	(4,876	)		(75.7	)%

⁽¹⁾ These amounts have been adjusted to exclude the impact of certain items to provide additional information regarding the performance of our operations and improve period-to-period comparability. Refer to our Reconciliation of Certain Non-GAAP Financial Measures for a description of the aforementioned adjustments.

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Group 1 Automotive, Inc.

Additional Information — Same Store⁽¹⁾

(Unaudited)

(Dollars in thousands, except per unit amounts)

	Three Months Ended June 30,									Six Months Ended June 30,
	2011			2010			% Change			2011			2010			% Change
REVENUES:
New vehicle retail sales	$	788,838		$	772,400			2.1	%	$	1,551,402		$	1,406,784			10.3	%
Used vehicle retail sales		343,758			336,540			2.1			654,721			613,030			6.8
Used vehicle wholesale sales		59,445			54,222			9.6			118,612			96,048			23.5
Total used		403,203			390,762			3.2			773,333			709,078			9.1
Parts and service		195,729			189,790			3.1			384,507			370,878			3.7
Finance and insurance		45,343			42,214			7.4			88,846			79,087			12.3
Total	$	1,433,113		$	1,395,166			2.7	%	$	2,798,088		$	2,565,827			9.1	%
GROSS MARGIN:
New vehicle retail sales		6.7	%		5.8	%					6.1	%		5.9	%
Used vehicle retail sales		9.8			9.6						9.4			9.5
Used vehicle wholesale sales		2.9			2.2						3.5			3.0
Total used		8.8			8.6						8.5			8.7
Parts and service		53.3			54.3						53.3			54.1
Finance and insurance		100.0			100.0						100.0			100.0
Total		16.6	%		16.0	%					16.2	%		16.5	%
GROSS PROFIT:
New vehicle retail sales	$	52,990		$	44,501			19.1	%	$	94,657		$	83,145			13.8	%
Used vehicle retail sales		33,601			32,292			4.1			61,684			58,494			5.5
Used vehicle wholesale sales		1,696			1,200			41.3			4,174			2,853			46.3
Total used		35,297			33,492			5.4			65,858			61,347			7.4
Parts and service		104,254			103,089			1.1			204,978			200,620			2.2
Finance and insurance		45,343			42,214			7.4			88,846			79,087			12.3
Total	$	237,884		$	223,296			6.5	%	$	454,339		$	424,199			7.1	%
UNITS SOLD:
Retail new vehicles sold		23,412			24,717			(5.3	)%		47,380			45,002			5.3	%
Retail used vehicles sold		16,716			17,416			(4.0	)		32,870			32,212			2.0
Wholesale used vehicles sold		8,303			8,532			(2.7	)		16,988			15,151			12.1
Total used		25,019			25,948			(3.6	)%		49,858			47,363			5.3	%
GROSS PROFIT PER UNIT SOLD:
New vehicle retail sales	$	2,263		$	1,800			25.7	%	$	1,998		$	1,848			8.1	%
Used vehicle retail sales		2,010			1,854			8.4			1,877			1,816			3.4
Used vehicle wholesale sales		204			141			44.7			246			188			30.9
Total used		1,411			1,291			9.3			1,321			1,295			2.0
Finance and insurance (per retail unit)	$	1,130		$	1,002			12.8	%	$	1,107		$	1,024			8.1	%
OTHER:
SG&A expenses	$	178,138		$	173,177			2.9	%	$	348,554		$	335,038			4.0	%
SG&A as % revenues		12.4	%		12.4	%					12.5	%		13.1	%
SG&A as % gross profit		74.9	%		77.6	%					76.7	%		79.0	%
Operating margin		3.7	%		3.1	%					3.3	%		3.0	%
FLOORPLAN EXPENSE:
Floorplan interest	$	(6,344	)	$	(8,494	)		(25.3	)%	$	(12,970	)	$	(15,923	)		(18.5	)%
Floorplan assistance		5,746			5,976			(3.8	)		11,888			11,072			7.4
Net floorplan expense	$	(598	)	$	(2,518	)		(76.3	)%	$	(1,082	)	$	(4,851	)		(77.7	)%

⁽¹⁾ Same store amounts include the results for the identical months in each period presented in the comparison, commencing with the first full month we owned the dealership and, in the case of dispositions, ending with the last full month we owned it. Same store results also include the activities of our corporate office.

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Group 1 Automotive, Inc.
Reconciliation of Certain Non-GAAP Financial Measures
(Unaudited)

(Dollars in thousands, except per share amounts)

	Three Months Ended June 30,									Six Months Ended June 30,
	2011			2010			% Change			2011			2010			% Change
NET INCOME RECONCILIATION:
As reported	$	24,683		$	12,769			93.3	%	$	40,045		$	20,750			93.0	%
After-tax Adjustments:
Non-Cash asset impairment charges (2)		85			950						225			950
Loss on dealership dispositions(3)		—			3,698						—			3,698
Loss on debt redemption(4)		—			—						—			2,458
Severance costs related to UK-dealership acquisitions(5)		—			405						—			405
Adjusted net income(1)	$	24,768		$	17,822			39.0	%	$	40,270		$	28,261			42.5	%
DILUTED INCOME PER SHARE RECONCILIATION:
As reported	$	1.06		$	0.54			96.3	%	$	1.72		$	0.88			95.5	%
After-tax Adjustments:
Non-Cash asset impairment charges		—			0.04						0.01			0.04
Loss on dealership dispositions		—			0.15						—			0.15
Loss on debt redemption		—			—						—			0.10
Severance costs related to UK-dealership acquisitions		—			0.02						—			0.02
Adjusted diluted income per share(1)	$	1.06		$	0.75			41.3	%	$	1.73		$	1.19			45.4	%
SG&A RECONCILIATION:
As reported	$	183,051		$	182,465			0.3	%	$	358,935		$	348,871			2.9	%
Pre-tax Adjustments:
Loss on dealership dispositions		—			(5,053	)					—			(5,053	)
Severance costs related to UK-dealership acquisitions		—			(562	)					—			(562	)
Adjusted SG&A(1)	$	183,051		$	176,850			3.5	%	$	358,935		$	343,256			4.6	%
SG&A AS % REVENUES:
Unadjusted		12.4	%		12.9	%					12.4	%		13.4	%
Adjusted(1)		12.4	%		12.5	%					12.4	%		13.2	%
SG&A AS % OF GROSS PROFIT:
Unadjusted		75.0	%		80.5	%					77.0	%		80.9	%
Adjusted(1)		75.0	%		78.0	%					77.0	%		79.6	%
OPERATING MARGIN:
Unadjusted		3.7	%		2.5	%					3.2	%		2.6	%
Adjusted(1), (6)		3.7	%		3.0	%					3.3	%		2.9	%
PRETAX MARGIN:
Unadjusted		2.7	%		1.5	%					2.2	%		1.3	%
Adjusted(1), (7)		2.7	%		2.0	%					2.2	%		1.7	%

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	Three Months Ended June 30,									Six Months Ended June 30,
	2011			2010			% Change			2011			2010			% Change
CASH FLOWS FROM OPERATING ACTIVITIES RECONCILIATION:
Net cash provided by (used in) operating activities	$	145,919		$	(35,969	)		505.7	%	$	200,374		$	(56,051	)		457.5	%
Change in floorplan notes payable-credit facility, excluding floorplan offset account and net acquisition and disposition related activity		(69,722	)		39,668						(73,286	)		107,215
Change in floorplan notes payable-manufacturer affiliates associated with net acquisition and disposition related activity		(22,419	)		7,463						(26,578	)		(2,210	)
Adjusted net cash provided by operating activities (1)	$	53,778		$	11,162			381.8	%	$	100,510		$	48,954			105.3	%

(1)	We believe that these adjusted financial measures are relevant and useful to investors because they provide additional information regarding the performance of our operations and improve period-to-period comparability. These measures are not measures of financial performance under GAAP. Accordingly, they should not be considered as substitutes for their unadjusted counterparts, which are prepared in accordance with GAAP. Although we find these non-GAAP results useful in evaluating the performance of our business, our reliance on these measures is limited because the adjustments often have a material impact on our financial statements calculated in accordance with GAAP. Therefore, we typically use these adjusted numbers in conjunction with our GAAP results to address these limitations.
(2)	Adjustments are net of tax benefit of $57 and $139 for the three and six months ended June 30, 2011, respectively, and $532 for the three and six months ended June 30, 2010 and are calculated utilizing the applicable federal and state tax rates for the adjustment.
(3)	Adjustment is net of tax benefit of $1,355 for the three and six months ended June 30, 2010 and is calculated utilizing the applicable federal and state tax rates for the adjustment.
(4)	Adjustment is net of tax benefit of $1,414 for the six months ended June 30, 2010 and is calculated utilizing the applicable federal and state tax rates for the adjustment.
(5)	Adjustment is net of a tax benefit of $157 for the three and six months ended June 30, 2010 and is calculated utilizing the applicable UK corporate tax rate for the adjustment.
(6)	Excludes the impact of non-cash asset impairment charges.
(7)	Excludes the impact of non-cash asset impairment charges and loss on debt redemption.

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