Sonic Automotive (SAH) 8-K Sonic Automotive, Inc. Continues Portfolio Maximization Strategy; Q3 Revenues and Volume Up Over Strong Prior Year Quarter

Exhibit 99.1

Sonic Automotive, Inc. Continues Portfolio Maximization Strategy; Q3 Revenues and
Volume Up Over Strong Prior Year Quarter

CHARLOTTE, N.C. —October 26, 2010—Sonic Automotive, Inc. (NYSE: SAH), one of the nation’s largest automotive retailers, today reported that 2010 third quarter adjusted earnings from continuing operations were $0.27 per diluted share, compared to an adjusted $0.26 per diluted share from continuing operations in the same prior year quarter. The adjustments are detailed further in the attached tables.

Business Overview — Strong Top Line Growth Over Prior Year

Commenting on the quarter, B. Scott Smith, the Company’s President, said, “Our total revenues were up approximately 9% over a prior year quarter that included the positive effects of the Cash for Clunkers program. Our strategy of portfolio maximization is built on utilizing predictable, repeatable and sustainable processes at our dealerships through our operating playbooks. These playbooks, coupled with the lowest associate turnover rate in our Company’s history, are driving our current operating performance. As we increase revenue in a challenging yet improving economic environment, we continue to take steps to control expenses. We expect to see the results of some recent activity on this front as we progress through the fourth quarter and head into next year.”

Capital Structure — Lower Debt and Strong Cash Flow Generation

During the third quarter, the Company completed the redemption of $20 million of its 8.625% senior subordinated notes. The Company also recently announced the planned redemption of the remaining $16 million of its 4.25% convertible notes. Mr. Smith commented, “The $49 million of debt repurchases which we will have completed this year will save us $3.5 million in annual cash interest expense. We expect to use our excess cash flow from operations to further reduce our non-mortgage debt over the next several years. At the same time, we expect to continue to replace our leased dealerships with mortgaged properties as the opportunity arises. With the internal growth opportunities we see in our portfolio maximization strategy, we expect to drive future revenue and profit growth without the risk and capital commitment associated with dealership acquisitions.”

New and Used Retail Vehicles — Combined Revenue Increases 9%

New vehicle retail revenue increased 4% and used vehicle retail revenue increased 20% for the third quarter of 2010 compared to the same quarter last year. Jeff Dyke, the Company’s EVP of Operations, stated, “We are pleased with the growth in our new vehicle revenue given that our strong import and luxury brand mix benefited in such a big way from the Cash for Clunkers program last year. Our 20% growth in used vehicle revenue was fueled by 15% volume growth along with a 5% increase in the average selling price. Every quarter we move closer to our near-term goal of 100 used vehicles per store per month. We have seen our average grow by approximately 30 vehicles per dealership since we started this process. Increasing that average at each dealership by another 25 vehicles per month would add over $600 million in annual revenue based on this quarter’s average selling price. That’s why we remain convinced that our focus on portfolio maximization and internal growth is the right strategy at this point in our Company’s evolution.”

Service, Parts & Body Shop — Revenue Growth Continues in Key Profit Center

Sonic’s Service, Parts & Body Shop revenue for the third quarter was up nearly 6% compared to the prior year quarter. Mr. Dyke stated, “Our customer pay business was up 4% and we saw some stabilization in our warranty repair business. We have seen steady growth in this high margin piece of our business all year and, if these trends continue, our current group of stores is on track to deliver their highest annual fixed operations gross profit. We have several exciting pilot programs underway to drive more customer traffic in this key area of our business.”

Presentation materials for the Company’s October 26, 2010 earnings conference call at 11:00 A.M. (Eastern) can be accessed on the Company’s website at www.sonicautomotive.com by clicking on the “For Investors” tab and choosing “Webcasts & Presentations” on the right side of the page.

To access the live broadcast of the call over the Internet go to: www.ccbn.com or www.sonicautomotive.com

A live audio of the call will be accessible to the public by calling (877) 791-3416. International callers dial (706) 643-0958. Callers should dial in approximately 10 minutes before the call begins.

A conference call replay will be available one hour following the call for seven days and can be accessed by calling (800) 642-1687; International callers dial (706) 645-9291, conference call ID # 15968314

About Sonic Automotive

Sonic Automotive, Inc., a Fortune 500 company based in Charlotte, N.C., is one of the nation’s largest automotive retailers. Sonic can be reached on the web at www.sonicautomotive.com.

Included herein are forward-looking statements, including statements with respect to future success and impacts from the implementation of our various operational playbooks, future expense reductions, future cash flow generation, growth opportunities, future debt retirement and mortgage activity and future used vehicle and fixed operations sales and gross profit trends. There are many factors that affect management’s views about future events and trends of the Company’s business. These factors involve risk and uncertainties that could cause actual results or trends to differ materially from management’s view, including without limitation, economic conditions in the markets in which we operate, new and used vehicle sales volume, the success of our operational strategies, the rate and timing of overall economic recovery and the risk factors described in the Company’s annual report on Form 10-K for the year ending December 31, 2009 and the quarterly report on Form 10-Q for the quarter ending June 30, 2010. The Company does not undertake any obligation to update forward-looking information.

Sonic Automotive, Inc.
Results of Operations (Unaudited)
(in thousands, except per share, unit data and percentage amounts)

	Three Months Ended									Three Months Ended
	As Reported						As Adjusted			As Reported						As Adjusted
	9/30/2010			Adjustments			9/30/2010			9/30/2009			Adjustments			9/30/2009
Revenues
New retail vehicles	$	886,355		$	—		$	886,355		$	854,902		$	—		$	854,902
Fleet vehicles		51,354			—			51,354			48,814			—			48,814
Total new vehicles		937,709			—			937,709			903,716			—			903,716
Used vehicles		453,815			—			453,815			379,389			—			379,389
Wholesale vehicles		47,597			—			47,597			34,588			—			34,588
Total vehicles		1,439,121			—			1,439,121			1,317,693			—			1,317,693
Parts, service and collision repair		283,741			—			283,741			268,801			—			268,801
Finance, insurance and other		47,398			—			47,398			43,403			—			43,403
Total revenues		1,770,260			—			1,770,260			1,629,897			—			1,629,897
Total gross profit		281,799			—			281,799			274,303			—			274,303
SG&A expenses		(226,331	)		—			(226,331	)		(214,140	)		—			(214,140	)
Impairment charges		(87	)		87			—			(620	)		620			—
Depreciation		(8,731	)		—			(8,731	)		(8,131	)		—			(8,131	)
Operating income		46,650			87			46,737			51,412			620			52,032
Interest expense, floor plan		(5,430	)		—			(5,430	)		(4,533	)		—			(4,533	)
Interest expense, other, net		(15,226	)		—			(15,226	)		(18,277	)		1,678			(16,599	)
Interest expense, non-cash, convertible debt		(1,768	)		—			(1,768	)		7,818			(11,400	)		(3,582	)
Interest expense, non-cash, cash flow swaps		(1,484	)		1,484			—			(2,180	)		2,180			—
Other (expense) / income, net		(351	)		403			52			2,449			(2,453	)		(4	)
Income / (loss) from continuing operations before taxes		22,391			1,974			24,365			36,689			(9,375	)		27,314
Income tax (expense) / benefit		(8,442	)		(744	)		(9,186	)		(16,510	)		4,218			(12,292	)
Income / (loss) from continuing operations		13,949			1,230			15,179			20,179			(5,157	)		15,022
Income / (Loss) from discontinued operations		(964	)		—			(964	)		(4,585	)		2,332			(2,253	)
Net income	$	12,985		$	1,230		$	14,215		$	15,594		$	(2,825	)	$	12,769
Diluted:
Weighted average common shares outstanding		65,851			—			65,851			63,195			—			63,195
Earnings / (loss) per share from continuing operations	$	0.25		$	0.02		$	0.27		$	0.24		$	0.02		$	0.26
Earnings / (loss) per share from discontinued operations		(0.02	)		—			(0.02	)		(0.07	)		0.04			(0.03	)
Earnings / (loss) per share	$	0.23		$	0.02		$	0.25		$	0.17		$	0.06		$	0.23
Gross Margin Data (Continuing Operations):
Retail new vehicles		6.6	%					6.6	%		7.3	%					7.3	%
Fleet vehicles		3.1	%					3.1	%		2.9	%					2.9	%
Total new vehicles		6.4	%					6.4	%		7.0	%					7.0	%
Used vehicles retail		7.8	%					7.8	%		8.5	%					8.5	%
Total vehicles retail		7.5	%					7.5	%		7.2	%					7.2	%
Wholesale vehicles		(3.1	%)					(3.1	%)		(4.7	%)					(4.7	%)
Parts, service and collision repair		49.6	%					49.6	%		50.9	%					50.9	%
Finance, insurance and other		100.0	%					100.0	%		100.0	%					100.0	%
Overall gross margin		15.9	%					15.9	%		16.8	%					16.8	%
SG&A Expenses (Continuing Operations):
Personnel	$	132,316		$	—		$	132,316		$	125,438		$	—		$	125,438
Advertising		12,642			—			12,642			11,345			—			11,345
Rent and rent related		32,743			—			32,743			33,413			—			33,413
Other		48,630			—			48,630			43,944			—			43,944
Total	$	226,331		$	—		$	226,331		$	214,140		$	—		$	214,140
SG&A Expenses as % of Gross Profit		80.3	%					80.3	%		78.1	%					78.1	%
Operating Margin %		2.6	%					2.6	%		3.2	%					3.2	%
Unit Data (Continuing Operations):
New retail units		25,780									27,100
Fleet units		2,020									1,975
New units		27,800									29,075
Used units		22,987									20,097
Total units retailed		50,787									49,172
Wholesale units		7,272									6,929
Other Data:
Continuing Operations revenue percentage changes:
New retail		3.7	%								(12.9	%)
Fleet		5.2	%								3.8	%
Total New Vehicles		3.8	%								(12.1	%)
Used		19.6	%								14.8	%
Parts, service and collision repair		5.6	%								(2.2	%)
Finance, insurance and other		9.2	%								(6.0	%)
Total		8.6	%								(6.9	%)
	2010						2009
Description of Adjustments:
Continuing Operations:
Mark-to-market on cash flow swaps	$	1,484					$	2,180
Debt restructuring charges		403						(775	)
Mark-to-market on derivative liability		—						(11,400	)
PP&E impairments		87						413
Goodwill impairments		—						207
Total pretax	$	1,974					$	(9,375	)
Tax effect		(744	)					4,218
Total	$	1,230					$	(5,157	)
Discontinued Operations:
Lease exit accruals	$	—					$	4,350
Tax effect		—						(2,018	)
Total	$	—					$	2,332

Sonic Automotive, Inc.
Results of Operations (Unaudited)
(in thousands, except per share, unit data and percentage amounts)

	Nine Months Ended									Nine Months Ended
	As Reported						As Adjusted			As Reported						As Adjusted
	9/30/2010			Adjustments			9/30/2010			9/30/2009			Adjustments			9/30/2009
Revenues
New retail vehicles	$	2,463,139		$	—		$	2,463,139		$	2,203,046		$	—		$	2,203,046
Fleet vehicles		148,849			—			148,849			164,190			—			164,190
Total new vehicles		2,611,988			—			2,611,988			2,367,236			—			2,367,236
Used vehicles		1,339,323			—			1,339,323			1,081,855			—			1,081,855
Wholesale vehicles		108,336			—			108,336			105,451			—			105,451
Total vehicles		4,059,647			—			4,059,647			3,554,542			—			3,554,542
Parts, service and collision repair		842,697			—			842,697			807,556			—			807,556
Finance, insurance and other		133,607			—			133,607			116,558			—			116,558
Total revenues		5,035,951			—			5,035,951			4,478,656			—			4,478,656
Total gross profit		830,153			—			830,153			776,263			—			776,263
SG&A expenses		(672,542	)		647			(671,895	)		(619,560	)		—			(619,560	)
Impairment charges		(132	)		132			—			(5,707	)		5,707			—
Depreciation		(25,729	)		—			(25,729	)		(23,865	)		—			(23,865	)
Operating income		131,750			779			132,529			127,131			5,707			132,838
Interest expense, floor plan		(15,615	)		—			(15,615	)		(14,925	)		—			(14,925	)
Interest expense, other, net		(48,024	)		1,464			(46,560	)		(57,998	)		10,833			(47,165	)
Interest expense, non-cash, convertible debt		(5,175	)		—			(5,175	)		1,556			(11,300	)		(9,744	)
Interest expense, non-cash, cash flow swaps		(5,402	)		5,402			—			(5,359	)		5,359			—
Other (expense) / income, net		(7,522	)		7,662			140			2,519			(2,453	)		66
Income / (loss) from continuing operations before taxes		50,012			15,307			65,319			52,924			8,146			61,070
Income tax (expense) / benefit		(19,905	)		(6,092	)		(25,997	)		(23,816	)		(3,666	)		(27,482	)
Income / (loss) from continuing operations		30,107			9,215			39,322			29,108			4,480			33,588
Income / (Loss) from discontinued operations		(4,532	)		—			(4,532	)		(11,810	)		4,771			(7,039	)
Net income	$	25,575		$	9,215		$	34,790		$	17,298		$	9,251		$	26,549
Diluted:
Weighted average common shares outstanding		65,711			—			65,711			52,529			—			52,529
Earnings / (loss) per share from continuing operations	$	0.56		$	0.13		$	0.69		$	0.48		$	0.21		$	0.69
Earnings / (loss) per share from discontinued operations		(0.07	)		0.01			(0.06	)		(0.22	)		0.09			(0.13	)
Earnings / (loss) per share	$	0.49		$	0.14		$	0.63		$	0.26		$	0.30		$	0.56
Gross Margin Data (Continuing Operations):
Retail new vehicles		6.8	%					6.8	%		7.0	%					7.0	%
Fleet vehicles		2.8	%					2.8	%		3.6	%					3.6	%
Total new vehicles		6.6	%					6.6	%		6.8	%					6.8	%
Used vehicles retail		8.0	%					8.0	%		8.8	%					8.8	%
Total vehicles retail		7.1	%					7.1	%		7.4	%					7.4	%
Wholesale vehicles		(3.6	%)					(3.6	%)		(2.7	%)					(2.7	%)
Parts, service and collision repair		50.0	%					50.0	%		50.4	%					50.4	%
Finance, insurance and other		100.0	%					100.0	%		100.0	%					100.0	%
Overall gross margin		16.5	%					16.5	%		17.3	%					17.3	%
SG&A Expenses (Continuing Operations):
Personnel	$	396,067		$	—		$	396,067		$	355,238		$	—		$	355,238
Advertising		36,445			—			36,445			32,934			—			32,934
Rent and rent related		98,226			—			98,226			97,703			—			97,703
Other		141,804			(647	)		141,157			133,685			—			133,685
Total	$	672,542		$	(647	)	$	671,895		$	619,560		$	—		$	619,560
SG&A Expenses as % of Gross Profit		81.0	%					80.9	%		79.8	%					79.8	%
Operating Margin %		2.6	%					2.6	%		2.8	%					3.0	%
Unit Data (Continuing Operations):
New retail units		71,809									67,782
Fleet units		6,042									6,802
New units		77,851									74,584
Used units		68,861									57,457
Total units retailed		146,712									132,041
Wholesale units		17,627									18,635
Other Data:
Continuing Operations revenue percentage changes:
New retail		11.8	%								(26.5	%)
Fleet		(9.3	%)								(38.8	%)
Total New Vehicles		10.3	%								(27.5	%)
Used		23.8	%								2.4	%
Parts, service and collision repair		4.4	%								(4.1	%)
Finance, insurance and other		14.6	%								(21.6	%)
Total		12.4	%								(19.2	%)
	2010						2009
Description of Adjustments:
Continuing Operations:
Hail damage	$	647					$	—
Mark-to-market on cash flow swaps		5,402						5,359
(Gain) / loss on extinguishment of debt		7,662						(2,453	)
Debt restructuring charges		—						10,833
Mark-to-market on derivative liability		—						(11,300	)
PP&E impairments		132						2,513
Franchise asset impairments		—						2,100
Goodwill impairments		—						1,094
Double-carry debt interest charges		1,464						—
Total pretax	$	15,307					$	8,146
Tax effect		(6,092	)					(3,666	)
Total	$	9,215					$	4,480
Discontinued Operations:
Lease exit accruals	$	—					$	4,350
PP&E impairments		—						1,822
Goodwill impairment		—						1,586
Total pretax	$	—					$	7,758
Tax effect		—						(2,987	)
Total	$	—					$	4,771