Q2 2012 Earnings Review July 23, 2012 Sonic Automotive, Inc. 1 Exhibit 99.2 |
Forward-Looking Statements This presentation contains “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. These statements relate to future events, are not historical facts and are based on our current expectations and assumptions regarding our business, the economy and other future conditions. These statements can generally be identified by lead-in words such as “believe”, “expect”, “anticipate”, “intend”, “plan”, “foresee”, “may”, “will” and other similar words. Statements that describe our Company’s objectives, plans or goals are also forward-looking statements. Examples of such forward-looking information we may be discussing in this presentation include, without limitation, further implementation of our operational strategies and playbooks, future debt retirement, capital expenditures, operating margins and revenues, inventory levels and new vehicle industry sales volume. You are cautioned that these forward-looking statements are not guarantees of future performance, involve risks and uncertainties and actual results may differ materially from those projected in the forward-looking statements as a result of various factors. These risks and uncertainties include, among other things, (a) economic conditions in the markets in which we operate, (b) the success of our operational strategies, (c) our relationships with the automobile manufacturers and (d) new and pre-owned vehicle sales volume. These risks and uncertainties, as well as additional factors that could affect our forward-looking statements, are described in our Form 10-K for the year ending December 31, 2011 and our Form 10-Q for the quarter ended March 31, 2012. These forward-looking statements, risks, uncertainties and additional factors speak only as of the date of this presentation. We undertake no obligation to update any such statements. Sonic Automotive, Inc. 2 |
Sonic Automotive, Inc. Quarter in Review Financial Results Operations Recap Summary and Outlook o o o o Sonic Automotive Q2 2012 3 |
Sonic Automotive, Inc. Overall Results Revenue Growth – up 12.3% New retail vehicle revenue up 21.3% - volume up 22.3% - exceeds industry retail volume growth Pre-owned revenue up 4.0% F&I revenue up 18.0% Fixed Operations revenue up 3.2% SG&A at 77.8% - in line with full year projections Income from continuing operations of $27.5 million up 19.7% Q2 2012 diluted EPS from continuing operations was $0.46 per share vs. $0.38 in prior year period Results include after-tax charges of approximately $1.6 million, or $0.03 per diluted share, related to debt repurchases and income 4 tax benefits of $3.6 million, or $0.06 per diluted share, related to the settlement of income tax related matters |
Q2 2012 Results Sonic Automotive, Inc. B/(W) than Q2 2011 (amounts in millions, except per share data) Q2 2012 $ % Revenue Gross Profit Operating Profit Continuing Ops: Profit (after tax) Diluted EPS $ 2,185 $ 239 12% $ 321 $ 15 5% $ 60 $ 1 1% $ 28 $ 5 20% $ 0.46 $ 0.08 21% 5 |
SG&A to Gross 160 bps Improvement from Q1 Target 78% for Full Year 2012 Sonic Automotive, Inc. |
Sonic Automotive, Inc. Capital Spending (amounts in millions) YTD Q2 2012 Estimated 2012 Real Estate Acquisitions $ 4.8 $ 14.5 All Other Cap Ex 29.7 128.9 Subtotal $ 34.5 $ 143.4 Less: Mortgage Funding (10.7) (48.5) Total Cash Used – Cap Ex $ 23.8 $ 94.9 7 |
Sonic Automotive, Inc. Debt Covenants Compliant with all Covenants Covenant Actual Q2 2012 Liquidity Ratio >= 1.05 1.16 Fixed Charge Coverage Ratio >= 1.20 1.56 Total Lease Adjusted Leverage Ratio <= 5.50 3.88 8 |
New Vehicles Includes Fleet (1) Source: JD Power Sonic Automotive, Inc. Q2 2012 Q2 2011 B/(W) Retail Revenue Retail Volume Selling Price Gross Margin % GPU Retail Gross Profit $1.2 billion 34,396 $ 34,213 6.0% $ 2,039 $ 70 million $1.0 billion 28,125 $ 34,483 6.8% $ 2,347 $ 66 million 21.3% 22.3% ($270) (80 bps) ($ 308) 6.2% 9 |
Pre-Owned Retail Vehicles Q2 2012 Q2 2011 B/(W) Retail Volume 27,528 26,799 2.7% Revenue $550 million $529 million 4.0% Pre-Owned Related Gross* $ 82 million $ 81 million $ 1 million Pre-Owned to New Ratio .80 to 1 .95 to 1 * - Includes: pre-owned vehicle + reconditioning + F&I gross Continue to make progress toward our goal of 100 per store per month Sonic Automotive, Inc. 10 |
B/(W) than Q2 2011 (amounts in millions) Q2 2012 $ % Revenue $ 305 $ 9 3.2% Gross Profit $ 149 $ 3 Q2 YOY Gross Profit Change Breakdown: Fixed Operations Sonic Automotive, Inc. 2.2% 11 • Customer Pay Up 3.0% • Whsl. Parts Up 3.1% • Internal & Sublet Up 12.9% • Warranty Down 9.4% |
Sonic Automotive, Inc. 12 Summary and Outlook Revenue continues to grow in all categories Investments in technology and training are progressing as planned Automotive retail industry outlook remains positive Raising 2012 continuing operations diluted earnings per share guidance of $1.62 - $1.70. |
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