Exhibit 99.1
 | Investors May Contact: | |
| Keith R. Style | ||
| V.P.-Finance and Investor Relations | ||
| (212) 885-2530 | ||
| investor@asburyauto.com | ||
| Reporters May Contact: | ||
| Stephanie Lowenthal | ||
| RF|Binder Partners | ||
| (212) 994-7619 | ||
| Stephanie.Lowenthal@RFBinder.com | ||
Asbury Automotive Group Reports Record Second Quarter Financial Results
EPS from Continuing Operations Increases 10%; Up 22% Adjusted for Non-Operating Items
New York, NY, July 26, 2007 – Asbury Automotive Group, Inc. (NYSE: ABG), one of the largest automotive retail and service companies in the U.S., today reported financial results for the second quarter and six months ended June 30, 2007.
Income from continuing operations for the second quarter was $21.2 million, or $0.64 per diluted share, an 8% increase from $19.5 million, or $0.58 per diluted share, a year ago. Results for this year’s second quarter include $0.02 per diluted share in non-operating expenses related to the completion of the Company’s debt refinancing and a secondary stock offering, while the results a year ago included non-operating items that added $0.04 per diluted share. Excluding these items, income from continuing operations for the second quarter increased 20% to $22.0 million, or $0.66 per diluted share, from $18.3 million, or $0.54 per diluted share, a year ago.
For the first six months of 2007, income from continuing operations was $23.6 million, or $0.70 per diluted share, compared with $33.2 million, or $0.99 per diluted share, in the corresponding period last year. Non-operating items reduced earnings per diluted share by $0.40 in the first half of 2007, while non-operating items increased results a year ago by $0.04 per diluted share. Excluding these items, income from continuing operations for the first half of 2007 increased 16% to $37.3 million, or $1.10 per diluted share.
President and CEO Charles R. Oglesby said, “Asbury’s excellent results for the second quarter reflect the fundamental strength of our diversified retail and services business model, as well as the resourcefulness and flexibility of our people in the face of a challenging vehicle sales environment. Retail sales, both new and used, were soft during the quarter, but thanks to record results in finance and insurance, both in total revenue and on a PVR basis, and solid results in fixed operations, we were again able to deliver record earnings per share.”
J. Gordon Smith, Senior Vice President and CFO, said, “The second quarter marks our 11th consecutive quarter of improved expenses as a percentage of gross profit, with 70 basis points of improvement on an adjusted basis. In addition, our EPS growth was further enhanced through two capital markets events: the repurchase of approximately 4% of our outstanding common stock at the end of the first quarter of 2007 and the refinancing of our 9% senior subordinated notes, which was completed in mid-June.”
Additional financial information for the second quarter of 2007, as compared to last year’s second quarter, included:
| • | Total revenue for the quarter of approximately $1.5 billion was essentially unchanged from a year ago. Total gross profit was $232.4 million, up 4% adjusted for non-operating items. |
| • | New light vehicle retail revenue increased 2% (1% on a same-store basis) and new light vehicle unit sales increased 1% (down 1% same-store). New vehicle retail gross profit was down 1% (2% same-store). New heavy truck retail revenue decreased 45% and new heavy truck unit sales declined 43%. |
| • | Used vehicle retail revenue increased 3% (1% same-store), and unit sales increased 1% (flat on a same-store basis). Used vehicle retail gross profit decreased 2% (4% same-store). |
| • | Parts, service and collision repair revenue increased 3% (2% same-store), and gross profit rose 7% (5% same-store). |
| • | Net finance and insurance (F&I) revenue increased 2% (1% same-store). Dealership-generated F&I for the quarter was up 13% (12% same-store). Dealership-generated F&I per vehicle retailed increased 14% to a record level of $1,000. |
| • | Selling, general and administrative (SG&A) expenses as a percentage of gross profit were 74.7% for the quarter. Adjusting both periods for non-operating items, the SG&A expenses were 74.6% of gross profit, a 70 basis-point improvement from 75.3% a year ago. |
During the first half of 2007, Asbury acquired three dealerships with approximately $140 million in annualized revenues. The Company currently expects to exceed its annual growth target of adding $200 million in annualized revenues through acquisitions for the full year.
The Company noted that it remains comfortable with its previous earnings guidance for 2007 in a range between $2.20 and $2.28 per diluted share from continuing operations.
Asbury will host a conference call to discuss its second quarter results this morning at 10:00 a.m. Eastern Time. The call will be simulcast live on the Internet and can be accessed by logging onto http://www.asburyauto.com or http://www.ccbn.com. In addition, a live audio of the call will be accessible to the public by calling 800-500-3170 (domestic), or 719-457-2733 (international); no access code is necessary. Callers should dial in approximately 5 to 10 minutes before the call begins.
2
About Asbury Automotive Group
Asbury Automotive Group, Inc. (“Asbury”), headquartered in New York City, is one of the largest automobile retailers in the U.S. Built through a combination of organic growth and a series of strategic acquisitions, Asbury currently operates 88 retail auto stores, encompassing 115 franchises for the sale and servicing of 33 different brands of American, European and Asian automobiles. Asbury offers customers an extensive range of automotive products and services, including new and used vehicle sales and related financing and insurance, vehicle maintenance and repair services, replacement parts and service contracts.
Forward-Looking Statements
This press release contains “forward-looking statements” as that term is defined in the Private Securities Litigation Reform Act of 1995. The forward-looking statements include statements relating to goals, plans, projections and guidance regarding the Company’s financial position, results of operations, market position, future acquisitions and business strategy. These statements are based on management’s current expectations and involve significant risks and uncertainties that may cause results to differ materially from those set forth in the statements. These risks and uncertainties include, among other things, market factors, the Company’s relationships with vehicle manufacturers and other suppliers, risks associated with the Company’s indebtedness, risks related to future acquisitions, risks related to competition in the automotive retail and service industries, general economic conditions both nationally and locally, governmental regulations, legislation and the Company’s ability to execute certain operational strategies. There can be no guarantees that the Company’s plans for future operations will be successfully implemented or that they will prove to be commercially successful or that the Company will be able to continue paying dividends in the future at the current rate or at all. These and other risk factors are discussed in the Company’s annual report on Form 10-K/A and in its other filings with the Securities and Exchange Commission. We undertake no obligation to publicly update any forward-looking statement, whether as a result of new information, future events or otherwise.
[Tables Follow]
3
Asbury Automotive Group, Inc.
Consolidated Statements of Income
(In thousands, except per share data)
(Unaudited)
For the Three Months Ended June 30, | For the Six Months Ended June 30, | |||||||||||||||
| 2007 | 2006 | 2007 | 2006 | |||||||||||||
REVENUES: | ||||||||||||||||
New vehicle | $ | 891,281 | $ | 906,669 | $ | 1,715,732 | $ | 1,716,326 | ||||||||
Used vehicle | 395,503 | �� | 378,739 | 773,650 | 731,154 | |||||||||||
Parts, service and collision repair | 176,173 | 170,701 | 350,461 | 339,230 | ||||||||||||
Finance and insurance, net | 43,576 | 42,706 | 82,260 | 77,856 | ||||||||||||
Total revenues | 1,506,533 | 1,498,815 | 2,922,103 | 2,864,566 | ||||||||||||
COST OF SALES: | ||||||||||||||||
New vehicle | 829,059 | 843,724 | 1,593,973 | 1,596,331 | ||||||||||||
Used vehicle | 361,006 | 344,458 | 702,984 | 664,440 | ||||||||||||
Parts, service and collision repair | 84,056 | 84,200 | 168,671 | 168,443 | ||||||||||||
Total cost of sales | 1,274,121 | 1,272,382 | 2,465,628 | 2,429,214 | ||||||||||||
GROSS PROFIT | 232,412 | 226,433 | 456,475 | 435,352 | ||||||||||||
OPERATING EXPENSES: | ||||||||||||||||
Selling, general and administrative | 173,625 | 169,458 | 350,011 | 332,749 | ||||||||||||
Depreciation and amortization | 5,348 | 5,093 | 10,676 | 10,048 | ||||||||||||
Income from operations | 53,439 | 51,882 | 95,788 | 92,555 | ||||||||||||
OTHER INCOME (EXPENSE): | ||||||||||||||||
Floor plan interest expense | (11,190 | ) | (11,007 | ) | (22,406 | ) | (19,944 | ) | ||||||||
Other interest expense | (9,168 | ) | (11,140 | ) | (20,954 | ) | (22,043 | ) | ||||||||
Interest income | 1,041 | 1,021 | 3,006 | 1,748 | ||||||||||||
Loss on extinguishment of long-term debt | (786 | ) | — | (18,523 | ) | — | ||||||||||
Other income, net | 397 | 480 | 689 | 824 | ||||||||||||
Total other expense, net | (19,706 | ) | (20,646 | ) | (58,188 | ) | (39,415 | ) | ||||||||
Income before income taxes | 33,733 | 31,236 | 37,600 | 53,140 | ||||||||||||
INCOME TAX EXPENSE | 12,567 | 11,713 | 14,025 | 19,927 | ||||||||||||
INCOME FROM CONTINUING OPERATIONS | 21,166 | 19,523 | 23,575 | 33,213 | ||||||||||||
DISCONTINUED OPERATIONS, net of tax | (607 | ) | (519 | ) | (2,583 | ) | (1,656 | ) | ||||||||
NET INCOME | $ | 20,559 | $ | 19,004 | $ | 20,992 | $ | 31,557 | ||||||||
BASIC EARNINGS PER COMMON SHARE: | ||||||||||||||||
Continuing operations | $ | 0.65 | $ | 0.59 | $ | 0.72 | $ | 1.01 | ||||||||
Discontinued operations | (0.02 | ) | (0.02 | ) | (0.08 | ) | (0.05 | ) | ||||||||
Net income | $ | 0.63 | $ | 0.57 | $ | 0.64 | $ | 0.96 | ||||||||
DILUTED EARNINGS PER COMMON SHARE: | ||||||||||||||||
Continuing operations | $ | 0.64 | $ | 0.58 | $ | 0.70 | $ | 0.99 | ||||||||
Discontinued operations | (0.02 | ) | (0.02 | ) | (0.08 | ) | (0.05 | ) | ||||||||
Net income | $ | 0.62 | $ | 0.56 | $ | 0.62 | $ | 0.94 | ||||||||
WEIGHTED AVERAGE COMMON SHARES OUTSTANDING: | ||||||||||||||||
Basic | 32,490 | 33,077 | 32,909 | 33,000 | ||||||||||||
Diluted | 33,329 | 33,709 | 33,806 | 33,680 | ||||||||||||
4
Asbury Automotive Group, Inc.
Selected Data
(Dollars in thousands, except per vehicle data)
(Unaudited)
As Reported for the Three Months Ended June 30, | Increase (Decrease) | % Change | |||||||||||||||||||
| 2007 | 2006 | ||||||||||||||||||||
RETAIL VEHICLES SOLD: | |||||||||||||||||||||
New retail units – light vehicles | 26,203 | 60.2 | % | 26,084 | 59.3 | % | 119 | 0.5 | % | ||||||||||||
New retail units – heavy trucks | 975 | 2.2 | % | 1,698 | 3.9 | % | (723 | ) | (42.6 | )% | |||||||||||
Total new retail units | 27,178 | 62.4 | % | 27,782 | 63.2 | % | (604 | ) | (2.2 | )% | |||||||||||
Used retail units | 16,401 | 37.6 | % | 16,196 | 36.8 | % | 205 | 1.3 | % | ||||||||||||
Total retail units | 43,579 | 100.0 | % | 43,978 | 100.0 | % | (399 | ) | (0.9 | )% | |||||||||||
NEW UNITS SOLD (INCLUDING FLEET) | 29,112 | 29,640 | (528 | ) | (1.8 | )% | |||||||||||||||
REVENUE: | |||||||||||||||||||||
New retail – light vehicles | $ | 788,545 | 52.3 | % | $ | 771,858 | 51.5 | % | $ | 16,687 | 2.2 | % | |||||||||
New retail – heavy trucks | 57,014 | 3.8 | % | 103,762 | 6.9 | % | (46,748 | ) | (45.1 | )% | |||||||||||
Total new retail | 845,559 | 56.1 | % | 875,620 | 58.4 | % | (30,061 | ) | (3.4 | )% | |||||||||||
Used retail | 300,839 | 20.0 | % | 292,396 | 19.5 | % | 8,443 | 2.9 | % | ||||||||||||
Parts, service and collision repair | 176,173 | 11.7 | % | 170,701 | 11.4 | % | 5,472 | 3.2 | % | ||||||||||||
Finance and insurance, net | 43,576 | 2.9 | % | 42,706 | 2.8 | % | 870 | 2.0 | % | ||||||||||||
Total retail revenue | 1,366,147 | 1,381,423 | (15,276 | ) | (1.1 | )% | |||||||||||||||
Fleet | 45,722 | 3.0 | % | 31,049 | 2.1 | % | 14,673 | 47.3 | % | ||||||||||||
Wholesale | 94,664 | 6.3 | % | 86,343 | 5.8 | % | 8,321 | 9.6 | % | ||||||||||||
Total revenue | $ | 1,506,533 | 100.0 | % | $ | 1,498,815 | 100.0 | % | $ | 7,718 | 0.5 | % | |||||||||
GROSS PROFIT: | |||||||||||||||||||||
New retail – light vehicles | $ | 58,837 | 25.3 | % | $ | 57,901 | 25.5 | % | $ | 936 | 1.6 | % | |||||||||
New retail – heavy trucks | 2,537 | 1.1 | % | 3,783 | 1.7 | % | (1,246 | ) | (32.9 | )% | |||||||||||
Total new retail | 61,374 | 26.4 | % | 61,684 | 27.2 | % | (310 | ) | (0.5 | )% | |||||||||||
Used retail | 34,701 | 14.9 | % | 35,527 | 15.7 | % | (826 | ) | (2.3 | )% | |||||||||||
Parts, service and collision repair | 92,117 | 39.6 | % | 86,501 | 38.2 | % | 5,616 | 6.5 | % | ||||||||||||
Finance and insurance, net | 43,576 | 18.8 | % | 42,706 | 18.9 | % | 870 | 2.0 | % | ||||||||||||
Total retail gross profit | 231,768 | 226,418 | 5,350 | 2.4 | % | ||||||||||||||||
Fleet | 848 | 0.4 | % | 1,261 | 0.6 | % | (413 | ) | (32.8 | )% | |||||||||||
Wholesale | (204 | ) | (0.1 | )% | (1,246 | ) | (0.6 | )% | 1,042 | 83.6 | % | ||||||||||
Total gross profit | $ | 232,412 | 100.0 | % | $ | 226,433 | 100.0 | % | $ | 5,979 | 2.6 | % | |||||||||
Adjusted gross profit | $ | 232,412 | $ | 223,033 | $ | 9,379 | 4.2 | % | |||||||||||||
Adjusted SG&A expenses | $ | 173,355 | $ | 168,041 | $ | 5,314 | 3.2 | % | |||||||||||||
Adjusted SG&A expenses as a percentage of adjusted gross profit | 74.6 | % | 75.3 | % | (0.7 | )% | (0.9 | )% | |||||||||||||
REVENUE PER VEHICLE RETAILED: | |||||||||||||||||||||
New retail – light vehicles | $ | 30,094 | $ | 29,591 | $ | 503 | 1.7 | % | |||||||||||||
New retail – heavy trucks | 58,476 | 61,108 | (2,632 | ) | (4.3 | )% | |||||||||||||||
Used retail | 18,343 | 18,054 | 289 | 1.6 | % | ||||||||||||||||
GROSS PROFIT PER VEHICLE RETAILED: | |||||||||||||||||||||
New retail – light vehicles | $ | 2,245 | $ | 2,220 | $ | 25 | 1.1 | % | |||||||||||||
New retail – heavy trucks | 2,602 | 2,228 | 374 | 16.8 | % | ||||||||||||||||
Used retail | 2,116 | 2,194 | (78 | ) | (3.6 | )% | |||||||||||||||
Finance and insurance, net | 1,000 | 971 | 29 | 3.0 | % | ||||||||||||||||
Dealership generated finance and insurance, net | 1,000 | 878 | 122 | 13.9 | % | ||||||||||||||||
GROSS PROFIT MARGIN: | |||||||||||||||||||||
New retail – light vehicles | 7.5 | % | 7.5 | % | — | % | — | % | |||||||||||||
New retail – heavy trucks | 4.4 | % | 3.6 | % | 0.8 | % | 22.2 | % | |||||||||||||
Used retail | 11.5 | % | 12.2 | % | (0.7 | )% | (5.7 | )% | |||||||||||||
Parts, service and collision repair | 52.3 | % | 50.7 | % | 1.6 | % | 3.2 | % | |||||||||||||
5
Asbury Automotive Group, Inc.
Selected Data
(Dollars in thousands, except per vehicle data)
(Unaudited)
Same Store for the Three Months Ended June 30, | Increase (Decrease) | % Change | |||||||||||||||||||
| 2007 | 2006 | ||||||||||||||||||||
RETAIL VEHICLES SOLD: | |||||||||||||||||||||
New retail – light vehicles | 25,860 | 60.1 | % | 26,084 | 59.3 | % | (224 | ) | (0.9 | )% | |||||||||||
New retail – heavy trucks | 975 | 2.3 | % | 1,698 | 3.9 | % | (723 | ) | (42.6 | )% | |||||||||||
Total new retail units | 26,835 | 62.4 | % | 27,782 | 63.2 | % | (947 | ) | (3.4 | )% | |||||||||||
Used retail units | 16,146 | 37.6 | % | 16,196 | 36.8 | % | (50 | ) | (0.3 | )% | |||||||||||
Total retail units | 42,981 | 100.0 | % | 43,978 | 100.0 | % | (997 | ) | (2.3 | )% | |||||||||||
NEW UNITS SOLD (INCLUDING FLEET) | 28,769 | 29,640 | (871 | ) | (2.9 | )% | |||||||||||||||
REVENUE: | |||||||||||||||||||||
New retail – light vehicles | $ | 777,638 | 52.3 | % | $ | 771,858 | 51.5 | % | $ | 5,780 | 0.7 | % | |||||||||
New retail – heavy trucks | 57,014 | 3.8 | % | 103,762 | 6.9 | % | (46,748 | ) | (45.1 | )% | |||||||||||
Total new retail | 834,652 | 56.1 | % | 875,620 | 58.4 | % | (40,968 | ) | (4.7 | )% | |||||||||||
Used retail | 296,339 | 19.9 | % | 292,396 | 19.5 | % | 3,943 | 1.3 | % | ||||||||||||
Parts, service and collision repair | 173,881 | 11.7 | % | 170,701 | 11.4 | % | 3,180 | 1.9 | % | ||||||||||||
Finance and insurance, net | 43,093 | 2.9 | % | 42,706 | 2.8 | % | 387 | 0.9 | % | ||||||||||||
Total retail revenue | 1,347,965 | 1,381,423 | (33,458 | ) | (2.4 | )% | |||||||||||||||
Fleet | 45,722 | 3.1 | % | 31,049 | 2.1 | % | 14,673 | 47.3 | % | ||||||||||||
Wholesale | 93,341 | 6.3 | % | 86,343 | 5.8 | % | 6,998 | 8.1 | % | ||||||||||||
Total revenue | $ | 1,487,028 | 100.0 | % | $ | 1,498,815 | 100.0 | % | $ | (11,787 | ) | (0.8 | )% | ||||||||
GROSS PROFIT: | |||||||||||||||||||||
New retail – light vehicles | $ | 58,010 | 25.3 | % | $ | 57,901 | 25.5 | % | $ | 109 | 0.2 | % | |||||||||
New retail – heavy trucks | 2,537 | 1.1 | % | 3,783 | 1.7 | % | (1,246 | ) | (32.9 | )% | |||||||||||
Total new retail | 60,547 | 26.4 | % | 61,684 | 27.2 | % | (1,137 | ) | (1.8 | )% | |||||||||||
Used retail | 34,195 | 14.9 | % | 35,527 | 15.7 | % | (1,332 | ) | (3.7 | )% | |||||||||||
Parts, service and collision repair | 90,772 | 39.6 | % | 86,501 | 38.2 | % | 4,271 | 4.9 | % | ||||||||||||
Finance and insurance, net | 43,093 | 18.8 | % | 42,706 | 18.9 | % | 387 | 0.9 | % | ||||||||||||
Total retail gross profit | 228,607 | 226,418 | 2,189 | 1.0 | % | ||||||||||||||||
Fleet | 848 | 0.4 | % | 1,261 | 0.6 | % | (413 | ) | (32.8 | )% | |||||||||||
Wholesale | (217 | ) | (0.1 | )% | (1,246 | ) | (0.6 | )% | 1,029 | 82.6 | % | ||||||||||
Total gross profit | $ | 229,238 | 100.0 | % | $ | 226,433 | 100.0 | % | $ | 2,805 | 1.2 | % | |||||||||
Adjusted gross profit | $ | 229,238 | $ | 223,033 | $ | 6,205 | 2.8 | % | |||||||||||||
Adjusted SG&A expenses | $ | 170,713 | $ | 168,041 | $ | 2,672 | 1.6 | % | |||||||||||||
Adjusted SG&A expenses as a percentage of adjusted gross profit | 74.5 | % | 75.3 | % | (0.8 | )% | (1.1 | )% | |||||||||||||
REVENUE PER VEHICLE RETAILED: | |||||||||||||||||||||
New retail – light vehicles | $ | 30,071 | $ | 29,591 | $ | 480 | 1.6 | % | |||||||||||||
New retail – heavy trucks | 58,476 | 61,108 | (2,632 | ) | (4.3 | )% | |||||||||||||||
Used retail | 18,354 | 18,054 | 300 | 1.7 | % | ||||||||||||||||
GROSS PROFIT PER VEHICLE RETAILED: | |||||||||||||||||||||
New retail – light vehicles | $ | 2,243 | $ | 2,220 | $ | 23 | 1.0 | % | |||||||||||||
New retail – heavy trucks | 2,602 | 2,228 | 374 | 16.8 | % | ||||||||||||||||
Used retail | 2,118 | 2,194 | (76 | ) | (3.5 | )% | |||||||||||||||
Finance and insurance, net | 1,003 | 971 | 32 | 3.3 | % | ||||||||||||||||
Dealership generated finance and insurance, net | 1,003 | 878 | 125 | 14.2 | % | ||||||||||||||||
GROSS PROFIT MARGIN: | |||||||||||||||||||||
New retail – light vehicles | 7.5 | % | 7.5 | % | — | % | — | % | |||||||||||||
New retail – heavy trucks | 4.4 | % | 3.6 | % | 0.8 | % | 22.2 | % | |||||||||||||
Used retail | 11.5 | % | 12.2 | % | (0.7 | )% | (5.7 | )% | |||||||||||||
Parts, service and collision repair | 52.2 | % | 50.7 | % | 1.5 | % | 3.0 | % | |||||||||||||
6
Asbury Automotive Group, Inc.
Selected Data
(Dollars in thousands, except per vehicle data)
(Unaudited)
As Reported for the Six Months Ended June 30, | Increase (Decrease) | % Change | |||||||||||||||||||
| 2007 | 2006 | ||||||||||||||||||||
RETAIL VEHICLES SOLD: | |||||||||||||||||||||
New retail – light vehicles | 49,478 | 58.5 | % | 49,131 | 59.0 | % | 347 | 0.7 | % | ||||||||||||
New retail – heavy trucks | 1,992 | 2.4 | % | 2,774 | 3.3 | % | (782 | ) | (28.2 | )% | |||||||||||
Total new retail units | 51,470 | 60.9 | % | 51,905 | 62.3 | % | (435 | ) | (0.8 | )% | |||||||||||
Used retail units | 33,026 | 39.1 | % | 31,415 | 37.7 | % | 1,611 | 5.1 | % | ||||||||||||
Total retail units | 84,496 | 100.0 | % | 83,320 | 100.0 | % | 1,176 | 1.4 | % | ||||||||||||
NEW UNITS SOLD (INCLUDING FLEET) | 56,142 | 56,198 | (56 | ) | (0.1 | )% | |||||||||||||||
REVENUE: | |||||||||||||||||||||
New retail – light vehicles | $ | 1,503,339 | 51.4 | % | $ | 1,469,547 | 51.3 | % | $ | (6,208 | ) | (0.4 | )% | ||||||||
New retail – heavy trucks | 115,700 | 4.1 | % | 166,880 | 5.9 | % | (51,180 | ) | (30.7 | )% | |||||||||||
Total new retail | 1,619,039 | 55.5 | % | 1,636,427 | 57.2 | % | (17,388 | ) | (1.1 | )% | |||||||||||
Used retail | 597,355 | 20.4 | % | 558,763 | 19.5 | % | 38,592 | 6.9 | % | ||||||||||||
Parts, service and collision repair | 350,461 | 12.0 | % | 339,230 | 11.8 | % | 11,231 | 3.3 | % | ||||||||||||
Finance and insurance, net | 82,260 | 2.8 | % | 77,856 | 2.7 | % | 4,404 | 5.7 | % | ||||||||||||
Total retail revenue | 2,649,115 | 2,612,276 | 36,839 | 1.4 | % | ||||||||||||||||
Fleet | 96,693 | 3.3 | % | 79,899 | 2.8 | % | 16,794 | 21.0 | % | ||||||||||||
Wholesale | 176,295 | 6.0 | % | 172,391 | 6.0 | % | 3,904 | 2.3 | % | ||||||||||||
Total revenue | $ | 2,922,103 | 100.0 | % | $ | 2,864,566 | 100.0 | % | $ | 57,537 | 2.0 | % | |||||||||
GROSS PROFIT: | |||||||||||||||||||||
New retail – light vehicles | $ | 114,065 | 25.0 | % | $ | 111,367 | 25.6 | % | $ | 2,698 | 2.4 | % | |||||||||
New retail – heavy trucks | 5,781 | 1.3 | % | 6,546 | 1.5 | % | (765 | ) | (11.7 | )% | |||||||||||
Total new retail | 119,846 | 26.3 | % | 117,913 | 27.1 | % | 1,933 | 1.6 | % | ||||||||||||
Used retail | 70,354 | 15.4 | % | 67,560 | 15.5 | % | 2,794 | 4.1 | % | ||||||||||||
Parts, service and collision repair | 181,790 | 39.8 | % | 170,787 | 39.2 | % | 11,003 | 6.4 | % | ||||||||||||
Finance and insurance, net | 82,260 | 18.0 | % | 77,856 | 17.9 | % | 4,404 | 5.7 | % | ||||||||||||
Total retail gross profit | 454,250 | 434,116 | 20,134 | 4.6 | % | ||||||||||||||||
Fleet | 1,913 | 0.4 | % | 2,082 | 0.5 | % | (169 | ) | (8.1 | )% | |||||||||||
Wholesale | 312 | 0.1 | % | (846 | ) | (0.2 | )% | 1,158 | 136.9 | % | |||||||||||
Total gross profit | $ | 456,475 | 100.0 | % | $ | 435,352 | 100.0 | % | $ | 21,123 | 4.9 | % | |||||||||
Adjusted gross profit | $ | 456,475 | $ | 431,952 | $ | 24,523 | 5.7 | % | |||||||||||||
Adjusted SG&A expenses | $ | 346,791 | $ | 331,091 | $ | 15,700 | 4.7 | % | |||||||||||||
Adjusted SG&A expenses as a percentage of adjusted gross profit | 76.0 | % | 76.6 | % | (0.6 | )% | (0.8 | )% | |||||||||||||
REVENUE PER VEHICLE RETAILED: | |||||||||||||||||||||
New retail – light vehicles | $ | 30,384 | $ | 29,911 | $ | 473 | 1.6 | % | |||||||||||||
New retail – heavy trucks | 58,082 | 60,159 | (2,077 | ) | (3.5 | )% | |||||||||||||||
Used retail | 18,087 | 17,787 | 300 | 1.7 | % | ||||||||||||||||
GROSS PROFIT PER VEHICLE RETAILED: | |||||||||||||||||||||
New retail – light vehicles | $ | 2,305 | $ | 2,267 | $ | 38 | 1.7 | % | |||||||||||||
New retail – heavy trucks | 2,902 | 2,360 | 542 | 23.0 | % | ||||||||||||||||
Used retail | 2,130 | 2,151 | (21 | ) | (1.0 | )% | |||||||||||||||
Finance and insurance, net | 974 | 934 | 40 | 4.3 | % | ||||||||||||||||
Dealership generated finance and insurance, net | 974 | 873 | 101 | 11.6 | % | ||||||||||||||||
GROSS PROFIT MARGIN: | |||||||||||||||||||||
New retail – light vehicles | 7.6 | % | 7.6 | % | — | — | |||||||||||||||
New retail – heavy trucks | 5.0 | % | 3.9 | % | 1.1 | % | 28.2 | % | |||||||||||||
Used retail | 11.8 | % | 12.1 | % | (0.3 | )% | (2.6 | )% | |||||||||||||
Parts, service and collision repair | 51.9 | % | 50.3 | % | 1.6 | % | 3.2 | % | |||||||||||||
7
Asbury Automotive Group, Inc.
Selected Data
(Dollars in thousands, except per vehicle data)
(Unaudited) | Same Store for the Six Months Ended June 30, | Increase (Decrease) | % Change | ||||||||||||||||||
| 2007 | 2006 | ||||||||||||||||||||
RETAIL VEHICLES SOLD: | |||||||||||||||||||||
New retail – light vehicles | 49,080 | 58.6 | % | 49,131 | 59.0 | % | (51 | ) | (0.1 | )% | |||||||||||
New retail – heavy trucks | 1,992 | 2.4 | % | 2,774 | 3.3 | % | (782 | ) | (28.2 | )% | |||||||||||
Total new retail units | 51,072 | 61.0 | % | 51,905 | 62.3 | % | (833 | ) | (1.6 | )% | |||||||||||
Used retail units | 32,714 | 39.0 | % | 31,415 | 37.7 | % | 1,299 | 4.1 | % | ||||||||||||
Total retail units | 83,786 | 100.0 | % | 83,320 | 100.0 | % | 466 | 0.6 | % | ||||||||||||
NEW UNITS SOLD (INCLUDING FLEET) | 55,744 | 56,198 | (454 | ) | (0.8 | )% | |||||||||||||||
REVENUE: | |||||||||||||||||||||
New retail – light vehicles | $ | 1,491,265 | 51.4 | % | $ | 1,469,547 | 51.3 | % | $ | 21,718 | 1.5 | % | |||||||||
New retail – heavy trucks | 115,700 | 4.1 | % | 166,880 | 5.9 | % | (51,180 | ) | (30.7 | )% | |||||||||||
Total new retail | 1,606,965 | 55.5 | % | 1,636,427 | 57.2 | % | (29,462 | ) | (1.8 | )% | |||||||||||
Used retail | 592,133 | 20.4 | % | 558,763 | 19.5 | % | 33,370 | 6.0 | % | ||||||||||||
Parts, service and collision repair | 348,096 | 12.0 | % | 339,230 | 11.8 | % | 8,866 | 2.6 | % | ||||||||||||
Finance and insurance, net | 81,702 | 2.8 | % | 77,856 | 2.7 | % | 3,846 | 4.9 | % | ||||||||||||
Total retail revenue | 2,628,896 | 2,612,276 | 16,620 | 0.6 | % | ||||||||||||||||
Fleet | 96,693 | 3.3 | % | 79,899 | 2.8 | % | 16,794 | 21.0 | % | ||||||||||||
Wholesale | 174,748 | 6.0 | % | 172,391 | 6.0 | % | 2,357 | 1.4 | % | ||||||||||||
Total revenue | $ | 2,900,337 | 100.0 | % | $ | 2,864,566 | 100.0 | % | $ | 35,771 | 1.2 | % | |||||||||
GROSS PROFIT: | |||||||||||||||||||||
New retail – light vehicles | $ | 113,175 | 25.0 | % | $ | 111,367 | 25.6 | % | $ | 1,808 | 1.6 | % | |||||||||
New retail – heavy trucks | 5,781 | 1.3 | % | 6,546 | 1.5 | % | (765 | ) | (11.7 | )% | |||||||||||
Total new retail | 118,956 | 26.3 | % | 117,913 | 27.1 | % | 1,043 | 0.9 | % | ||||||||||||
Used retail | 69,771 | 15.4 | % | 67,560 | 15.5 | % | 2,211 | 3.3 | % | ||||||||||||
Parts, service and collision repair | 180,376 | 39.8 | % | 170,787 | 39.2 | % | 9,589 | 5.6 | % | ||||||||||||
Finance and insurance, net | 81,702 | 18.0 | % | 77,856 | 17.9 | % | 3,846 | 4.9 | % | ||||||||||||
Total retail gross profit | 450,805 | 434,116 | 16,689 | 3.8 | % | ||||||||||||||||
Fleet | 1,913 | 0.4 | % | 2,082 | 0.5 | % | (169 | ) | (8.1 | )% | |||||||||||
Wholesale | 277 | 0.1 | % | (846 | ) | (0.2 | )% | 1,123 | 132.7 | % | |||||||||||
Total gross profit | $ | 452,995 | 100.0 | % | $ | 435,352 | 100.0 | % | $ | 17,643 | 4.1 | % | |||||||||
Adjusted gross profit | $ | 452,995 | $ | 431,952 | $ | 21,043 | 4.9 | % | |||||||||||||
Adjusted SG&A expenses | $ | 343,880 | $ | 331,091 | $ | 12,789 | 3.9 | % | |||||||||||||
Adjusted SG&A expenses as a percentage of adjusted gross profit | 75.9 | % | 76.6 | % | (0.7 | )% | (1.0 | )% | |||||||||||||
REVENUE PER VEHICLE RETAILED: | |||||||||||||||||||||
New retail – light vehicles | $ | 30,384 | $ | 29,911 | $ | 473 | 1.6 | % | |||||||||||||
New retail – heavy trucks | 58,082 | 60,159 | (2,077 | ) | (3.5 | )% | |||||||||||||||
Used retail | 18,100 | 17,787 | 313 | 1.8 | % | ||||||||||||||||
GROSS PROFIT PER VEHICLE RETAILED: | |||||||||||||||||||||
New retail – light vehicles | $ | 2,306 | $ | 2,267 | $ | 39 | 1.7 | % | |||||||||||||
New retail – heavy trucks | 2,902 | 2,360 | 542 | 23.0 | % | ||||||||||||||||
Used retail | 2,133 | 2,151 | (18 | ) | (0.8 | )% | |||||||||||||||
Finance and insurance, net | 975 | 934 | 41 | 4.4 | % | ||||||||||||||||
Dealership generated finance and insurance, net | 975 | 873 | 102 | 11.7 | % | ||||||||||||||||
GROSS PROFIT MARGIN: | |||||||||||||||||||||
New retail – light vehicles | 7.6 | % | 7.6 | % | — | — | |||||||||||||||
New retail – heavy trucks | 5.0 | % | 3.9 | % | 1.1 | % | 28.2 | % | |||||||||||||
Used retail | 11.8 | % | 12.1 | % | (0.3 | )% | (2.5 | )% | |||||||||||||
Parts, service and collision repair | 51.8 | % | 50.3 | % | 1.5 | % | 3.0 | % | |||||||||||||
8
Asbury Automotive Group, Inc.
Selected Data
(dollars in thousands except per share data)
(Unaudited)
As of June 30, | As of December 31, 2006 | |||||
BALANCE SHEET HIGHLIGHTS: | ||||||
Cash and cash equivalents | $ | 48,680 | $ | 129,170 | ||
Inventories | 808,235 | 775,313 | ||||
Total current assets | 1,223,762 | 1,293,064 | ||||
Floor plan notes payable | 667,309 | 700,777 | ||||
Total current liabilities | 848,263 | 881,055 | ||||
CAPITALIZATION: | ||||||
Long-term debt (including current portion) | $ | 493,007 | $ | 477,154 | ||
Stockholders’ equity | 587,928 | 611,833 | ||||
Total | $ | 1,080,935 | $ | 1,088,987 | ||
9
ASBURY AUTOMOTIVE GROUP, INC.
SUPPLEMENTAL DISCLOSURES REGARDING NON-GAAP FINANCIAL INFORMATION
(In thousands, except vehicle and per vehicle data)
(Unaudited)
We evaluate finance and insurance gross profit performance on a per vehicle retailed (“PVR”) basis by dividing total finance and insurance gross profit by the number of retail vehicles sold. During 2003, we renegotiated a contract with a third party finance and insurance product provider, which resulted in the recognition of income in 2006 that was not attributable to retail vehicles sold during 2006 (referred to as “corporate generated finance and insurance gross profit”). During the second quarter of 2006, we decided to sell our remaining interest in the pool of extended service contracts which had been the source of our corporate generated finance and insurance gross profit, which resulted in the recognition of a $3.4 million gain on the sale (“corporate generated finance and insurance gain”). We believe that dealership generated finance and insurance PVR, which excludes the additional amounts derived from contracts negotiated by our corporate office, provides a more accurate measure of our finance and insurance operating performance. The following table reconciles finance and insurance gross profit to dealership generated finance and insurance gross profit, and provides the necessary components to calculate dealership generated finance and insurance gross profit PVR.
| As Reported for the Three Months Ended June 30, | Same Store for the Three Months Ended June 30, | |||||||||||||
| 2007 | 2006 | 2007 | 2006 | |||||||||||
RECONCILIATION OF FINANCE AND INSURANCE GROSS PROFIT TO DEALERSHIP GENERATED FINANCE AND INSURANCE GROSS PROFIT: | ||||||||||||||
Finance and insurance, net | $ | 43,576 | $ | 42,706 | $ | 43,093 | $ | 42,706 | ||||||
Less: corporate generated finance and insurance | — | (692 | ) | — | (692 | ) | ||||||||
Less: corporate generated finance and insurance gain | — | (3,400 | ) | — | (3,400 | ) | ||||||||
Dealership generated finance and insurance, net | $ | 43,576 | $ | 38,614 | $ | 43,093 | $ | 38,614 | ||||||
RETAIL VEHICLES SOLD: | ||||||||||||||
New retail units | 27,178 | 27,782 | 26,835 | 27,782 | ||||||||||
Used retail units | 16,401 | 16,196 | 16,146 | 16,196 | ||||||||||
Total retail units | 43,579 | 43,978 | 42,981 | 43,978 | ||||||||||
Finance and insurance gross profit PVR | $ | 1,000 | $ | 971 | $ | 1,003 | $ | 971 | ||||||
Dealership generated finance and insurance gross profit PVR | $ | 1,000 | $ | 878 | $ | 1,003 | $ | 878 | ||||||
| As Reported for the Six Months Ended June 30, | Same Store for the Six Months Ended June 30, | |||||||||||||
| 2007 | 2006 | 2007 | 2006 | |||||||||||
RECONCILIATION OF FINANCE AND INSURANCE GROSS PROFIT TO DEALERSHIP GENERATED FINANCE AND INSURANCE GROSS PROFIT: | ||||||||||||||
Finance and insurance, net | $ | 82,260 | $ | 77,856 | $ | 81,702 | $ | 77,856 | ||||||
Less: corporate generated finance and insurance | — | (1,685 | ) | — | (1,685 | ) | ||||||||
Less: corporate generated finance and insurance gain | — | (3,400 | ) | — | (3,400 | ) | ||||||||
Dealership generated finance and insurance, net | $ | 82,260 | $ | 72,771 | $ | 81,702 | $ | 72,771 | ||||||
RETAIL VEHICLES SOLD: | ||||||||||||||
New retail units | 51,470 | 51,905 | 51,072 | 51,905 | ||||||||||
Used retail units | 33,026 | 31,415 | 32,714 | 31,415 | ||||||||||
Total retail units | 84,496 | 83,320 | 83,786 | 83,320 | ||||||||||
Finance and insurance gross profit PVR | $ | 974 | $ | 934 | $ | 975 | $ | 934 | ||||||
Dealership generated finance and insurance gross profit PVR | $ | 974 | $ | 873 | $ | 975 | $ | 873 | ||||||
10
Our operations for three and six months ended June 30, 2007 were impacted by (i) expenses associated with the secondary stock offerings of our former private equity owners, (ii) the retirement benefit paid to our former Chief Executive Officer and (iii) the losses associated with the extinguishment of certain of our senior subordinated notes. Our operations for the three and six months ended June 30, 2006 were impacted by (i) our decision to abandon certain strategic projects and (ii) the one-time gain recognized on the sale of a pool of extended warranty contracts. We believe that excluding these items provides a more accurate measure of our operations for the three and six months ended June 30, 2007 and 2006.
RECONCILIATION OF ADJUSTED SG&A EXPENSES AS A PERCENTAGE OF ADJUSTED | As Reported for the Three Months Ended June 30, | Increase (Decrease) | % Change | ||||||||||||
| 2007 | 2006 | ||||||||||||||
SG&A expenses | $ | 173,625 | $ | 169,458 | $ | 4,167 | 2 | % | |||||||
Secondary stock offering expenses | (270 | ) | — | ||||||||||||
Abandoned strategic project expenses | — | (1,417 | ) | ||||||||||||
Adjusted SG&A expenses | $ | 173,355 | $ | 168,041 | $ | 5,314 | 3 | % | |||||||
Gross profit | $ | 232,412 | $ | 226,433 | |||||||||||
Corporate generated finance and insurance gain | — | (3,400 | ) | ||||||||||||
Adjusted gross profit | $ | 232,412 | $ | 223,033 | $ | 9,379 | 4 | % | |||||||
Adjusted SG&A expenses as a percentage of adjusted gross profit | 74.6 | % | 75.3 | % | (0.7 | )% | (1.0 | )% | |||||||
RECONCILIATION OF ADJUSTED SG&A EXPENSES AS A PERCENTAGE OF ADJUSTED | Same Store for the Three Months Ended June 30, | Increase (Decrease) | % Change | ||||||||||||
| 2007 | 2006 | ||||||||||||||
SG&A expenses | $ | 170,983 | $ | 169,458 | $ | 1,525 | 1 | % | |||||||
Secondary stock offering expenses | (270 | ) | — | ||||||||||||
Abandoned strategic project expenses | — | (1,417 | ) | ||||||||||||
Adjusted SG&A expenses | $ | 170,713 | $ | 168,041 | $ | 2,672 | 2 | % | |||||||
Gross profit | $ | 229,238 | $ | 226,433 | |||||||||||
Corporate generated finance and insurance gain | — | (3,400 | ) | ||||||||||||
Adjusted gross profit | $ | 229,238 | $ | 223,033 | $ | 6,205 | 3 | % | |||||||
Adjusted SG&A expenses as a percentage of adjusted gross profit | 74.5 | % | 75.3 | % | (0.8 | )% | (1.1 | )% | |||||||
RECONCILIATION OF ADJUSTED SG&A EXPENSES AS A PERCENTAGE OF ADJUSTED | As Reported for the Six Months Ended June 30, | Increase (Decrease) | % Change | ||||||||||||
| 2007 | 2006 | ||||||||||||||
SG&A expenses | $ | 350,011 | $ | 332,749 | $ | 17,262 | 5 | % | |||||||
Secondary stock offering expenses | (270 | ) | — | ||||||||||||
Abandoned strategic project expenses | — | (1,658 | ) | ||||||||||||
Retirement benefits expense | (2,950 | ) | — | ||||||||||||
Adjusted SG&A expenses | $ | 346,791 | $ | 331,091 | $ | 15,700 | 5 | % | |||||||
Gross profit | $ | 456,475 | $ | 435,352 | |||||||||||
Corporate generated finance and insurance gain | — | (3,400 | ) | ||||||||||||
Adjusted gross profit | $ | 456,475 | $ | 431,952 | $ | 24,523 | 6 | % | |||||||
Adjusted SG&A expenses as a percentage of adjusted gross profit | 76.0 | % | 76.6 | % | (0.6 | )% | (0.8 | )% | |||||||
11
RECONCILIATION OF ADJUSTED SG&A EXPENSES AS A PERCENTAGE OF ADJUSTED | Same Store for the Six Months Ended June 30, | Increase (Decrease) | % Change | ||||||||||||
| 2007 | 2006 | ||||||||||||||
SG&A expenses | $ | 347,100 | $ | 332,749 | $ | 14,351 | 4 | % | |||||||
Secondary stock offering expenses | (270 | ) | — | ||||||||||||
Abandoned strategic project expenses | — | (1,658 | ) | ||||||||||||
Retirement benefits expense | (2,950 | ) | — | ||||||||||||
Adjusted SG&A expenses | $ | 343,880 | $ | 331,091 | $ | 12,789 | 4 | % | |||||||
Gross profit | $ | 452,995 | $ | 435,352 | |||||||||||
Corporate generated finance and insurance gain | — | (3,400 | ) | ||||||||||||
Adjusted gross profit | $ | 452,995 | $ | 431,952 | $ | 21,043 | 5 | % | |||||||
Adjusted SG&A expenses as a percentage of adjusted gross profit | 75.9 | % | 76.6 | % | (0.7 | )% | (0.9 | )% | |||||||
RECONCILIATION OF ADJUSTED INCOME FROM CONTINUING OPERATIONS | As Reported for the Three Months Ended June 30, | Increase (Decrease) | % Change | ||||||||||||
| 2007 | 2006 | ||||||||||||||
Net income | $ | 20,559 | $ | 19,004 | $ | 1,555 | 8 | % | |||||||
Discontinued operations, net of tax | 607 | 519 | |||||||||||||
Income from continuing operations | 21,166 | 19,523 | 1,643 | 8 | % | ||||||||||
Corporate generated finance and insurance gain, net of tax | — | (2,125 | ) | ||||||||||||
Loss on extinguishment of long-term debt, net of tax | 564 | — | |||||||||||||
Abandoned strategic project expenses, net of tax | — | 886 | |||||||||||||
Secondary offering expenses* | 270 | — | |||||||||||||
Adjusted income from continuing operations | $ | 22,000 | $ | 18,284 | $ | 3,716 | 20 | % | |||||||
Net income | $ | 0.62 | $ | 0.56 | $ | 0.06 | 11 | % | |||||||
Discontinued operations, net of tax | 0.02 | 0.02 | |||||||||||||
Income from continuing operations | 0.64 | 0.58 | 0.06 | 10 | % | ||||||||||
Corporate generated finance and insurance gain, net of tax | — | (0.06 | ) | ||||||||||||
Loss on extinguishment of long-term debt, net of tax | 0.01 | — | |||||||||||||
Abandoned strategic project expenses, net of tax | — | 0.02 | |||||||||||||
Secondary offering expenses* | 0.01 | — | |||||||||||||
Adjusted income from continuing operations | $ | 0.66 | $ | 0.54 | $ | 0.12 | 22 | % | |||||||
Weighted average common shares outstanding (diluted): | 33,329 | 33,709 | |||||||||||||
| * | Secondary offering expenses are not deductible for tax purposes; therefore, no tax benefit has been reflected |
12
RECONCILIATION OF ADJUSTED INCOME FROM CONTINUING OPERATIONS | As Reported for the Six Months Ended June 30, | Increase (Decrease) | % Change | |||||||||||
| 2007 | 2006 | |||||||||||||
Net income | $ | 20,992 | $ | 31,557 | $ | (10,565 | ) | (33 | )% | |||||
Discontinued operations, net of tax | 2,583 | 1,656 | ||||||||||||
Income from continuing operations | 23,575 | 33,213 | (9,638 | ) | (29 | )% | ||||||||
Corporate generated finance and insurance gain, net of tax | — | (2,125 | ) | |||||||||||
Loss on extinguishment of long-term debt, net of tax | 11,614 | — | ||||||||||||
Retirement benefit expense, net of tax | 1,850 | — | ||||||||||||
Abandoned strategic project expenses, net of tax | — | 1,036 | ||||||||||||
Secondary offering expenses* | 270 | — | ||||||||||||
Adjusted income from continuing operations | $ | 37,309 | $ | 32,124 | $ | 5,185 | 16 | % | ||||||
Net income | $ | 0.62 | $ | 0.94 | $ | (0.32 | ) | (34 | )% | |||||
Discontinued operations, net of tax | 0.08 | 0.05 | ||||||||||||
Income from continuing operations | 0.70 | 0.99 | (0.29 | ) | (29 | )% | ||||||||
Corporate generated finance and insurance gain, net of tax | — | (0.06 | ) | |||||||||||
Loss on extinguishment of long-term debt, net of tax | 0.34 | — | ||||||||||||
Retirement benefit expense, net of tax | 0.05 | — | ||||||||||||
Abandoned strategic project expenses, net of tax | — | 0.02 | ||||||||||||
Secondary offering expenses* | 0.01 | — | ||||||||||||
Adjusted income from continuing operations | $ | 1.10 | $ | 0.95 | $ | 0.15 | 16 | % | ||||||
Weighted average common shares outstanding (diluted): | 33,806 | 33,680 | ||||||||||||
| * | Secondary offering expenses are not deductible for tax purposes; therefore, no tax benefit has been reflected |
13