[UNITED AUTO LOGO]
[UNITEDAUTO LOGO]
EXHIBIT 99.1
PRESS RELEASE
UNITEDAUTO REPORTS RECORD THIRD QUARTER REVENUES AND EARNINGS
14TH CONSECUTIVE QUARTER OF SAME STORE REVENUE GROWTH
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Income From Continuing Operations Increased 70%
Earnings Per Share From Continuing
Operations Increased 46%
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DETROIT, MI, OCTOBER 29, 2002 - United Auto Group, Inc. (NYSE: UAG), a
FORTUNE 500 automotive specialty retailer, today announced record results for
third quarter 2002 with double-digit growth in revenues, income and earnings per
share. The record results were driven by strong retail vehicle, service and
parts, and finance and insurance revenues, which increased 38%, 36% and 30%,
respectively, and reduced borrowing costs.
Third quarter revenues increased 37% to $2.1 billion, and income and
earnings per share from continuing operations increased 70% and 46% to $22.6
million and $0.54, respectively. Earnings per share reflect an 18% increase in
weighted average shares outstanding. Excluding the effect of goodwill
amortization in the third quarter 2001, income from continuing operations and
related earnings per share increased 40% and 17%, respectively, over the prior
year.
For the nine months ended September 30, 2002, revenues increased 28% to
$5.6 billion and income and earnings per share from continuing operations
increased 85% and 51% to $60.9 million and $1.48, respectively. Earnings per
share reflect a 23% increase in weighted average shares outstanding. Excluding
the effect of goodwill amortization in the nine months 2001, income from
continuing operations and related earnings per share increased 48% and 20%,
respectively, over the prior year.
Chairman Roger Penske commented, "I am delighted with the performance
of UnitedAuto during the third quarter. Our business continues to demonstrate
its resiliency because of its diverse revenue streams and our variable cost
structure. We also continue to see the benefits of our facility investment
program which is paying dividends as reflected by our industry-leading same
store sales growth. Our same store high margin service and parts business
continued its steady growth, increasing 6.3% during the third quarter, while
overall service and parts gross margin
increased 250 basis points. I remain optimistic about our business over the
balance of the year, and our earnings guidance of $1.82 - 1.86 per share from
continuing operations remains unchanged."
President Sam DiFeo stated, "I believe our consistent same store growth
is the result of our customer satisfaction focus which drives repeat and
referral business. Same store retail revenue increased 7.4%, and related retail
gross profit also increased by 6.1%. We also achieved same store revenue growth
for both our domestic and foreign nameplates. I am convinced that our customer
focus will yield increasing dividends in the future."
Periodically, the Company examines its dealership portfolio and divests
of dealerships that are not strategic. During 2002, the Company has divested or
has entered into definitive agreements to divest five dealerships, which have
been treated as discontinued operations in accordance with Statement of
Financial Accounting Standards No. 144. Including the impact of the divested
dealership operations, net income and earnings per share were $22.0 million and
$0.53 per share, respectively, in the third quarter and $61.6 million and $1.50
per share for the nine months.
UnitedAuto, which has pursued a strategy based on internal growth from
its existing dealerships, as well as from strategic acquisitions, operates 126
franchises in the United States and 71 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.
UnitedAuto will host a conference call discussing financial results
relating to third quarter 2002 on Tuesday, October 29, 2002 at 2 P.M. Eastern
time. Advance registration is not required. Participants must call (800)
230-1096 (INTERNATIONAL, PLEASE CALL (612) 332-0107). Calls need to be made
shortly before the call is to commence. Please provide the leader's name - ROGER
PENSKE - as well as the code UAG3Q. The conference call cannot be accessed
without this information. The call will also be simultaneously broadcast live
over the Internet through the UnitedAuto website at www.unitedauto.com.
Statements in this press release may involve forward-looking
statements, including forward-looking statements regarding UnitedAuto's future
reportable sales and earnings growth potential. Actual results may vary
materially because of 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
are contained in UnitedAuto's filings with the Securities and Exchange
Commission and which are incorporated into this press release by reference.
Media Contact:
Phillip M. Hartz
Senior VP - Corporate Communications
248-648-2610
UNITED AUTO GROUP, INC.
Consolidated Statements of Income (Unaudited)
(Amounts In Thousands, Except Per Share Data)
Three Months Ended Nine Months Ended
September 30, September 30,
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2002 2001 2002 2001
---- ---- ---- ----
New Vehicles $1,227,100 $ 914,577 $3,303,753 $2,618,117
Used Vehicles 411,161 272,765 1,106,603 807,329
Finance and Insurance 49,920 38,306 133,283 106,705
Service and Parts 207,586 152,247 565,221 435,614
Fleet 32,604 37,097 93,355 119,061
Wholesale 131,232 91,059 355,422 263,463
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Total Revenues 2,059,603 1,506,051 5,557,637 4,350,289
Cost of Sales 1,771,953 1,294,050 4,767,825 3,745,316
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Gross Profit 287,650 212,001 789,812 604,973
SG&A Expenses 229,803 171,411 631,596 487,364
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Operating Income 57,847 40,590 158,216 117,609
Floor Plan Interest Expense (9,082) (8,998) (26,023) (31,577)
Other Interest Expense (9,990) (7,992) (27,834) (27,217)
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Income from Continuing
Operations Before Minority
Interests and Income Taxes 38,775 23,600 104,359 58,815
Minority Interests (458) (66) (1,383) (364)
Income Tax Provision (15,704) (10,266) (42,035) (25,583)
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Income from Continuing
Operations 22,613 13,268 60,941 32,868
Income (Loss) of Discontinued
Operations, Net of Tax (Including
Gain on Disposal of $499) (624) 220 648 595
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Net Income $ 21,989 $ 13,488 $ 61,589 $ 33,463
========== ========== ========== ==========
Income from Continuing Operations
Per Diluted Share $ 0.54 $ 0.37 $ 1.48 $ 0.98
========== ========== ========== ==========
Diluted Earnings Per Share $ 0.53 $ 0.38 $ 1.50 $ 1.00
========== ========== ========== ==========
Diluted Weighted Average Shares
Outstanding 41,733 35,418 41,168 33,550
========== ========== ========== ==========
EBITDA (a) $ 54,221 $ 40,159 $ 147,955 $ 110,277
========== ========== ========== ==========
SAME STORE RETAIL REVENUE
New Vehicles $ 980,992 $ 898,629 $2,546,520 $2,380,496
Used Vehicles 271,701 266,744 729,399 729,157
Finance and Insurance 37,077 33,605 97,395 88,614
Service and Parts 158,898 149,520 424,708 399,873
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Total $1,448,668 $1,348,498 $3,798,022 $3,598,140
========== ========== ========== ==========
(a) EBITDA is defined as income from continuing operations before minority
interests, income tax provision, other interest expense, depreciation and
amortization. Depreciation was $5.5 million and $3.6 million in the three
months ended September 30, 2002 and 2001, respectively, and was $15.8
million and $9.7 million in the nine months ended September 30, 2002 and
2001, respectively. Amortization was $5.0 and $14.6 million in the three
and nine months ended September 30, 2001, respectively.
UNITED AUTO GROUP, INC.
Consolidated Condensed Balance Sheets
(Amounts In Thousands)
9/30/02 12/31/01
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ASSETS (unaudited)
Cash and Cash Equivalents $ 685 $ 2,952
Accounts Receivable, Net 305,313 239,610
Inventories 885,805 611,889
Other Current Assets 33,821 16,081
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Total Current Assets 1,225,624 870,532
Property and Equipment, Net 274,259 181,290
Intangible Assets, Net 957,390 772,737
Other Assets 75,932 84,098
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Total Assets $2,533,205 $1,908,657
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LIABILITIES AND STOCKHOLDERS' EQUITY
Floor Plan Notes Payable $ 790,850 $ 586,620
Accounts Payable and Accrued Expenses 300,241 157,730
Current Portion Long - Term Debt 9,217 4,202
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Total Current Liabilities 1,100,308 748,552
Long - Term Debt (a) 646,793 551,648
Other Liabilities 96,703 92,774
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Total Liabilities 1,843,804 1,392,974
Stockholders' Equity 689,401 515,683
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Total Liabilities and Stockholders' Equity $2,533,205 $1,908,657
========== ==========
(a) Includes $300.0 million of 9.625% subordinated notes. Undrawn capacity
under the Company's credit facility was $358.7 million as of September 30,
2002.
UNITED AUTO GROUP, INC.
Selected Data
Three Months Ended Nine Months Ended
September 30, September 30,
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2002 2001 2002 2001
---- ---- ---- ----
Units
New Retail Units 44,432 35,351 119,962 100,016
Used Retail Units 20,792 16,792 58,092 49,278
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Total Retail Units 65,224 52,143 178,054 149,294
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Revenue Mix
New Vehicles 59.5% 60.7% 59.4% 60.2%
Used Vehicles 20.0% 18.1% 19.9% 18.5%
Finance and Insurance 2.4% 2.5% 2.4% 2.5%
Service and Parts 10.1% 10.1% 10.2% 10.0%
Fleet 1.6% 2.5% 1.7% 2.7%
Wholesale 6.4% 6.1% 6.4% 6.1%
Retail Gross Margin - by Product
New Vehicles 8.2% 8.4% 8.5% 8.3%
Used Vehicles 9.7% 10.7% 10.2% 10.6%
Finance and Insurance 100.0% 100.0% 100.0% 100.0%
Service and Parts 47.3% 44.8% 46.9% 44.7%
Gross Profit per Transaction
New Vehicles $2,270 $2,167 $2,329 $2,179
Used Vehicles 1,915 1,737 1,943 1,731
Finance and Insurance 765 735 742 715
Same Store Retail Revenue Growth
New Vehicles 9.2% 5.1% 7.0% 7.1%
Used Vehicles 1.9% 4.9% --% 2.7%
Finance and Insurance 10.3% 22.6% 9.9% 16.5%
Service and Parts 6.3% 7.7% 6.2% 4.7%
Debt to Total Capital Ratio 49% 53% 49% 53%