CARMAX RAISES SECOND QUARTER EXPECTATIONS
Richmond, Va., August 23, 2005 - For the second quarter ending August 31, 2005,
CarMax, Inc. (NYSE: KMX) today:
|X| Raised comparable store used unit sales expectations to growth of
approximately 10%, and
|X| Raised earnings per share expectations to approximately 37 cents.
On June 20, 2005, CarMax had estimated second quarter comparable store used unit
sales growth in a range of 3% to 9% and earnings per share in a range of 29
cents to 34 cents.
"During our second quarter, our consumer-preferred market offer and continuing
strong execution in our stores have allowed us to take advantage of the increase
in customer traffic we have seen during the quarter," said Austin Ligon,
president and chief executive officer.
"Traffic is up compared with the second quarter of last year, at least partly
due to the increase in consumer interest and appraisal traffic generated by new
car employee pricing programs," Ligon said. "As a result, our sales pace has
increased from the rate we were seeing in early June. We believe the employee
pricing programs have also clarified dealer new car pricing, which usually works
to CarMax's benefit.
"While wholesale auction prices for larger SUVs and trucks have plummeted,
wholesale auction prices for other vehicles are still above historical norms,"
said Ligon. "We continue to keep our appraisal offers consistent with broader
market trade-in offers, employing the lessons we learned during the more
challenging periods last year and this spring. Doing so has enabled us to keep
our retail pricing attractive to consumers. We also are keeping our inventories
closely aligned with our sales pace.
"In addition, we currently expect CarMax Auto Finance income to be higher than
original expectations as CAF has benefited from increased penetration," said
Ligon. "This increase is being driven in part by a rise in finance applications
from prime-rated customers."
Earnings Release Conference Call Information
- --------------------------------------------
As previously announced, the company currently plans to release second quarter
results on Wednesday, September 21, 2005. On that date, CarMax will host a
conference call for investors at 9:00 a.m. Eastern time. Domestic investors may
access the call at 1-888-298-3261
-more-
CarMax, Inc.
Page 2 of 2
(conference I.D.: 7882552). International investors should dial 1-706-679-7457
(conference I.D.: 7882552). A live webcast of the call will be available on the
company's investor information home page at http://investor.carmax.com or at
www.streetevents.com.
A replay of the call will be available beginning at approximately 1:00 p.m.
Eastern time on September 21, 2005, and will run through midnight, September 28,
2005. Domestic investors may access the recording at 1-800-642-1687 (conference
I.D.: 7882552) and international investors at 1-706-645-9291 (conference I.D.:
7882552). A replay of the call also will be available on the company's investor
information home page or at www.streetevents.com.
About CarMax
- ------------
CarMax, a Fortune 500 company and one of the Fortune 2005 "100 Best Companies to
Work For," is the nation's largest retailer of used cars. Headquartered in
Richmond, Va., CarMax currently operates 62 used car superstores in 28 markets.
CarMax also operates seven new car franchises, all of which are integrated or
co-located with its used car superstores. During the twelve month period ended
May 31, 2005, the company retailed 264,958 used cars, which is 93 percent of the
total 285,354 vehicles the company retailed during that period. For more
information, access the CarMax website at www.carmax.com.
Forward-Looking Statements
- --------------------------
The company cautions readers that the statements in this release about the
company's future business plans, operations, opportunities, or prospects,
including without limitation any statements or factors regarding expected sales,
margins, or earnings, are forward-looking statements made pursuant to the safe
harbor provisions of the Private Securities Litigation Reform Act of 1995. Such
forward-looking statements are based on management's current knowledge and
assumptions about future events and involve risks and uncertainties that could
cause actual results to differ materially from anticipated results. For more
details on factors that could affect expectations, see the company's Annual
Report on Form 10-K for the fiscal year ended February 28, 2005, and its
quarterly or current reports as filed with or furnished to the Securities and
Exchange Commission.
###
Contacts
- --------
Investors and Financial Media:
Dandy Barrett, Assistant Vice President, Investor Relations, (804) 935-4591
Celeste Gunter, Manager, Investor Relations, (804) 935-4597
General Media:
Lisa Van Riper, Assistant Vice President, Public Affairs, (804) 935-4594
Trina Lee, Public Relations Manager, (804) 747-0422, ext. 4197