Earnings call transcript Q4 2022

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Operator

Good afternoon. Welcome to the Penske Automotive Group Fourth Quarter 2022 Earnings Conference Call. Today's call is being recorded and will be available for replay approximately 1 hour after completion through February 15, 2022, on the company's website under the Investors tab at www.penskeautomotive.com.

I will now introduce Anthony Pordon, the company's Executive Vice President of Investor Relations and Corporate Development. Sir, please go ahead.

Anthony Pordon

Allan. you, Thank and everyone, for us joining Good thank today. afternoon, you morning detailing A financial record this to on assist Penske company's presentation fourth understanding with release website, results is along our quarter issued you XXXX Group's designed year Automotive press the posted full and was the in and results. record

any may have. you always, available e-mail by questions I'm or follow-up As by phone for

Financial Hulgrave, Officer; our Joining Tony me Chair Penske, EVP for and Officer; Executive Roger President Chief today's Vice and Shelley and Facione, and call Chief Controller. are Corporate

before include Our discussion liquidity or amortization statements today of also such flow. earnings operations, leverage interest, potential, our the EBITDA, earnings non-GAAP and future may business and plans, taxes, forward-looking growth depreciation certain free about We cash may measures, discuss our and events, conditions. ratio assessment outlook, financial and as

comparable website the in presentation, and presented our on this prominently most measures. press reconciled measures which release morning's have GAAP and investor directly comparable to the available non-GAAP GAAP measures We the are have

SEC XX-K may because Form and expectations. press actual including for of today's uncertainties in cause outlined may that to which factors Form filed cause additional release, to actual vary you our direct differ could differ our materially. materially results Our I and risks from to previously and results discussion filings, XX-Q, the results

the turn Roger. to I'll over time, call this now At

Roger Penske

today. joining premium was capital Thank everyone, was you, driven for our diversification, thank us record XXXX our and brand certainly, right. year All Tony. our afternoon, PAG, by Good a allocation. you mix for and and

$X.X billion. continuing taxes We XX% to revenue our by our before to by XX% billion. our share increased to $X.X per operations to and by We earnings our from billion, we increased earnings we $XX $XX.XX. almost income XX% XXXX, increased grew During X%

the we year. at the XX% completed acquisitions of And annualized billion $X to the shares of We dividends our outstanding $X.X million and year, representing billion approximately or expected X.X repurchases. beginning shareholders repurchased through during in revenue. We returned shares stock

the and which quarter. model. pleased our Earnings to Now to revenue diversified let I'm X% per $X.XX. report share, turn increased XX% increased share to record billion. to me $X Revenue fourth per was driven business by earnings

to $XXX Excluding revenue X.X earnings Again, million. to and XX% the increased we approximately shares increased $X.X fourth per billion, of FX, $X.XX. share quarter, for stock million during repurchased X%

Looking is new Demand our and our 'XX, XX%. this same-store on QX increased new strong operations, retail automotive improving. is vehicles a for basis, versus 'XX units availability vehicle remain at and QX

to in most However, during do side expect that the for constraints remain of XXXX brands represent. supply we the premium we

take to continue We orders. forward

Used the largely profit. is inventory fact, to in meet U.K., declined forward gross it same XXX XX% was last million year, challenges GBP customer acquiring due higher of our at our forward representing order the to XX,XXX bank the or units expectations. In than X%, in time units affordable

X%. revenue automotive Retail increased

However, when revenue XX%. excluding increased FX,

year, declined than gross remains $XXX. gross XX% higher Variable strong to historical verbal compared and When to last QX profit levels. profit

variable declined X%. FX excluding However, only growth

a sequential variable per declined on only basis, unit at gross you If $XX. excluding that really look FX, profit

revenue parts increased and service Our X%.

However, pay, warranty customer and driven when revenue increased service closing our excluding repair business. XX%, by increases and FX, parts in

Looking at CarShop.

Revenue unit increased $X.X XX% During XXXX, XX,XXX to sales CarShop units. increased billion. XX% to

customer profitability. our reconditioning XX to costs impact X and affordability gross certainly X and However, logistics unit continue as acquisition XX% profit our vehicle to variable declined per prices,

the its inventory cost continue self-sourced in XX% vehicle We U.S. and profitability. U.K. to to XX% sourcing on programs in CarShop the only and of improve focus CarShop improvement

truck Let me now retail turn to business. our

had million diversification. part revenue in billion America, on and generated contributed and XX XXXX, and represents sales $X.X a a very Premier in As of our our you taxes business locations of know, return Truck In $XXX North important business this earnings Dealership X%. before in

truck several demand replacement the associated commercial supply with very solid constraints last demand over by New years. driven being as remains

fourth the sales quarter, the by the increased X,XXX XX% A fourth X,XXX. market quarter, Class unit compared to sales growing We market, During in sales increased to XX% to our units. outperformed Same-store the increased XX% XX%. unit our which

revenue XX% $X billion XX% and Total increased $XXX gross to million. increased profit to

Our XXX% parts our of and same-store increased and of XX%, including increase and our profit Service represented in service fixed revenue gross covered XX% a our XX% total cost. business. parts

of $XX to million, trucks. new X increased in are XX% EBT XX% sales unit our and the commercial quarter approximately Class

The XXXX, I as strong, is in when we would XX American fact, truck of backlog remains at for XXX,XXX North Class sits forecast sales sales, XXXX, over retail In at market look XXX,XXX the the allocation units and of look represent XXX,XXX out. months with today X sold units And is entire our for XXXX. sales.

the savings. over PAG our XXX,XXX to Transportation PTS, quarter. XXX,XXX Turning increasing it by and tax $X.X and fourth of long-term Penske on strength increased to produced XX% the record its owns of and Solutions, rental PTS PTS units, a of contracts logistics a manages distributions and currently XXXX. us leasing, revenue. with fleet cash billion equity business. to goal XX% income, cash is provides Revenue which commercial

Profit percent a increase $XXX to million. record of in

And equity $XXX quarter to As received in a X% result, distributions. we've increased million million. our year-to-date, earnings cash fourth $XX.X

entire PTS earnings year, taxes $X.X the billion. For were before

lease. for environment business current the expect We

in Our as will remain rental expect size PTS XXXX and our increasing maintenance, fleet. strong our logistics to the commercial of we continue

Chief Officer. turn me to Shelley the over Hulgrave, call Financial let our Shelley? Now

Michelle Hulgrave

Thank Good everyone. you, afternoon, Roger.

as XXXX another gained efficiencies beginning fourth XXXX to AI. had below last and quarter points our as the we cost was and quarter, our diversification well X,XXX compared by remains of the pandemic. indicated, commitment driven basis efficiencies to other gross operational to fourth through Roger year, quarter fourth XX.X% to and maintain reductions in XX.X% As the quarter profit through the SG&A automation strong in achieved in prior

XXs. increase flow XX% net was billion, the we compared $X.X As of look last to EBITDA, an operations period in of the year. Cash cash $X.X free ratio same was billion future, the generated approximately to billion and the low we $X.X Year-to-date, capital to profit when gross flow from of in expenditures. to deducting our be after expect we SG&A representing

acquisitions XXXX, X $X.X of truck open annual completed points, X and new franchises, billion In open in representing points retail consisting X revenue, we dealership. and commercial approximately automotive

For outstanding the year, of we of of full XX% XXXX. which repurchased shares the for $XXX X.X million, were million beginning shares represents that stock the at

most our XX% income. returned net reflecting we to billion the In million returned share to per dividends increased total, our to shareholders, quarter recently addition by we our X% performance. dividend and to In $X.XX share, $X.XX $XXX fourth repurchases, strong of shareholders, representing in

million additional an growth. on million spent acquisitions In $XXX net on land XXXX, and CapEx we $XX future for

and allocation As our shareholder can investments you capital return. see, includes for future disciplined growth acquisitions, strategy

and of for including the Total had $X had was than supply approximately premium a is XX. XX-day XX in million the XX-day is U.K. billion. $X.X was Floorplan vehicles, in debt inventory and Used days foreign XX higher vehicle XX, XX and of December was which inventory new U.S. days vehicles million We $XXX volume Days increased at supply a supply. billion, new XXXX. $XXX

debt leverage fixed. increase XX debt end the of our of our X.Xx to to is for average long-term rate average the of an was total at The total XX% X.X years. fixed XX% Debt end rate At December of and million was interest our have remaining is $XXX representing term we compared December. an billion, sits $X.X on of capitalization debt secured year. when X.X%, of at last December, which

business us our of through acquisitions We Xx, continue have opportunities to to to the grow to leaving ability to plenty flex returning capital our leverage and shareholders.

shape. to December macro and great In is that XX, over billion challenges through At any and in conclusion, remain our ability our may $XXX we sheet in million lie we confident manage ahead. in had in balance liquidity $X.X cash

I the to will call back time, this Roger. over At turn

Roger Penske

Shelley, thanks.

will as lower to efficiencies We that we forward. believe to structure we are committed go operational lead implementing cost

efficiency One artificial intelligence. leveraging initiatives of key our is

continue to test and implement our We of service the AI sales solutions on both and business. side

like more hours. online quarter, and XX% AI BDC our That The support fourth in In automate service of sales tasks over total provide to the appointments setting quality after created increased us and customer service XXX,XXX. AI inquiries appointments XX,XXX were to online using answering the efficient, be U.S. appointments. allows our allows and employees to

to processes ensure to consistency, program, compliance to in digital OEM our continue and solutions quality website digital the streamline integrate and pursuing while automate sales programs digital preferred proprietary purchase control, our and our We our U.K. through

In total QX, our unit digital represented of sales. sales X%

as We dealers top congratulate our also recognized CARFAX. are focus by proud we on for reputation management, dealerships being XXX to and of

talk to recently. like management happened just about I'd that changes some

the company's this automotive experience, has been Penske -- Greg Board. Chairman has brings and extensive of Vice year, January with Penske effective all of X named with familiarity of As partners the automotive retail industry of Greg relationships operations. has

formerly its Truck, Penske Vice truck American Commercial Group's Operations Power U.K., Group's Australia. including and Systems, automotive President, Shearing, Trucks Executive operations Japan Europe, Automotive Automotive for oversee North international the and of Penske President Rich Randall in and Premier dealerships. the commercial oversee Global operations, will Seymore, the formerly will

best remain both and the building [Indiscernible] leadership ensure to team, our the world. place Rob the President, tandem work while that executive will in These in have our in new and company transportation me with service we leading leadership further Kurnik, to depth

our I and business In diversification allocation the commercial of a continue and closing, automotive control truck our our industries, cost to model. remain retail capital demonstrate confident the to across results strategy. in continue benefit our disciplined

Thanks us and to today, the operator. joining for over it turn I'll

Operator

Imbro Instructions] [Operator the line We'll of Stephens go Inc. with first to Daniel

Daniel Imbro

the everybody the quarter. I demand start and Shelley want promotion. the the team, on congrats on Roger, on congrats side. And to

the New think and vehicle there backdrop. price on increases, a volatile hung clearly despite increases, demand automotive side, has in rate I

today? through So on demand discuss shapes year your consumer side? can as customer you you're up from automotive you seeing how And progress think what do the you this core

Roger Penske

talk one luxury. the premium But we're Well, obviously which point our about business, vehicle number is is diversified. side, let's on

here on is inventory quickly, And we demand talked we today. we're turning strong. new the So very earlier consistent our see as about and vehicle

my And our certainly from in second -- XX% X earlier over XX% orders. this billion sold XX%. of positive go prefilled that up to first inventory, mentioned I That's U.S. we pounds in for into remarks is quarter. year XXX almost us forward both and is million And as last the

premium when to you look at residual finance of last companies. support perspective, that down from it is look our Penske to when XX% real the XX%. due the we was of certainly, from And our And at XX in was to get also significantly down and think XX%. months. we support leasing to We're the prior XX numbers, I a overall, maybe -- penetration some lease

haven't this those But see. market OEMs customers at cars premium going used get this really at want So And we're wait stickier. point. seen are the into coming time, those back. and I to to we back think, the have We

we'll look forward. as something be me, to to at we So that's going go

think OEM, think I we're that is when I hit only have strong, now, interest to not look but you for customer hasn't numbers. But again, think about And for obviously, when what that the driving cars But historical our margins I highest the which even getting, at margins And way growth see and looking us. them, higher think our our with rates. our they you with continues also below the at affordability can certainly premium inventory, right based best factory, the on the our what's building and levels, it's they're you success, be supply.

about think only Florent X When Vayant the days. you even is Toyota and

we bodes OEMs of us well So think right product over again, building the look in the low next as couple quarters. I for premium the for us inventories, side,

Daniel Imbro

maybe there to potential you the still a then SG&A quantify the any smarter stronger. at said there. And stay operational are wanted help are? of as you cost new side. XXXX? team is margin your over you AI If changes? of Are -- the and just task percent to How SG&A end the the and but to of about on automation. for So I growth savings outlook going talked Great. about shift thinking help I Can kind think you some expenses comments GPU about thinking what

Roger Penske

the our quarter, was When indicated XXX look from from really, we look fourth our more that the at really in standpoint the basis SG&A. let's probably from before. compensation had people. And of at went up due Well, standpoint SG&A that U.K. you the points

fleet here for had an that which have loaner most in significantly our onetime And was impact a fact U.S. turn living, We have maintenance was the vehicle to up fact benefit did and the likely, car of us. cars the we due hurt loaner that them the would in in as cost we can't the because availability. we more we past today don't

for key So as those points that I were lift. the on us are the SG&A think as far

we really forward, go I Number to when at numbers think of it, X,XXX in looking And to XXXX. components. the XXXX. Now our at I the what's at from one, were at standpoint And think We growth look at X X,XXX look for got X,XXX. were we the look and growth? I -- got I in we're we looked January, today,

So on glide I a our nice think we've on certainly slope got growth. our --

at gross just say, when from as X,XXX in profit, to our our SG&A. standpoint But from SG&A, would go the we off look XX% I took year, the to our a me, profit XX% during number, SG&A roughly a gross if

other cases, jobs that think looking at company move what in were we're I So of be inbound reduce the can force can AI. how on. is can taking calls, labor or many they within people doing these into we using put Many

the we're seasonally based plus And and way availability able at want to and putting wouldn't work much to days the of to satisfaction ability up, on the benefit the also before. has better, filling be that we schedule we've go more got seeing jobs do times we our been the customer

our help that and also offset us again, with higher unit will help gross through work our we'll parts in get will shop, which but more sales automation, because us will with service absorption And think maybe I margins profit. higher lower all

Operator

to Our go next Murphy question Bank will of America. John with

John Murphy

in a on up see of Slide total are slides -- very on that units XX%. the trended couple can helpful. around question we're one, well First course XX. They of clearly if the There's we that you fairly actually But focus year. this through also

above about able these drive is the an of to, you it saw kind can With vehicle get sort of and to the industry talk far the how in side, from you vehicles short on coming availability we supply Because lack at what of actually and maybe increase? were new automakers, the just that large. just

Roger Penske

one, the they less that, had number Well, had that we were of the benefit I 'XX. probably in think locked U.K. Because availability

that the And say bigger So of that with [Indiscernible] low look number. again, when quite of premium in and luxury a over a had me, supply running mix it. that is we lift, I And help are luxury. mix the premium we the day would and probably between our would XX% that bit in certainly was U.S. at to there, international, drove you where probably side.

John Murphy

And time? mean than the helpful. the to U.S.? U.S. U.K. is I maybe XX% over self-sourcing, see in lower far than opportunity we'd you're U.K. what Okay. an there to the second. market over going XX% there That's in is for I'm something in CarShop just is XX% the staying what that's a that much in lower the range that structurally Or curious, doing in keep

Roger Penske

John. Well, structural change, we made a

OEMs about vehicles talking have to like talked and In do other. non-OEM You efficiencies lot you to the businesses on Europe, is used. each the not

see they I'm a Mercedes-Benz. dealer, to don't if a want So Porsche

the we're giving CarShop, all taken to in on proprietary. are is big not doing we're done putting a non-vehicles and which [Indiscernible] them made the And what there, those has we've difference. vehicles, what So each which dealership,

will XXX selling We're moment, week, from self-purchased looking the us a go that vehicles And think rather their themselves. out cars and somewhere than into help having of cars the are the build at us between I auctions. fleets to most XXX which that

as where up we have those pick bigger we buys. these to opportunity the have don't we So normally --

those the XXX, don't to buy to cars a even they the you from when at and used look now time And at OEMs buy. basically, maybe OEMs XXX XXX, XXX, who have

restructuring margin, that, is availability. help our which going somewhat we're also So help to our

had January month We margins. of good new X,XXX very units a a did the over -- good at in had we month. We

a think margin So us fleet we're see the to also sell. process internal to pickup need for starting giving in and I the we

John Murphy

high-class reallocating you flow. then free whether or that's helpful. I bull have you're bear still And estimates to And Okay. of problem amount then you're for a on cash or for of lastly just significant mean going Shelley. a a XXXX,

buybacks, are what at about even XXXX, will think us you happened if look obviously we could of us dividend. remind just cash as priorities was we kind give your where view or kind the in you But So fresh acquisitions spread the go? of it XXXX, what think in excess and a across

Michelle Hulgrave

I that. year, before, more about any from to talked a John. was X/X We've operations. shareholders versus can billion this $X.X bit growth. we in shareholders take Sure, return start in had a insignificant flow We certainly by about with means. was of split planted not X/X return That cash typically But that XX-XX to growth.

FX, over growth we When standpoint, growth target exclude we X% X% organically. growth there year. typically certainly a from you So got the acquisitions,

from was just a [Indiscernible] we're standpoint. So that bit happy larger.

And multiples stance compared on to share of in our the took market, and proactive shareholder our given acquisition repurchases returns. prices so we very a multiple and the the

billion. So billion that about $X was $X.X of that

John Murphy

Michelle, I of you'll than guess that a the kind XXXX. direction we acquisitions, that but it's tilted lot will being fair cheaper XX-XX, it lean statement? is remains those be that in should a your dynamic assume stock -- even towards if target Is in the

Michelle Hulgrave

think fair, that's yes. I

Roger Penske

was certainly really at the from interested John are things we're high acquisition moment. in seen an that the standpoint, priced

one all returns the truck we to do thing it's plus forward. be best all selective. So international those get is our as U.S., have is we good retail we're business. we'll we think auto, areas. our And we I And diversification not about And ones opportunities pick in think going the go very what the

John Murphy

in an certainly opportunity there's your stock. And Yes.

an you that So avenue, gives too.

Operator

the [Operator David with Instructions] line We'll Whiston Morningstar. of go to next

David Whiston

to But great. would on I opportunities make what on all -- variables deal perhaps you like or said side reasonable acquisition on seller. is versa? light any versus side there's variables. which how know really the the you first, topic. do choose the just guess, make probably or business, vice the What you is the just I throughout truck the continuing would aren't variables there It's vehicle

Roger Penske

question. there's Well, I think no

side, multiples number we at on have the auto don't the i.e., we less on point number et side, truck tile, truck requirements, CapEx As the have the cetera, been two, Point look one. the side. they are than furniture, that

significantly typically the dealership. talking U.S. when me, CapEx about requirements to a you're So buying are less

help side to contiguous, us that gives say and U.S. scale, volume and also, place that that in we in think already go And is can want. of share Toyota in take we the if would it's -- But where we lane us XX% admin premium/luxury costs a are certain the into which here have we mixed, So we business. market we infrastructure we standpoint foreign, have which in have today out and can Honda market primarily course, would typically the international. we the returns from in tilted our of internationally, stay if we

the And grow. on even Freightliner we're across truck in want And Australia Star. with they side, markets committed all us Western and to to

We top of have a near the framework of share. nowhere framework agreement agreement total from that where we're standpoint market the

look So opportunities. I at would say continue Freightliner to we'll

Daniel Imbro

major do what Can a another Or with maker? Freightliner? truck contractual obligation still about do that? And you you

Roger Penske

to committed Freightliner. we're now, Right

Daniel Imbro

And shifting over then Okay. to light used. vehicle

curious, used the Just customer. customer at, at a versus stores, a look vehicle when say, you franchise CarShop

a not perhaps is hit board? customers issue? affordability across affordability the both an is the channels, Or as issue but and in probably are perhaps really you bad the think just it I seeing by bit wealthier franchise

Roger Penske

customer paying $X,XXX is the Well, think to I I $X,XXX than that CarShop XX typical In months to model, ago. XX sure. for $X,XXX to guess, we're more affordability

price source be So us logistics on able for to them, a and recondition that's to some customer. pay share for had for limiting market the be factor vehicles,

to aside, bought luxury business. back of So a opportunities we leased of penetration. had which number the lot the filled years, across We've leasing coming brands. car that used putting we've a because OEM over the I had the OEMs, the from cars leasing our go -- and And that one, been premium

luxury cars mix is today. Today, our we car. have within X,XXX also that fleets premium And our loaner in loaner

XX to we you so, X to those or year last turning go months. XX days. back probably or those today, would If turn we're X And every

the limiting us premium you when that, XX,XXX side. XX,XXX at maybe look to basically, that's the units So for

grows I that young And we lease So used people the course, to business. good we're way say get grow struggle, as this it's the going want would into not this, good a It's service that brand. our parts car, to it but we car. and a of

today. So we're those I think are dynamics at looking

Daniel Imbro

the Ford question. any basically, just be And Right. No have one approach? right the their But would now. I future, inventory? know interested you of with type EV direct-to-consumer model don't you in last in representation stores

Roger Penske

haven't looked that. We really at

luxury direction. have take foreign to be I that the as we say become premium truck they think a that have it. and are we that wouldn't These I today maybe wouldn't going opportunities dealerships is probably the volume things side, other the mix on separate that look franchise.

Ford. of in kind a noise marketplace. as do that business very of look see a parts part us. of would Ford We which there been to starting is PAG out is opportunity with -- parts successful the us We operation, You're have Oklahoma, for operates an certainly for Tulsa, which distribution has that

Operator

have the We queue with Gupta question JP Rajat line a in of from Morgan.

Rajat Gupta

right. Great. All

question to on about first picture you in strong Maybe worse we here how expect business revenue quarter. the from the us Again, And standpoint, think XXXX? better a think should get there? or parts that a in Can of PTS. any year-over-year your Just XXXX? fourth about quarter help you pretty

things sale. about on color or refinancing, debt And inflation. helpful. expense all there the wage for gain side, we the for maybe PTS? then think a those And I be How mentioned and would have follow-up. of you any should maybe, then And some on XXXX buckets know like I guidance the

Roger Penske

Okay.

shot at take me Let these. a

sale in think I XX,XXX one, talk gain million That units. about sale, on XXXX. had number we about you when was on in gain $XXX

Obviously, again. X,XXX The is had good XXXX sale. that the million units gain have mix, Our January. XX,XXX. for we'll lower in did is we news a $XX because forecast on We

used have just that on But shows rest out Now coming around there $XXX vehicles at on into If the it we'll of I I we probably wouldn't looking write that think but go mix a and is out. down the that as the still least somewhere today, our are market million. for at line, the in pricing gain look we at deterioration sale year. straight

at costs. interest Looking

think $XXX ago in XX than higher here, I We before. XXX days. that was the had million we the I've about bond years for same $XXX did points X last million. talked here That a basis

So we're probably $XXX through more going in that financing bond our have million we'll to costs see our portfolio. interest of

grade. are going But We investment point. this we're market again, at the with

our an the up for From standpoint, are one but are units maintenance fleet. will running business, XX,XXX for many out the costs these be on units get order. need overall units reason, replacement and also and And some them we growing of mileage, of high because we're those have we many units customers, to of because

we're hopefully, get here we them out have opportunity, So forward. as to the going to go

of it's that working. our important in employee on at hours certainly, we wages, But and pressure base. also I -- mechanics, on think maintaining look employee our There's and

into year, overall, drive these got leasing But higher contract the some our or growth next business cost. truck going will a So with we've strong very maintenance. in

that we think rental of XX% those in our business rental XX,XXX our in lease you our XX% when rent coming are look And fleet, And we at of if when the of you XX% January, utilization our on XX% the have day, the of and -- every because think tractors. and on our leasing were size to size of at I that, we the customers midrange our comes on fleet, of have our revenue customers. I side because rental units our from our and at truck looked PTS, tractors quality us. get of we Remember, about fleet, of

on we units again, to those in. number So with expect of come XX,XXX, to a order

we'll So opportunity. gain have on sale more

will I other creep we'll think maintenance it the during costs still down, maintenance On see hand, help the some some drive year. on but

Rajat Gupta

Got maybe I are services, thinking it. mid-single fourth like believe Got in And for U.S. on quarter. this Strong segment that the plus XX%. range digit how you more That’s it. helpful. about X%, in growth year? was and parts

shop. help helpful. if you Do kind be into warranty, that trend or you different would Maybe to us continue the body expect of could here pay like buckets there color across customer XXXX? Any

A –Roger Penske

a think working, cars Remember, work. their sitting seeing I come asking not not we’re for X our people going miles into had in and we’ve catch-up with days. And GM by is people driven.

see to more going we’re demand. So

our after continuing. in excluding service we But FX, up that fourth quarter. the certainly were we It’s look when XX%, U.K. strong growth, very you see also. been at parts And and in

that’s So we far see we again, QX less which And board the profit. gross efficiency more increase forward get. least rate, at ELR will not expect that domestically, labor rate charge customer, hopefully can that nice labor to that of be discounts in going the we’ve our the labor we really go as grow right it’s but rate been all we in expect generally across to the last our a drive ELR and now. as only locations, effective that as effective QX, would we From able internationally, also standpoint, about $X year. and we And increase

seeing back is we’re you again. up down, Body warranty tell can’t Shop I Warranty see spike why, but we’re warranty. but creep to exactly some up. business now starting was in

Operator

to And in We queue. turn further back with have no that, questions Mr. I'll it over Penske.

Roger Penske

right. All the Bye-bye. end best. you welcome, everybody Thank coming call the we'll the see you, and And All next quarter. today. of to at

Operator

and conclude that Teleconferencing. for for Event your your gentlemen, using call you will Thank Ladies AT&T participation for and today. conference

may disconnect. You now

Penske Automotive (PAG) 8 Feb 232022 Q4 Earnings call transcript