GPI - Earnings call transcript Q2 2019 | Group 1 Automotive, Inc.

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Operator

Good morning, ladies and gentlemen. Welcome to Group 1 Automotive's 2019 Second Quarter Financial Results Conference Call. Please be advised that this call is being recorded.

I would now like to turn the call over to Mr. Pete DeLongchamps, Group 1's Senior Vice President of Manufacturer Relations, Financial Services and Public Services. Mr. ahead, go Please DeLongchamps.

Pete DeLongchamps

the and been earnings everyone, morning release presentation for related related Debbie, to will today's this to on and welcome Group call. slide call to reconciliations include The we purposes that results good you, we and refer have morning, comparison to a adjusted posed Thank issued website. this X's

information and make mentioned the made of I'd to begin, are of remarks Act brief Securities provisions we Except statements some for the the made Harbor like measures. during Litigation to Reform historical of XXXX. call, by use Group of forward-looking forward-looking Before non-GAAP X pursuant financial statements statements Private Safe about management the are that

uncertainties Forward-looking periods statements with include, risks which in actual pricing differ of the Those to but Copies described the to of and involve results. future months. the results both risks company's are are the both Company's these cause known XX filings the are the Those and associated from filings in Commission volume available risks may markets. forecasted over materially last limited risks not Company. and Exchange with from condition and SEC the Securities and other unknown

In may this under call. non-GAAP measures SEC addition certain be as defined financial rules discussed on

most required applicable comparable measures directly the non-GAAP GAAP the SEC measures company rules, financial provides its As to by such reconciliations of any on website.

period the stated. Kenningham, Chief President comparisons President all otherwise remarks Officer; Chief Senior our today Rickel, Please and Officer; President Executive same-prior of Financial the prepared Operations. the note of are our Hesterberg, Earl year are Daryl Participating and unless Vice in John U.S. that and our

call now over the to hand I'd to Earl. like

Earl Hesterberg

for Group share environment share, I'm and UK of adjusted quarter. X%. good pleased in slowing per the earnings This U.S. the industry quarterly industry X% adjusted down and X This in overall of income net increase both morning, our the that increase where diluted an new $X.XX Pete, you, $XX.X prior to market equates the over record million was Thank all-time sales of where earned year. declined report of to vehicle an delivered was everyone. per XX% sales retail

to an declining This sales even result grow our environment earnings of ability core new in in our demonstrates vehicle again markets.

growth drive profit and of the vehicles after strong driven is that the within these being we in strong Our sales our initiatives conditions. growth, sales have by The areas same-store independent market used continue new execution to undertaken sales. areas are control: in vehicle

U.S. same-store and an XX% all-time performance. growth after used gross vehicle strong record sales is our Our vehicle U.S. profit quarterly continues revenue XX% same-store growth used our

not vehicle volume Although same-store as sales last equal impressive, the year. market. quarter sound quite it to outperformed With our second the may new

vehicle our volume performance, new continued Given maintaining very F&I important. our strong is

business segment. Turning to our

that I'll quarter we Brazil UK XX,XXX a currency During increases vehicles. on market retailed by cover and X% sales, by the Total prices to new in unit a conditions constant decline in weak new basis, moment. due average selling consolidated nearly U.S. offset sales increased in vehicle partially a unit further revenues driven

was XX% and unit sales U.S., mix Our UK new Brazil. geographic X% XX%

BMW brand new sales XX% units; both Lexus' unit represented by and for and of represented and Our new and accounted Acura represented our was XX% Honda vehicle sales. mix which Volkswagen/Audi our Toyota new X% XX%; led Ford MINI of

profit X% vehicle almost margins on strong XX,XXX currency impressive revenues consolidated team. U.S. by increased per while we increase gross and units in used Total X% performance During by X% volume basis. U.S. continued X% a retail performance At by driven expanding unit nearly our another is retailed the operating also quarter, constant our the used grew same-store

warranty XX%, by driven X% after revenue pay sales wholesale of of X% parts on increases and a constant basis, consolidated currency in increased of Total X%. customer

and quarter. on XX% for a U.S. local same-store sales businesses currency the Brazilian basis over Our by increased both after

gross and as are UK retail a strong the per currency on by profit roughly profit retail Finance was U.S. and sales increased total consolidated insurance XX% flat unit year. constant basis. unit in growth from prior increases This driven

Regarding our I'd UK cover geographic to over results to results, of President turn the segment Brazil. call quarterly discuss before U.S. our I Daryl Operations to like the Kenningham, U.S. and

Daryl Kenningham

Thank you, Earl.

and vehicles quarter. very and used with represented able generate new we unit were sales profit. in same-store the our vehicles in to XX% the in and used increase used X% value second We vehicles, grew performance again gross pleased The growth volume. total retail once in quarterly of unit Due quarter. X% outsold unit the to U.S. line a F&I are after in XX% strong same-store retail our sales, sales grew used

also We per in increase profit gross used an of $XX. saw total unit

critical focus been have inventory Our continued a on driving on of XX% and pricing, to basis. gross sourcing profit discipline same-store vehicle growth used

an industry-challenge by We've and enabled the implemented last It to same-store our and in on by increased Hiring in of increase. XX.X% basis technicians stores. revenues wholesale retention collision grew that revenue increase a on driving U.S. X%. is front, work pay XXX a same-store sales increased Customer XX.X%, the us continues an week warranty to be XX increased has year, increased after headcount XX% our we record four-day and quarterly better-employee X.X% are all-time technicians XX.X%, Our parts winning. in

Our to is both up warranty well. the in These our and led as CP improvements double-digit adviser quarter. in headcount XX% growth capacity

and of at implement on-track initiative of our will to the about by service are week end We the XX revenues. approximately which work stores third quarter, parts four-day the cover XX%

the digit to mid-single strong to retail $XXX quarter we we driven keep increases. feel F&I around rate. forward full for confident units the per sales least $X,XXX per [ph] after income unit for increased product growth F&I We per at maintain unit, income rest year and XXXX. growth would expect from to $X,XXX penetration contract Looking year, the the by of

omnichannel customers. feel We efforts. robust online our that experience our a providing confident digital we are to for Turning

customers do us to with our business how want Our and business do or to goal online offline. when is

We online retailing U.S. of digital Acceleride, have launched in our XX initiative our dealerships.

the quarter, car dealerships customer gross the from quarter. the nearly to profits and X,XXX from Acceleride first the continue continues the to rate We're -- our started a number who nearly customers in with excellent. pleased double of one feedback the bought selling increase process be Our

in We our U.S. are QX. install on track to stores all Acceleride the of of end before

customer grew our addition, XX% were center now second and XXXX online made In of versus omnichannel that complements are online. over best-in-class inbound the during development the quarter. over handled our of scheduling service appointments sales our and This efforts Customers continuing. service after service quarter XX% calls appointments XXX,XXX

approve via work online. or customers can addition, pay and In service for our text

digital increase XX%, Our trends positive traffic XX% in increased website a visits track. also Lease traffic and XX%. continued increased on organic

as team able continuing from our leverage SG&A points to able SG&A leverage We sales to Lastly, basis our increase and from XX XX.X%. gross by a was basis to profit be on used XX.X%, anticipate to we same-store down efforts. after

the back call Earl. I'll to over turn

Earl Hesterberg

Thanks, Daryl.

used The likely than earlier, the continuing caused that was quarter. demand UK total OEMs vehicle our vehicle pressure as mentioned conditions are the the values uncertainties pressure of support caused industry down to vehicle X% resulted primarily challenging, this surrounding remained vehicle used on values in by vehicles above-average market very down second even The As plus shortages customer related for market The new new year in self-registrations by more is quarter. pushing new true sales some downward last in new Brexit. vehicle aggressively numbers. combination WLPP

pressure. new elected New by as also by quarter. were vehicle many We new vehicle market XX% on hit this to basis vehicles a volume profit OEM certain bonuses self-registering same-store gross declined volume as margins forgo not

had used cost should it in XX% future gross vehicle this margins conditions and is significant to Although same-store decision profitability. business decline hit short-term benefit same used right The negative also market a total impact, vehicle the profit. and

after be for of focus what a as year sales weather will the management, remainder inventory auto business expect cost we the Our we be on control temporary slowdown retail sector. our and the in to growing

ongoing to the vehicles, XX% constant in vehicles. Brazil, gross however increased used and as by increase to recovery. XX% anticipation turning recovery, basis, staff we total a a driven a in have market also benefit which of accelerated from after same-store a sales in increase new the profit in currency X% XX% added economic further increase on Now Cost continues

reviewing are growth in anticipate market and would better-leveraging the balance forward. We the going

over I'll now to of turn our more the go quarter call some second detail. financial Rickel results in over to CFO, our John John?

John Rickel

Thank you, Earl, everyone. and morning, good

of diluted million. These all second XX.X% For results record. by damage X.X% quarterly a adjusted quarter after of million to quarterly tax basis, On West charges $X in in per-share from Texas. results adjusted hailstorms primarily time XXXX, net fully million earnings million exclude increased XXXX adjusted explained the of over $XX.X $X.XX $X $X.X income comparable increased our or to our XXXX net inventory

constant was quarter, an total For we basis. from prior $X in on generated increase X.X% which of a currency the the billion revenue year

Our gross increased XX profit conditions adjusted as gross than more offset gross percent XX profit to as SG&A basis UK cost margin of U.S. basis points points weak to X.X% market XX.X%. increased increased XX.X% leverage. This

million interest expense year prior balances million to from the lower explained capital $XX.X $XX XX% by X% rates. Floor expense interest and or plan $X.X and reflecting borrowings. mortgage interest $X.X loan decreased increased or working million, to by Other by prior inventory year LIBOR higher million, from

forecast was rate which XX.X%, is with Our tax year-to-date consolidated full second effective and year XX.X%, consistent the between of XX% adjusted quarter our rates XX%. from bringing to our

and Turning consolidated structure. liquidity to our capital

funds on million. $XX.X our immediately offset of available was As $XX.X million June total of of to account, invested and $XXX.X we million other floor hand a plan that XX, had in bringing cash

and by will credit rates our five-year June $X million term. savings end previously as another benefit extended As spreads amended at result $X.X U.S. reduced of of a annually. we for the announced, us Interest approximately billion facility

to our covenant ratio revised addition, from X.Xx RET calculations lower X.XXx. leverage adjusted In

$X.XX second million of used yield an is Also which per quarter, annualized during to dividends approximately share, X.X%. of the we pay currently $X.X

posted attached please financial our the as to of the the website. information release regarding detail our additional well presentation refer schedules as news additional investor to condition, on For

over turn will Earl. to call the I now back

Earl Hesterberg

BMW That in we efforts, revenues. BMW MINI included in $XXX also Thanks, corporate franchises. our dealerships Motorcycle in franchises annualized Related to and our John. first These generate Mexico million development acquired July. New expected approximately previously two U.S. to as announced, are two

revenues. a $XXX we to our existing date have acquisition generated commercial million the the in XX the recent million disposed the UK trailing vehicle franchises four dealerships Volkswagen generate franchise This to geographic disposed and in increase Since franchise last footprint approximately that BMW, are our MINI revenues, These revenues To franchises is Benz announced acquired of XXXX $XXX within Volkswagen from year-to-date franchise also $XXX to commercial acquisition count and in earnings vehicle in and annual in UK. one have total expected a Volkswagen franchises bringing our UK. also and of call, XX-month in we million franchises. Mercedes and XX Volkswagen Brazil. XX We

the prepared our session. I'll question-and-answer the begin call turn over concludes remarks. to Operator now This Operator? to the

Operator

question-and-answer session. of will begin John [Operator We Instructions] America. question now The Bank the ahead. Please go with comes Murphy first from

Unidentified Analyst

morning, RDE? how as now that more is region and economic on in UK the that or for the your impact and driven question on how of of in how WLTP This And structural at [ph] relatively, volatile, relatively at weakness Good [indiscernible] by all? guess reflects a your least if weakness? it John. expense does your much remains much strategy I like weak guys. A first is dynamics market, it view, go-to

Earl Hesterberg

mix politically-driven than has least others. it's others path political this this I clear is of And is forward underlying WLTP some brand than and is in issue. a until problem. a Volkswagen/Audi more others. weakness Brexit, bit confidence more of our probably Group, This the to some Earl. terms the degree, lesser going remain at But so consumer believe impacted to problem Volkswagen on a majority there's brands choppy. the

Unidentified Analyst

you've WLTP, with I on supply particular. quarters that constraints in then previous QX? in seen VW And Have mentioned any know you way easing in in

Earl Hesterberg

so because there of go eased must certain already being another have by cars cars the there year with are registered we and half we're the new first that know in point pressure some model be September. to about a then emissions-regime seeing we're new because issues September starting Well, register into vehicles will it be supply certain but pushed that in to X [ph], beginning problems of this

yet. not it's yes, behind So us

Unidentified Analyst

bench think then That's the you lowest that to how you. And thank lastly, appropriate the level a Okay, you talk long-term? or XX% over is about Is level mid-XX% can maybe an about SG&A your use number helpful. you cost digital is more potentially drive greatest efforts to where industry can just slowing? volumes And help down? likely given are relatively, take see do how the and out opportunity the

Earl Hesterberg

John and going corporate I'll quicker is but We market we than This used drives many UK Brazil, Earl. recover Daryl few, little -- on this in the issues experienced metric means do a and in UK is let we vehicles people which better Clearly, or recovering and speak we then both too haven't in And market it what to a a have numbers we we business can kind the our the to cost of have the the cost job has. need and the But markets. dramatically we added more Okay. to bit, expecting much the the experience. U.S. leverage now in may than week, have have. right new to Brazil primarily. on is opportunity in I'm come to a condition SG&A both market and

cost on So and UK in Brazil. we opportunity significant corporate the have a basis,

John Rickel

John is This Rickel.

was to basis, is overall term, to on mid get the think longer Just right corporate a I we number. Earl into to lower add can saying, that consolidated what XX%s

you and we individual to Brazil XX%s we able can that I certainly should leverage something time, If upper think and mid continue for the UK over longer pieces, are look think high term if and gross targets good structural in maybe in at the be XX% profit about. U.S., grow to is the sustainable to to the in XX%s similar to country

Unidentified Analyst

Thank you so much.

Earl Hesterberg

technicians. Nearly I'd The add is advisers capacity and people made investments sales. comment after U.S.-specific the our add in U.S. XXX to thing in about to we

after As grow we'll we sales to as be scale expense well. that double-digits, able to continue

Unidentified Analyst

That's it Thank me. you. helpful. for very That's

Operator

The next Michael Global. Seaport go question Please with comes from Ward ahead.

Michael Ward

Thanks Good everyone. very morning, much.

then footprint. ones, what some the off UK and First where buying for strategy mentioned your selling You stores me, is other of that you're driver some strategy?

Earl Hesterberg

quarter circumstantial. Michael The in the was acquisition, recent just

in UK even the wanted OEM years. much acquire going We're improves we they're those to on market to us as to until we stores. our pretty acquisitions existing consolidate recent fact trying the made But weren't some the bid and In it. to in big franchises Volkswagen very contiguous

We that. long that the UK years in recovering did but nicely in brand about was will after the few work out we us circumstantial, diesel ago. the So really a term. well the concert and it has the didn't issue on OEM That Volkswagen OEM been for with in plan

Michael Ward

compare we still you versus have You those the profitability ones the on disposed?

John Rickel

that the Whether ones the I'd more up the it's we under-performing The profitable. say were we we at challenges. that portfolio and consistent overall or John. estate had This are ones as is we cost to it's portfolio. some be ones expect the we to did disposed, and with fixed real obviously fair look the issues picked certainly ones certainly up very assume picked we

Michael Ward

XX want understand business and the new is technology There I service I Okay. that. chart a Page just it business. on make impact sure has on to

at correct? engine, retention combustion looking that you're versus If electrified then and vehicles internal the is levels the

John Rickel

that It's have whether Rickel. associated. really what assumption here hybrids we'd we per that electrics is certain same electrics amongst about an have they're is service have. What investors unit we you would The and electrics, out have a there pure doesn't trying is engine hypothesis. the that John what with lower nice shared battery the see basically support dollars to is this battery Michael, battery, data basically dollars there or Correct. say

other a units. have place better maybe you there's You but to little retention less those have because repair, no take

Michael Ward

what retention. XXXX U.S., about with levels for XX% then the XX%. Is And have electrified? it's talking retention I'm the Okay. at looking the -- you the you're that a data

John Rickel

Yes.

Michael Ward

Wow.

John Rickel

Correct.

Michael Ward

Okay.

John Rickel

alternatives fewer take to. Because the are there to units

Michael Ward

one And housekeeping right. item. John, just that's Yes,

is I about impairment it asset one-time all the are in items, those hits the SG&A? the in assume U.S., all On

John Rickel

[ph] is hail obviously a with it's U.S. impairment the franchisee asset of in is divestiture The the Brazil and The stuff No. associated basically there. on

Michael Ward

Okay.

the -- looking operations? in at standpoint, statement items other we're be the million and are an would legal, if and So the included the in SG&A [ph] the those in income -- those from in two items it estate in U.S. real $X.X

John Rickel

are The $X Brazil. in other million the is items in SG&A

Michael Ward

[ph]. estate All other [indiscernible] okay are ones and real the

John Rickel

Correct.

Michael Ward

right. All

of to out of a how get U.S. you and lower that SG&A that's apples-to-apples? from you the kind do So back if it percentage gross

John Rickel

Correct.

Michael Ward

Thank Awesome. you, guys.

John Rickel

Yes.

Operator

Please from Gupta JPMorgan. The ahead. with Rajat next question go comes

Rajat Gupta

Hey. sense actions. And on follow UK saving my to actions wanted of us a for what just and there? up of and then that follow-up. the have the Thanks of taking a I taking timing Could are give I cost question. you you of magnitude rates benefits the kind

Earl Hesterberg

major changing need personnel-related used that expense used better. depreciation these short this expense term the have a you're such vehicle addressed that of has people. And on cars employed comes fleet, vehicle items demo car quickly year, less up the dramatically. selling and vehicles, you way UK as inventories to values actions to staffing. Simplistically, lot jumped But depreciation in address need self-registered as substantially is lease be the cost you don't many dropped When sales your from control the the have vehicles you is are

vehicles, have more You have of forth. quickly to create you sell those so less those vehicles and to

expense a staffing better. better our adjustment control make to personnel have related We and to to we our and size need business inventories

Rajat Gupta

stage? to it. is in Or the there? it Got at quantify be planning you that process able still Would this

John Rickel

SG&A was equation. Rickel. profit part don't yet is to that a Roger. bit because look the in want is know there that as contraction we just John number quite gross Yes, the UK worse dependent put of for on quarter well. line makes I that it's one thing the to This also The of profit it a that gross the

of Used year vehicle when mentioned. pass the half of inventory used depress allow is to vehicle That Some in because will values that of partners, It's were bit little the vehicle and of of we some transitory. on the passing happened a new used the bonus first took OEM acquisition kind also volume I really the WLTP the think Earl recover inflated us gross. issue that the one shortages. a of decision And a our the from growth. about the

the suffice We have to into but ranges. equation, as looking bring to of of more to back percent work sides both SG&A normalized gross we're that say,

Rajat Gupta

would to I what sales the new launch. launch? the second also Got you've impact that the helpful. wanted already see possible it. on just it online you on to in started Is That's ask to from half quantify the expect that initiative, and

Daryl Kenningham

seen what sold XX,XXX Kenningham. over a XX,XXX saw we first we that's business as time Yes, the transactions grow car something in quarter, double is we and more customers vehicles impact and impact one in learn from of their thousand us. Daryl every The this a The but see started continue -- these monitor new. thousand we that expect bought nearly it with And who a to almost quarter we've process online of first customers second at the we to online. their do and we

a expect this we piece bigger So it going to be of forward.

Rajat Gupta

I'll it. on. All right. Thanks. pass Got

Earl Hesterberg

you. Thank

Operator

David go The comes Goldman with from Tamberrino Please next ahead. question Sachs.

David Tamberrino

Good parts your on is and the not service double-digits said technician about, gross that, question great. Obviously guidance. morning. but got the Great. a I having spoke you

it's of deck. think I your Slide XX

and two for growing You've you've comps the got X% to quarters. easy X% year-over-year been first

seeing being in conservative? something you're just there's little to back if half going wondering bit of a that's growth? slowdown a Or Just that in the drive you're

Daryl Kenningham

our collision warranty haven't parts we're pleased sales goes in We warranty. with decline the also that in This and warranty One wholesale we're growth but CP seeing year. really saw But double-digit we obviously last is thing, seen. Daryl. growth, is after

might the digit that that. you that's know So with why comfortable when we're In reverse mid-single total, forecast. growth never

David Tamberrino

Understood.

far year-end? tech the XXXX you pretty another growing headcount way you continue think your gone this can -- so through to ask has to think that and I change. to you've stores something out though. text be me The since add by U.S. continue stellar service XX% into that of growth Is been you Let the might XXXX, capacity?

Daryl Kenningham

is again. this Daryl Yes,

sales at end want be have now text to and ways our the after then. add expect by year XX% the revenue the we of We we expect capacity to to as much the do for and cover in to between of We as how looking we're possible. stores leverage more

we'll So we at it. certainly rate, it but are. I this know at don't expect do to pleased we if continue where do to we're

David Tamberrino

how current one. ticked much last and some U.S. market? is that still vehicle still pressured residual Or Just market growing? Okay. off incentives. the And then values? new to supply up you potential have that a drive strong lease Do you in fluid wasn't backdrop Do the going understand incentives business? OEM think used is forward that to favorable use trying How changes helping and the to the

Earl Hesterberg

This is Earl.

lot U.S. off a additional few vehicle there's if think is difficult and the used of in years market more I consumer really to vehicle the equation there again incentives. think reverse supply that it will that even I a in be But new vehicles. the with fundamental towards leased difficult shift value with to shift the shift last be a for will

lot You've financial there's of by land they lenders. retail seen on a I that the support, vehicles. pricing data money think And new the

really don't market of the shift massive a vehicle vehicle used I toward the So market. back at new the expense see

David Tamberrino

it. you very Got Thank Helpful. much.

Operator

Sinkevicius ahead. question with Armintas next comes The Morgan Stanley. Please from go

Armintas Sinkevicius

to the UK make Good sure this at right. you taking I wanted for look -- I I just When morning. the heard Thank question.

WLTP impact business RDE year. the in do starting How about back of talking to last from were from this You this you RDE half September? year, year the anticipate

Earl Hesterberg

I will continue think it to brands. for bumpy some be

model, our going the think new because biggest I to business. vehicles biggest in it's brands. on new be our short we're is of Audi certain concern piece

Armintas Sinkevicius

interaction some then with regards a site. essentially a on looks it with the product. dealer third you there pretty looks it nice a used representative from there There And software to like Okay. party and the like Acceleride, is

finish? fade transaction what where from could need interact we sort to could entire and at the happen with of see actually representative dealer curious, to the start point Just the online

Daryl Kenningham

This is Daryl.

pick delivered. they have really like of they I The if want come to up a think use if one only if to to that honestly. the we providers or able up learn be choose that do they to that's it to need different them. is and through moving thing each online it. and car of and from to in customers the do want The is couple world customers, purchases we accommodate We to

Armintas Sinkevicius

of with last competitors used the UK used then -- market. are And end side? and on seen on side your Pendragon on some Lookers. used one the car We've here from you warnings your the seeing What

Earl Hesterberg

Well, self-registrations, expensive demo That's get new but those the low-mileage issues and part these car fairly what side When change-outs, cars. hence drop, vehicles. the of difficult it's tough, they're those to values the of used mentioned tough the earlier. used tend most hit is types are expense very -- you merely to hard, whether vehicles manage, for be I pretty depreciation these

used this vehicle two, you're relate cars. if used four-year-old new and a Most the new problems franchise market of is at in vehicle indicate. not mileage looking to nearly and UK as So our dealers true bad performance the as young very three, as numbers cars car would low dealer

Armintas Sinkevicius

appreciated. Okay. Much

Earl Hesterberg

Thanks.

Operator

next The Nelson Rick from comes question ahead. Please go with Stephens.

Rick Nelson

morning. Good Thanks.

I think sales down. flat same-store market the was U.S. industry U.S. and the were

could think or there? you regionally driver what If you was speak the

Earl Hesterberg

It that drive class of Texas but market, We We generally were -- any Oklahoma, across were mostly specific to Texas. seem up one we're wasn't market it any one generally that. one on wasn't and Rick.

Rick Nelson

outlook? and F&I the cars drivers and Well, the which I again, $X,XXX unit, some there have [ph] toward a Pete lower used think valued attachments, would Once with this [ph]. cars F&I quarter question per shift even for

Earl Hesterberg

product in outlook been performances quarter, F&I Daryl his we've opening $X,XXX we're in main That's But driver and Rick. said just $X,XXX range. that that sales. product comfortable focusing the on of so the the

Rick Nelson

And what lower? that number drive would

Daryl Kenningham

we is $X,XXX a forward. lower still the few number drive would range What is the products, but moving selling number good us think for of

Rick Nelson

like acquisitions this Fair paid the at down I'd environment, buy backs, enough. debt Also you versus versus to acquisition point. view ask about how

Earl Hesterberg

is new when be vehicle decisions but financially Earl. destroy generated soft was vehicle to market this in to it's and interested new very on to profits Because opportunities. a when paid you're capital past our market are expect in stronger. We' Rick, continue driven be those years on easy sellers acquisitions, a in

opportunistic the terms that's our our relative quarter uses of very again, And So acquisitions. of discusses circumstantial in every and cash. board

We that very have backs been until in market very debt just quarter-by-quarter. the dynamic this It's we'll buy relative a to to revisit same aggressive continue and repayment. year and

Rick Nelson

got you. Thanks and good luck.

Operator

comes from David the Morningstar. Please question with Whiston ahead. next go

David Whiston

good Thanks, morning.

the cost question on and cutting then just UK because the now to bunch I if and guess how rehire restructuring. people you on both a you back a Going reduce efficiently of cut rehiring at and -- although an money who you some stores? how Brexit and many at too will not when spend resources, to balance issue, be point do having knows time people the

Earl Hesterberg

to in way That's law UK working your longer is it's That's that of than U.S. about different we in takes step employment the just a is the challenges the country. in go back. our how It the longer dynamic business one headcount that. In market, takes to reduce headcount, it

take to in in cost, we slow that and slow we keep when you slow a we So little mind vehicles, hiring actions on a But slower little and both back these when take actions. be used or new little cutting have directions, tend do to it in some a on profit if we the in gross drop of uptick does Even now. it XX% the XX% little comes. when saw make

David Whiston

Okay.

weakness to whether consumers I SUV of now? couple back seeing any right at crossover, or there. it's even questions Are marginally guess U.S., pickup amongst light in the you a Going trucks

Daryl Kenningham

was consistent Daryl. is XX% Not is where over fairly which been. material quarter the truck and of SUV any second seeing with the it's in the market change This first quarter.

David Whiston

Do about trucks vehicles? in Oklahoma. want in talking The Okay. are all auto there zero doing for guys of Texas customers in Tucson those And ground type makers your think [indiscernible] you you pickup are BEV in pickups.

Daryl Kenningham

This is Daryl.

gas Our honestly. big engines, trucks customers love with

David Whiston

Okay, thanks.

Earl Hesterberg

Thank you.

Operator

over question-and-answer Mr. back I our closing remarks. like to Earl concludes now any session. conference turn the Hesterberg for This would to

Earl Hesterberg

Thanks, for our look October. joining everyone, to in third today. forward updating call We earnings us you on quarter

Operator

The concluded. Thank today's presentation. attending you for now conference has

You disconnect. may now

Group 1 Automotive (GPI) 26 Jul 192019 Q2 Earnings call transcript