SAH - Earnings call transcript Q4 2019

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Operator

Good morning, and welcome to the Sonic Automotive Fourth Quarter 2019 Earnings Conference Call. This conference call is being recorded today Wednesday, February 19th, 2020. Presentation materials which management will be reviewing on the conference call can be accessed at the company’s website at www.sonicautomotive.com by clicking on Our Company at the top of the page and Investor Relations.

At this time, I’d like to refer to the safe harbor statement under the Private Securities and Litigation Reform Act of 1995.

During this conference call, management may discuss financial projections, information or expectations about the company’s products or market or otherwise make statements about the future. and could a differ cause the made. forward-looking and of materially are statements that uncertainties actual statements subject number to risks from Such results to with and the These Commission. detailed and and Exchange uncertainties company’s risks filings the Securities in

today. discuss Please filed Exchange In Commission. current measures as and to report the with company’s the and non-GAAP on non-GAAP defined addition, certain earlier financial X-K the the by Securities Commission management Securities in Form may refer Exchange reconciliation tables

would introduce Mr. and you I to EchoPark’s Chief may conference. Sonic like David Smith, now Mr. your Executive Smith, Officer. begin

David Smith

very morning, XXXX Sonic’s earnings you company’s and year fourth I’m Again, welcome David Smith, Thank to much. Good call. CEO. full quarter and everyone

our teammates, Joining to achieve full We quarter me an on vendors call customers, an is fourth and the for time and Heath all thank all CFO, want today helping our our manufacturer Dyke; and record partners Byrd. record us XXXX. time Jeff year President,

continue both we successfully grow business. franchise pre-owned EchoPark our vehicle to stores our As in core

XX% was fourth which last quarter the for income, up million, over volume the quarter XXXX; up total and quarter EchoPark record XX,XXX highlights Some $XXX.X XXX%; share for of for all XXX% were diluted quarterly per segment of a of fourth EchoPark earnings operations quarterly revenues continuing the billion XX%; of from fourth an fourth units, record consolidated year. of $XXX.X XXXX. time quarter $X.X retail XXXX, record the include all EchoPark gross time up up profit record quarter revenues record million fourth $X.XX of

$X,XXX X.X%; to new finance for to used unit; X.X% gross retail vehicle retail X.X% volume results X.X%; vehicle volume the gross up per repair new X.X% all franchise XX.X%, pay up unit to total quarterly consolidated used fourth service dealership Some the per XX.X% up fourth F&I profit to record unit unit and profit X.X%; retail XXXX; the profit basis. $X,XXX up up operating to unit; on profit compared unit gross insurance and collision quarter. profit compared the of gross XXXX; a up customer up $X,XXX up up vehicle per per vehicle of Sonic unit profit per XXXX; time part and quarter profit of same-store gross X.X%; gross Revenues quarter quarter fourth gross compared fourth

$X.X XXXX, basis certain record million. segment operations expense From record revenues billion full of We Some year of an time of percentage to from billion up XX,XXX XX% and year year excluding prior $XX.X XX% SG&A billion XXXX; units, XXXX; all items income highlights. as from XX.X%, compared XXXX; up record XXXX; point volume XXXX compared was an $XX EchoPark record XXX% billion, of profit control record reduction of gross continuing about of EPS debt gross fiscal of XXX% EchoPark EchoPark up for to retail improvement profit, of interest total respectively a from time million, the XXX of $X.X consolidated year. year $XXX had and full all $X.X to revenues up from $X.XX, full $X.X billion compared perspective,

per to up we Retail compared operating dealerships per used vehicle franchise had volume that up X.X%, down $X,XXX profit gross unit up vehicle X.X% $X,XXX results, new used vehicle gross retail unit profit Gross X.X%. profit unit. per X.X%, X.X% to up revenues X.X%, Same-store XXXX, were up unit. volume unit to unit vehicle new per

consolidated annual profit to $X,XXX basis. profit all-time unit consolidated up – a XX.X% and XXXX, on compared Parts, up F&I per record collision gross F&I total profit of gross profit service X%, Customer to XXXX. Pay Sonic X.X% repair gross up compared gross retail

Long first our Long Beach, days EchoPark within Some opening our ninth our opened vehicles sold in unique across nationwide Beach additional model and location business EchoPark to XXX experience, EchoPark highlights. California XX first Upon over United over In locations. the operation. store, of continues our guest that’s we is California. mid-December, strength which an and excellent speaks from the and start draw to the only existing This customers industry-leading of XXX EchoPark it with X our markets States

new EchoPark about vehicle franchise growth end EchoPark we of over is our pre-owned three while sells further it record capitalize growth and example, on per to by well experienced nationwide, store XXXX, month, poised For opportunities vehicles we pre-owned expect traditional XXXX. for our vehicles XXX the new store average sells of month. as EchoPark in which XXXX stores include expand XXX per record to

I earlier, which highlighted our favorable early to principal advantage XXXX. in as notes, conditions the to December, all balance due mature $XXX sheet, of market were we of million of retirement X% subordinated took in Turning the senior to amount complete

$XXX years, by a XXXX other Sonic debt our and As in reduced of total the result efforts million. during this

debt financial and this Additionally, position interest EBITDA into our to XXXX, reducing significantly by has Sonic’s going ratio. reduction debt improved improving

pleased dividend focused driving share strong Board April performance on XX, payable closing, we $X.XX a franchise of XXXX to of March XX, in XXXX. our on to In report our record team approved that of stockholders By nationwide will while per are our also service as our stores term and initiatives. create our all Directors Lastly, business remains parts quarterly increased shareholders. continue F&I, long of course, grow our selling our and digital omni-channel we and other EchoPark footprint continuing from execute on expand for following for and cash this value to to and and profits plans

Even for term sets in this revenue long achieving of stage annual us we goal Sonic’s the decade. XXXX $XX our in achieve billion believe record to XXXX, performance

progress plans to with execute franchise goal excited positioned We stores. well are and continue this are our achieve the our have EchoPark already very we as and growth for on we made to

our concludes to be happy and remarks This opening questions. your we’ll now take

Operator

Murphy, Please of John ahead. comes first question from America. Thank [Operator Bank go sir. you, Instructions] Our

Yarden Amsalem

Yarden is for This guys. morning Good Amsalem John. on

which you’ve taken the very there store, in and Beach on of Can first key perform some helped well actions to unique you some new seems performance the and about new Long of that wanted month have maybe talk the XXXX? the stores in for drive this learnings your to half. I First, touch

Jeff Dyke

This start. more better we got from we stores, obviously, we is as the than Yes. we Dyke. first – execution open if could ninth store you openings. we’re it so get Jeff look first our And like store, from at times a fantastic off the that. Yes, is better at to store were we opened, the This nine

Long us that to one And our X-year-old shortens goals, running pace kind well be And in the for of open country. along, and is ahead first learnings in we’re the As the of of zero to all with we to get Beach very area said that the in markets which on take our of the Beach length Long opening, those takes up We’ll part these April. excited. Tampa it next and will to from profitable. stores largest our

David Smith

that Yes. a our And you XX to the cars highlight in in XXX sells crazy. at franchise XXX It’s again, This David. look used when is about store month. when average just just first traditional days,

Yarden Amsalem

And you. a then Thank Okay. quick follow-up. just

Is a the year? first the half be in Can first be or time would it the half stores? opening You going other provide two of store line you to XQ. the for the said in second

Jeff Dyke

I can.

And open second our of towards the of year, open market of year. we’ll the end we’ll quarter, the first the the then this our Towards for half third. beginning fourth

So early the market – have Tampa April you’ll in April.

you’ll our You’ll beginning And July. have have in the fourth towards the then third the middle quarter, additional of an market year, June, market.

Yarden Amsalem

sorry, Great. Thank more with one your XX you. – to regards target And yes? of question long-term

Jeff Dyke

I think to about Well, million and note important those that for on $X each drag open we’ve got as everybody to it’s remember we location. stores, a

Long think a of little this those stores. of December, end the Beach of bit that at drag you if of you’ll three about year opening a into carryover So have

forecast, the million everybody’s revenue of the million of stores somewhere growth set, in have, $X current $XXX will along that So to calendar generate, $X billion drag probably with this year. worth $X the those for to million but we’ll also in for

Yarden Amsalem

Okay.

year, a think of and given in the should So improve stay same to SG&A this in relatively maybe about or just leverage you’re low next given your bunch pretty reduce with you cost EchoPark, how slightly? we is just quarter, it and – investment guys continued taking that mind, your actions should

Heath Byrd

This is Sure. Yes. Byrd. Heath

XX.X% If like a you is X,XXX was was look at at of XX our which gross, EchoPark SG&A year-over-year comparison running as for XX.X%, is full basis the better. points year, Franchise points better. which percent basis

we XXX points focus basis the So think side, We opportunity franchise reductions. enterprise better. a hyper the where was on there’s on the have total expense year XX.X%, for

opportunity So business. we on to we franchise basis XX have the the of side points think XX

going $X be the our to our mentioned, the that obviously, EchoPark, new on that On But Jeff the of is $X million, offset to depending the timing, SG&A. will million maturity by stores. drag impact

points XX side, little I expect so And basis franchise the on XX, bit the an a EchoPark opportunity for of reductions. side on increase,

so potential looking a have that underway currently for flat reduction SG&A on year-over-year overall, some And XXXX. we upside with at we’re expense reductions some

Jeff Dyke

on of that. is And would also top this Jeff I Dyke. add

two markets last XX%. those are Dallas, running more in our of numbers you Both If look below SG&A Denver, most at year profit. $XX markets mature generated our in or million and Colorado

on And into the maturing faster below other the the that we to being that term get three-year markets, SG&A Charlotte mark, can the franchise side have near or that So three in range. Houston only we this range. stores and ramp we actually XX%

So it’s plenty accretive.

and picture, EchoPark. the kind that, if a needed to After really will, do year we before again profitability the the also you at get that have to on growth which really we can stores, profitably the turned really believe gas begin mode down We’re starting mashing now growth out again. we’ve it’s proved our EchoPark. back done of maturing and mode now and pedal, we because we on took grow growth into done we we mode that get to And

from you that, when perspective our XXXX outlook XXXX fantastic. all beyond the – for is So and combine and

Heath Byrd

Yes. you again. if – And I Heath is this keep think

keep stores expense than get certain level in to maturity, so dramatically so EchoPark you I different a that throughput, the is much franchise structure the of mind of once is greater. think if you the

have as Jeff hit a are percent a going portfolio, on of and total have gross. EchoPark that to a as proportion sub-XX entire mature of these and significant mentioned, the of that is others growth. a as obviously, enterprise SG&A we impact stores as so And And SG&A higher the becomes percent

Yarden Amsalem

great. you Thank much. Okay, very

Operator

you. Thank

from from ahead. Stephens. next Please Nelson Rick Our go question comes

Rick Nelson

ramping morning. Thanks, early are EchoPark, start pullback units relative how deck a ramp? have slide see QX this to [indiscernible]. would refers in On I of did to expected We units good number own but you expectations? in your the QX, at the to seasonality know

Jeff Dyke

is look That’s at Yes, Rick. have Dyke. This to Jeff how you it. exactly

quarter. EchoPark especially segment. huge sequentially, can’t the look business And happen You at We zero forward. terms numbers, in seasonality expectations see cars, always really But volume our expect at trend to in against we the the four-year-old quarter that competing car car look as new we same car fourth we year-over-year used if we’re the a of new to sort beat significantly. of move you as

So we move forward. to to a quarter you when want on the look is same-store fourth basis, looking fourth quarter as at you’re which really growth important

look expect big slows So takes how And car a a new used again to third got the great fourth we quarter the you in at business little that. down see bit, that’s car move cyclical because have off. That’s and business from sort why the the of to QX you quarter.

analogy that that you’ll is in same last last see as year And example it So again starting and same you’ll had that the way. XXXX, the we year, year. see off

Rick Nelson

Okay.

Houston, those So in and is Charlotte the stores kind you seasonality? like Or the stores are of the mature there? ramp seasonality offsetting seeing the less

Jeff Dyke

to offsetting seasonality I sort still the marketplace. mean continue into there’s stores the because you built ramp, those but they’re seasonality

than And in into quarter they’re both So get first we’re of did quarter really, the off fourth of faster. we because even in quarter, seasonally you those to new side. what are happens they’re car ramping when more going – taking sell the the nicely. But the on stores first

fire. faster kicking seasonality taking at the level across else the and than stores year, So year than everybody the own board. seeing But half level, are that – that’s and who first – its other just because is in maturity Long those we’re ramping in, and they’re Beach, that of that

David Smith

Rick, this is Smith. David

as that ninth Jeff there mentioned location. he and about Beach, think, Long I it’s our mentioned

Xx in getting our better the We’re execution opening at stores.

training. So I’m that saying we’re

better. getting is training Our

our locations seeing. is better acquiring Our to getting in is and those locations what ability achieve faster opening profitability quicker we’re and

new we’re and I So that going locations to think with we’re we’re it’s – Jeff and see – that I as these mentioned, getting were think better better, opened.

Jeff Dyke

And again. it’s Jeff

we allow up faster could stores get move open than – projecting. we more us of to As we’re terms that as in profitability,

same Beach now, at we’re And ramp, ability is we’re those and acts how beginning. three do Houston the right what in acting, way. we the stores stores on and the and grow continue the Tampa depending more have level. calling than So capacity calling those But out said to to like the Charlotte Long out. we

Rick Nelson

question is of the about EchoPark One get replicable. lot up we a kind comps

If I that, that’d great. you think address be could

Jeff Dyke

We It’s the a slide that the get day, – day too, It’s shows at by in At the end great have look deck, question. all our we think the time, I it supply. the a competition. if of replicable you tough.

much going hard also a we to the to inside doing make you and If difficult secret that have to the XX-day The that sauce the in the where XX that, that day happen to day going on that’s do experience but effectively overnight. things not real to replicate, buying car, be guest all we it, that’s to levels you days supply efficiently, going supply another happen to that pretty look do, our is the that line right be replicate. in price, the buying and managing how front at of we that’s to supply, pipeline transporting handle XX

a to to companies think know in just going growing here. I or sort but people terms lot $XXX get of a not story worth That’s That’s that of and of And you’ve overnight. happening there have I can, technology there tens years be millions, our happen to to that and not think into of going not businesses doesn’t lot training. environment it’s and able they get take are that if just tell. out seen that. of And may a out of million in quit to do or investment take and get

problem Our ability that. doing to buy the inventory, never had a

or it, recondition Our And that. for numbers transport front I to well the do it we than in ability anybody better line that, it industry. the ready and turn to get the as it show quickly, think,

makes I difficult very, replicate. think very it to it

have one end that make start to got the You’ve to do has day structure able a the structure, got sell of to costs you’ve it that from be a and or difficult that drive at embedded manage. to the lot to the to the prices manage guest do we that the to the and that them we way at cars inventory at to drive do, sell levels experience we the back we very

of good segment that while not going So like of bunch people they’re this a their out overnight try, really there’s business. start I’m snap not it and do head there and do in we’ve a fingers feel saying not got the bright to

Heath Byrd

this Rick, And Heath. is

of in an of through. cars I time. get do all the are Just number that to and add that, individuals we that that to the not Days And Investor at question when difficulty understand putting the and EchoPark, don’t industry

advantage cars level use out analytics For that that takes, are that and the is times of are everyone and recon, logistics level a XX markets. there. high require things we the that capital-intensive to the year. of it getting example, a logistics in only not has take selling of the the auction expertise just month Dallas, Not the and merchandising, expertise. process that of Those per of we’re And the not the selling car, X,XXX

Jeff Dyke

you keep that for expectations. blowing out And goes retail combined making store – what our not in there’s those have markets. XX% through with out our a below four our stores Dallas and kind stores retail And is targets, keep markets Rick, million, of in exceeding that Jeff $XX Denver exceptional. do – – again. We just high-line some – discipline are top say these we stores SG&A of to just targets it’s lot there the that running that. there are are that When along

so And to replicate. hard it it all very makes

coming of just Long it can Houston They’re all off Charlotte, is And is, news them started great the did. better Beach growing. has their And heels, we are happening. on see than

XXXX. XXXX like we even a then have poised faster. we’re grows great So great, And to feel

So continue. we’re gotten and to the looking Like expect this forward start said, of I year. off to a great remainder to we’ve that

David Smith

is David. this And

in those of high repeat very and percentage and As referral is a mature like seeing very customers, which we’re markets, Denver Dallas, encouraging.

a it we’re easier makes going as it lot forward. So

Rick Nelson

That’s Thanks. helpful.

Finally, if I franchise could ask side. on the

same-stores sold How You this the about are portfolio? current year some gains. nice you looks thinking in

Jeff Dyke

And invest invest the sense manufacturers mean, In it made huge to solve buying that the look were the either. a doesn’t not do to that But pull the grow asking a at EchoPark. there’s to EchoPark that we facility that not stores of that those we want markets going returns look trigger and that in, if then projects. in fits the store whole to stores, Rick, and our returns, lot fits we you portfolio, as market money in at on the stores out and we’re there a out be franchise us

the do doesn’t So that you’ll that brand get facility like sell to they up bunch just also facility. to an that look money depends a can a asked what won’t and the match at spend we EchoPark in. that of we on market and on returns don’t we the It it we’re if mean

any looking So We’ve big right screen the got how don’t it’s – we’ve plans of points we have we’re offered. that off any buying. at through and couple end see we’ll a year. the radar that don’t on just to go We now have anything been we that stores, we’re sell

from we’ll things for the go of rest a so year. franchise how perspective the see And

going about. of lot store up add then and got It’s investments to a to a company. the facilities. right franchise excited lot revenue really that Houston, making growth now we’re in we’re going of BMW And in Texas We’ve big our

go how the see of remainder we’ll things So XXXX. for

David Smith

is is the want And stores still many that And when this we’re kind too, that to Rick, grow as per making. about debt paying growing number it’s our We from EchoPark. to that not we that of slowing of David. we’re talking grow emphasize, can we can. store as down us a down big fast output that

– to just that emphasize that you we with So want guys.

Jeff Dyke

in in sold franchise But in $XX.X about grew $XX revenue, and we is we never significantly, business did almost we billion you annual million in we’ve billion think revenue which if history. before still the $XXX And broken it, – our company’s revenue.

think when great it revenue, great And EchoPark a than business. to it tell comes we the our a story we’ve we’ve managing blend So managed business ever to we’re of got better in franchise franchise before.

Our relationships with manufacturers been our they’ve ever before. better are than

there the so us And are business of of ops for in fantastic that just that team growing a there’s part upside our plenty job doing here.

Rick Nelson

and good luck. Thanks Great.

Jeff Dyke

Thank you.

Operator

you. Thank

comes Our JPMorgan. ahead. Rajat next Please Gupta question from from go

Rajat Gupta

and $XX EBITDA morning to taking Good wanted go EchoPark. for or questions. XXXX. had I so million mean my thanks just I you back to in in

it ramp follow-ups. full just have seen seen that a million expect the I and maturity $X where million stores stores. With nine continue you’ve going $XX the XXXX drag you’ve to something the for expecting do to then year, couple the nine of to are to based EBITDA on in from $X million million would as the stores mature, XXXX? But And and the color appreciate unreasonable profile already for we on I you’re XXXX? maturity this new those that from we be the to open $XX mean below profile – see

Jeff Dyke

Jeff is This Dyke. Okay.

got you million $X of to have range. the going $X $X revs at we it to drag the billion that are way look going the think the is And million. million that in to to is, to I $XXX grow we’re

the are can’t going franchise be other already going cover you we’re are stores some of the but drag. that So not also a to tell stores already the EchoPark going than – franchise open to the existing how that that stores, – three. I they’re open, open, the majority there’s stores to But many

the we’re Beach, progress and making that in we see We Long continue in Tampa. see that to happening

stores. open We’re going more some to

opportunity that so that And change profile. could

in be So XXXX. million is in XXXX, somewhere $XX going much purchase in tell many upon that in get there. them in markets that EBITDA is dependent real those we’re be would The again open, And finalize you you’ve on as big we’re we role we or hoping it’s going ballpark lease of how but when stores to what play that is, to I that got we estate. how options drag that a open,

so there. there’s effect just And if timing a

have you that in So in of probably having whether in little bit of open terms be the growth, going a the opening year another stores – realm and in, EBITDA of we the somewhere you or to same XXXX. of it’s XXXX but from not, its in in were that ballpark drag

Rajat Gupta

it’s mean did mean year-over-year? seasonally flattish – mean grew little mean still I and expect I I although smaller pretty because wouldn’t you mean to third you mean I like opened? you I the why strong base. $XX million coming why it’s significantly, that a already the – stores second it a XXXX low. XXXX I of you mean I would on quarters. a seems in mean, So have quarter from off that like would – increase in like bigger I XXXX

– I to Just trying low me. mean but I it color. appreciate the seems to a little just

Jeff Dyke

as work that with these feel big the at open when we timing can we’re a in making plays sure role being we And as be end stores. that we I mean the getting. we – conservative – of number when we’re comfortable of a you the again, it and guys day, not provide we

all along together. profitability that the have that – got come real estate us, the grow the store of sure the nine stores to and growth have We and and make of time with to purchase important make is we that we’ve current we the

I being It obviously. when again a open. these that certainly how as nine with there. overstretching, There’s million on $XX role see plays don’t depends move can only lot we of open fast just some opportunity open. I we stores – the stores, those it big get a So see don’t But to

Heath Byrd

excuse up proved We this it we proved our did year growing, And we XXXX. and ramping us XXXX for in of XXXX. first me, model is – – XXXX sets What profitable. model Heath. as is was this excuse XXXX me, our is This and

hitting that point enough maturity. at the where we’ve start of You stores tipping got level

see increase the So to XXXX EBITDA. significant when a in is you’re going

that this So XXXX, we’re think that to trading point, and of EBITDA that we’re but and – for around in number growth at I locations. we’re brand going flattish for be the the growth and expansion

David Smith

This is David.

continue also want experience sure the we We other that in to deliver guest delivering our make we’re to stores. outstanding

stores kind of various greenfield passionate markets the very so Starbucks can emphasize anywhere, we’ve this, about have facilities build brand-new proven – other We We’re the go quality and these don’t we thing that can facilities. proven open that that of existing have the to that to are Starbucks store And different similar to like into we opening. a anywhere put a EchoPark. is and

it to opens us So faster stores really done lot open past. a up in than we’ve the

Rajat Gupta

talked for believe And points profit coming some the you’re at helpful on the And the stores were Digital gross we also this up and like to you What fourth basis Got about the mean investments if in in adjusting of to just it onetime, look One-Stop I pilot growth, that? it. SG&A franchisee was quarter. That’s making. a drivers you have then XX quarter. SG&A color. I looks roughly

well? I where buckets help mean, cuts as then bps those from? decline the that expecting cost XX are to you on break just as XXXX, a tie on Thanks. XX the that, you’re to And you Could the franchisee follow-up down? could coming side So

Heath Byrd

This is Heath.

in driven was dramatically focus Because XXXX. and compensation QX look were Let’s QX between by basically performance full XXXX compared on first. in was our the performance year basis for The really of the at – difference if better lower the we compare XXXX the XX franchise, to compensation. you That’s our XXXX, points.

And so what that’s see the year-over-year QX. you for reason you do

$XX,XXX actually conversation Going force is this I opportunities, the month stores accretive. having literally were $X.XX and We our if that franchise empowered per been – we identify to run task throughout per they mean forward, has did go to – yesterday. store we have over a the stores.

we the so out looking there And every them for side. on opportunity had franchise

we are side, our robotic jury automation automation. down corporate – the starting On just

using opportunity these there us reduction there there’s office, those is functions we’ve at concept. And kind that well and new to efficient. AI and for technologies more So opportunities that we technologies. And corporate those of as make some already an in regional utilizing think back proved

Rajat Gupta

me. the Or X just saw Antonio, vehicles in piloting I to stores. typically drove you’re X X thinking that – most Got San to in it. for What change that And versus there? X you’ve one and one year-old like the doing last been in how Thanks. has any issue X-year-old there has the much the all. so you’re mean that change? program? pilot far, I it in to like any source drove also, been or that to been in of That restrictions will able terms vehicle like how be X

Jeff Dyke

X that. requirement a the for lot for that range, year-old and big We that. in we And other cars and X This is coming of saw that between have drove in Actually, the market customers a asking Jeff. markets. don’t

come that. a EchoPark market, We’ve got lot And particular, that that in stores. in drove so at trade-ins the of

stores So supporting buying from the then and Dallas those environment. And inventory, we’re the to from the that just that inventory moving Houston stores. taking of some of down Sonic and trades we’re some

fantastic, But purely at last the has and within which end to market-driven. San are XX XX for here days, great results early the been day, of started us. the the Antonio We the market in

to some an for put and that’s a we’ll base here us we’re the opportunity how that very that asking months taking excited into and that we’re of at but for EchoPark for goes advantage take to or about So customer take of trades the next move see that. so, marketplace six that

Rajat Gupta

for helpful. that. Got Thanks it. That’s

Operator

next Our from [Operator question you. Instructions] Jordan Jefferies. from ahead. Please Thank comes go Bret

Mark Jordan

is on Jordan Mark Good This morning. Bret. for morning. Good

still the going seen in about the street. auctions? off sourcing, in it is EchoPark the there you mix? kind any the of predominantly here some thinking from CarCash of have and purchases Just has sourcing changes increases on been of And Or any some

Jeff Dyke

will Again, through an inventory. in But market plenty which and that the issue, Jeff getting San so. primarily being mean Beach just been. Antonio we’re see here of now I opened sourced app, the of for market Dyke auctions. rollout ever we is or start CarCash any This don’t really it’s primarily coming month We into Long the CarCash the issue the it and in the never app now. has the without us,

any the been this doing Over had and had inventory that we at all on our our technology. sourcing Sonic, years XX.X we’ve systems based never issue

range now, the near And still XX% somewhere in sourcing – so range to of we’re right XX% inventory XX% the auctions. through

Mark Jordan

gross being grow per about And end? end? Or total front here, improvement the you driven on unit it seeing like Great. is are then thinking any back the continues mostly EchoPark’s profit Okay. on to

Jeff Dyke

– end actually was quarter, a fourth of front was It’s the majority the improvement. it for the

was to number I of we’ll and front improvement we’re XX% overall, to bounce around in the going something think XX%, that that. end, bounce on But end. minus or somewhere zero on the $X,XXX XXX around like $X,XXX it the there, maybe to number the back

with And just so a and that pricing we we’ll significant adjust and which amount pricing range. keep stay range markets is the below-market in of the kind traffic. We intact, of long the markets as as in are our driving that

at just It’s of amazing in leads than been amount example we’re per one gets and leads just per our location, can which leads location. XX,XXX you’ve is you getting times. of independent see of would is insane. good handle more month, independent we the that And traffic A the if stores, that Dallas about

And believe pricing working. so is our we strategy

is Our along. right inventory Everything popping strategy is working.

Mark Jordan

Thank much. very you Great. Okay.

Jeff Dyke

You bet.

Operator

and I’d to closing further in queue show ahead. at for remarks. like this Mr. go EchoPark’s call I over questions to the you. no turn Smith, sir. time, David Sonic Please back the CEO Thank

David Smith

a everyone. great have time, Thank and your day. appreciate We you,

Operator

conference call. today’s concludes Thank this you gentlemen, participating. and for Ladies

disconnect. may You now

Sonic Automotive (SAH) 19 Feb 202019 Q4 Earnings call transcript