Asbury Automotive Group Announces 2011 Second Quarter Financial Results

DULUTH, GA--July 26, 2011: Asbury Automotive Group, Inc. , one of the largest automotive retail and service companies in the U.S., today reported adjusted income from continuing operations for the second quarter 2011 of $16.8 million, or $0.51 per diluted share, versus income from continuing operations in the second quarter 2010 of $13.1 million, or $0.40 per diluted share, a 28% increase per diluted share. Net income for the second quarter 2011 was $14.2 million, or $0.43 per diluted share, compared to $12.8 million, or $0.39 per diluted share in the prior year period. See attached reconciliation for reported adjustments.

Second Quarter 2011 Highlights (compared to the prior year period):

• Total revenues increased 9% to $1.1 billion
• New vehicle revenues increased 5%, including 2% from same store revenues
• Used vehicle retail revenues and units up 22%, including 17% from same store revenues
• Finance and insurance revenues up 20%
• Total gross profit up 14% with strong increases from all business lines
• Adjusted SG&A expense as a percent of gross profit improved 130 basis points to 75.1%
• J6 inventories down approximately 50% versus March 2011 (see tables below)

Strategic Updates:

• Board elected Thomas C. DeLoach, Jr. as Non-Executive Chairman effective as of August 1, 2011
• Repurchased $13 million of Asbury common stock during the quarter
• Board increased share repurchase authorization in July; $45 million remaining
• Reducing leverage target to 3.0x Total Debt/EBITDA
• Acquired $13 million of previously leased properties during the quarter
• Subsequent to the end of the quarter, repurchased $9 million of the convertible notes due 2012
• 65% of the DMS conversions completed to date

"Once again, Asbury is pleased to announce double-digit growth in adjusted EPS from continuing operations, proving both the resiliency of our business model and the agility of our Company," said Craig T. Monaghan, Asbury's President and CEO. "We produced these excellent results through a dramatic 70 basis point improvement in our new vehicle margins, achieving a Company record used-to-new ratio, and setting a Company record increase in finance and insurance profit per vehicle retailed."

Commenting on the Japanese supply challenges, Michael S. Kearney, Asbury's Executive Vice President and Chief Operating Officer stated, "We are encouraged by the speed and efficiency with which our Japanese manufacturing partners are restoring production capacity, and admire their dedication. Our Japanese dealerships are experiencing the impact of inventory shortages; we anticipate that our affected inventories will bottom-out in July or August. We believe our third quarter earnings could be adversely impacted in the range of $0.05-0.10 per diluted share as a result of disruptions in the market. Our results will depend on, amongst other things, SAAR, when production reaches normalized levels, and when we are able to receive a more favorable mix of product at our dealerships. We believe this will be a short-term issue and expect much healthier inventory levels heading into the fourth quarter."

Asbury will host a conference call to discuss its second quarter results this afternoon at 2:00 p.m. Eastern Time.  The call will be simulcast live on the Internet and can be accessed by logging onto Asbury Auto or CCBN. In addition, a live audio of the call will be accessible to the public by calling (800) 768-6563 (domestic), or (785) 830-7991 (international); passcode - 4451418. Callers should dial in approximately 5 to 10 minutes before the call begins.

About Asbury Automotive Group, Inc.

Asbury Automotive Group, Inc. ("Asbury"), headquartered in Duluth, Georgia, a suburb of Atlanta, is one of the largest automobile retailers in the U.S.  Built through a combination of organic growth and a series of strategic acquisitions, Asbury currently operates 80 retail auto stores, encompassing 99 franchises for the sale and servicing of 29 different brands of American, European and Asian automobiles.  Asbury offers customers an extensive range of automotive products and services, including new and used vehicle sales and related financing and insurance, vehicle maintenance and repair services, replacement parts and service contracts.