AutoNation Earns $86.3 Million, or $0.26 Per Share, Beating
The Analysts' Second-Quarter Consensus Estimate
FORT LAUDERDALE, Fla., July 19 AutoNation, Inc.
, America's largest automotive retailer, reported results for the
2001 second quarter that beat the analysts' consensus estimate as the Company
countered softer sales of new vehicles with same-store sales growth from its
parts and service, and finance and insurance operations.
The Company said that for the second quarter ended June 30, 2001, it
earned net income of $86.3 million, or $0.26 per share, versus net income from
continuing operations of $96.6 million, or $0.27 per share, in the same period
a year ago. Excluding non-recurring gains totaling $0.02 per share in each
year, the 2001 second-quarter earnings of $0.24 per share compared to
$0.25 per share reported a year earlier, and beat the 2001 analysts' consensus
estimate of $0.23 per share. The non-recurring gains were primarily the result
of this year's sale of the Company's New Jersey-based Flemington Group of
dealerships and the gain resulting from last year's sale of certain marketable
securities. The year-ago result from continuing operations excluded $0.01 per
share of net income from discontinued operations.
"For a second consecutive quarter AutoNation has surpassed earnings
expectations while overcoming significant challenges in the new vehicle
market," said AutoNation Chief Executive Officer Mike Jackson. "We've
delivered strong operating margins and higher same-store revenue in parts and
service, and finance and insurance, while reducing debt and buying back
shares. This demonstrates our resiliency in a difficult retail environment."
Looking ahead, Mr. Jackson added, "AutoNation is on track to achieve full-
year earnings per share of $0.85 to $0.90. Our earnings per share estimate for
the 2001 third quarter is a range of $0.23 to $0.25."
During the quarter, revenue totaled $4.94 billion, down 7.4% from $5.34
billion during the same period a year ago. The Company said revenue reflected
fewer sales of new vehicles, particularly among domestic brands. The softer
new vehicle sales were partially offset by a 9.6% improvement in total finance
and insurance sales, an 1.8% improvement in total parts and service sales, and
a stable performance in used vehicle sales.
Also during the quarter, AutoNation:
* Generated earnings before interest, taxes, depreciation and amortization
(EBITDA) of $219.6 million.
* Increased the sale of finance and insurance products by 21% on a per-
vehicle-retailed basis to $694 from $575 a year ago.
* Improved the total gross margin on parts and service to 43.4%, a 30-
basis-point improvement from a year ago.
* Reduced non-vehicle debt by $134.1 million to $698.1 million or
16% during the quarter and by $159.1 million or 19% since December 31,
2000.
* Reduced new vehicle days supply by 6% to 59 days from 63 days at March
31, 2001; 29% from a December 31, 2000 mark of 83 days.
* Reduced corporate selling, general and administrative (SG&A) expenses by
10.5% from the same period a year ago, driven primarily by the
continuing disposal of excess properties.
* Repurchased 2.9 million of its shares at a cost of $30.9 million,
leaving a board-authorized amount of $137.9 million for future
repurchases.
For the six-month period ended June 30, 2001, the Company earned net
income of $146.2 million, or $0.43 per share, versus net income from
continuing operations of $161.3 million, or $0.44 per share, in the prior
year. The year-ago result excludes $0.01 per share of net income from
discontinued operations. The Company's revenue during first six months of 2001
totaled $9.83 billion versus $10.57 billion in the same period a year ago.
AutoNation will discuss its second-quarter results, its earnings outlook
and supporting assumptions later this morning during an 11 a.m. EDT conference
call. To listen to the call, dial 1-888-408-5406, or log on to the "Corporate
Site" section at http://www.autonation.com and click on the "Visit Our Corporate
Site" icon and then on the "Webcast" icon. A playback of the conference call
will be available after 12 p.m. on July 19, 2001, through Thursday, July 26,
2001, by dialing 1-800-475-6701 (access code 594914), or by visiting the
"Audio Presentations" section of the Investor Relations page at AutoNation's
corporate web site.
AutoNation, Inc., headquartered in Fort Lauderdale, Florida, is America's
largest automotive retailer, on and off the Web. A Fortune 100 company,
AutoNation employs 31,000 people and owns and operates 368 automotive retail
franchises in 17 states. For additional information, please visit
http://www.autonation.com.
Certain statements and information included in this release constitute
"forward-looking statements" within the meaning of the Federal Private
Securities Litigation Reform Act of 1995. Such forward-looking statements
involve known and unknown risks, uncertainties and other factors which may
cause the actual results, performance or achievements of the Company to be
materially different from any future results, performance or achievements
expressed or implied in such forward-looking statements. Additional discussion
of factors that could cause actual results to differ materially from
management's projections, estimates and expectations is contained in the
Company's SEC filings. The Company undertakes no duty to update its forward-
looking statements, including its earnings outlook.
AUTONATION, INC.
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In millions, except per share data)
Three Months Ended Six Months Ended
June 30, June 30,
2001 2000 2001 2000
Revenue $4,942.1 $5,339.5 $9,829.1 $10,569.7
Cost of operations 4,186.8 4,555.5 8,336.0 9,033.6
Gross margin 755.3 784.0 1,493.1 1,536.1
Selling, general and
administrative expenses 544.5 547.1 1,094.6 1,103.1
Depreciation 16.4 13.1 32.0 27.8
Amortization 20.4 19.9 40.4 38.3
Restructuring and impairment
charges, net 9.5 --- 8.7 ---
Other gain (19.0) --- (19.0) ---
Operating income 183.5 203.9 336.4 366.9
Floorplan interest expense (35.1) (51.5) (81.0) (99.0)
Other interest expense, net (6.2) (5.5) (15.8) (13.7)
Other income (expense) (0.7) 7.6 (0.8) 3.8
Income from continuing
operations before income
taxes 141.5 154.5 238.8 258.0
Provision for income taxes 55.2 57.9 92.6 96.7
Net income from continuing
operations 86.3 96.6 146.2 161.3
Income from discontinued
operations, net of income
taxes and minority interest --- 4.2 --- 1.8
Net income $86.3 $100.8 $146.2 $163.1
Diluted earnings per share:
Continuing operations $0.26 $0.27 $0.43 $0.44
Discontinued operations --- 0.01 --- 0.01
Net income $0.26 $0.28 $0.43 $0.45
Weighted average common and
common equivalent shares
outstanding 337.0 361.3 340.7 364.4
Common shares outstanding 333.1 361.1 333.1 361.1
AUTONATION, INC.
UNAUDITED SUPPLEMENTARY DATA
($ in millions, except gross margin per vehicle data)
Three Months Ended June 30,
2001 % 2000 %
Operating Highlights:
Revenue:
New vehicle $2,941.2 59.5 $3,241.8 60.7
Used vehicle 972.4 19.7 1,008.4 18.9
Parts and service 599.5 12.1 588.8 11.0
F&I 122.2 2.5 111.5 2.1
Other 306.8 6.2 389.0 7.3
$4,942.1 100.0 $5,339.5 100.0
Gross margin:
New vehicle $242.0 8.2 $275.5 8.5
Used vehicle 111.8 11.5 114.9 11.4
Parts and service 260.3 43.4 253.8 43.1
F&I 122.2 100.0 111.5 100.0
Other 19.0 6.2 28.3 7.3
755.3 15.3 784.0 14.7
S,G&A - Store 511.3 10.3 510.0 9.6
Store performance 244.0 5.0 274.0 5.1
S,G&A - Corporate 33.2 0.8 37.1 0.7
Depreciation 16.4 0.3 13.1 0.2
Amortization 20.4 0.4 19.9 0.4
Restructuring and impairment
charges, net 9.5 0.2 --- 0.0
Other gain (19.0) (0.4) --- 0.0
Operating income $183.5 3.7 $203.9 3.8
Retail vehicle sales:
New 112,000 127,000
Used 64,000 67,000
176,000 194,000
Gross margin per vehicle retailed:
New $2,161 $2,169
Used $1,747 $1,715
F&I $694 $575
EBITDA 219.6 244.5
Capital expenditures $28.8 $26.4
AUTONATION, INC.
UNAUDITED SUPPLEMENTARY DATA
($ in millions, except gross margin per vehicle data)
Six Months Ended June 30,
2001 % 2000 %
Operating Highlights:
Revenue:
New vehicle $5,808.9 59.1 $6,399.0 60.6
Used vehicle 1,949.5 19.8 2,011.7 19.0
Parts and service 1,201.0 12.2 1,176.7 11.1
F&I 233.7 2.4 218.3 2.1
Other 636.0 6.5 764.0 7.2
$9,829.1 100.0 $10,569.7 100.0
Gross margin:
New vehicle $481.0 8.3 $536.4 8.4
Used vehicle 219.2 11.2 231.3 11.5
Parts and service 518.1 43.1 500.9 42.6
F&I 233.7 100.0 218.3 100.0
Other 41.1 6.5 49.2 6.4
1,493.1 15.2 1,536.1 14.5
S,G&A - Store 1,020.7 10.4 1,019.4 9.6
Store performance 472.4 4.8 516.7 4.9
S,G&A - Corporate 73.9 0.8 83.7 0.7
Depreciation 32.0 0.3 27.8 0.3
Amortization 40.4 0.4 38.3 0.4
Restructuring and impairment
charges, net 8.7 0.1 --- 0.0
Other gain (19.0) (0.2) --- 0.0
Operating income $336.4 3.4 $366.9 3.5
Retail vehicle sales:
New 221,000 253,000
Used 129,000 134,000
350,000 387,000
Gross margin per vehicle retailed:
New $2,176 $2,120
Used $1,699 $1,726
F&I $668 $564
EBITDA 408.0 436.8
Capital expenditures 52.8 52.9
Balance Sheet and
Other Highlights: June 30, 2001 March 31, 2001 December 31, 2000
Cash and cash
equivalents $26.1 $83.0 $82.2
Inventory 2,439.3 2,597.4 2,769.2
Floorplan
financing 2,110.1 2,294.6 2,454.0
Non-vehicle debt 698.1 832.2 857.2
Equity 3,858.5 3,803.4 3,842.5
Days supply
(trailing 30 days):
New 59 days 63 days 83 days
Used 36 days 35 days 43 days
AUTONATION, INC.
UNAUDITED SAME STORE DATA
($ in millions, except gross margin per vehicle data)
Three Months Ended June 30, 2001
2001 % 2000 %
Revenue:
New vehicle $2,809.7 59.6 $3,097.1 61.3
Used vehicle 927.8 19.7 949.0 18.8
Parts and service 566.4 12.0 549.9 10.9
F&I 115.3 2.4 105.7 2.1
Other 295.7 6.3 351.2 6.9
$4,714.9 100.0 $5,052.9 100.0
Gross margin:
New vehicle $232.4 8.3 $263.4 8.5
Used vehicle 105.9 11.4 108.0 11.4
Parts and service 246.5 43.5 236.9 43.1
F&I 115.3 100.0 105.7 100.0
Other 15.6 5.3 25.2 7.2
715.7 15.2 739.2 14.6
S,G&A - Store 485.9 10.3 478.7 9.5
Store performance $229.8 4.9 $260.5 5.1
Retail vehicle sales:
New 107,000 122,000
Used 61,000 62,000
168,000 184,000
Gross margin per vehicle retailed:
New $2,172 $2,159
Used $1,736 $1,742
F&I $686 $574
AUTONATION, INC.
UNAUDITED SAME STORE DATA
($ in millions, except gross margin per vehicle data)
Six Months Ended June 30, 2001
2001 % 2000 %
Revenue:
New vehicle $5,474.9 59.3 $6,087.9 61.2
Used vehicle 1,829.5 19.8 1,864.2 18.8
Parts and service 1,119.1 12.1 1,090.8 11.0
F&I 218.9 2.4 206.0 2.1
Other 592.8 6.4 692.4 6.9
$9,235.2 100.0 $9,941.3 100.0
Gross margin:
New vehicle $454.9 8.3 $512.0 8.4
Used vehicle 206.4 11.3 214.0 11.5
Parts and service 483.4 43.2 464.2 42.6
F&I 218.9 100.0 206.0 100.0
Other 33.2 5.6 44.8 6.5
1,396.8 15.1 1,441.0 14.5
S,G&A - Store 952.3 10.3 948.4 9.5
Store performance $444.5 4.8 $492.6 5.0
Retail vehicle sales:
New 208,000 241,000
Used 120,000 124,000
328,000 365,000
Gross margin per vehicle retailed:
New $2,187 $2,124
Used $1,720 $1,726
F&I $667 $564
