UnitedAuto Reports Record Second Quarter Results
DETROIT--July 24, 2001--Same Store Retail Revenue and Gross Profit Increased 9.0%
and 7.6%, Respectively
United Auto Group, Inc. , a FORTUNE 500 automotive specialty retailer, announced record results for second quarter 2001.
Second quarter revenues increased 34.1% to $1.6 billion from $1.2 billion in 2000. Net income in the quarter increased 88.9% to $13.4 million and earnings per share increased 66.7% to $0.40. Earnings per share reflects a 15.3% increase in weighted average shares outstanding from 29,400,000 to 33,889,000 in the second quarter 2001. Net income for second quarter 2000 included an after-tax extraordinary charge of $4.0 million ($0.14 per share) resulting from a repurchase of the Company's 11% subordinated debt.
The Company's operations remain strong. During the quarter the Company retailed 36,410 and 17,904 new and used retail units, representing increases of 33.2% and 21.2%, respectively, versus second quarter 2000. Gross profit increased 31.3% to $219.0 million and, most importantly, revenues from high margin service and parts operations increased 33.6% to $156 million.
For the six months ended June 30, 2001, revenue increased 30.0% to $3.0 billion versus $2.3 billion in 2000. Net income for the six months ended June 30, 2001 increased 56.9% to $20.0 million compared to $12.7 million, including the extraordinary item, in the comparable prior year period. Corresponding earnings per share were $0.61, which represents a 41.9% increase over the $0.43 reported in 2000. Earnings per share reflects a 9.4% increase in weighted average shares outstanding from 29,808,000 to 32,620,000 in 2001. Based upon the strong six months results, the Company currently expects earnings per share to be between $1.21 and $1.25 for the year ending December 31, 2001.
Roger Penske, Chairman, said, "This was another outstanding quarter for UnitedAuto, with a record quarter to quarter increase in net income of nearly 89%. Our business shows signs of strengthening fundamentals, including strong contributions from recent acquisitions and impressive same store unit and revenue growth. I am particularly pleased to see the Company's second quarter 2001 same store results reflect: a 10.6% increase in new retail vehicle revenues; a 4.3% increase in used retail vehicle revenues; an 18.0% increase in finance and insurance revenues; and a 6.7% increase in service and parts revenues, over the comparable prior year period. As we move into the last half of 2001, the mix of our brand offerings provides a solid foundation for increased growth and profitability."
Sam DiFeo Jr., President, added, "We are realizing the benefit of our strong organizational structure and our efforts to enhance inventory management and increase our profitable service and parts operations. These improvements contributed to a 7.6% increase in same store retail gross profit over the corresponding period in 2000. We are also benefiting from the strength of recent acquisitions, as we fully integrate their operations into UnitedAuto."
UnitedAuto, which pursues a strategy based on internal growth from its existing dealerships, as well as from strategic acquisitions, operates 123 franchises in 19 states, Puerto Rico and Brazil. UnitedAuto dealerships sell new and used vehicles and market a complete line of aftermarket automotive products and services.
UNITED AUTO GROUP, INC.
Consolidated Statements of Operations (Unaudited)
(Amounts In Thousands, Except Per Share Data)
Second Quarter
------------------------------------
2001 2000
---- ----
New Vehicle Sales (a) $1,010,329 $727,072
Used Vehicle Sales (b) 384,207 312,306
Finance and Insurance 64,636 47,969
Service and Parts 156,011 116,802
------- -------
Total Revenues 1,615,183 1,204,149
Cost of Sales 1,396,187 1,037,369
--------- ---------
Gross Profit (c) 218,996 166,780
Selling, General &
Administrative Expenses 173,844 128,912
------- -------
Operating Income 45,152 37,868
Floor Plan Interest Expense (11,347) (10,539)
Other Interest Expense (9,576) (7,430)
------- -------
Income Before Minority
Interests, Income
Tax Provision and
Extraordinary Item 24,229 19,899
Minority Interests (284) (82)
Income Tax Provision (10,540) (8,753)
-------- -------
Income Before
Extraordinary Item 13,405 11,064
Extraordinary Item -- (3,969)
-------- -------
Net Income $13,405 $7,095
======= ======
Diluted Earnings Per Share
Before Extraordinary Item $0.40 $0.38
===== =====
Diluted Earnings Per Share $0.40 $0.24
===== =====
Diluted Weighted Average
Shares Outstanding 33,889 29,400
====== ======
EBITDA (d) $42,065 $33,033
======= =======
Same Store Operating Data
New Vehicle Retail Sales $690,034 $624,085
Used Vehicle Retail Sales 228,769 219,424
Finance and Insurance 44,327 37,553
Service and Parts 115,272 108,029
(a) Includes fleet sales of $50.6 million and $43.6 million in
2001 and 2000, respectively.
(b) Includes used wholesale sales of $89.7 million and $77.5
million in 2001 and 2000, respectively.
(c) Gross profit as a percentage of revenues for new vehicle
retail, used vehicle retail, finance and insurance and service
and parts revenues was 8.2%, 10.5%, 59.2%, and 44.7%,
respectively, compared with 8.9%, 10.7%, 58.9% and 43.7% in
the comparable prior year period.
(d) EBITDA is defined as income before minority interests, income
tax provision, extraordinary item, other interest expense,
depreciation and amortization. Depreciation and amortization
amounted to $8.3 million and $5.7 million in 2001 and 2000,
respectively.
UNITED AUTO GROUP, INC.
Consolidated Statements of Operations (Unaudited)
(Amounts In Thousands, Except Per Share Data)
First Half
--------------------------------------
2001 2000
---- ----
New Vehicle Sales (a) $1,853,708 $1,390,872
Used Vehicle Sales (b) 738,804 605,377
Finance and Insurance 121,014 91,704
Service and Parts 296,633 226,963
------- -------
Total Revenues 3,010,159 2,314,916
Cost of Sales 2,599,373 1,996,023
--------- ---------
Gross Profit (c) 410,786 318,893
Selling, General &
Administrative Expenses 331,738 253,756
------- -------
Operating Income 79,048 65,137
Floor Plan Interest Expense (23,925) (20,457)
Other Interest Expense (19,244) (14,293)
-------- --------
Income Before Minority
Interests, Income
Tax Provision and
Extraordinary Item 35,879 30,387
Minority Interests (298) (313)
Income Tax Provision (15,606) (13,370)
-------- --------
Income Before
Extraordinary Item 19,975 16,704
Extraordinary Item -- (3,969)
-------- -------
Net Income $19,975 $12,735
======= =======
Diluted Earnings Per Share
Before Extraordinary Item $0.61 $0.56
===== =====
Diluted Earnings Per Share $0.61 $0.43
===== =====
Diluted Weighted Average
Shares Outstanding 32,620 29,808
====== ======
EBITDA (d) $71,060 $55,761
======= =======
Same Store Operating Data
New Vehicle Retail Sales $1,234,673 $1,151,772
Used Vehicle Retail Sales 421,655 408,528
Finance and Insurance 79,987 69,714
Service and Parts 209,998 198,750
(a) Includes fleet sales of $88.1 million and $74.9 million in
2001 and 2000, respectively.
(b) Includes used wholesale sales of $178.3 million and $154.0
million in 2001 and 2000, respectively.
(c) Gross profit as a percentage of revenues for new vehicle
retail, used vehicle retail, finance and insurance and service
and parts revenues was 8.3%, 10.5%, 58.9%, and 44.7%,
respectively, compared with 8.8%, 10.8%, 58.8% and 43.5% in
the comparable prior year period.
(d) EBITDA is defined as income before minority interests, income
tax provision, extraordinary item, other interest expense,
depreciation and amortization. Depreciation and amortization
amounted to $15.9 million and $11.1 million in 2001 and 2000,
respectively.
UNITED AUTO GROUP, INC.
Consolidated Condensed Balance Sheets
(Amounts In Thousands)
(Unaudited)
6/30/01 6/30/00 12/31/00
------- ------- --------
Assets
Cash and Cash
Equivalents $1,557 $20,005 $7,413
Accounts Receivable, Net 248,443 165,061 190,792
Inventories 750,530 595,071 737,942
Other Current Assets 19,888 11,435 15,469
------ ------ ------
Total Current
Assets 1,020,418 791,572 951,616
Property and
Equipment, Net 145,883 90,107 107,085
Intangible Assets, Net 741,400 540,044 664,510
Other Assets 38,494 32,738 39,484
------ ------ ------
Total Assets $1,946,195 $1,454,461 $1,762,695
========== ========== ==========
Liabilities and
Stockholders' Equity
Floor Plan Notes Payable $691,021 $544,811 $689,687
Accounts Payable and
Accrued Expenses 132,625 94,962 127,419
Current Portion Long
- Term Debt 35,027 13,498 41,456
------ ------ ------
Total Current
Liabilities 858,673 653,271 858,562
Long - Term Debt (a) 524,759 335,075 377,721
Other Liabilities 74,422 45,710 64,742
------ ------ ------
Total Liabilities 1,457,854 1,034,056 1,301,025
Stockholders' Equity (b) 488,341 420,405 461,670
------- ------- -------
Total Liabilities
and Stockholders'
Equity $1,946,195 $1,454,461 $1,762,695
========== ========== ==========
(a) Availability under the Company's credit facility amounts to
$160.0 million as of June 30, 2001
(b) Includes an $8.0 million decrease at June 30, 2001 due to the
impact of Statement of Financial Accounting Standards No. 133
- Accounting For Derivative Instruments and Hedging Activities