United Auto Reports Record Results; Revenue Increased 19.9% to $1.6 Billion; Net Income Increased 20.7% to $13.5 Million -$0.38 Per Share-
DETROIT--Oct. 24, 2001--United Auto Group, Inc. , a FORTUNE 500 automotive specialty retailer, announced record results for the third quarter 2001.
Third quarter revenues increased 19.9% to $1.6 billion from $1.3 billion in 2000, and net income increased 20.7% to $13.5 million. Earnings per share were $0.38 compared to $0.40 in the third quarter 2000. Earnings per share reflect a 26.1% increase in weighted average shares outstanding from 28,080,000 to 35,418,000 in 2001.
During the quarter, the Company retailed 36,835 and 17,728 new and used retail units, representing increases of 15.1% and 11.9%, respectively, versus the third quarter 2000. Gross profit increased 21.1% to $221.1 million and, most importantly, revenues from high margin service and parts operations increased 22.4% to $159.4 million.
For the nine months ended September 30, 2001, revenue increased 26.3% to $4.6 billion versus $3.6 billion in 2000, and net income increased 39.9% to $33.5 million. Nine months 2000 net earnings included an extraordinary item resulting from the retirement of debt in the second quarter of 2000. Earnings per share were $1.00, up 22.0% over the $0.82 reported in 2000. Earnings per share reflect a 14.4% increase in weighted average shares outstanding from 29,325,000 to 33,550,000 in 2001.
Roger Penske, Chairman, said, "This was a record quarter for UnitedAuto. Despite the effects of the tragic events that occurred on September 11th, which initially decreased dealership traffic, we have seen our level of business increase. Our business remains strong, as evidenced by increases in same store revenue and retail units sales. I am particularly pleased to see the Company's third quarter 2001 same store results reflect: a 4.4% increase in new retail vehicle revenues; a 4.6% increase in used retail vehicle revenues; a 22.1% increase in finance and insurance revenues; and a 7.5% increase in service and parts revenues, over the comparable prior year period. In light of our continued strong operational performance and an increase in our working capital and acquisition credit facility to nearly $1.0 billion, we believe our business is positioned for future growth."
Sam DiFeo Jr., President, added, "I am delighted with our results for the third quarter. We are realizing the benefits from our favorable brand mix and our efforts to increase service and parts operations. Our ability to increase sales while maintaining customer satisfaction levels, coupled with our efforts to reduce inventory levels, will continue to help us achieve future success."
Based upon the strong nine months results, the Company believes earnings per share will be at least $1.25 for the year ending December 31, 2001. For 2002, the Company is currently estimating that same store revenues will increase between 3% and 5%. In addition, the Company currently estimates that earnings per share will be at least $1.45, before the impact of the new accounting standard affecting the amortization of goodwill.
UnitedAuto, which pursues a strategy based on internal growth from its existing dealerships, as well as from strategic acquisitions, operates 126 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.
UnitedAuto will host a conference call discussing financial results relating to third quarter 2001 on Wednesday, October 24, 2001 at 11 A.M. Eastern time. Advance registration is not required. Participants must call (888)-396-9923 (International, please call (712)-271-3627). Calls need to be made shortly before the call is to commence. Please provide the leader's name - Roger Penske - as well as the code UAG3Q. The conference call cannot be accessed without this information. The call will also be simultaneously broadcast live over the internet through the UnitedAuto website at www.unitedauto.com.
Statements in this press release may involve forward-looking statements, including forward-looking statements regarding UnitedAuto's future reportable sales and earnings growth potential. Actual results may vary materially because of external factors such as interest rate fluctuations, changes in consumer spending and other factors over which management has no control. These forward-looking statements should be evaluated together with additional information about UnitedAuto's business, markets, conditions and other uncertainties which could effect UnitedAuto's future performance, which are contained in UnitedAuto's filings with the Securities and Exchange Commission and which are incorporated into this press release by reference.
UNITED AUTO GROUP, INC.
Consolidated Statements of Income (Unaudited)
(Amounts In Thousands, Except Per Share Data)
Third Quarter
--------------------------------------
2001 2000
---- ----
New Vehicle Sales (a) $988,522 $818,112
Used Vehicle Sales (b) 380,016 329,484
Finance and Insurance 67,885 53,373
Service and Parts 159,360 130,204
------- -------
Total Revenues 1,595,783 1,331,173
Cost of Sales 1,374,684 1,148,560
--------- ---------
Gross Profit (c) 221,099 182,613
Selling, General &
Administrative Expenses 179,592 142,453
------- -------
Operating Income 41,507 40,160
Floor Plan Interest Expense (9,522) (11,226)
Other Interest Expense (7,995) (8,681)
------- -------
Income Before Minority
Interests and Income
Tax Provision 23,990 20,253
Minority Interests (66) (162)
Income Tax Provision (10,436) (8,912)
-------- -------
Net Income $13,488 $11,179
======== =======
Diluted Earnings Per Share $0.38 $0.40
===== =====
Diluted Weighted Average
Shares Outstanding 35,418 28,080
====== ======
EBITDA (d) $40,718 $35,200
======= =======
Same Store Operating Data
New Vehicle Retail Sales $774,606 $742,269
Used Vehicle Retail Sales 239,540 228,988
Finance and Insurance 51,413 42,124
Service and Parts 131,578 122,417
------- -------
Total Same Store
Retail Revenue $1,197,137 $1,135,798
========== ==========
(a) Includes fleet sales of $40.3 million and $30.9 million in
2001 and 2000, respectively.
(b) Includes used wholesale sales of $93.9 million and $82.2
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 8.4%, 10.7%, 58.7%, and 44.8%,
respectively, compared with 8.4%, 10.8%, 60.6% and 43.6% in
the comparable prior year period.
(d) EBITDA is defined as income before minority interests, income
tax provision, other interest expense, depreciation and
amortization. Depreciation and amortization amounted to $8.7
million and $6.3 million in 2001 and 2000, respectively.
UNITED AUTO GROUP, INC.
Consolidated Statements of Income (Unaudited)
(Amounts In Thousands, Except Per Share Data)
Nine Months
--------------------------------------
2001 2000
---- ----
New Vehicle Sales (a) $2,842,230 $2,208,984
Used Vehicle Sales (b) 1,118,820 934,861
Finance and Insurance 188,899 145,077
Service and Parts 455,993 357,167
------- -------
Total Revenues 4,605,942 3,646,089
Cost of Sales 3,974,057 3,144,583
--------- ---------
Gross Profit (c) 631,885 501,506
Selling, General &
Administrative Expenses 511,330 396,209
------- -------
Operating Income 120,555 105,297
Floor Plan Interest Expense (33,447) (31,683)
Other Interest Expense (27,239) (22,974)
-------- --------
Income Before Minority
Interests, Income
Tax Provision and
Extraordinary Item 59,869 50,640
Minority Interests (364) (475)
Income Tax Provision (26,042) (22,282)
-------- --------
Income Before
Extraordinary Item 33,463 27,883
Extraordinary Item -- (3,969)
-------- --------
Net Income $33,463 $23,914
======= =======
Diluted Earnings Per Share
Before Extraordinary Item $1.00 $0.95
===== =====
Diluted Earnings Per Share $1.00 $0.82
===== =====
Diluted Weighted Average
Shares Outstanding 33,550 29,325
====== ======
EBITDA (d) $111,778 $90,961
======== =======
Same Store Operating Data
New Vehicle Retail Sales $1,882,204 $1,768,305
Used Vehicle Retail Sales 614,031 600,922
Finance and Insurance 123,367 106,669
Service and Parts 312,782 298,760
------- -------
Total Same Store
Retail Revenue $2,932,384 $2,774,656
========== ==========
(a) Includes fleet sales of $128.5 million and $105.9 million in
2001 and 2000, respectively.
(b) Includes used wholesale sales of $272.3 million and $236.2
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%, 10.6%, 58.8%, and 44.8%,
respectively, compared with 8.6%, 10.8%, 59.4% 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 $24.7 million and $17.3 million in 2001 and 2000,
respectively.
UNITED AUTO GROUP, INC.
Consolidated Condensed Balance Sheets
(Amounts In Thousands)
(Unaudited)
9/30/01 6/30/01 12/31/00
------- ------- --------
Assets
Cash and Cash
Equivalents $4,658 $1,557 $7,413
Accounts
Receivable, Net 223,550 248,443 190,792
Inventories 661,206 750,530 737,942
Other Current Assets 20,052 19,888 15,469
------ ------ ------
Total Current Assets 909,466 1,020,418 951,616
Property and
Equipment, Net 169,553 145,883 107,085
Intangible Assets, Net 743,467 741,400 664,510
Other Assets 34,601 38,494 39,484
------ ------ ------
Total Assets $1,857,087 $1,946,195 $1,762,695
========== ========== ==========
Liabilities and
Stockholders' Equity
Floor Plan
Notes Payable $637,067 $691,021 $689,687
Accounts Payable and
Accrued Expenses 146,865 132,625 127,419
Current Portion
Long - Term Debt 32,051 35,027 41,456
------ ------ ------
Total Current
Liabilities 815,983 858,673 858,562
Long - Term Debt (a) 463,590 524,759 377,721
Other Liabilities 83,549 74,422 64,742
------ ------ ------
Total Liabilities 1,363,122 1,457,854 1,301,025
Stockholders'
Equity (b) 493,965 488,341 461,670
------- ------- -------
Total Liabilities
and Stockholders'
Equity $1,857,087 $1,946,195 $1,762,695
========== ========== ==========
(a) Availability under the Company's credit facility amounts to
$226.0 million as of September 30, 2001
(b) Includes a $11.7 million decrease at September 30, 2001 due to
the impact of Statement of Financial Accounting Standards No.
133 - Accounting For Derivative Instruments and Hedging
Activities