Asbury Automotive Group Reports Second Quarter Earnings of $0.18 Per Diluted Share from Continuing Operations
DULUTH, Ga., July 30 -- Asbury Automotive Group, Inc. , one of the largest automotive retail and service companies in the U.S., today reported financial results for the second quarter and six months ended June 30, 2009.
Income from continuing operations for the second quarter was $6.0 million, or $0.18 per diluted share, compared to $10.9 million, or $0.34 per diluted share, in the corresponding period last year. Results for both periods included non-core items that reduced earnings by $0.04 per diluted share, as disclosed in the attached tables. Net income for the second quarter of 2009 totaled $5.5 million, or $0.17 per diluted share, compared with $10.4 million, or $0.32 per diluted share, a year ago.
For the first six months of 2009, income from continuing operations was $7.8 million, or $0.24 per diluted share, compared with $21.4 million, or $0.66 per diluted share, in the corresponding period last year. Non-core items, as disclosed in the attached tables, reduced earnings by $0.04 per diluted share in the first half of 2009, and by $0.05 per diluted share in the six-month period a year ago.
"We are pleased to report further sequential improvement in our operating results for the second quarter, building on the momentum established in the first quarter," said Charles R. Oglesby, Asbury's President and CEO. "U.S. new vehicle sales have essentially stabilized, but at a historically low level. Against this backdrop, we continued to focus on executing our organizational restructuring and store-level productivity initiatives, and, on a rolling twelve month basis, reduced same store SG&A expense by more than $100 million compared to the prior rolling twelve month period. Also, we have aligned our inventory levels with the current sales environment. As of June 30, our new light vehicle inventory was at 69 days' sales and our used vehicle inventory was at 38 days' sales."
Last Friday, Asbury disclosed that we successfully renegotiated the covenants in our principal credit facilities. Total leverage ratio covenants have been permanently removed and fixed charge ratio covenants have been eased for a period of time. In return, Asbury has agreed to additional restrictions on new indebtedness and to a reduction in the amount of its revolving credit facility.
Craig T. Monaghan, Asbury's Senior Vice President and Chief Financial Officer, said, "Our disciplined working capital management and ongoing restructuring program continue to strengthen Asbury's liquidity position. At the end of the quarter, we had $42 million in cash on hand. As a result of our recent amendments, we have $170 million in available borrowing capacity under our credit facilities today."
Mr. Monaghan commented, "The continued responsiveness and support of our financial partners speak volumes about the strength of these critical relationships. The covenant changes we have negotiated significantly enhance our financial flexibility during this challenging sales environment."
Mr. Oglesby concluded, "Overall, Asbury continues to make excellent progress towards its longer-term goal of creating the optimal operating structure for our company. With a more streamlined, efficient organization, we will be able to leverage the inherent strengths of our dealership portfolio more effectively as vehicle sales recover."
Asbury will host a conference call to discuss its second quarter results this morning at 10:00 a.m. Eastern Time. The call will be simulcast live on the Internet and can be accessed by logging onto http://www.asburyauto.com/ or http://www.ccbn.com/. In addition, a live audio of the call will be accessible to the public by calling (877) 874-1586 (domestic), or (719) 325-4758 (international); passcode - 3624773. Callers should dial in approximately 5 to 10 minutes before the call begins.
About Asbury Automotive Group
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 84 retail auto stores, encompassing 110 franchises for the sale and servicing of 37 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.
Forward-Looking Statements
This press release contains "forward-looking statements" as that term is defined in the Private Securities Litigation Reform Act of 1995. The forward-looking statements include statements relating to goals, plans, market conditions and projections regarding Asbury's financial position, liquidity, results of operations, market position and dealership portfolio, the benefits of its restructuring program and store-level and IT productivity initiatives, ability to structure the business to be profitable in the current challenging economic environment, ability to maintain compliance with the covenants in its debt and lease agreements and future business strategy. These statements are based on management's current expectations and involve significant risks and uncertainties that may cause results to differ materially from those set forth in the statements. These risks and uncertainties include, among other things, market factors, Asbury 's relationships with, and financial stability of, vehicle manufacturers and other suppliers, risks associated with Asbury 's indebtedness (including available borrowing capacity and compliance with its financial covenants), Asbury's relationship with, and the financial stability of, its lenders and lessors, risks related to competition in the automotive retail and service industries, general economic conditions both nationally and locally, governmental regulations, legislation and Asbury 's ability to execute its restructuring programs and IT initiatives and other operational strategies, Asbury's ability to leverage gains from its dealership portfolio, and Asbury's ability to stay within its targeted range for capital expenditures. There can be no guarantees that Asbury's plans for future operations will be successfully implemented or that they will prove to be commercially successful. These and other risk factors are discussed in Asbury's annual report on Form 10-K and in its other filings with the Securities and Exchange Commission. We undertake no obligation to publicly update any forward-looking statement, whether as a result of new information, future events or otherwise.
Investors May Contact:
Ryan Marsh
Treasurer
(770) 418-8211
investor@asburyauto.com
Reporters May Contact:
Anuj Baveja
RF|Binder Partners
(212) 994-7552
anuj.baveja@RFBinder.com
ASBURY AUTOMOTIVE GROUP, INC.
CONSOLIDATED STATEMENTS OF INCOME
(In millions, except per share data)
(Unaudited)
For the Three Months For the Six Months
Ended June 30, Ended June 30,
-----------------------------------------
2009 2008 2009 2008
REVENUES:
New vehicle $517.7 $743.7 $958.3 $1,438.4
Used vehicle 242.4 289.2 451.3 587.7
Parts and service 159.7 169.2 321.7 336.6
Finance and insurance, net 22.6 36.8 43.3 73.0
---- ---- ---- ----
Total revenues 942.4 1,238.9 1,774.6 2,435.7
COST OF SALES:
New vehicle 483.3 693.3 896.5 1,341.6
Used vehicle 222.4 263.9 411.7 535.7
Parts and service 80.8 82.8 163.7 165.8
---- ---- ----- -----
Total cost of sales 786.5 1,040.0 1,471.9 2,043.1
----- ------- ------- -------
GROSS PROFIT 155.9 198.9 302.7 392.6
OPERATING EXPENSES:
Selling, general and
administrative 126.7 156.2 249.7 311.1
Depreciation and amortization 5.9 5.4 12.0 10.5
Other operating (income)
expense, net (0.4) 2.0 (0.8) 1.7
----- --- ----- ---
Income from operations 23.7 35.3 41.8 69.3
OTHER INCOME (EXPENSE):
Floor plan interest expense (4.7) (7.5) (9.6) (15.8)
Other interest expense (9.0) (9.3) (19.0) (18.3)
Convertible debt discount
amortization (0.5) (0.8) (0.9) (1.6)
Interest income 0.1 0.3 0.1 1.3
--- --- --- ---
Total other expense, net (14.1) (17.3) (29.4) (34.4)
------ ------ ------ ------
Income before income taxes 9.6 18.0 12.4 34.9
INCOME TAX EXPENSE 3.6 7.1 4.6 13.5
--- --- --- ----
INCOME FROM CONTINUING OPERATIONS 6.0 10.9 7.8 21.4
DISCONTINUED OPERATIONS,
net of tax (0.5) (0.5) (2.0) (0.9)
----- ----- ----- -----
NET INCOME $5.5 $10.4 $5.8 $20.5
==== ===== ==== =====
EARNINGS (LOSS) PER COMMON SHARE:
BASIC -
Continuing operations $0.19 $0.34 $0.24 $0.68
Discontinued operations (0.02) (0.01) (0.06) (0.03)
------ ------ ------ ------
Net income $0.17 $0.33 $0.18 $0.65
===== ===== ===== =====
DILUTED -
Continuing operations $0.18 $0.34 $0.24 $0.66
Discontinued operations (0.01) (0.02) (0.06) (0.02)
------ ------ ------ ------
Net income $0.17 $0.32 $0.18 $0.64
===== ===== ===== =====
WEIGHTED AVERAGE COMMON
SHARES OUTSTANDING:
Basic 32.2 31.7 32.1 31.6
==== ==== ==== ====
Diluted 33.2 32.2 33.0 32.2
==== ==== ==== ====
ASBURY AUTOMOTIVE GROUP, INC.
SELECTED DATA
(Dollars in millions, except per vehicle data)
(Unaudited)
As Reported for
the Three Months
Ended June 30,
------------------ Increase
2009 2008 (Decrease) % Change
---- ---- --------- --------
REVENUE:
New light vehicles $483.1 $696.1 $(213.0) (31%)
New heavy trucks 34.6 47.6 (13.0) (27%)
---- ----
Total new vehicle 517.7 743.7 (226.0) (30%)
Used retail 194.9 224.0 (29.1) (13%)
Used wholesale 47.5 65.2 (17.7) (27%)
---- ----
Total used vehicle 242.4 289.2 (46.8) (16%)
Parts and service 159.7 169.2 (9.5) (6%)
Finance and insurance, net 22.6 36.8 (14.2) (39%)
---- ----
Total revenue $942.4 $1,238.9 $(296.5) (24%)
====== ========
GROSS PROFIT
New light vehicles $33.0 $48.4 $(15.4) (32%)
New heavy trucks 1.4 2.0 (0.6) (30%)
--- ---
Total new 34.4 50.4 (16.0) (32%)
Used retail 20.6 25.7 (5.1) (20%)
Used wholesale (0.6) (0.4) (0.2) (50%)
----- -----
Total used vehicle 20.0 25.3 (5.3) (21%)
Parts and service 78.9 86.4 (7.5) (9%)
Finance and insurance, net 22.6 36.8 (14.2) (39%)
---- ----
Total gross profit $155.9 $198.9 $(43.0) (22%)
====== ======
VEHICLES SOLD:
New light retail vehicles 15,770 23,371 (7,601) (33%)
New fleet vehicles 741 688 53 8%
--- ---
Total light vehicles 16,511 24,059 (7,548) (31%)
New heavy trucks 508 698 (190) (27%)
--- ---
Total new vehicle 17,019 24,757 (7,738) (31%)
====== ======
Used retail units 10,655 12,666 (2,011) (16%)
====== ======
REVENUE PER VEHICLE SOLD:
New light vehicles $29,259 $28,933 $326 1%
New heavy trucks 68,110 68,195 (85) -%
Used retail 18,292 17,685 607 3%
GROSS PROFIT PER VEHICLE SOLD:
New light vehicles $1,999 $2,012 $(13) (1%)
New heavy trucks 2,756 2,865 (109) (4%)
Used retail 1,933 2,029 (96) (5%)
Finance and insurance, net 817 983 (166) (17%)
GROSS PROFIT MARGIN:
New light vehicles 6.8% 7.0% (0.2%) (3%)
New heavy trucks 4.0% 4.2% (0.2%) (5%)
Used retail 10.6% 11.5% (0.9%) (8%)
Parts and service 49.4% 51.1% (1.7%) (3%)
----- -----
Total 16.5% 16.1% 0.4% 2%
===== =====
REVENUE MIX PERCENTAGES:
New light vehicles 51.3% 56.2%
New heavy trucks 3.7% 3.8%
Used retail 20.7% 18.0%
Used wholesale 5.0% 5.3%
Parts and service 16.9% 13.7%
Finance and insurance, net 2.4% 3.0%
---- ----
Total revenue 100.0% 100.0%
====== ======
GROSS PROFIT MIX PERCENTAGES:
New light vehicles 21.2% 24.3%
New heavy trucks 0.9% 1.0%
Used retail 13.2% 13.0%
Used wholesale (0.4%) (0.2%)
Parts and service 50.6% 43.4%
Finance and insurance, net 14.5% 18.5%
----- -----
Total gross profit 100.0% 100.0%
====== ======
SG&A EXPENSES AS A PERCENTAGE
OF GROSS PROFIT 81.3% 78.5% 2.8 4%
===== =====
Same Store for
the Three Months
Ended June 30,
------------------ Increase
2009 2008 (Decrease) % Change
---- ---- ---------- --------
REVENUE:
New light vehicles $482.9 $696.1 $(213.2) (31%)
New heavy trucks 34.6 47.6 (13.0) (27%)
---- ----
Total new vehicle 517.5 743.7 (226.2) (30%)
Used retail 194.6 224.0 (29.4) (13%)
Used wholesale 47.5 65.2 (17.7) (27%)
---- ----
Total used vehicle 242.1 289.2 (47.1) (16%)
Parts and service 159.7 169.2 (9.5) (6%)
Finance and insurance, net 22.6 36.8 (14.2) (39%)
---- ----
Total revenue $941.9 $1,238.9 $(297.0) (24%)
====== ========
GROSS PROFIT
New light vehicles $33.0 $48.4 $(15.4) (32%)
New heavy trucks 1.4 2.0 (0.6) (30%)
--- ---
Total new 34.4 50.4 (16.0) (32%)
Used retail 20.3 25.7 (5.4) (21%)
Used wholesale (0.4) (0.4) - -
----- -----
Total used vehicle 19.9 25.3 (5.4) (21%)
Parts and service 78.9 86.4 (7.5) (9%)
Finance and insurance, net 22.6 36.8 (14.2) (39%)
---- ----
Total gross profit $155.8 $198.9 $(43.1) (22%)
====== ======
VEHICLES SOLD:
New light retail vehicles 15,759 23,371 (7,612) (33%)
New fleet vehicles 741 688 53 8%
--- ---
Total light vehicles 16,500 24,059 (7,559) (31%)
New heavy trucks 508 698 (190) (27%)
--- ---
Total new vehicle 17,008 24,757 (7,749) (31%)
====== ======
Used retail units 10,649 12,666 (2,017) (16%)
====== ======
Same Store for
the Three Months
Ended June 30,
------------------ Increase
2009 2008 (Decrease) % Change
---- ---- ---------- --------
REVENUE PER VEHICLE SOLD:
New light vehicles $29,267 $28,933 $334 1%
New heavy trucks 68,110 68,195 (85) 0%
Used retail 18,274 17,685 589 3%
GROSS PROFIT PER VEHICLE SOLD:
New light vehicles $2,000 $2,012 $(12) (1%)
New heavy trucks 2,756 2,865 (109) (4%)
Used retail 1,906 2,029 (123) (6%)
Finance and insurance, net 817 983 (166) (17%)
GROSS PROFIT MARGIN:
New light vehicles 6.8% 7.0% (0.2%) (3%)
New heavy trucks 4.0% 4.2% (0.2%) (5%)
Used retail 10.4% 11.5% (1.1%) (10%)
Parts and service 49.4% 51.1% (1.7%) (3%)
----- -----
Total 16.5% 16.1% 0.4% 2%
===== =====
REVENUE MIX PERCENTAGES:
New light vehicles 51.3% 56.2%
New heavy trucks 3.7% 3.8%
Used retail 20.7% 18.0%
Used wholesale 5.0% 5.3%
Parts and service 16.9% 13.7%
Finance and insurance, net 2.4% 3.0%
---- ----
Total revenue 100.0% 100.0%
====== ======
Gross profit mix percentages:
New light vehicles 21.2% 24.3%
New heavy trucks 0.9% 1.0%
Used retail 13.2% 13.0%
Used wholesale (0.4%) (0.2%)
Parts and service 50.6% 43.4%
Finance and insurance, net 14.5% 18.5%
----- -----
Total gross profit 100.0% 100.0%
====== ======
SG&A EXPENSES AS A PERCENTAGE
OF GROSS PROFIT 81.3% 78.5% 2.8 4%
===== =====
ASBURY AUTOMOTIVE GROUP, INC.
SELECTED DATA
(Dollars in millions, except per vehicle data)
(Unaudited)
As Reported for
the Six Months
Ended June 30,
------------------- Increase
2009 2008 (Decrease) % Change
---- ---- ---------- --------
REVENUE:
New light vehicles $887.2 $1,354.2 $(467.0) (34%)
New heavy trucks 71.1 84.2 (13.1) (16%)
---- ----
Total new vehicle 958.3 1,438.4 (480.1) (33%)
Used retail 366.1 453.4 (87.3) (19%)
Used wholesale 85.2 134.3 (49.1) (37%)
---- -----
Total used vehicle 451.3 587.7 (136.4) (23%)
Parts and service 321.7 336.6 (14.9) (4%)
Finance and insurance, net 43.3 73.0 (29.7) (41%)
---- ----
Total revenue $1,774.6 $2,435.7 $(661.1) (27%)
======== ========
GROSS PROFIT
New light vehicles $58.8 $93.1 $(34.3) (37%)
New heavy trucks 3.0 3.7 (0.7) (19%)
--- ---
Total new 61.8 96.8 (35.0) (36%)
Used retail 39.9 52.7 (12.8) (24%)
Used wholesale (0.3) (0.7) 0.4 57%
----- -----
Total used vehicle 39.6 52.0 (12.4) (24%)
Parts and service 158.0 170.8 (12.8) (7%)
Finance and insurance, net 43.3 73.0 (29.7) (41%)
---- ----
Total gross profit $302.7 $392.6 $(89.9) (23%)
====== ======
VEHICLES SOLD:
New light retail vehicles 28,927 44,310 (15,383) (35%)
New fleet vehicles 1,200 2,018 (818) (41%)
----- -----
Total light vehicles 30,127 46,328 (16,201) (35%)
New heavy trucks 1,092 1,305 (213) (16%)
----- -----
Total new vehicle 31,219 47,633 (16,414) (34%)
====== ======
Used retail units 20,343 25,344 (5,001) (20%)
====== ======
REVENUE PER VEHICLE SOLD:
New light vehicles $29,449 $29,231 $218 1%
New heavy trucks 65,110 64,521 589 1%
Used retail 17,996 17,890 106 1%
GROSS PROFIT PER VEHICLE SOLD:
New light vehicles $1,952 $2,010 $(58) (3%)
New heavy trucks 2,747 2,835 (88) (3%)
Used retail 1,961 2,079 (118) (6%)
Finance and insurance, net 840 1,000 (160) (16%)
GROSS PROFIT MARGIN:
New light vehicles 6.6% 6.9% (0.3%) (4%)
New heavy trucks 4.2% 4.4% (0.2%) (5%)
Used retail 10.9% 11.6% (0.7%) (6%)
Parts and service 49.1% 50.7% (1.6%) (3%)
----- -----
Total 17.1% 16.1% 1% 6%
===== =====
REVENUE MIX PERCENTAGES:
New light vehicles 50.0% 55.6%
New heavy trucks 4.0% 3.5%
Used retail 20.7% 18.6%
Used wholesale 4.8% 5.5%
Parts and service 18.1% 13.8%
Finance and insurance, net 2.4% 3.0%
---- ----
Total revenue 100.0% 100.0%
====== ======
GROSS PROFIT MIX PERCENTAGES:
New light vehicles 19.4% 23.7%
New heavy trucks 1.0% 0.9%
Used retail 13.2% 13.5%
Used wholesale (0.1%) (0.2%)
Parts and service 52.2% 43.5%
Finance and insurance, net 14.3% 18.6%
----- -----
Total gross profit 100.0% 100.0%
====== ======
SG&A EXPENSES AS A PERCENTAGE
OF GROSS PROFIT 82.5% 79.2% 3.3 4%
===== =====
Same Store for
the Six Months
Ended June 30,
------------------- Increase
2009 2008 (Decrease) % Change
---- ---- ---------- --------
REVENUE:
New light vehicles $881.2 $1,354.2 $(473.0) (35%)
New heavy trucks 71.1 84.2 (13.1) (16%)
---- ----
Total new vehicle 952.3 1,438.4 (486.1) (34%)
Used retail 364.1 453.4 (89.3) (20%)
Used wholesale 84.5 134.3 (49.8) (37%)
---- -----
Total used vehicle 448.6 587.7 (139.1) (24%)
Parts and service 319.4 336.6 (17.2) (5%)
Finance and insurance, net 43.0 73.0 (30.0) (41%)
---- ----
Total revenue $1,763.3 $2,435.7 $(672.4) (28%)
======== ========
GROSS PROFIT
New light vehicles $58.4 $93.1 $(34.7) (37%)
New heavy trucks 3.0 3.7 (0.7) (19%)
--- ---
Total new 61.4 96.8 (35.4) (37%)
Used retail 39.7 52.7 (13.0) (25%)
Used wholesale (0.3) (0.7) 0.4 57%
----- -----
Total used vehicle 39.4 52.0 (12.6) (24%)
Parts and service 156.9 170.8 (13.9) (8%)
Finance and insurance, net 43.0 73.0 (30.0) (41%)
---- ----
Total gross profit $300.7 $392.6 $(91.9) (23%)
====== ======
VEHICLES SOLD:
New light retail vehicles 28,676 44,310 (15,634) (35%)
New fleet vehicles 1,200 2,018 (818) (41%)
----- -----
Total light vehicles 29,876 46,328 (16,452) (36%)
New heavy trucks 1,092 1,305 (213) (16%)
----- -----
Total new vehicle 30,968 47,633 (16,665) (35%)
====== ======
Used retail units 20,210 25,344 (5,134) (20%)
====== ======
Same Store for
the Six Months
Ended June 30,
----------------- Increase
2009 2008 (Decrease) % Change
---- ---- ---------- --------
REVENUE PER VEHICLE SOLD:
New light vehicles $29,495 $29,231 $264 1%
New heavy trucks 65,100 64,521 579 1%
Used retail 18,016 17,890 126 1%
GROSS PROFIT PER VEHICLE SOLD:
New light vehicles $1,955 $2,010 $(55) (3%)
New heavy trucks 2,747 2,835 (88) (3%)
Used retail 1,964 2,079 (115) (6%)
Finance and insurance, net 840 1,000 (160) (16%)
GROSS PROFIT MARGIN:
New light vehicles 6.6% 6.9% (0.3%) (4%)
New heavy trucks 4.2% 4.4% (0.2%) (5%)
Used retail 10.9% 11.6% (0.7%) (6%)
Parts and service 49.1% 50.7% (1.6%) (3%)
----- -----
Total 17.1% 16.1% 1.0% 6%
===== =====
REVENUE MIX PERCENTAGES:
New light vehicles 50.0% 55.6%
New heavy trucks 4.0% 3.5%
Used retail 20.7% 18.6%
Used wholesale 4.8% 5.5%
Parts and service 18.1% 13.8%
Finance and insurance, net 2.4% 3.0%
---- ----
Total revenue 100.0% 100.0%
====== ======
Gross profit mix percentages:
New light vehicles 19.4% 23.7%
New heavy trucks 1.0% 0.9%
Used retail 13.2% 13.5%
Used wholesale (0.1%) (0.2%)
Parts and service 52.2% 43.5%
Finance and insurance, net 14.3% 18.6%
----- -----
Total gross profit 100.0% 100.0%
====== ======
SG&A EXPENSES AS A PERCENTAGE
OF GROSS PROFIT 82.6% 79.2% 3.4 4%
===== =====
ASBURY AUTOMOTIVE GROUP, INC.
Selected Balance Sheet Data
(In millions)
(Unaudited)
June 30, December 31, Increase % Change
2009 2008 (Decrease)
------- ----------- --------- ---------
Selected Balance Sheet Data
Cash and cash equivalents $41.9 $91.6 $(49.7) (54.3%)
New vehicle inventory 414.6 562.2 (147.6) (26.3%)
Used vehicle inventory 71.0 59.9 11.1 18.5%
Parts inventory 43.7 44.5 (0.8) (1.8%)
Total current assets 821.3 1,019.7 (198.4) (19.5%)
Floor plan notes payable 456.1 612.8 (156.7) (25.6%)
Total current liabilities 626.5 854.5 (228.0) (26.7%)
CAPITALIZATION:
Long-term debt
(including current portion) $547.5 $599.7 $(52.2) (8.7%)
Shareholders' equity 233.3 226.6 6.7 3.0%
----- ----- --- ---
Total $780.8 $826.3 $(45.5) (5.5%)
Brand Mix - New Light Vehicle by Revenue For the Six Months Ended
June 30,
-------------------
2009 2008
---- ----
Luxury
BMW 10% 9%
Mercedes-Benz 6% 6%
Lexus 5% 6%
Acura 4% 5%
Infiniti 4% 4%
Other luxury 5% 5%
---- ----
Total luxury 34% 35%
Mid-Line Imports:
Honda 27% 28%
Toyota 10% 10%
Nissan 12% 12%
Other imports 4% 3%
---- ----
Total imports 53% 53%
Mid-Line Domestic:
Ford 7% 5%
General motors 2% 3%
Chrysler 3% 3%
---- ----
Total domestic 12% 11%
Value 1% 1%
---- ----
Total Light Vehicles 100% 100%
==== ====
Asbury Automotive Group, Inc.
Supplemental Disclosures Regarding Non-GAAP Financial Information
(Dollars in millions, except per share data)
(Unaudited)
Our operations during the first six months of 2009 and 2008 were
impacted by certain items that are not core dealership operating
items, which we believe are important to highlight when reviewing our
results and should not be considered when forecasting our future results.
The non-core items shown in the table below include (i) restructuring
costs consisting primarily of severance and retention expenses related
to the relocation of our corporate headquarters and the elimination of
our regional management structure, (ii) executive separation benefits in
2008 related to the departure of our former chief financial officer, (iii)
implementation costs associated with transitioning our dealerships to
DealerTrack's Arkona dealer management system and (iv) a legal settlements
benefit in 2009 related to legal claims arising in, and before, the year
2003.
For the Three
Months Ended
June 30,
---------------
2009 2008
---- ----
Non-core items - (income) expense
Restructuring costs $1.7 $0.3
Executive separation benefits expense - 1.7
Dealer management system implementation costs 0.1 0.3
Tax benefit of non-core items above (0.6) (0.9)
Total $1.2 $1.4
Non-core items per dilutive share $0.04 $0.04
Weighted average common shares outstanding (diluted) 33.2 32.2
As Reported for the
Six Months Ended
June 30,
--------------------
2009 2008
------- -------
Non-core items - (income) expense
Restructuring costs $3.0 $0.3
Executive separation benefits expense - 1.7
Dealer management system implementation costs 0.3 0.6
Legal settlements benefit (1.5) -
Tax benefit of non-core items above (0.6) (1.0)
Total $1.2 $1.6
Non-core items per dilutive share $0.04 $0.05
Weighted average common shares outstanding (diluted) 33.0 32.2
Asbury Automotive Group, Inc.
Summary of Debt Covenants
As of and for the Period Ended June 30, 2009
(Dollars in millions, except per vehicle data)
(Unaudited)
Wachovia Credit
Mortgages Facilities
--------- ----------
Senior Leverage Ratio must be < 3.00
SECURED DEBT (numerator)
+ Mortgage notes payable (including
mortgages associated with assets held
for sale) $182.1
+ Borrowings under Revolving Credit
Facility -
+ Capital lease obligations 0.2
+ Interest rate SWAP obligations -
+ Other indebtedness 0.1
= TOTAL SECURED DEBT (ex floorplan) $182.4
EBITDA (denominator)
+ Income from continuing operations -
trailing 12 months ("T12") $(342.3)
+ Add back Total interest expense (ex
floorplan interest) - T12 43.0
+ Add back Income tax expense - T12 (146.0)
+ Add back Depreciation & amortization - T12 24.3
+ Add back Accounting changes from gain on
debt repurchase 6.3
+ Add back Other non-cash charges - T12 540.1
= CONSOLIDATED EBITDA 125.4
+ Add back Pro forma acquisitions EBITDA
(as defined) -
+ Add back Pro forma rent savings (as
defined) -
= CONSOLIDATED PROFORMA EBITDA $125.4
SENIOR LEVERAGE RATIO 1.45
Total Leverage Ratio must be < 5.00
TOTAL DEBT (numerator)
+ 8.0% Sr. Subordinated Notes (face value
outstanding) $179.4 $179.4
+ 7.625% Sr. Subordinated Notes 143.2 143.2
+ 3.0% Convertible Notes 62.0 62.0
+ Mortgage notes payable (including
mortgages associated with assets held
for sale) 182.1 182.1
+ Borrowings under Revolving Credit
Facility - -
+ Direct reimbursement obligations under
letters of credit 11.4 -
+ Capital lease obligations 0.2 0.2
+ Interest rate SWAP obligations 8.4 -
+ Other indebtedness (as defined) 1.8 0.1
= TOTAL DEBT (ex Floorplan) $588.5 $567.0
EBITDA (denominator)
+ Income from continuing operations -
trailing 12 months ("T12") $(342.3) $(342.3)
+ Add back Total interest expense (ex
floorplan) - T12 43.0 43.0
+ Add back Income tax expense - T12 (146.0) (146.0)
+ Add back Depreciation & amortization - T12 24.3 24.3
+ Add back Accounting changes from gain on
debt repurchase 6.3 6.3
+ Add back Other non-cash charges - T12 546.4 540.1
+ Add back Non-recurring items - T12 11.0 -
= CONSOLIDATED EBITDA 142.7 125.4
+ Add back Pro forma acquisitions EBITDA
(as defined) - -
+ Add back Pro forma rent savings (as
defined) - -
= CONSOLIDATED PROFORMA EBITDA $142.7 $125.4
TOTAL LEVERAGE RATIO 4.12 4.52
Fixed Charge Coverage Ratio must be > 1.2
EBITDAR (numerator)
+ Income from continuing operations -
trailing 12 months ("T12") $(342.3) $(342.3)
+ Add back Total interest expense (ex
floorplan) - T12 43.0 43.0
+ Add back Income tax expense - T12 (146.0) (146.0)
+ Add back Depreciation & amortization - T12 24.3 24.3
+ Add back Accounting changes from gain on
debt repurchase 6.3 6.3
+ Add back Other non-cash charges - T12 (as
defined) 546.4 540.1
+ Add back Non-recurring items - T12 (as
defined) 11.0 -
= CONSOLIDATED EBITDA 142.7 125.4
+ PLUS Required principal payments - T12 41.3 41.3
- LESS Capital expenditures (as defined) (16.8) (12.5)
= TOTAL EARNINGS AVAILABLE FOR FIXED CHARGES $167.2 $154.2
FIXED CHARGES (denominator)
+ Total interest expense (ex Floorplan
Interest) - T12 $43.0 $43.0
- LESS rest associated with convertible
notes - T12 (2.4) (2.4)
+ PLUS Required principal payments - T12 8.8 8.8
+ PLUS Rental expense - T12 41.3 41.3
- LESS Pro forma rent savings (as defined) - -
+ PLUS Cash paid for taxes - T12 3.7 3.7
= TOTAL FIXED CHARGES $94.4 $94.4
FIXED CHARGE COVERAGE RATIO 1.77 1.63
Current Ratio must be > 1.2
Total current assets (numerator)
+ Total current assets $821.3 $821.3
+ PLUS Available unused commitments under
Revolving Credit Facility 125.0 135.9
= TOTAL CURRENT ASSETS $946.3 $957.2
Total current liabilities (denominator)
+ Total current liabilities $626.5 $626.5
- LESS Debt balloon payments due within 6-12
months - -
= TOTAL CURRENT LIABILITIES $626.5 $626.5
CURRENT RATIO 1.51 1.53
Adjusted Net Worth must be > $350 million
Stockholders' equity $233.3
- LESS 50% of net income subsequent to June 30,
2008 (to the extent net income is positive) -
- LESS Proceeds from stock option exercises
subsequent to June 30, 2008 (0.1)
+ ADD Impairment expenses, net of tax 383.0
= ADJUSTED NET WORTH $616.2