Asbury Automotive Group Reports Second Quarter 2010 Financial Results
Diluted EPS from continuing operations of $0.42 compared to $0.20 in the prior year period Total revenues up 13% over the prior year period SG&A as a percentage of gross profit of 76.5% improved 400 basis points over the prior year period
DULUTH, Ga., July 27 -- Asbury Automotive Group, Inc. , one of the largest automotive retail and service companies in the U.S., today reported income from continuing operations for the second quarter 2010 of $13.7 million, or $0.42 per diluted share, versus income from continuing operations of $6.6 million, or $0.20 per diluted share, in the corresponding period last year. Last year's results included a charge of $1.2 million, net of taxes, of non-core items in SG&A, or $0.04 per diluted share. The increase was primarily the result of 13% growth in revenues and gross profit from new and used light vehicle sales and finance and insurance ("F&I") as well as benefits achieved from the Company's leaner cost structure. Net income for the second quarter 2010 totaled $12.8 million, or $0.39 per diluted share, compared with $5.5 million, or $0.17 per diluted share, in the prior year period.
Second quarter 2010 revenues totaled $1.1 billion, an increase of 13% compared to the prior year. This improvement was driven by increases of 14% in new vehicle revenue, 18% in used vehicle revenue, and 35% in F&I revenues. Gross profit increased 13% and was up in all major areas of the business.
For the six-month period ended June 30, 2010, the Company reported income from continuing operations of $22.7 million, or $0.69 per diluted share, compared to $9.2 million, or $0.28 per diluted share in the prior year period. Last year's results included a net charge of $1.2 million, net of taxes, of non-core items in SG&A, or $0.04 per diluted share. The Company's revenues totaled $2.0 billion, an increase of 15% compared to $1.8 billion in the prior year period. Net income for the six-month period ended June 30, 2010 was $20.2 million, or $0.62 per diluted share compared to $5.8 million or $0.18 per diluted share for the prior year period.
"I am thrilled to report another quarter of consistent improvement in Asbury's performance. The increased sales and profitability resulted in second quarter income from continuing operations of 42 cents per diluted share versus 20 cents per diluted share a year ago. Gross profit increased across all four of our business lines in the second quarter," said Charles R. Oglesby, Asbury's President and CEO. "In addition, we decreased SG&A as a percent of gross profit by 400 basis points."
Craig T. Monaghan, Asbury's Senior Vice President and Chief Financial Officer, stated, "To better support our improving operating performance, we continue to pursue process improvement initiatives to deliver sustainable growth. Our financial position continues to improve and, we believe, provides us with the flexibility we need going forward."
Mr. Oglesby concluded, "While the pace of economic recovery remains uncertain, we have delivered consistent earnings growth. This is a result of Asbury's rapid response in better aligning its cost structure, as well as the continuing cost discipline our employees are demonstrating while capturing our share of an improved market."
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 (888) 632-5017 (domestic), or (913) 981-4912 (international); passcode - 3479884. 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 80 retail auto stores, encompassing 107 franchises for the sale and servicing of 38 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" within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are statements other than historical fact, and may 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 other initiatives and future business strategy. These statements are based on management's current expectations and beliefs 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 the 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 relationships 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, Asbury's ability to capitalize on opportunities to repurchase its debt securities or purchase properties that it currently leases, 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 that could cause actual results to differ materially from those expressed or implied in our forward-looking statements are and will be discussed in Asbury's filings with the Securities and Exchange Commission from time to time, including its most recent annual report on Form 10-K and any subsequently filed quarterly reports on Form 10-Q. We undertake no obligation to publicly update any forward-looking statement, whether as a result of new information, future events or otherwise.
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,
2010 2009 2010 2009
---- ---- ---- ----
REVENUES:
New vehicle $587.7 $514.7 $1,118.6 $949.7
Used vehicle 285.9 241.3 539.7 450.4
Parts and service 157.7 158.3 310.8 317.5
Finance and
insurance, net 30.4 22.5 56.5 43.1
---- ---- ---- ----
Total revenues 1,061.7 936.8 2,025.6 1,760.7
COST OF SALES:
New vehicle 548.9 480.3 1,043.8 888.0
Used vehicle 261.7 221.3 492.8 410.7
Parts and service 75.2 79.8 149.6 160.7
---- ---- ----- -----
Total cost of
sales 885.8 781.4 1,686.2 1,459.4
----- ----- ------- -------
GROSS PROFIT 175.9 155.4 339.4 301.3
OPERATING
EXPENSES:
Selling, general
and
administrative 134.6 125.1 264.2 246.3
Depreciation and
amortization 5.6 5.9 11.3 11.8
Other operating
income, net (0.4) (0.4) (0.8) (0.8)
---- ---- ---- ----
Income from
operations 36.1 24.8 64.7 44.0
OTHER EXPENSE:
Floor plan
interest expense (4.0) (4.6) (8.1) (9.5)
Other interest
expense (9.5) (9.1) (18.9) (19.0)
Convertible debt
discount
amortization (0.4) (0.5) (0.8) (0.9)
Interest income 0.1 0.1 0.1 0.1
--- --- --- ---
Total other
expense, net (13.8) (14.1) (27.7) (29.3)
----- ----- ----- -----
Income before
income taxes 22.3 10.7 37.0 14.7
INCOME TAX
EXPENSE 8.6 4.1 14.3 5.5
--- --- ---- ---
INCOME FROM
CONTINUING
OPERATIONS 13.7 6.6 22.7 9.2
DISCONTINUED
OPERATIONS, net
of tax (0.9) (1.1) (2.5) (3.4)
---- ---- ---- ----
NET INCOME $12.8 $5.5 $20.2 $5.8
===== ==== ===== ====
EARNINGS PER
COMMON SHARE:
Basic--
Continuing
operations $0.43 $0.20 $0.70 $0.29
Discontinued
operations (0.03) (0.03) (0.07) (0.11)
----- ----- ----- -----
Net income $0.40 $0.17 $0.63 $0.18
===== ===== ===== =====
Diluted--
Continuing
operations $0.42 $0.20 $0.69 $0.28
Discontinued
operations (0.03) (0.03) (0.07) (0.10)
----- ----- ----- -----
Net income $0.39 $0.17 $0.62 $0.18
===== ===== ===== =====
WEIGHTED AVERAGE
COMMON SHARES
OUTSTANDING:
Basic 32.2 32.2 32.2 32.1
Stock options 0.5 0.7 0.5 0.4
Restricted stock 0.2 0.2 0.1 0.4
Performance share
units 0.1 0.1 - 0.1
--- --- --- ---
Diluted 33.0 33.2 32.8 33.0
==== ==== ==== ====
New Vehicle--
For the
Three
Months
Ended Increase %
June 30, (Decrease) Change
-------- ---------- ------
2010 2009
---- ----
(Dollars in millions)
Revenue:
New vehicle
revenue-same
store(1)
Luxury $197.7 $166.1 $31.6 19%
Mid-line import 270.5 244.9 25.6 10%
Mid-line domestic 79.2 64.5 14.7 23%
Value 8.4 4.6 3.8 83%
--- ---
Total new light
vehicle
revenue-same
store(1) 555.8 480.1 75.7 16%
Heavy truck 31.9 34.6 (2.7) (8%)
---- ----
Total new vehicle
revenue-same
store(1) 587.7 514.7 73.0 14%
New vehicle
revenue-acquisitions - -
--- ---
Total new vehicle
revenue, as
reported $587.7 $514.7 $73.0 14%
====== ======
Gross profit:
New vehicle gross
profit-same
store(1)
Luxury $15.0 $12.1 $2.9 24%
Mid-line import 16.2 16.6 (0.4) (2%)
Mid-line domestic 5.9 4.0 1.9 48%
Value 0.3 0.3 - - %
--- ---
Total new light
vehicle gross
profit-same
store(1) 37.4 33.0 4.4 13%
Heavy truck 1.4 1.4 - -%
--- ---
Total new vehicle
gross profit-same
store(1) 38.8 34.4 4.4 13%
New vehicle gross
profit-acquisitions - -
--- ---
Total new vehicle
gross profit, as
reported $38.8 $34.4 $4.4 13%
===== =====
For the
Three
Months
Ended Increase %
June 30, (Decrease) Change
-------- ---------- ------
2010 2009
---- ----
New vehicle
units:
New vehicle
retail
units-same
store(1)
Luxury 4,081 3,569 512 14%
Mid-line import 10,730 9,831 899 9%
Mid-line
domestic 2,051 1,884 167 9%
Value 401 219 182 83%
--- ---
Total new light
vehicle retail
units-same
store(1) 17,263 15,503 1,760 11%
Fleet vehicles 803 741 62 8%
--- ---
Total new light
vehicle
units-same
store(1) 18,066 16,244 1,822 11%
Heavy truck 651 508 143 28%
--- ---
Total new vehicle
units-same
store(1) 18,717 16,752 1,965 12%
Total new vehicle
units-acquisitions - -
--- ---
New vehicle
units-actual 18,717 16,752 1,965 12%
====== ======
Total new light
vehicle
units-same
store(1) 18,066 16,244 1,822 11%
Total new light
vehicle
units-acquisitions - -
--- ---
Total new light
vehicle units 18,066 16,244 1,822 11%
====== ======
New Vehicle Metrics--
For the Three Months
Ended Increase %
June 30, (Decrease) Change
-------- ---------- ------
2010 2009
---- ----
Revenue per new light vehicle
sold-same store(1) $30,765 $29,556 $1,209 4%
======= =======
Revenue per new heavy truck sold $49,002 $68,110 $(19,108) (28%)
======= =======
Revenue per new vehicle sold-same
store(1) $31,399 $30,725 $674 2%
======= =======
Gross profit per new light
vehicle sold-same store(1) $2,070 $2,032 $38 2%
====== ======
Gross profit per new heavy truck
sold $2,151 $2,756 $(605) (22%)
====== ======
Gross profit per new vehicle
sold-same store(1) $2,073 $2,053 $20 1%
====== ======
New light vehicle gross
margin-same store(1) 6.7% 6.9% (0.2%) (3%)
=== ===
New heavy truck gross margin 4.4% 4.0% 0.4% 10%
=== ===
New vehicle gross margin-same
store(1) 6.6% 6.7% (0.1%) (1%)
=== ===
(1)Same store information consists of amounts from dealerships for
the identical months of each period presented
in the comparison, commencing with the first full month in which an
applicable dealership was owned by us.
Used Vehicle--
For the
Three
Months
Ended Increase %
June 30, (Decrease) Change
-------- ---------- ------
2010 2009
---- ----
(Dollars in millions,
except for per
vehicle data)
Revenue:
Used vehicle retail
revenues-same
store(1)
Light vehicles $226.9 $189.1 $37.8 20%
Heavy truck 3.3 5.3 (2.0) (38%)
--- ---
Total used vehicle
retail
revenues-same
store(1) 230.2 194.4 35.8 18%
Used vehicle retail
revenues-acquisitions - -
--- ---
Total used vehicle
retail revenues 230.2 194.4 35.8 18%
Used vehicle
wholesale
revenues-same
store(1)
Light vehicles 55.5 46.6 8.9 19%
Heavy truck 0.2 0.3 (0.1) (33%)
--- ---
Total used vehicle
wholesale
revenues-same
store(1) 55.7 46.9 8.8 19%
Used vehicle
wholesale
revenues-acquisitions - -
--- ---
Total used vehicle
wholesale revenues 55.7 46.9 8.8 19%
---- ----
Used vehicle
revenue, as
reported $285.9 $241.3 $44.6 18%
====== ======
Gross profit:
Used vehicle retail
gross profit-same
store(1)
Light vehicles $24.4 $21.1 $3.3 16%
Heavy truck (0.3) (0.7) 0.4 57%
---- ----
Total used vehicle
retail gross
profit-same
store(1) 24.1 20.4 3.7 18%
Used vehicle retail
gross
profit-acquisitions - -
--- ---
Total used vehicle
retail gross
profit 24.1 20.4 3.7 18%
Used vehicle
wholesale gross
profit-same
store(1)
Light vehicles - 0.2 (0.2) (100%)
Heavy truck 0.1 (0.6) 0.7 117%
--- ----
Total used vehicle
wholesale gross
profit-same
store(1) 0.1 (0.4) 0.5 125%
Used vehicle
wholesale gross
profit-acquisitions - -
--- ---
Total used vehicle
wholesale gross
profit 0.1 (0.4) 0.5 125%
--- ----
Used vehicle gross
profit, as
reported $24.2 $20.0 $4.2 21%
===== =====
Used vehicle retail
units:
Used vehicle retail
units-same
store(1)
Light vehicles 11,786 10,399 1,387 13%
Heavy truck 111 139 (28) (20%)
--- ---
Total used vehicle
retail units-same
store(1) 11,897 10,538 1,359 13%
Used vehicle retail
units-acquisitions - -
--- ---
Used vehicle retail
units-actual 11,897 10,538 1,359 13%
====== ======
Used Vehicle Metrics--
For the
Three
Months
Ended Increase %
June 30, (Decrease) Change
-------- ---------- ------
2010 2009
---- ----
Revenue per used
light vehicle
retailed-same
store(1) $19,252 $18,184 $1,068 6%
======= =======
Revenue per used
heavy truck
retailed $29,730 $38,129 $(8,399) (22%)
======= =======
Revenue per used
vehicle
retailed-same
store(1) $19,349 $18,448 $901 5%
======= =======
Gross profit per
used light
vehicle
retailed-same $2,070 $2,029 $41 2%
store(1) ====== ======
Gross profit per
used heavy truck
retailed $(2,703) $(5,036) $2,333 46%
======= =======
Gross profit per
used vehicle
retailed-same
store(1) $2,026 $1,936 $90 5%
====== ======
Used light
vehicle retail
gross
margin-same
store(1) 10.8% 11.2% (0.4%) (4%)
==== ====
Used heavy truck
retail gross
margin (9.1%) (13.2%) 4.1% 31%
====== =======
Used vehicle
retail gross
margin-same
store(1) 10.5% 10.5% -% -%
==== ====
(1)Same store information consists of amounts from dealerships for
the identical months of each period presented
in the comparison, commencing with the first full month in which the
dealership was owned by us.
Parts and Service--
For the
Three
Months
Ended Increase %
June 30, (Decrease) Change
-------- ---------- ------
2010 2009
---- ----
(Dollars in millions)
Revenue:
Parts and service
revenues-same
store(1)
Light vehicles $140.6 $143.2 $(2.6) (2%)
Heavy truck 17.1 15.1 2.0 13%
---- ----
Total parts and
service
revenue-same
store(1) 157.7 158.3 (0.6) -%
Parts and service
revenues-acquisitions - -
--- ---
Parts and service
revenue, as
reported $157.7 $158.3 $(0.6) -%
====== ======
Gross profit:
Parts and service
gross profit-same
store(1)
Light vehicles $77.2 $73.7 $3.5 5%
Heavy truck 5.3 4.8 0.5 10%
--- ---
Total parts and
service gross
profit-same
store(1) 82.5 78.5 4.0 5%
Parts and service
gross
profit-acquisitions - -
--- ---
Parts and service
gross profit, as
reported $82.5 $78.5 $4.0 5%
===== =====
Light vehicle
parts and service
gross margin-same
store(1) 54.9% 51.5% 3.4% 7%
==== ====
Heavy truck parts
and service gross
margin 31.0% 31.8% (0.8%) (3%)
==== ====
Parts and service
gross margin-same
store(1) 52.3% 49.6% 2.7% 5%
==== ====
(1)Same store information consists of amounts from dealerships for
the identical months of each period
presented in the comparison, commencing with the first full month in
which the dealership was owned by us.
Finance and Insurance, net--
For the
Three
Months Increase %
Ended
June 30, (Decrease) Change
-------- ---------- ------
2010 2009
---- ----
(Dollars in
millions, except
for per vehicle
data)
Dealership generated
F&I, net-same
store(1)
Light vehicles $30.0 $22.9 $7.1 31%
Heavy truck 0.1 - 0.1 -%
--- ---
Dealership generated
F&I-same store(1) 30.1 22.9 7.2 31%
Dealership generated
F&I-acquisitions - -
--- ---
Dealership generated
F&I, net 30.1 22.9 7.2 31%
Corporate generated
F&I 0.3 (0.4) 0.7 175%
--- ----
Finance and insurance,
net as reported $30.4 $22.5 $7.9 35%
===== =====
Dealership generated
light vehicle F&I per
vehicle sold-same
store(1) (2) $1,005 $860 $145 17%
====== ====
Dealership generated
F&I per vehicle sold-
same store(1) (2) $983 $839 $144 17%
==== ====
Light vehicle F&I per
vehicle sold-same
store(1) $1,015 $844 $171 20%
====== ====
Heavy truck F&I per
vehicle sold $131 $- $131 -%
==== ===
F&I per vehicle
sold-same store(1) $993 $824 $169 21%
==== ====
(1)Same store information consists of amounts from dealerships for
the identical months of each period
presented in the comparison, commencing with the first full month in
which the dealership was owned by us.
(2)Dealership generated F&I per vehicle sold excludes Corporate
generated F&I.
For the Three
Months Ended
June 30,
--------
2010 2009
---- ----
REVENUE MIX PERCENTAGES:
New light vehicles 52.4% 51.2%
New heavy trucks 3.0% 3.7%
Used light vehicle retail 21.5% 20.2%
Used heavy truck retail 0.3% 0.6%
Used light vehicle
wholesale 5.2% 5.0%
Used heavy truck wholesale -% -%
Parts and service-light
vehicle 13.2% 15.3%
Parts and service-heavy
truck 1.6% 1.6%
Finance and insurance,
net-light vehicle 2.8% 2.4%
Finance and insurance,
net-heavy truck -% -%
--- ---
Total revenue 100.0% 100.0%
===== =====
GROSS PROFIT MIX
PERCENTAGES:
New light vehicles 21.3% 21.2%
New heavy trucks 0.8% 0.9%
Used light vehicle retail 13.9% 13.5%
Used heavy truck retail (0.2%) (0.5%)
Used light vehicle
wholesale -% 0.1%
Used heavy truck wholesale 0.1% (0.4%)
Parts and service-light
vehicle 43.9% 47.4%
Parts and service-heavy
truck 3.0% 3.1%
Finance and insurance,
net-light vehicle 17.1% 14.7%
Finance and insurance,
net-heavy truck 0.1% -%
--- ---
Total gross profit 100.0% 100.0%
===== =====
SG&A EXPENSES AS A
PERCENTAGE OF GROSS
PROFIT 76.5% 80.5%
New Vehicle--
For the Six
Months
Ended Increase %
June 30, (Decrease) Change
-------- ---------- ------
2010 2009
---- ----
(Dollars in millions)
Revenue:
New vehicle
revenue-same
store(1)
Luxury $378.5 $310.9 $67.6 22%
Mid-line import 499.2 434.7 64.5 15%
Mid-line domestic 146.3 123.7 22.6 18%
Value 14.8 9.3 5.5 59%
---- ---
Total new light
vehicle
revenue-same
store(1) 1,038.8 878.6 160.2 18%
Heavy truck 79.8 71.1 8.7 12%
---- ----
Total new vehicle
revenue-same
store(1) 1,118.6 949.7 168.9 18%
New vehicle
revenue-acquisitions - -
--- ---
Total new vehicle
revenue, as
reported $1,118.6 $949.7 $168.9 18%
======== ======
Gross profit:
New vehicle gross
profit-same
store(1)
Luxury $29.4 $21.9 $7.5 34%
Mid-line import 31.1 28.1 3.0 11%
Mid-line domestic 10.7 8.0 2.7 34%
Value 0.5 0.7 (0.2) (29%)
--- ---
Total new light
vehicle gross
profit-same
store(1) 71.7 58.7 13.0 22%
Heavy truck 3.1 3.0 0.1 3%
--- ---
Total new vehicle
gross profit-same
store(1) 74.8 61.7 13.1 21%
New vehicle gross
profit-acquisitions - -
--- ---
Total new vehicle
gross profit, as
reported $74.8 $61.7 $13.1 21%
===== =====
For the Six
Months
Ended Increase %
June 30, (Decrease) Change
-------- ---------- ------
2010 2009
---- ----
New vehicle units:
New vehicle retail
units-same
store(1)
Luxury 7,859 6,712 1,147 17%
Mid-line import 19,789 17,521 2,268 13%
Mid-line domestic 3,843 3,650 193 5%
Value 705 423 282 67%
--- ---
Total new light
vehicle retail
units-same
store(1) 32,196 28,306 3,890 14%
Fleet vehicles 1,289 1,200 89 7%
----- -----
Total new light
vehicle
units-same
store(1) 33,485 29,506 3,979 13%
Heavy truck 1,710 1,092 618 57%
----- -----
Total new vehicle
units-same
store(1) 35,195 30,598 4,597 15%
Total new vehicle
units-acquisitions - -
--- ---
New vehicle
units-actual 35,195 30,598 4,597 15%
====== ======
Total new light
vehicle
units-same
store(1) 33,485 29,506 3,979 13%
Total new light
vehicle
units-acquisitions - -
--- ---
Total new light
vehicle units 33,485 29,506 3,979 13%
====== ======
New Vehicle Metrics--
For the Six Months
Ended Increase %
June 30, (Decrease) Change
-------- ---------- ------
2010 2009
---- ----
Revenue per new light vehicle
sold-same store(1) $31,023 $29,777 $1,246 4%
======= =======
Revenue per new heavy truck
sold $46,667 $65,110 $(18,443) (28%)
======= =======
Revenue per new vehicle
sold-same store(1) $31,783 $31,038 $745 2%
======= =======
Gross profit per new light
vehicle sold-same store(1) $2,141 $1,989 $152 8%
====== ======
Gross profit per new heavy
truck sold $1,813 $2,747 $(934) (34%)
====== ======
Gross profit per new vehicle
sold-same store(1) $2,125 $2,016 $109 5%
====== ======
New light vehicle gross
margin-same store(1) 6.9% 6.7% 0.2% 3%
=== ===
New heavy truck gross margin 3.9% 4.2% (0.3%) (7%)
=== ===
New vehicle gross margin-same
store(1) 6.7% 6.5% 0.2% 3%
=== ===
(1)Same store information consists of amounts from dealerships for
the identical months of each period
presented in the comparison, commencing with the first full month in
which the dealership was owned by us.
Used Vehicle--
For the Six
Months
Ended Increase %
June 30, (Decrease) Change
-------- ---------- ------
2010 2009
---- ----
(Dollars in millions,
except for per
vehicle data)
Revenue:
Used vehicle retail
revenues-same
store(1)
Light vehicles $432.9 $359.0 $73.9 21%
Heavy truck 4.7 7.2 (2.5) (35%)
--- ---
Total used vehicle
retail
revenues-same
store(1) 437.6 366.2 71.4 19%
Used vehicle retail
revenues-acquisitions - -
--- ---
Total used vehicle
retail revenues 437.6 366.2 71.4 19%
Used vehicle
wholesale
revenues-same
store(1)
Light vehicles 101.0 83.1 17.9 22%
Heavy truck 1.1 1.1 - -%
--- ---
Total used vehicle
wholesale
revenues-same
store(1) 102.1 84.2 17.9 21%
Used vehicle
wholesale
revenues-acquisitions - -
--- ---
Total used vehicle
wholesale revenues 102.1 84.2 17.9 21%
----- ----
Used vehicle
revenue, as
reported $539.7 $450.4 $89.3 20%
====== ======
Gross profit:
Used vehicle retail
gross profit-same
store(1)
Light vehicles $47.1 $40.6 $6.5 16%
Heavy truck (0.3) (0.8) 0.5 63%
---- ----
Total used vehicle
retail gross
profit-same
store(1) 46.8 39.8 7.0 18%
Used vehicle retail
gross
profit-acquisitions - -
--- ---
Total used vehicle
retail gross
profit 46.8 39.8 7.0 18%
Used vehicle
wholesale gross
profit-same
store(1)
Light vehicles 0.4 0.9 (0.5) (56%)
Heavy truck (0.3) (1.0) 0.7 70%
---- ----
Total used vehicle
wholesale gross
profit-same
store(1) 0.1 (0.1) 0.2 200%
Used vehicle
wholesale gross
profit-acquisitions - -
--- ---
Total used vehicle
wholesale gross
profit 0.1 (0.1) 0.2 200%
--- ----
Used vehicle gross
profit, as
reported $46.9 $39.7 $7.2 18%
===== =====
Used vehicle retail
units:
Used vehicle retail
units-same
store(1)
Light vehicles 22,743 19,988 2,755 14%
Heavy truck 180 199 (19) (10%)
--- ---
Total used vehicle
retail units-same
store(1) 22,923 20,187 2,736 14%
Used vehicle retail
units-acquisitions - -
--- ---
Used vehicle retail
units-actual 22,923 20,187 2,736 14%
====== ======
Used Vehicle Metrics--
For the Six
Months
Ended Increase %
June 30, (Decrease) Change
-------- ---------- ------
2010 2009
---- ----
Revenue per used
light vehicle
retailed-same
store(1) $19,034 $17,961 $1,073 6%
======= =======
Revenue per used
heavy truck
retailed $26,111 $36,181 $(10,070) (28%)
======= =======
Revenue per used
vehicle
retailed-same
store(1) $19,090 $18,140 $950 5%
======= =======
Gross profit per
used light vehicle
retailed-same $2,071 $2,031 $40 2%
store(1) ====== ======
Gross profit per
used heavy truck
retailed $(1,667) $(4,020) $2,353 59%
======= =======
Gross profit per
used vehicle
retailed-same
store(1) $2,042 $1,972 $70 4%
====== ======
Used light vehicle
retail gross
margin-same
store(1) 10.9% 11.3% (0.4%) (4%)
==== ====
Used heavy truck
retail gross margin (6.4%) (11.1%) 4.7% 42%
====== =======
Used vehicle retail
gross margin-same
store(1) 10.7% 10.9% (0.2%) (2%)
==== ====
(1)Same store information consists of amounts from dealerships for
the identical months of each period
presented in the comparison, commencing with the first full month in
which the dealership was owned by us.
Parts and Service--
For the Six Months
Ended Increase %
June 30, (Decrease) Change
2010 2009
(Dollars in millions)
Revenue:
Parts and service
revenues-same
store(1)
Light vehicles $277.1 $286.8 $(9.7) (3%)
Heavy truck 33.7 30.7 3.0 10%
---- ----
Total parts and
service revenue-same
store(1) 310.8 317.5 (6.7) (2%)
Parts and service
revenues-acquisitions - -
--- ---
Parts and service
revenue, as reported $310.8 $317.5 $(6.7) (2%)
====== ======
Gross profit:
Parts and service
gross profit-same
store(1)
Light vehicles $150.9 $147.1 $3.8 3%
Heavy truck 10.3 9.7 0.6 6%
---- ---
Total parts and
service gross
profit-same store(1) 161.2 156.8 4.4 3%
Parts and service
gross
profit-acquisitions - -
--- ---
Parts and service
gross profit, as
reported $161.2 $156.8 $4.4 3%
====== ======
Light vehicle parts
and service gross
margin-same store(1) 54.5% 51.3% 3.2% 6%
==== ====
Heavy truck parts and
service gross margin 30.6% 31.6% (1.0%) (3%)
==== ====
Parts and service
gross margin-same
store(1) 51.9% 49.4% 2.5% 5%
==== ====
(1)Same store information consists of amounts from dealerships for
the identical months of each period
presented in the comparison, commencing with the first full month in
which the dealership was owned by us.
Finance and Insurance, net--
For the
Six
Months Increase %
Ended
June 30, (Decrease) Change
-------- ---------- ------
2010 2009
---- ----
(Dollars in
millions, except
for per vehicle
data)
Dealership generated
F&I, net-same
store(1)
Light vehicles $55.5 $43.0 $12.5 29%
Heavy truck 0.1 0.1 - -%
--- ---
Dealership generated
F&I-same store(1) 55.6 43.1 12.5 29%
Dealership generated
F&I-acquisitions - -
--- ---
Dealership generated
F&I, net 55.6 43.1 12.5 29%
Corporate generated
F&I 0.9 - 0.9 -%
--- ---
Finance and insurance,
net as reported $56.5 $43.1 $13.4 31%
===== =====
Dealership generated
light vehicle F&I per
vehicle sold-same
store(1) (2) $987 $869 $118 14%
==== ====
Dealership generated
F&I per vehicle sold-
same store(1) (2) $957 $849 $108 13%
==== ====
Light vehicle F&I per
vehicle sold-same
store(1) $1,003 $869 $134 15%
====== ====
Heavy truck F&I per
vehicle sold $53 $77 $(24) (31%)
=== ===
F&I per vehicle
sold-same store(1) $972 $849 $123 14%
==== ====
(1) Same store information consists of amounts from dealerships for
the identical months of each period
presented in the comparison, commencing with the first full month in
which the dealership was owned by us.
(2) Dealership generated F&I per vehicle sold excludes Corporate
generated F&I.
For the Six
Months
Ended
June 30,
--------
2010 2009
---- ----
REVENUE MIX PERCENTAGES:
New light vehicles 51.3% 49.9%
New heavy trucks 3.9% 4.0%
Used light vehicle retail 21.4% 20.5%
Used heavy truck retail 0.2% 0.4%
Used light vehicle wholesale 5.0% 4.7%
Used heavy truck wholesale 0.1% 0.1%
Parts and service-light
vehicle 13.7% 16.3%
Parts and service-heavy truck 1.7% 1.7%
Finance and insurance,
net-light vehicle 2.7% 2.4%
Finance and insurance,
net-heavy truck -% -%
--- ---
Total revenue 100.0% 100.0%
===== =====
GROSS PROFIT MIX PERCENTAGES:
New light vehicles 21.1% 19.5%
New heavy trucks 0.9% 1.0%
Used light vehicle retail 14.2% 13.5%
Used heavy truck retail (0.1%) (0.3%)
Used light vehicle wholesale 0.1% 0.3%
Used heavy truck wholesale (0.1%) (0.3%)
Parts and service-light
vehicle 44.5% 48.8%
Parts and service-heavy truck 3.0% 3.2%
Finance and insurance,
net-light vehicle 16.4% 14.3%
Finance and insurance,
net-heavy truck -% -%
--- ---
Total gross profit 100.0% 100.0%
===== =====
SG&A EXPENSES AS A PERCENTAGE
OF GROSS PROFIT 77.8% 81.7%
ASBURY AUTOMOTIVE GROUP, INC.
Additional Disclosures
(In millions)
(Unaudited)
December
June 30, 31, Increase % Change
2010 2009 (Decrease) --------
---- ---- ----------
SELECTED BALANCE SHEET DATA
Cash and cash equivalents $27.0 $84.7 $(57.7) (68.1%)
New vehicle inventory 400.6 394.2 6.4 1.6%
Used vehicle inventory 73.5 64.1 9.4 14.7%
Parts inventory 43.1 41.4 1.7 4.1%
Total current assets 768.6 815.6 (47.0) (5.8%)
Floor plan notes payable 351.8 434.7 (82.9) (19.1%)
Total current liabilities 526.7 598.8 (72.1) (12.0%)
CAPITALIZATION:
Long-term debt (including
current portion) $534.9 $537.8 $(2.9) (0.5%)
Shareholders' equity 265.7 243.6 22.1 9.1%
----- -----
Total $800.6 $781.4 $19.2 2.5%
Brand Mix - New Light Vehicle Revenue by Brand--
For the Six Months Ended
June 30,
--------
2010 2009
---- ----
Luxury
BMW 9% 10%
Mercedes-Benz 8% 7%
Lexus 6% 5%
Acura 5% 5%
Infiniti 5% 4%
Other luxury 3% 4%
--- ---
Total luxury 36% 35%
Mid-Line Imports:
Honda 23% 25%
Toyota 10% 10%
Nissan 13% 11%
Other imports 2% 3%
--- ---
Total imports 48% 49%
Mid-Line Domestic:
Ford 9% 9%
Chevrolet 2% 2%
Other domestics 3% 3%
--- ---
Total domestic 14% 14%
Value 2% 2%
--- ---
Total New Light Vehicle Revenue 100% 100%
=== ===
Asbury Automotive Group, Inc.
Additional Disclosures
(In millions)
(Unaudited)
Light Vehicle Parts and Service Gross Profit Detail--
For the
Three
Months
Ended Increase %
June 30, (Decrease) Change
-------- ---------- ------
2010 2009
---- ----
(Dollars in
millions)
Customer pay $48.7 $46.2 $2.5 5%
Warranty 11.6 12.2 (0.6) (5%)
Reconditioning and
preparation 11.5 9.6 1.9 20%
Wholesale parts 5.4 5.7 (0.3) (5%)
Total light vehicle
parts and service
gross profit $77.2 $73.7 $3.5 5%
===== =====
For the
Six
Months
Ended Increase %
June 30, (Decrease) Change
-------- ---------- ------
2010 2009
---- ----
(Dollars in
millions)
Customer pay $94.1 $92.1 $2.0 2%
Warranty 23.8 25.4 (1.6) (6%)
Reconditioning and
preparation 22.1 18.0 4.1 23%
Wholesale parts 10.9 11.6 (0.7) (6%)
Total light vehicle
parts and service
gross profit $150.9 $147.1 $3.8 3%
====== ======
Asbury Automotive Group, Inc.
Additional Disclosures
(Dollars in millions)
(Unaudited)
Selling, General and Administrative Expense ("SG&A")--
For the Three Months Ended
June 30,
--------
2010 % of Gross 2009 % of Gross
---- Profit ---- Profit
------ ------
(Dollars in millions)
SG&A, excluding rent
expense $124.1 70.5% $115.1 74.1%
Rent expense 10.5 6.0% 10.0 6.4%
---- ----
SG&A-total $134.6 76.5% $125.1 80.5%
====== ======
Gross profit $175.9 $155.4
====== ======
Increase % of Gross
(Decrease) Profit
---------- Increase
(Decrease)
----------
(Dollars in millions)
SG&A, excluding rent
expense $9.0 (3.6%)
Rent expense 0.5 (0.4%)
SG&A-total $9.5 (4.0%)
Gross profit
For the Six Months Ended
June 30,
--------
2010 % of Gross 2009 % of Gross
---- Profit ---- Profit
------ ------
(Dollars in millions)
SG&A, excluding rent
expense $242.3 71.3% $226.2 75.0%
Rent expense 21.9 6.5% 20.1 6.7%
---- ----
SG&A-total $264.2 77.8% $246.3 81.7%
====== ======
Gross profit $339.4 $301.3
====== ======
Increase % of Gross
(Decrease) Profit
Increase
(Decrease)
(Dollars in millions)
SG&A, excluding rent
expense $16.1 (3.7%)
Rent expense 1.8 (0.2%)
SG&A-total $17.9 (3.9%)
Gross profit
Asbury Automotive Group, Inc.
Supplemental Disclosures
(Dollars in millions, except per share data)
(Unaudited)
Our operations during 2009 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,
(ii) implementation costs associated with transitioning our
dealerships to the Arkona dealer management system, and, (iii) a
legal settlements benefit related to legal claims arising in,
and before, the year 2003.
For the Three Months For the Three Months
Ended Ended
June 30, June 30,
2010 2009
---- ----
Non-core items -
expense (income):
Restructuring costs $- $1.7
Dealer management
system
implementation
costs - 0.1
Tax benefit on non-
core items above - (0.6)
--- ----
Total non-core items $- $1.2
=== ====
Non-core items per
dilutive share $- $0.04
=== =====
Weighted average
common shares
outstanding
(diluted) 33.0 33.2
==== ====
For the Six Months For the Six Months
Ended Ended
June 30, June 30,
2010 2009
---- ----
Non-core items -
expense (income):
Restructuring costs $- $3.0
Dealer management
system
implementation costs - 0.3
Legal settlements
benefit - (1.5)
Tax benefit on non-
core items above - (0.6)
--- ----
Total non-core items $- $1.2
=== ====
Non-core items per
dilutive share $- $0.04
=== =====
Weighted average
common shares
outstanding
(diluted) 32.8 33.0
==== ====
Asbury Automotive Group, Inc.
Summary of Debt Covenants
As of and for the Period Ended June 30, 2010
(Dollars in millions, except per vehicle data)
(Unaudited)
Wachovia Credit
Facilities
Mortgages (2)
(1) -----------
---
Senior Leverage Ratio must be < 3.00: 1.00
SECURED DEBT (numerator)
+ Mortgage notes payable (including
mortgages associated with assets held for
sale) $165.7
+ Borrowings under revolving credit
facility -
+ Capital lease obligations -
+ Interest rate obligations -
+ Other indebtedness 0.4
---
= TOTAL SECURED DEBT (ex floorplan) $166.1
======
EBITDA (denominator)
+ Net income -trailing 12 months ("T12") $27.9
+ Add back losses from discontinued
operations -T12 9.8
+ Add back total interest expense
(excluding floorplan interest) -T12 39.8
+ Add back income tax expense - T12 23.3
+ Add back depreciation and amortization -
T12 23.0
+ Add back other non-cash charges - T12* 5.6
---
= CONSOLIDATED EBITDA 129.4
+ Add back pro forma acquisitions EBITDA
(as defined) -
+ Add back pro forma rent savings (as
defined) -
- Less gain on debt extinguishment (0.1)
----
= CONSOLIDATED PRO FORMA EBITDA $129.3
======
SENIOR LEVERAGE RATIO 1.28
*Includes impairment expenses, stock-based compensation expense,
deferred finance fee amortization and swap
amortization.
(1) The "Wachovia Mortgages" are the Company's mortgage notes with
Wachovia Bank, National Association and
Wachovia Financial Services, Inc.
(2) The "Credit Facilities" are the Company's revolving credit
facility with Bank of America, as administrative agent,
and the Company's used vehicle floor plan facility with J.P. Morgan
Chase Bank, N.A. and Bank of America, N.A.
Fixed Charge Coverage Ratio must be > 1.20: 1:00
EBITDAR (numerator)
+ Net income - trailing 12 months ("T12") $27.9 $27.9
+ Add back losses from discontinued operations -T12 9.8 9.8
+ Add back total interest expense (ex floorplan) -
T12 39.8 39.8
+ Add back income tax expense - T12 23.3 23.3
+ Add back depreciation & amortization - T12 23.0 23.0
+ Add back other non-cash charges - T12 (as
defined)* 12.3 5.6
- Less gain on debt extinguishment - (0.1)
+ Add back non-recurring items - T12 (as
defined)** 3.2 -
--- ---
= CONSOLIDATED EBITDA 139.3 129.3
+ PLUS Required principal payments - T12 (Rent) 42.5 42.5
- LESS Capital expenditures (as defined) (16.0) (12.0)
----- -----
= TOTAL EARNINGS AVAILABLE FOR FIXED CHARGES $165.8 $159.8
====== ======
FIXED CHARGES (denominator)
+ Total interest expense (ex floorplan interest) -
T12 39.8 39.8
-LESS Interest associated with convertible notes -
T12 (1.7) (1.7)
+ PLUS Required principal payments - T12 8.7 8.7
+ PLUS Rental expense - T12 42.5 42.5
---- ----
= TOTAL FIXED CHARGES $89.3 $89.3
===== =====
FIXED CHARGE COVERAGE RATIO 1.86 1.79
Current Ratio must be > 1.20: 1:00
Total current assets (numerator)
+ Total current assets $768.6 $768.6
+ PLUS Available unused commitments under revolving
credit facility 125.0 128.1
----- -----
= TOTAL CURRENT ASSETS $893.6 $896.7
====== ======
Total current liabilities (denominator)
+ Total current liabilities $526.7 $526.7
------ ------
= TOTAL CURRENT LIABILITIES $526.7 $526.7
====== ======
CURRENT RATIO 1.70 1.70
Adjusted Net Worth must be > $350 million
Stockholders' equity $265.7
-LESS 50% of net income subsequent to March 31,
2008 (to the extent net income is positive) -
-LESS Proceeds from stock option exercises
subsequent to March 31, 2008 (1.7)
+ ADD Impairment expenses, net of tax 383.0
-----
= ADJUSTED NET WORTH $647.0
======
* Includes impairment expenses, stock-based compensation expense,
deferred finance fee amortization and swap
amortization.
** Includes restructuring costs and dealer management system
transition costs.