UnitedAuto Reports Results for Second Quarter 2000
21 July 2000
UnitedAuto Reports Results for Second Quarter 2000
DETROIT - UnitedAuto Group, Inc. , a leading publicly traded automotive retailer, today announced second quarter earnings. Income before extraordinary item in the quarter amounted to $11.1 million, which represents a 28.4% increase over the comparable prior year period. Income before extraordinary item per diluted share was $0.38, an 8.6% increase over the $0.35 per share reported in the second quarter 1999.Net income for the second quarter 2000 was $7.1 million, or $0.24 per share on a fully diluted basis, after an extraordinary charge of $4.0 million resulting from a repurchase of the Company's 11% subordinated debt. Net income in the second quarter 1999 was $8.6 million, or $0.35 per share on a fully diluted basis.
Earnings per share reflects a 20.4% increase in weighted average shares outstanding from 24,422,000 to 29,400,000 in the second quarter of 2000. The increase resulted primarily from the issuance of $83.0 million in convertible preferred stock in 1999, offset in part by the impact on average shares of the purchase of 2,990,000 common shares under the Company's share repurchase program in 2000.
Second quarter revenues increased 15.4% to $1.2 billion versus $1.0 billion in the comparable prior year period. Same store revenues were $983.3 million in the second quarter 2000, an increase of 2.6% over the previous year. Same store retail revenues, which exclude wholesale and fleet sales, increased 4.5% to $881.7 million.
Total new and used retail unit sales increased 13.8% and 9.3%, respectively, versus the second quarter of 1999. The Company retailed 27,327 new and 14,776 used vehicles during the second quarter versus 24,018 new and 13,517 used vehicles for the comparable 1999 period.
Roger Penske, Chairman, said "This was another outstanding quarter for UnitedAuto. In an increasingly challenging operating environment, the strength of our business is evidenced by an overall 17.1% increase in gross profit over the comparable period in 1999, which includes a 6.2% increase in same store retail gross profits."
Sam DiFeo Jr., added "The impact of our continued focus on operations is evidenced by the excellent performance of our dealerships, especially the continued improvement of same store dealership operating results in all aspects of our business versus the corresponding period in 1999."
For the six months ended June 30, 2000, income before extraordinary item amounted to $16.7 million, which represents a 35.6% increase over the first half 1999. Income before extraordinary item per diluted share was $0.56, a 5.7% increase over the $0.53 per share reported in the comparable prior year period. Net income for the six months ended June 30, 2000 was $12.7 million, or $0.43 per share on a fully diluted basis, after the $4.0 million extraordinary charge. Net income for the first half 1999 was $12.3 million, or $0.53 per share on a fully diluted basis. Earnings per share reflects a 28.5% increase in weighted average shares outstanding from 23,202,000 to 29,808,000 during the six months ended June 30, 2000.
Total new and used retail unit sales increased 19.3% and 11.1%, respectively, in the six months ended June 30, 2000 versus the comparable period in 1999. The Company retailed 52,793 new and 28,971 used vehicles during the first half of 2000 versus 44,258 new and 26,086 used vehicles for the comparable 1999 period.
For the six months ended June 30, 2000, revenues increased 18.8% to $2.3 billion versus $1.9 billion in the first half 1999. Same store revenues were $1.9 billion in the first half 2000, an increase of 6.5% over the previous year. Same store retail revenues, which exclude wholesale and fleet sales, increased 8.4% to $1.7 billion.
UnitedAuto, which pursues a strategy based on internal growth from its existing dealerships as well as from strategic acquisitions, operates 120 franchises in 17 states, Puerto Rico and Brazil. UnitedAuto dealerships sell new and used vehicles and market a complete line of aftermarket automotive products and services.
UNITEDAUTO GROUP, INC.
Consolidated Statements of Operations (Unaudited)
(Amounts in Thousands, Except Per Share Data)
Second Quarter
------------------------------------
2000 1999
---- ----
New Vehicle Sales $727,072 $633,337
Used Vehicle Sales 312,306 266,818
Finance and Insurance 47,969 43,335
Service and Parts 116,802 100,108
------- -------
Total Revenues 1,204,149 1,043,598
Cost of Sales 1,037,369 901,164
--------- -------
Gross Profit 166,780 142,434
Selling, General and Administrative
Expenses 128,912 111,484
------- -------
Operating Income 37,868 30,950
Floor Plan Interest Expense (10,539) (7,221)
Other Interest Expense (7,430) (7,813)
Income Before Minority Interests
and Income Tax Provision 19,899 15,916
Minority Interests (82) (213)
Income Tax Provision (8,753) (7,083)
------- -------
Income before Extraordinary Item 11,064 8,620
Extraordinary Loss, Net of Income
Tax (a) (3,969) --
------- -------
Net Income $7,095 $8,620
====== ======
Diluted Earnings per Share before
Extraordinary Item $0.38 $0.35
===== =====
Diluted Earnings Per Share $0.24 $0.35
===== =====
Diluted Weighted Average Shares
Outstanding 29,400 24,422
====== ======
EBITDA (b) $43,572 $35,629
======= =======
(a) Results from the repurchase of $147 million of 11% subordinated
notes at 101% of face value, including the write-off of deferred
financing costs.
(b) EBITDA is defined as income before minority interests, income tax
provision, floor plan interest expense, other interest expense,
depreciation and amortization. Depreciation and amortization
amounted to $5.7 million and $4.7 million in 2000 and 1999,
respectively.
UNITEDAUTO GROUP, INC.
Consolidated Statements of Operations (Unaudited)
(Amounts in Thousands, Except Per Share Data)
First Half
-------------------------------------
2000 1999
---- ----
New Vehicle Sales $1,390,872 $1,158,028
Used Vehicle Sales 605,377 517,487
Finance and Insurance 91,704 79,999
Service and Parts 226,963 192,816
------- -------
Total Revenues 2,314,916 1,948,330
Cost of Sales 1,996,023 1,680,344
--------- ---------
Gross Profit 318,893 267,986
Selling, General and
Administrative Expenses 253,756 215,036
------- -------
Operating Income 65,137 52,950
Floor Plan Interest Expense (20,457) (13,724)
Other Interest Expense (14,293) (16,255)
Income Before Minority Interests
and Income Tax Provision 30,387 22,971
Minority Interests (313) (361)
Income Tax Provision (13,370) (10,292)
-------- --------
Income before Extraordinary Item 16,704 12,318
Extraordinary Loss, Net of Income
Tax (a) (3,969) --
------- --------
Net Income $12,735 $12,318
======= =======
Diluted Earnings per Share before
Extraordinary Item $0.56 $0.53
===== =====
Diluted Earnings Per Share $0.43 $0.53
===== =====
Diluted Weighted Average Shares
Outstanding 29,808 23,202
====== ======
EBITDA (b) $76,218 $62,184
======= =======
(a) Results from the repurchase of $147 million of 11% subordinated
notes at 101% of face value, including the write-off of deferred
financing costs.
(b) EBITDA is defined as income before minority interests, income tax
provision, floor plan interest expense, other interest expense,
depreciation and amortization. Depreciation and amortization
amounted to $11.1 million and $9.2 million in 2000 and 1999,
respectively.