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Group 1 Automotive

800 Gessner
Houston, TX 77024

  • Sales: (713) 647-5700
Investor Relations

Group 1 Automotive Announces First Quarter 2018 Financial Results

Strong U.S. Performance in March and Benefits from New Tax Law Drive Record Earnings

HOUSTON, April 26, 2018 /PRNewswire/ -- Group 1 Automotive, Inc. (NYSE: GPI), ("Group 1" or the "Company"), an international, Fortune 500 automotive retailer, today reported 2018 first quarter net income of $35.8 million, and diluted earnings per common share of $1.70. There were no non-GAAP adjustments for the first quarter of 2018.

In comparison, Group 1 generated $33.9 million of net income, $32.8 million of adjusted net income (a non-GAAP measure), $1.58 of diluted earnings per common share and $1.53 of adjusted diluted earnings per common share (a non-GAAP measure) for the first quarter of 2017. First quarter 2017 adjusted net income and diluted earnings per share exclude a non-core benefit of approximately $1.1 million after-tax, or $0.05 per share, related to a settlement with an Original Equipment Manufacturer (OEM). Reconciliations of non-GAAP financial measures are included in the attached financial tables.

"An acceleration of our U.S. business in March allowed us to deliver record first quarter revenue of $2.9 billion, which coupled with the benefits from the new U.S. tax law, drove record first quarter earnings per share of $1.70," said Earl J. Hesterberg, Group 1's president and chief executive officer. "We also received a major contribution from our U.K. operations despite an extremely weak new vehicle sales market, which declined 12.4 percent in the first quarter. We generated a 26 percent increase in overall gross profit for the quarter in the U.K. on a constant currency basis, driven by an impressive 5 percent increase in same store used vehicle unit sales and the efficient integration of two recent dealer group acquisitions. Additionally, we are pleased to report continued recovery in the Brazilian market, where Same Store total revenue increased 20 percent on a constant currency basis."

Consolidated Results for First Quarter 2018 (year-over-year comparable basis)
For ease of comparison, we have included constant currency metrics (a non-GAAP measure) both below (shown in parenthesis) and in the financial tables that follow:

  • Total revenue grew 13.5 percent (10.8 percent) to $2.9 billion.
  • Total gross profit grew 9.4 percent (7.5 percent), to $419.8 million.
  • New vehicle revenues increased 13.2 percent (10.4 percent) on 7.6 percent higher unit sales. New vehicle gross profit improved 9.0 percent (6.1 percent), to $75.4 million.
  • Retail used vehicle revenues increased 18.1 percent (15.0 percent) on 14.7 percent higher unit sales. Retail used vehicle gross profit decreased 3.4 percent (decreased 5.3 percent), to $43.5 million, with the decline more than offset by stronger wholesale used vehicle gross profit, which increased $1.6 million. Total used vehicle gross profit was up slightly, to $45.2 million.
  • Parts and service gross profit increased 8.4 percent (6.6 percent) on revenue growth of 9.3 percent (7.6 percent). Same Store parts and service gross profit increased 3.3 percent (1.9 percent) on revenue growth of 4.6 percent (3.3 percent).
  • Finance and Insurance (F&I) gross profit per retail unit (PRU) increased 4.7 percent (3.3 percent), to $1,451 and total F&I gross profit increased $15.5 million, or 16.0 percent (14.4 percent), reflecting strong new and used retail unit growth, as well as the improvement in PRU.
  • Selling, General and Administrative (SG&A) expenses as a percent of gross profit increased 170 basis points, to 77.3 percent. Compared with adjusted 2017 SG&A expense levels, SG&A as a percent of gross profit increased 130 basis points, to 77.3 percent. As disclosed in the Company's press release on March 19, 2018, included within the 2018 first quarter results are $3 million of costs associated with a one-time bonus to qualified U.S. employees and approximately $3 million of costs associated with the Company's new strategic initiatives.
  • Provision for income taxes declined 40.0 percent to $10.4 million, or 22.4 percent of income before income taxes, primarily reflecting the impact of the U.S. Tax Reform Bill that reduced the U.S. corporate income tax rate.

 

Segment Results for First Quarter 2018 (year-over-year comparable basis)

  • United States:
    The Company's U.S. operations accounted for 73.0 percent of total revenues and 80.0 percent of total gross profit. Total U.S. revenues were $2.1 billion, an increase of 6.1 percent, driven by increases in new vehicle revenue (up 7.0 percent), used retail (up 8.0 percent), parts and service (up 4.9 percent), and a 12.1 percent increase in F&I revenue. F&I gross profit PRU grew $81, or 4.9 percent per unit, to an all-time record of $1,718; and total gross profit grew 4.7 percent, to $335.7 million.

    New vehicle retail gross profit PRU decreased $9, to $1,853. Used vehicle retail gross profit PRU declined $296, to $1,226. This decline was significantly more pronounced in our luxury brands, and primarily in our certified pre-owned (CPO) business as we work with our OEM partners to absorb an increased supply of off-lease and loaner vehicles. Additionally, a portion of the decline relates to the continuing shift in consumer demand from cars to trucks. 

    SG&A expenses as a percent of gross profit increased 170 basis points to 75.4 percent and operating margin decreased 40 basis points to 3.3 percent. These costs include $3 million for the one-time bonus paid to our U.S. non-managerial staff, as well as approximately $3 million associated with our new initiatives in used and parts and service.

    "As we announced in March, we have launched several important strategic initiatives in our U.S. market that are designed to expand our used car sales and further strengthen our parts and service operations. Although it is still very early, we are encouraged by the initial results," said Daryl Kenningham, Group 1's president of U.S. operations. "Same Store used retail unit sales increased 7.7 percent in the U.S. during the quarter, the highest growth we have seen in ten quarters. In addition, we have installed our new work schedule in 65 of our U.S. dealerships as of March 31, 2018, and we are already seeing an improvement in retention and hiring, with a 17 percent increase in our service advisor headcount from the same period last year. Although these actions have added some costs in the near-term, we remain confident these investments will allow us to accelerate growth later this year and going forward."
     
  • United Kingdom:
    The Company's U.K. operations accounted for 23.1 percent of total revenues and 17.0 percent of total gross profit. Total U.K. revenues increased 46.7 percent (30.3 percent), to $660.5 million, driven by double-digit revenue growth across each business segment, despite the industry decreasing by over 12 percent. Total gross profit increased 42.1 percent (26.2 percent), to $71.5 million.

    SG&A expenses as a percent of gross profit increased 60 basis points to 83.4 percent and operating margin decreased 30 basis points to 1.3 percent.
     
  •  Brazil:
    The Company's Brazilian operations were approximately breakeven during the first quarter (traditionally the weakest quarter of the year) and accounted for 3.9 percent of total revenues and 3.0 percent of total gross profit. The Company's Same Store new vehicle revenue grew 23.5 percent on a constant currency basis, with units up 23.3 percent, which significantly outpaced the industry's unit sales increase of 14.7 percent. On a Same Store basis, total revenues grew 19.9 percent, driven by revenue growth of the aforementioned 23.5 percent in new vehicles, 16.6 percent in total used vehicles, 10.4 percent in parts & service, and 8.5 percent in F&I.

    SG&A expenses as a percent of gross profit improved 60 basis points to 93.5 percent.

 

Share Repurchase Authorization

For the first quarter of 2018, the Company repurchased 135,605 shares at an average price per common share of $67.83 for a total of $9.2 million. As of April 26, 2018, $40.4 million remains available under the Company's common stock share repurchase authorization.

Future repurchases may be made from time to time, based on market conditions, legal requirements and other corporate considerations, in the open market or in privately negotiated transactions, and subject to Board approval and covenant restrictions.

Corporate Development

As previously announced in 2018, the Company:

  • Acquired Toyota Alpha Trevo Automoveis Ltda in western São Paulo of Brazil in April 2018, which will operate as T-Drive Toyota Alphaville, and is expected to generate approximately $45 million in annualized revenues;
  • Acquired five Mercedes-Benz franchises and three Smart franchises northeast of London in the U.K. at the end of February 2018, which are expected to generate approximately $260 million in annualized revenues;
  • Acquired Audi El Paso and Subaru El Paso in January 2018 in West Texas, which are expected to generate approximately $65 million in annualized revenues; and
  • Opened a Land Rover franchise in January 2018 in Watford, a North London suburb in the U.K., which is expected to generate approximately $35 million in annualized revenues.

 

Year-to-date 2018, the Company has acquired a total of 12 franchises, which are expected to generate an estimated $405 million in annual revenues.

 

First Quarter 2018 Earnings Conference Call Details

Group 1's senior management will host a conference call today at 10 a.m. ET to discuss the first quarter financial results and the Company's outlook and strategy.

The conference call will be simulcast live on the Internet at www.group1auto.com, then click on 'Investor Relations' and then 'Events' or through this link: http://www.group1corp.com/events. A webcast replay will be available for 30 days.

The conference call will also be available live by dialing in 15 minutes prior to the start of the call at:

Domestic:

1-888-317-6003

International:

1-412-317-6061

Conference ID:

6796253

 

A telephonic replay will be available following the call through May 3, 2018 by dialing:

 

Domestic:

1-877-344-7529

International:

1-412-317-0088

Replay ID:

10118929

 

ABOUT GROUP 1 AUTOMOTIVE, INC.
Group 1 owns and operates 181 automotive dealerships, 239 franchises, and 48 collision centers in the United States, the United Kingdom and Brazil that offer 32 brands of automobiles. Through its dealerships, the Company sells new and used cars and light trucks; arranges related vehicle financing; sells service contracts; provides automotive maintenance and repair services; and sells vehicle parts.

Investors please visit www.group1corp.com, www.group1auto.com, www.group1collision.com, www.facebook.com/group1auto, and www.twitter.com/group1auto, where Group 1 discloses additional information about the Company, its business, and its results of operations.

FORWARD-LOOKING STATEMENTS
This press release contains "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995, which are statements related to future, not past, events and are based on our current expectations and assumptions regarding our business, the economy and other future conditions. In this context, the forward-looking statements often include statements regarding our goals, plans, projections and guidance regarding our financial position, results of operations, market position, pending and potential future acquisitions and business strategy, and often contain words such as "expects," "anticipates," "intends," "plans," "believes," "seeks," "should," "foresee," "may" or "will" and similar expressions. While management believes that these forward-looking statements are reasonable as and when made, there can be no assurance that future developments affecting us will be those that we anticipate. Any such forward-looking statements are not assurances of future performance and involve risks and uncertainties that may cause actual results to differ materially from those set forth in the statements. These risks and uncertainties include, among other things, (a) general economic and business conditions, (b) the level of manufacturer incentives, (c) the future regulatory environment, (d) our ability to obtain an inventory of desirable new and used vehicles, (e) our relationship with our automobile manufacturers and the willingness of manufacturers to approve future acquisitions, (f) our cost of financing and the availability of credit for consumers, (g) our ability to complete acquisitions and dispositions and the risks associated therewith, (h) foreign exchange controls and currency fluctuations, and (i) our ability to retain key personnel. For additional information regarding known material factors that could cause our actual results to differ from our projected results, please see our filings with the SEC, including our Annual Report on Form 10-K, Quarterly Reports on Form 10-Q and Current Reports on Form 8-K. Readers are cautioned not to place undue reliance on forward-looking statements, which speak only as of the date hereof. We undertake no obligation to publicly update or revise any forward-looking statements after the date they are made, whether as a result of new information, future events or otherwise.

NON-GAAP FINANCIAL MEASURES
In addition to evaluating the financial condition and results of our operations in accordance with GAAP, from time to time our management evaluates and analyzes results and any impact on the Company of strategic decisions and actions relating to, among other things, cost reduction, growth, and profitability improvement initiatives, and other events outside of normal, or "core," business and operations, by considering alternative financial measures not prepared in accordance with GAAP. This includes evaluating measures such as adjusted selling, general and administrative expenses, adjusted net income and adjusted diluted earnings per share. These adjusted measures are not measures of financial performance under U.S. GAAP, but are instead considered non-GAAP financial performance measures. Non-GAAP measures do not have definitions under GAAP and may be defined differently by and not be comparable to similarly titled measures used by other companies. As a result, any non-GAAP financial measures considered and evaluated by management are reviewed in conjunction with a review of the most directly comparable measures calculated in accordance with GAAP. We caution investors not to place undue reliance on such non-GAAP measures, but also to consider them with the most directly comparable GAAP measures. In our evaluation of results from time to time, we exclude items that do not arise directly from core operations, such as non-cash asset impairment charges, gains and losses on dealership franchise or real estate transactions, and catastrophic weather events such as hail storms, hurricanes, and snow storms. Because these non-core charges and gains materially affect the Company's financial condition or results in the specific period in which they are recognized, management also evaluates, and makes resource allocation and performance evaluation decisions based on, the related non-GAAP measures excluding such items.

In addition to using such non-GAAP measures to evaluate results in a specific period, management believes that such measures may provide more complete and consistent comparisons of operational performance on a period-over-period historical basis and a better indication of expected future trends. Our management also uses these adjusted measures in conjunction with U.S. GAAP financial measures to assess our business, including communication with our Board of Directors, investors and industry analysts concerning financial performance. We disclose these non-GAAP measures, and the related reconciliations, because we believe investors use these metrics in evaluating longer-term period-over-period performance, and to allow investors to better understand and evaluate the information used by management to assess operating performance. The exclusion of certain expenses in the calculation of non-GAAP financial measures should not be construed as an inference that these costs are unusual or infrequent. We anticipate excluding these expenses in the future presentation of our non-GAAP financial measures.

In addition, we evaluate our results of operations on both an as reported and a constant currency basis. The constant currency presentation, which is a non-GAAP measure, excludes the impact of fluctuations in foreign currency exchange rates. We believe providing constant currency information provides valuable supplemental information regarding our underlying business and results of operations, consistent with how we evaluate our performance. We calculate constant currency percentages by converting our current period reported results for entities reporting in currencies other than United States dollars using comparative period exchange rates rather than the actual exchange rates in effect during the respective periods. The constant currency performance measures should not be considered a substitute for, or superior to, the measures of financial performance prepared in accordance with U.S. GAAP.

Investor contacts:
Sheila Roth
Manager, Investor Relations
Group 1 Automotive, Inc.
713-647-5741 | sroth@group1auto.com

Media contacts:
Pete DeLongchamps
Senior Vice President, Manufacturer Relations, Financial Services and Public Affairs
Group 1 Automotive, Inc.
713-647-5770 | pdelongchamps@group1auto.com 
or
Clint Woods
Pierpont Communications, Inc.
713-627-2223 | cwoods@piercom.com

 

Group 1 Automotive, Inc.

Consolidated Statements of Operations

(Unaudited)

(In thousands, except per share amounts)

           
 

 Three Months Ended March 31, 

 

2018

 

2017

 

% Increase/
(Decrease)

REVENUES:

         

New vehicle retail sales

$              1,513,590

 

$ 1,337,213

 

13.2

Used vehicle retail sales

780,570

 

660,927

 

18.1

Used vehicle wholesale sales

104,029

 

104,157

 

(0.1)

Parts and service

349,515

 

319,698

 

9.3

Finance, insurance and other, net

112,322

 

96,834

 

16.0

Total revenues

2,860,026

 

2,518,829

 

13.5

           

COST OF SALES:

         

New vehicle retail sales

1,438,163

 

1,267,986

 

13.4

Used vehicle retail sales

737,075

 

615,922

 

19.7

Used vehicle wholesale sales

102,374

 

104,057

 

(1.6)

Parts and service

162,651

 

147,342

 

10.4

Total cost of sales

2,440,263

 

2,135,307

 

14.3

           

GROSS PROFIT

419,763

 

383,522

 

9.4

           

SELLING, GENERAL AND ADMINISTRATIVE EXPENSES

324,347

 

289,779

 

11.9

           

DEPRECIATION AND AMORTIZATION EXPENSE

16,342

 

13,606

 

20.1

           

OPERATING INCOME

79,074

 

80,137

 

(1.3)

           

OTHER EXPENSE:

         

Floorplan interest expense

(14,087)

 

(11,942)

 

18.0

Other interest expense, net

(18,820)

 

(16,999)

 

10.7

INCOME BEFORE INCOME TAXES

46,167

 

51,196

 

(9.8)

           

PROVISION FOR INCOME TAXES

(10,353)

 

(17,257)

 

(40.0)

           

NET INCOME 

$                   35,814

 

$      33,939

 

5.5

Less: Earnings allocated to participating securities

$                     1,208

 

$        1,250

 

(3.4)

Earnings available to diluted common shares

$                   34,606

 

$      32,689

 

5.9

DILUTED EARNINGS PER SHARE

$                       1.70

 

$          1.58

 

7.6

Weighted average dilutive common shares outstanding

20,307

 

20,698

 

(1.9)

Weighted average participating securities

715

 

818

 

(12.6)

Total weighted average shares outstanding

21,022

 

21,516

 

(2.3)

 

Group 1 Automotive, Inc.

Consolidated Balance Sheets

(Dollars in thousands)

           
 

March 31,
2018

 

December 31,
2017

 

% Increase/
(Decrease)

 ASSETS: 

(Unaudited)

       

 CURRENT ASSETS: 

         

 Cash and cash equivalents 

$      33,090

 

$          28,787

 

14.9

 Contracts in transit and vehicle receivables, net 

297,885

 

306,433

 

(2.8)

 Accounts and notes receivable, net 

200,159

 

188,611

 

6.1

 Inventories, net 

1,804,176

 

1,763,293

 

2.3

 Prepaid expenses and other current assets 

77,888

 

42,062

 

85.2

 Total current assets 

2,413,198

 

2,329,186

 

3.6

 PROPERTY AND EQUIPMENT, net 

1,357,870

 

1,318,959

 

3.0

 GOODWILL AND INTANGIBLE FRANCHISE RIGHTS 

1,255,736

 

1,198,666

 

4.8

 OTHER ASSETS 

31,674

 

24,254

 

30.6

 Total assets 

$ 5,058,478

 

$     4,871,065

 

3.8

           

 LIABILITIES AND STOCKHOLDERS' EQUITY: 

         

 CURRENT LIABILITIES: 

         

 Floorplan notes payable - credit facility and other 

$ 1,199,741

 

$     1,240,695

 

(3.3)

 Offset account related to floorplan notes payable - credit facility 

(74,359)

 

(86,547)

 

(14.1)

 Floorplan notes payable - manufacturer affiliates 

420,315

 

397,183

 

5.8

 Offset account related to floorplan notes payable - manufacturer affiliates 

(24,000)

 

(22,500)

 

6.7

 Current maturities of long-term debt and short-term financing 

58,195

 

77,609

 

(25.0)

 Current liabilities from interest rate risk management activities 

1,177

 

1,996

 

(41.0)

 Accounts payable 

491,841

 

412,981

 

19.1

 Accrued expenses 

194,248

 

177,070

 

9.7

 Total current liabilities 

2,267,158

 

2,198,487

 

3.1

 5.00% SENIOR NOTES (principal of $550,000 at March 31, 2018 and December 31,
2017, respectively) 

542,474

 

542,063

 

0.1

 5.25% SENIOR NOTES (principal of $300,000 at March 31, 2018 and December 31,
2017, respectively) 

296,295

 

296,151

 

-

 ACQUISITION LINE 

28,035

 

26,988

 

3.9

 REAL ESTATE RELATED AND OTHER LONG-TERM DEBT, net of current maturities 

447,540

 

405,950

 

10.2

 CAPITAL LEASE OBLIGATIONS RELATED TO REAL ESTATE, net of current maturities 

62,426

 

47,032

 

32.7

 DEFERRED INCOME TAXES 

134,800

 

124,404

 

8.4

 LIABILITIES FROM INTEREST RATE RISK MANAGEMENT ACTIVITIES 

3,512

 

8,583

 

(59.1)

 OTHER LIABILITIES 

98,159

 

97,125

 

1.1

 STOCKHOLDERS' EQUITY: 

         

 Common stock 

255

 

255

 

-

 Additional paid-in capital 

286,244

 

291,461

 

(1.8)

 Retained earnings 

1,288,052

 

1,246,323

 

3.3

 Accumulated other comprehensive loss 

(105,950)

 

(123,226)

 

(14.0)

 Treasury stock 

(290,522)

 

(290,531)

 

-

 Total stockholders' equity 

1,178,079

 

1,124,282

 

4.8

 Total liabilities and stockholders' equity 

$ 5,058,478

 

$     4,871,065

 

3.8

           

 

Group 1 Automotive, Inc.

Additional Information - Consolidated

(Unaudited)

         
   

Three Months Ended

   

March 31,

   

2018 (%)

 

2017 (%)

NEW VEHICLE UNIT SALES GEOGRAPHIC MIX:

     

Region

Geographic Market

     

United States

Texas

34.9

 

34.8

 

California

6.5

 

7.9

 

Oklahoma

6.0

 

6.4

 

Massachusetts

4.8

 

4.2

 

Georgia

4.3

 

4.5

 

Florida

2.5

 

2.5

 

Louisiana

1.8

 

2.1

 

New Hampshire

1.8

 

1.8

 

New Jersey

1.6

 

1.6

 

South Carolina

1.5

 

1.3

 

Kansas

1.4

 

1.6

 

Mississippi

1.2

 

1.5

 

Alabama

0.7

 

1.2

 

Maryland

0.5

 

0.4

 

New Mexico 

0.1

 

   

69.6

 

71.8

         

International

United Kingdom

25.4

 

23.6

 

Brazil

5.0

 

4.6

   

100.0

 

100.0

         

NEW VEHICLE UNIT SALES BRAND MIX:

     

Toyota/Scion/Lexus

24.1

 

23.2

Volkswagen/Audi/Porsche

13.6

 

12.5

BMW/MINI

12.7

 

14.3

Ford/Lincoln

11.3

 

12.8

Honda/Acura

9.5

 

9.1

Nissan

6.7

 

8.2

Chevrolet/GMC/Buick/Cadillac

5.8

 

6.7

Mercedes-Benz/smart/Sprinter

4.7

 

3.9

Chrysler/Dodge/Jeep/RAM

4.1

 

3.7

Hyundai/Kia

3.9

 

3.4

Other

3.6

 

2.2

   

100.0

 

100.0

 

Group 1 Automotive, Inc.

Additional Information - U.S.

(Unaudited)

(Dollars in thousands, except per unit amounts)

           
 

Three Months Ended March 31,

 

2018

 

2017

 

% Increase/
(Decrease)

REVENUES:

         

New vehicle retail sales

$ 1,089,953

 

$ 1,018,249

 

7.0

Used vehicle retail sales

563,830

 

521,947

 

8.0

Used vehicle wholesale sales

54,002

 

70,545

 

(23.5)

Total used

617,832

 

592,492

 

4.3

Parts and service

284,514

 

271,159

 

4.9

Finance, insurance and other, net

96,187

 

85,819

 

12.1

Total

$ 2,088,486

 

$ 1,967,719

 

6.1

           

GROSS MARGIN %:

         

New vehicle retail sales

4.9

 

5.0

   

Used vehicle retail sales

5.9

 

7.3

   

Used vehicle wholesale sales

2.7

 

(0.5)

   

Total used

5.7

 

6.3

   

Parts and service

53.2

 

53.8

   

Finance, insurance and other, net

100.0

 

100.0

   

Total

16.1

 

16.3

   
           

GROSS PROFIT:

         

New vehicle retail sales

$      53,135

 

$      51,209

 

3.8

Used vehicle retail sales

33,485

 

37,932

 

(11.7)

Used vehicle wholesale sales

1,434

 

(362)

 

496.1

Total used

34,919

 

37,570

 

(7.1)

Parts and service

151,444

 

145,998

 

3.7

Finance, insurance and other, net

96,187

 

85,819

 

12.1

Total 

$    335,685

 

$    320,596

 

4.7

           

UNITS SOLD:

         

Retail new vehicles sold

28,673

 

27,498

 

4.3

Retail used vehicles sold

27,310

 

24,929

 

9.6

Wholesale used vehicles sold

9,383

 

9,981

 

(6.0)

Total used

36,693

 

34,910

 

5.1

           

AVERAGE RETAIL SALES PRICE:

         

New vehicle retail

$      38,013

 

$      37,030

 

2.7

Used vehicle retail

$      20,646

 

$      20,937

 

(1.4)

           

GROSS PROFIT PER UNIT SOLD:

         

New vehicle retail sales

$        1,853

 

$        1,862

 

(0.5)

Used vehicle retail sales

1,226

 

1,522

 

(19.4)

Used vehicle wholesale sales

153

 

(36)

 

525.0

Total used

952

 

1,076

 

(11.5)

Finance, insurance and other, net (per retail unit)

$        1,718

 

$        1,637

 

4.9

           

OTHER: 

         

SG&A expenses

$    252,941

 

$    236,273

 

7.1

Adjusted SG&A expenses (1)

$    252,941

 

$    238,106

 

6.2

SG&A as % revenues

12.1

 

12.0

   

Adjusted SG&A as % revenues (1)

12.1

 

12.1

   

SG&A as % gross profit

75.4

 

73.7

   

Adjusted SG&A as % gross profit (1)

75.4

 

74.3

   

Operating margin %

3.3

 

3.7

   

Adjusted operating margin % (1)

3.3

 

3.6

   

Pretax margin %

1.9

 

2.3

   

Adjusted pretax margin %(1)

1.9

 

2.2

   
           

INTEREST EXPENSE:

         

Floorplan interest expense

$    (12,337)

 

$    (10,878)

 

13.4

Floorplan assistance

10,750

 

10,284

 

4.5

Net floorplan expense

$      (1,587)

 

$         (594)

 

167.2

Other interest expense, net

$    (17,016)

 

$    (16,272)

 

4.6

           

(1) See the section of this release entitled "Non-GAAP Financial Measures" and the tables attached hereto for information regarding certain selected items that the Company believes impact comparability of financial results between reporting periods, as well as for information regarding non-GAAP financial measures and their reconciliation to the most directly comparable measures as reported in accordance with U.S. GAAP.

 

Group 1 Automotive, Inc.

Additional Information - U.K.

(Unaudited)

(Dollars in thousands, except per unit amounts)

               
 

Three Months Ended March 31,

 

2018

 

2017

 

% Increase/
(Decrease)

 

Constant Currency (1)
% Increase/ (Decrease)

REVENUES:

             

New vehicle retail sales

$   354,404

 

$   258,640

 

37.0

 

21.6

Used vehicle retail sales

192,549

 

115,369

 

66.9

 

48.5

Used vehicle wholesale sales

46,185

 

30,509

 

51.4

 

34.7

Total used

238,734

 

145,878

 

63.7

 

45.7

Parts and service

53,141

 

36,781

 

44.5

 

28.6

Finance, insurance and other, net

14,263

 

9,028

 

58.0

 

40.3

Total

$   660,542

 

$   450,327

 

46.7

 

30.3

               

GROSS MARGIN %:

             

New vehicle retail sales

5.2

 

5.6

       

Used vehicle retail sales

4.4

 

4.7

       

Used vehicle wholesale sales

0.2

 

0.7

       

Total used

3.6

 

3.9

       

Parts and service

56.5

 

57.7

       

Finance, insurance and other, net

100.0

 

100.0

       

Total

10.8

 

11.2

       
               

GROSS PROFIT:

             

New vehicle retail sales

$     18,511

 

$     14,401

 

28.5

 

13.9

Used vehicle retail sales

8,560

 

5,429

 

57.7

 

40.3

Used vehicle wholesale sales

70

 

211

 

(66.8)

 

(72.7)

Total used

8,630

 

5,640

 

53.0

 

36.1

Parts and service

30,047

 

21,225

 

41.6

 

26.0

Finance, insurance and other, net

14,263

 

9,028

 

58.0

 

40.3

Total 

$     71,451

 

$     50,294

 

42.1

 

26.2

               

UNITS SOLD:

             

Retail new vehicles sold

10,450

 

9,018

 

15.9

   

Retail used vehicles sold

7,835

 

5,611

 

39.6

   

Wholesale used vehicles sold

5,587

 

4,169

 

34.0

   

Total used

13,422

 

9,780

 

37.2

   
               

AVERAGE RETAIL SALES PRICE:

             

New vehicle retail

$     33,914

 

$     28,680

 

18.2

 

4.9

Used vehicle retail

$     24,575

 

$     20,561

 

19.5

 

6.4

               

GROSS PROFIT PER UNIT SOLD:

             

New vehicle retail sales

$       1,771

 

$       1,597

 

10.9

 

(1.7)

Used vehicle retail sales

1,093

 

968

 

12.9

 

0.5

Used vehicle wholesale sales

13

 

51

 

(74.5)

 

(79.6)

Total used

643

 

577

 

11.4

 

(0.8)

Finance, insurance and other, net (per retail unit)

$          780

 

$          617

 

26.4

 

12.3

               

OTHER: 

             

SG&A expenses

$     59,596

 

$     41,624

 

43.2

 

27.4

SG&A as % revenues

9.0

 

9.2

       

SG&A as % gross profit

83.4

 

82.8

       

Operating margin %

1.3

 

1.6

       

Pretax margin %

0.9

 

1.2

       
               

INTEREST EXPENSE:

             

Floorplan interest expense

$      (1,514)

 

$      (1,034)

 

46.4

 

30.4

Floorplan assistance

285

 

229

 

24.5

 

10.6

Net floorplan expense

$      (1,229)

 

$         (805)

 

52.7

 

36.0

Other interest expense, net

$      (1,532)

 

$         (581)

 

163.7

 

135.6

               

(1) See the section of this release entitled "Non-GAAP Financial Measures" and the tables attached hereto for information regarding certain selected items that the Company believes impact comparability of financial results between reporting periods, as well as for information regarding non-GAAP financial measures and their reconciliation to the most directly comparable measures as reported in accordance with U.S. GAAP.

 

Group 1 Automotive, Inc.

Additional Information - Brazil

(Unaudited)

(Dollars in thousands, except per unit amounts)

               
 

Three Months Ended March 31,

 

2018

 

2017

 

% Increase/
(Decrease)

 

Constant Currency (1)
% Increase/ (Decrease)

REVENUES:

             

New vehicle retail sales

$   69,233

 

$   60,324

 

14.8

 

18.8

Used vehicle retail sales

24,191

 

23,611

 

2.5

 

5.9

Used vehicle wholesale sales

3,842

 

3,103

 

23.8

 

28.4

Total used

28,033

 

26,714

 

4.9

 

8.5

Parts and service

11,860

 

11,758

 

0.9

 

4.1

Finance, insurance and other, net

1,872

 

1,987

 

(5.8)

 

(2.4)

Total

$ 110,998

 

$ 100,783

 

10.1

 

13.9

               

GROSS MARGIN %:

             

New vehicle retail sales

5.5

 

6.0

       

Used vehicle retail sales

6.0

 

7.0

       

Used vehicle wholesale sales

3.9

 

8.1

       

Total used

5.7

 

7.1

       

Parts and service

45.3

 

43.7

       

Finance, insurance and other, net

100.0

 

100.0

       

Total

11.4

 

12.5

       
               

GROSS PROFIT:

             

New vehicle retail sales

$     3,781

 

$     3,617

 

4.5

 

8.2

Used vehicle retail sales

1,450

 

1,644

 

(11.8)

 

(8.9)

Used vehicle wholesale sales

151

 

251

 

(39.8)

 

(37.4)

Total used

1,601

 

1,895

 

(15.5)

 

(12.7)

Parts and service

5,373

 

5,133

 

4.7

 

8.1

Finance, insurance and other, net

1,872

 

1,987

 

(5.8)

 

(2.4)

Total 

$   12,627

 

$   12,632

 

-

 

3.4

               

UNITS SOLD:

             

Retail new vehicles sold

2,067

 

1,774

 

16.5

   

Retail used vehicles sold

1,071

 

1,026

 

4.4

   

Wholesale used vehicles sold

357

 

379

 

(5.8)

   

Total used

1,428

 

1,405

 

1.6

   
               

AVERAGE RETAIL SALES PRICE:

             

New vehicle retail

$   33,494

 

$   34,005

 

(1.5)

 

2.0

Used vehicle retail

$   22,587

 

$   23,013

 

(1.8)

 

1.5

               

GROSS PROFIT PER UNIT SOLD:

             

New vehicle retail sales

$     1,829

 

$     2,039

 

(10.3)

 

(7.1)

Used vehicle retail sales

1,354

 

1,602

 

(15.5)

 

(12.7)

Used vehicle wholesale sales

423

 

662

 

(36.1)

 

(33.5)

Total used

1,121

 

1,349

 

(16.9)

 

(14.1)

Finance, insurance and other, net (per retail unit)

$        597

 

$        710

 

(15.9)

 

(12.9)

               

OTHER: 

             

SG&A expenses

$   11,810

 

$   11,882

 

(0.6)

 

2.6

SG&A as % revenues

10.6

 

11.8

       

SG&A as % gross profit

93.5

 

94.1

       

Operating margin %

0.4

 

0.4

       

Pretax margin %

(0.1)

 

0.2

       
               

INTEREST EXPENSE:

             

Floorplan interest expense

$      (236)

 

$        (30)

 

686.7

 

722.5

Floorplan assistance

 

 

-

 

-

Net floorplan expense

$      (236)

 

$        (30)

 

686.7

 

722.5

Other interest expense, net

$      (272)

 

$      (146)

 

86.3

 

91.0

               

(1) See the section of this release entitled "Non-GAAP Financial Measures" and the tables attached hereto for information regarding certain selected items that the Company believes impact comparability of financial results between reporting periods, as well as for information regarding non-GAAP financial measures and their reconciliation to the most directly comparable measures as reported in accordance with U.S. GAAP.

 

Group 1 Automotive, Inc.

Additional Information - Consolidated

(Unaudited)

(Dollars in thousands, except per unit amounts)

               
 

Three Months Ended March 31,

 

2018

 

2017

 

% Increase/
(Decrease)

 

Constant Currency %(1)
Increase/ (Decrease)

REVENUES:

             

New vehicle retail sales

$ 1,513,590

 

$ 1,337,213

 

13.2

 

10.4

Used vehicle retail sales

780,570

 

660,927

 

18.1

 

15.0

Used vehicle wholesale sales

104,029

 

104,157

 

(0.1)

 

(4.9)

Total used

884,599

 

765,084

 

15.6

 

12.3

Parts and service

349,515

 

319,698

 

9.3

 

7.6

Finance, insurance and other, net

112,322

 

96,834

 

16.0

 

14.4

Total

$ 2,860,026

 

$ 2,518,829

 

13.5

 

10.8

               

GROSS MARGIN %:

             

New vehicle retail sales

5.0

 

5.2

       

Used vehicle retail sales

5.6

 

6.8

       

Used vehicle wholesale sales

1.6

 

0.1

       

Total used

5.1

 

5.9

       

Parts and service

53.5

 

53.9

       

Finance, insurance and other, net

100.0

 

100.0

       

Total

14.7

 

15.2

       
               

GROSS PROFIT:

             

New vehicle retail sales

$      75,427

 

$      69,227

 

9.0

 

6.1

Used vehicle retail sales

43,495

 

45,005

 

(3.4)

 

(5.3)

Used vehicle wholesale sales

1,655

 

100

 

1,555.0

 

1,549.1

Total used

45,150

 

45,105

 

0.1

 

(1.9)

Parts and service

186,864

 

172,356

 

8.4

 

6.6

Finance, insurance and other, net

112,322

 

96,834

 

16.0

 

14.4

Total 

$    419,763

 

$    383,522

 

9.4

 

7.5

               

UNITS SOLD:

             

Retail new vehicles sold

41,190

 

38,290

 

7.6

   

Retail used vehicles sold

36,216

 

31,566

 

14.7

   

Wholesale used vehicles sold

15,327

 

14,529

 

5.5

   

Total used

51,543

 

46,095

 

11.8

   
               

AVERAGE RETAIL SALES PRICE:

             

New vehicle retail

$      36,747

 

$      34,923

 

5.2

 

2.6

Used vehicle retail

$      21,553

 

$      20,938

 

2.9

 

0.3

               

GROSS PROFIT PER UNIT SOLD:

             

New vehicle retail sales

$        1,831

 

$        1,808

 

1.3

 

(1.4)

Used vehicle retail sales

1,201

 

1,426

 

(15.8)

 

(17.5)

Used vehicle wholesale sales

108

 

7

 

1,442.9

 

1,463.3

Total used

876

 

979

 

(10.5)

 

(12.3)

Finance, insurance and other, net (per retail unit)

$        1,451

 

$        1,386

 

4.7

 

3.3

               

OTHER: 

             

SG&A expenses

$    324,347

 

$    289,779

 

11.9

 

9.8

Adjusted SG&A expenses (1)

$    324,347

 

$    291,612

 

11.2

 

9.1

SG&A as % revenues

11.3

 

11.5

       

Adjusted SG&A as % revenues (1)

11.3

 

11.6

       

SG&A as % gross profit

77.3

 

75.6

       

Adjusted SG&A as % gross profit (1)

77.3

 

76.0

       

Operating margin %

2.8

 

3.2

       

Adjusted operating margin % (1)

2.8

 

3.1

       

Pretax margin %

1.6

 

2.0

       

Adjusted pretax margin % (1)

1.6

 

2.0

       
               

INTEREST EXPENSE:

             

Floorplan interest expense

$    (14,087)

 

$    (11,942)

 

18.0

 

16.7

Floorplan assistance

11,035

 

10,513

 

5.0

 

4.7

Net floorplan expense

$      (3,052)

 

$      (1,429)

 

113.6

 

104.9

Other interest expense, net

$    (18,820)

 

$    (16,999)

 

10.7

 

9.8

               

(1) See the section of this release entitled "Non-GAAP Financial Measures" and the tables attached hereto for information regarding certain selected items that the Company believes impact comparability of financial results between reporting periods, as well as for information regarding non-GAAP financial measures and their reconciliation to the most directly comparable measures as reported in accordance with U.S. GAAP.

 

Group 1 Automotive, Inc.

Additional Information - Same Store U.S. (1)

(Unaudited)

(Dollars in thousands, except per unit amounts)

           
 

Three Months Ended March 31,

 

2018

 

2017

 

% Increase/
(Decrease)

REVENUES:

         

New vehicle retail sales

$ 1,068,221

 

$ 1,018,249

 

4.9

Used vehicle retail sales

553,733

 

521,945

 

6.1

Used vehicle wholesale sales

52,779

 

70,544

 

(25.2)

Total used

606,512

 

592,489

 

2.4

Parts and service

280,403

 

271,159

 

3.4

Finance, insurance and other, net

94,151

 

85,391

 

10.3

Total 

$ 2,049,287

 

$ 1,967,288

 

4.2

           

GROSS MARGIN %:

         

New vehicle retail sales

4.9

 

5.0

   

Used vehicle retail sales

6.0

 

7.3

   

Used vehicle wholesale sales

2.7

 

(0.5)

   

Total used

5.7

 

6.3

   

Parts and service

53.1

 

53.8

   

Finance, insurance and other, net

100.0

 

100.0

   

Total

16.1

 

16.3

   
           

GROSS PROFIT:

         

New vehicle retail sales

$      52,071

 

$      51,207

 

1.7

Used vehicle retail sales

33,028

 

37,931

 

(12.9)

Used vehicle wholesale sales

1,425

 

(345)

 

513.0

Total used

34,453

 

37,586

 

(8.3)

Parts and service

148,910

 

145,998

 

2.0

Finance, insurance and other, net

94,151

 

85,391

 

10.3

Total 

$    329,585

 

$    320,182

 

2.9

           

UNITS SOLD:

         

Retail new vehicles sold

28,150

 

27,498

 

2.4

Retail used vehicles sold

26,858

 

24,929

 

7.7

Wholesale used vehicles sold

9,223

 

9,981

 

(7.6)

Total used

36,081

 

34,910

 

3.4

           

AVERAGE RETAIL SALES PRICE:

         

New vehicle retail

$      37,947

 

$      37,030

 

2.5

Used vehicle retail

$      20,617

 

$      20,937

 

(1.5)

           

GROSS PROFIT PER UNIT SOLD:

         

New vehicle retail sales

$        1,850

 

$        1,862

 

(0.6)

Used vehicle retail sales

1,230

 

1,522

 

(19.2)

Used vehicle wholesale sales

155

 

(35)

 

542.9

Total used

955

 

1,077

 

(11.3)

Finance, insurance and other, net (per retail unit)

$        1,712

 

$        1,629

 

5.1

           

OTHER: 

         

SG&A expenses

$    247,611

 

$    236,051

 

4.9

Adjusted SG&A expenses(2)

$    247,611

 

$    237,884

 

4.1

SG&A as % revenues

12.1

 

12.0

   

Adjusted SG&A as % revenues (2)

12.1

 

12.1

   

SG&A as % gross profit

75.1

 

73.7

   

Adjusted SG&A as % gross profit (2)

75.1

 

74.3

   

Operating margin %

3.4

 

3.7

   

Adjusted operating margin % (2)

3.4

 

3.6

   
           

(1) Same store amounts include the results for the identical months in each period presented in the comparison, commencing with the first full month we owned the dealership and, in the case of dispositions, ending with the last full month we owned it. Same store results also include the activities of our corporate office.

(2) See the section of this release entitled "Non-GAAP Financial Measures" and the tables attached hereto for information regarding certain selected items that the Company believes impact comparability of financial results between reporting periods, as well as for information regarding non-GAAP financial measures and their reconciliation to the most directly comparable measures as reported in accordance with U.S. GAAP.

 

Group 1 Automotive, Inc.

Additional Information - Same Store U.K. (1)

(Unaudited)

(Dollars in thousands, except per unit amounts)

 
   

Three Months Ended March 31,

   

2018

 

2017

 

% Increase/
(Decrease)

 

Constant Currency (2)
% Increase/ (Decrease)

REVENUES:

               

New vehicle retail sales

 

$ 270,060

 

$ 256,703

 

5.2

 

(6.6)

Used vehicle retail sales

 

146,240

 

114,806

 

27.4

 

13.4

Used vehicle wholesale sales

 

36,073

 

30,415

 

18.6

 

5.6

Total used

 

182,313

 

145,221

 

25.5

 

11.7

Parts and service

 

41,225

 

36,446

 

13.1

 

0.7

Finance, insurance and other, net

 

10,635

 

8,973

 

18.5

 

5.3

Total 

 

$ 504,233

 

$ 447,343

 

12.7

 

0.2

                 

GROSS MARGIN %:

               

New vehicle retail sales

 

5.4

 

5.6

       

Used vehicle retail sales

 

4.6

 

4.7

       

Used vehicle wholesale sales

 

(0.1)

 

0.7

       

Total used

 

3.6

 

3.9

       

Parts and service

 

57.0

 

57.8

       

Finance, insurance and other, net

 

100.0

 

100.0

       

Total

 

11.0

 

11.2

       
                 

GROSS PROFIT:

               

New vehicle retail sales

 

$   14,584

 

$   14,296

 

2.0

 

(9.6)

Used vehicle retail sales

 

6,671

 

5,383

 

23.9

 

10.3

Used vehicle wholesale sales

 

(50)

 

212

 

(123.6)

 

(123.5)

Total used

 

6,621

 

5,595

 

18.3

 

5.2

Parts and service

 

23,505

 

21,073

 

11.5

 

(0.7)

Finance, insurance and other, net

 

10,635

 

8,973

 

18.5

 

5.3

Total 

 

$   55,345

 

$   49,937

 

10.8

 

(1.5)

                 

UNITS SOLD:

               

Retail new vehicles sold

 

8,012

 

8,904

 

(10.0)

   

Retail used vehicles sold

 

5,864

 

5,578

 

5.1

   

Wholesale used vehicles sold

 

4,333

 

4,142

 

4.6

   

Total used

 

10,197

 

9,720

 

4.9

   
                 

AVERAGE RETAIL SALES PRICE:

               

New vehicle retail

 

$   33,707

 

$   28,830

 

16.9

 

3.8

Used vehicle retail

 

$   24,939

 

$   20,582

 

21.2

 

7.9

                 

GROSS PROFIT PER UNIT SOLD:

               

New vehicle retail sales

 

$     1,820

 

$     1,606

 

13.3

 

0.5

Used vehicle retail sales

 

1,138

 

965

 

17.9

 

4.9

Used vehicle wholesale sales

 

(12)

 

51

 

(123.5)

 

(122.4)

Total used

 

649

 

576

 

12.7

 

0.3

Finance, insurance and other, net (per retail unit)

 

$        766

 

$        620

 

23.5

 

9.9

                 

OTHER: 

               

SG&A expenses

 

$   46,816

 

$   40,929

 

14.4

 

1.8

SG&A as % revenues

 

9.3

 

9.1

       

SG&A as % gross profit

 

84.6

 

82.0

       

Operating margin %

 

1.2

 

1.6

       
                 

(1) Same store amounts include the results for the identical months in each period presented in the comparison, commencing with the first full month we owned the dealership and, in the case of dispositions, ending with the last full month we owned it. Same store results also include the activities of our corporate office.

(2) See the section of this release entitled "Non-GAAP Financial Measures" and the tables attached hereto for information regarding certain selected items that the Company believes impact comparability of financial results between reporting periods, as well as for information regarding non-GAAP financial measures and their reconciliation to the most directly comparable measures as reported in accordance with U.S. GAAP.

 

Group 1 Automotive, Inc.

Additional Information - Same Store Brazil (1)

(Unaudited)

(Dollars in thousands, except per unit amounts)

 
   

Three Months Ended March 31,

   

2018

 

2017

 

% Increase/
(Decrease)

 

Constant Currency (2)
% Increase/ (Decrease)

REVENUES:

               

New vehicle retail sales

 

$   69,233

 

$ 58,086

 

19.2

 

23.5

Used vehicle retail sales

 

24,191

 

21,801

 

11.0

 

14.9

Used vehicle wholesale sales

 

3,842

 

3,087

 

24.5

 

29.0

Total used

 

28,033

 

24,888

 

12.6

 

16.6

Parts and service

 

11,860

 

11,098

 

6.9

 

10.4

Finance, insurance and other, net

 

1,872

 

1,790

 

4.6

 

8.5

Total 

 

$ 110,998

 

$ 95,862

 

15.8

 

19.9

                 

GROSS MARGIN %:

               

New vehicle retail sales

 

5.5

 

6.1

       

Used vehicle retail sales

 

6.0

 

7.3

       

Used vehicle wholesale sales

 

3.9

 

8.2

       

Total used

 

5.7

 

7.4

       

Parts and service

 

45.3

 

45.4

       

Finance, insurance and other, net

 

100.0

 

100.0

       

Total

 

11.4

 

12.7

       
                 

GROSS PROFIT:

               

New vehicle retail sales

 

$     3,781

 

$   3,520

 

7.4

 

11.3

Used vehicle retail sales

 

1,452

 

1,591

 

(8.7)

 

(5.7)

Used vehicle wholesale sales

 

151

 

252

 

(40.1)

 

(37.4)

Total used

 

1,603

 

1,843

 

(13.0)

 

(10.0)

Parts and service

 

5,373

 

5,042

 

6.6

 

10.1

Finance, insurance and other, net

 

1,872

 

1,790

 

4.6

 

8.5

Total 

 

$   12,629

 

$ 12,195

 

3.6

 

7.1

                 

UNITS SOLD:

               

Retail new vehicles sold

 

2,067

 

1,676

 

23.3

   

Retail used vehicles sold

 

1,071

 

981

 

9.2

   

Wholesale used vehicles sold

 

357

 

269

 

32.7

   

Total used

 

1,428

 

1,250

 

14.2

   
                 

AVERAGE RETAIL SALES PRICE:

               

New vehicle retail

 

$   33,494

 

$ 34,658

 

(3.4)

 

0.1

Used vehicle retail

 

$   22,587

 

$ 22,223

 

1.6

 

5.2

                 

GROSS PROFIT PER UNIT SOLD:

               

New vehicle retail sales

 

$     1,829

 

$   2,100

 

(12.9)

 

(9.8)

Used vehicle retail sales

 

1,356

 

1,622

 

(16.4)

 

(13.6)

Used vehicle wholesale sales

 

423

 

937

 

(54.9)

 

(52.9)

Total used

 

1,123

 

1,474

 

(23.8)

 

(21.3)

Finance, insurance and other, net (per retail unit)

 

$        597

 

$      674

 

(11.4)

 

(8.1)

                 

OTHER: 

               

SG&A expenses

 

$   11,773

 

$ 11,315

 

4.0

 

7.5

SG&A as % revenues

 

10.6

 

11.8

       

SG&A as % gross profit

 

93.2

 

92.8

       

Operating margin %

 

0.4

 

0.5

       
                 

(1) Same store amounts include the results for the identical months in each period presented in the comparison, commencing with the first full month we owned the dealership and, in the case of dispositions, ending with the last full month we owned it. Same store results also include the activities of our corporate office.

(2) See the section of this release entitled "Non-GAAP Financial Measures" and the tables attached hereto for information regarding certain selected items that the Company believes impact comparability of financial results between reporting periods, as well as for information regarding non-GAAP financial measures and their reconciliation to the most directly comparable measures as reported in accordance with U.S. GAAP.

 

Group 1 Automotive, Inc.

Additional Information - Same Store Consolidated (1)

(Unaudited)

(Dollars in thousands, except per unit amounts)

 
   

Three Months Ended March 31,

   

2018

 

2017

 

% Increase/
(Decrease)

 

Constant Currency (2)
% Increase/ (Decrease)

REVENUES:

               

New vehicle retail sales

 

$ 1,407,514

 

$ 1,333,038

 

5.6

 

3.5

Used vehicle retail sales

 

724,164

 

658,552

 

10.0

 

7.7

Used vehicle wholesale sales

 

92,694

 

104,046

 

(10.9)

 

(14.6)

Total used

 

816,858

 

762,598

 

7.1

 

4.6

Parts and service

 

333,488

 

318,703

 

4.6

 

3.3

Finance, insurance and other, net

 

106,658

 

96,154

 

10.9

 

9.8

Total 

 

$ 2,664,518

 

$ 2,510,493

 

6.1

 

4.1

                 

GROSS MARGIN %:

               

New vehicle retail sales

 

5.0

 

5.2

       

Used vehicle retail sales

 

5.7

 

6.8

       

Used vehicle wholesale sales

 

1.6

 

0.1

       

Total used

 

5.2

 

5.9

       

Parts and service

 

53.3

 

54.0

       

Finance, insurance and other, net

 

100.0

 

100.0

       

Total

 

14.9

 

15.2

       
                 

GROSS PROFIT:

               

New vehicle retail sales

 

$      70,436

 

$      69,023

 

2.0

 

(0.2)

Used vehicle retail sales

 

41,151

 

44,905

 

(8.4)

 

(9.9)

Used vehicle wholesale sales

 

1,526

 

119

 

1,182.4

 

1,181.5

Total used

 

42,677

 

45,024

 

(5.2)

 

(6.7)

Parts and service

 

177,788

 

172,113

 

3.3

 

1.9

Finance, insurance and other, net

 

106,658

 

96,154

 

10.9

 

9.8

Total 

 

$    397,559

 

$    382,314

 

4.0

 

2.5

                 

UNITS SOLD:

               

Retail new vehicles sold

 

38,229

 

38,078

 

0.4

   

Retail used vehicles sold

 

33,793

 

31,488

 

7.3

   

Wholesale used vehicles sold

 

13,913

 

14,392

 

(3.3)

   

Total used

 

47,706

 

45,880

 

4.0

   
                 

AVERAGE RETAIL SALES PRICE:

               

New vehicle retail

 

$      36,818

 

$      35,008

 

5.2

 

3.1

Used vehicle retail

 

$      21,429

 

$      20,914

 

2.5

 

0.3

                 

GROSS PROFIT PER UNIT SOLD:

               

New vehicle retail sales

 

$        1,842

 

$        1,813

 

1.6

 

(0.6)

Used vehicle retail sales

 

1,218

 

1,426

 

(14.6)

 

(16.0)

Used vehicle wholesale sales

 

110

 

8

 

1,275.0

 

1,225.6

Total used

 

895

 

981

 

(8.8)

 

(10.3)

Finance, insurance and other, net (per retail unit)

 

$        1,481

 

$        1,382

 

7.2

 

6.0

                 

OTHER: 

               

SG&A expenses

 

$    306,200

 

$    288,295

 

6.2

 

4.6

Adjusted SG&A expenses(2)

 

$    306,200

 

$    290,128

 

5.5

 

3.9

SG&A as % revenues

 

11.5

 

11.5

       

Adjusted SG&A as % revenues (2)

 

11.5

 

11.6

       

SG&A as % gross profit

 

77.0

 

75.4

       

Adjusted SG&A as % gross profit (2)

 

77.0

 

75.9

       

Operating margin %

 

2.9

 

3.2

       

Adjusted operating margin % (2)

 

2.9

 

3.1

       
                 

(1) Same store amounts include the results for the identical months in each period presented in the comparison, commencing with the first full month we owned the dealership and, in the case of dispositions, ending with the last full month we owned it. Same store results also include the activities of our corporate office.

(2) See the section of this release entitled "Non-GAAP Financial Measures" and the tables attached hereto for information regarding certain selected items that the Company believes impact comparability of financial results between reporting periods, as well as for information regarding non-GAAP financial measures and their reconciliation to the most directly comparable measures as reported in accordance with U.S. GAAP.

 

Group 1 Automotive, Inc.

Reconciliation of Certain Non-GAAP Financial Measures - U.S.

(Unaudited)

 (Dollars in thousands)

             
   

Three Months Ended March 31,

   

2018

 

2017

 

% Increase/
(Decrease)

SG&A RECONCILIATION:

         
 

As reported

$ 252,941

 

$ 236,273

 

7.1

 

  Pre-tax adjustments:

         
 

      Legal settlements (2)

-

 

1,833

   
 

Adjusted SG&A (1)

$ 252,941

 

$ 238,106

 

6.2

             

SG&A AS % REVENUES:

         
 

Unadjusted

12.1

 

12.0

   
 

Adjusted (1)

12.1

 

12.1

   

SG&A AS % GROSS PROFIT:

         
 

Unadjusted

75.4

 

73.7

   
 

Adjusted (1)

75.4

 

74.3

   

OPERATING MARGIN %

         
 

Unadjusted

3.3

 

3.7

   
 

Adjusted (1)

3.3

 

3.6

   

PRETAX MARGIN %:

         
 

Unadjusted

1.9

 

2.3

   
 

Adjusted (1)

1.9

 

2.2

   
             

SAME STORE SG&A RECONCILIATION:

         
 

As reported

$ 247,611

 

$ 236,051

 

4.9

 

  Pre-tax adjustments:

         
 

      Legal settlements (2)

-

 

1,833

   
 

Adjusted Same Store SG&A(1)

$ 247,611

 

$ 237,884

 

4.1

             

SAME STORE SG&A AS % REVENUES:

         
 

Unadjusted

12.1

 

12.0

   
 

Adjusted (1)

12.1

 

12.1

   

SAME STORE SG&A AS % GROSS PROFIT:

         
 

Unadjusted

75.1

 

73.7

   
 

Adjusted (1)

75.1

 

74.3

   

SAME STORE OPERATING MARGIN %

         
 

Unadjusted

3.4

 

3.7

   
 

Adjusted (1)

3.4

 

3.6

   
             

(1)

See the section of this release entitled "Non-GAAP Financial Measures" for information regarding non-GAAP financial measures and certain selected items that the Company believes impact comparability of financial results between reporting periods.

(2)

For the three months ended March 31, 2017, the Company recognized a net pre-tax gain related to a settlement with an OEM of $1.8 million. 

 

Group 1 Automotive, Inc.

Reconciliation of Certain Non-GAAP Financial Measures - CONSOLIDATED

(Unaudited)

 (Dollars in thousands, except per share amounts)

             
   

Three Months Ended March 31,

   

2018

 

2017

 

% Increase/
(Decrease)

             

NET INCOME RECONCILIATION:

         
 

As reported

         
 

  Pretax Net Income

$   46,167

 

$   51,196

   
 

   Income Tax Provision 

(10,353)

 

(17,257)

   
 

     Net Income  

$   35,814

 

$   33,939

 

5.5

 

       Effective Tax Rate 

22.4%

 

33.7%

   
 

  Adjustments:  

         
 

      Legal settlements (2)

         
 

 Pre-tax 

-

 

(1,833)

   
 

 Tax impact 

-

 

696

   
 

 Adjusted 

         
 

   Pretax Net Income 

$   46,167

 

$   49,363

   
 

   Income Tax Provision 

(10,353)

 

(16,561)

   
 

           Adjusted net income (1)

$   35,814

 

$   32,802

 

9.2

 

       Effective Tax Rate 

22.4%

 

33.6%

   
             

ADJUSTED NET INCOME ATTRIBUTABLE TO DILUTED

         
 

COMMON SHARES RECONCILIATION:

         
 

Adjusted net income (1)

$   35,814

 

$   32,802

 

9.2

 

Less: Adjusted earnings allocated to participating securities

1,208

 

1,206

 

0.2

 

Adjusted net income available to diluted common shares (1)

$   34,606

 

$   31,596

 

9.5

             

 DILUTED INCOME PER COMMON SHARE RECONCILIATION: 

         
 

As reported

$       1.70

 

$       1.58

 

7.6

 

  After-tax adjustments:

         
 

      Legal settlements (2)

-

 

(0.05)

   
 

Adjusted diluted income per share (1)

$       1.70

 

$       1.53

 

11.1

             

SG&A RECONCILIATION:

         
 

As reported

$ 324,347

 

$ 289,779

 

11.9

 

  Pre-tax adjustments:

         
 

      Legal settlements (2)

-

 

1,833

   
 

Adjusted SG&A (1)

$ 324,347

 

$ 291,612

 

11.2

             

SG&A AS % REVENUES:

         
 

Unadjusted

11.3

 

11.5

   
 

Adjusted (1)

11.3

 

11.6

   

SG&A AS % GROSS PROFIT:

         
 

Unadjusted

77.3

 

75.6

   
 

Adjusted (1)

77.3

 

76.0

   

OPERATING MARGIN %

         
 

Unadjusted

2.8

 

3.2

   
 

Adjusted (1)

2.8

 

3.1

   

PRETAX MARGIN %

         
 

Unadjusted

1.6

 

2.0

   
 

Adjusted (1)

1.6

 

2.0

   
             

SAME STORE SG&A RECONCILIATION:

         
 

As reported

$ 306,200

 

$ 288,295

 

6.2

 

  Pre-tax adjustments:

         
 

      Legal settlements (2)

-

 

1,833

   
 

Adjusted Same Store SG&A (1)

$ 306,200

 

$ 290,128

 

5.5

             

SAME STORE SG&A AS % REVENUES:

         
 

Unadjusted

11.5

 

11.5

   
 

Adjusted(1)

11.5

 

11.6

   

SAME STORE SG&A AS % GROSS PROFIT:

         
 

Unadjusted

77.0

 

75.4

   
 

Adjusted(1)

77.0

 

75.9

   

SAME STORE OPERATING MARGIN %

         
 

Unadjusted

2.9

 

3.2

   
 

Adjusted (1)

2.9

 

3.1

   
             

(1)

See the section of this release entitled "Non-GAAP Financial Measures" for information regarding non-GAAP financial measures and certain selected items that the Company believes impact comparability of financial results between reporting periods.

(2)

For the three months ended March 31, 2017, the Company recognized a net pre-tax gain related to a settlement with an OEM of $1.8 million.

 

SOURCE Group 1 Automotive, Inc.


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