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Group 1 Automotive

800 Gessner
Houston, TX 77024

  • Sales: (713) 647-5700
Investor Relations

Group 1 Automotive Announces Third Quarter 2018 Financial Results

Increases Share Repurchase Authorization to $100 Million

HOUSTON, Oct. 25, 2018 /PRNewswire/ -- Group 1 Automotive, Inc. (NYSE: GPI), ("Group 1" or the "Company"), an international, Fortune 500 automotive retailer, today reported 2018 third quarter net income of $34.8 million, diluted earnings per common share of $1.74, adjusted net income (a non-GAAP measure) of $49.2 million, and adjusted diluted earnings per common share (a non-GAAP measure) of $2.47.

Third quarter 2018 adjusted net income and diluted earnings per share exclude approximately $14.4 million of net after-tax adjustments, or $0.73 per common share. These adjustments are more than explained by non-cash asset impairments of $17.7 million and legal settlement reserve adjustments of $1.6 million, which were partially offset by gains on real estate and dealership transactions of $4.2 million and reduced tax liabilities of $0.7 million due to the corporate income tax rate enacted by the U.S. Tax Reform Bill.

"Although our results were impacted by some unusual factors, especially in the U.K., we are pleased with our quarterly results, which established a new all-time quarterly record of $2.47 per share on an adjusted basis," said Earl J. Hesterberg, Group 1's president and chief executive officer.  "Strong used vehicle results and good cost control contributed positively to the quarter.  However, the severe lack of 2019 model vehicles to sell in the U.K. during a major plate change sales month was unexpected and very damaging to our business.  We expect manufacturer supply to improve across the U.K. by year end."

Consolidated Results for Third 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 decreased 4.1 percent (decreased 3.1 percent) to $2.9 billion.
  • Total gross profit increased 0.9 percent (increased 1.8 percent), to $435.1 million.
  • New vehicle revenues decreased 10.0 percent (decreased 8.9 percent) on a 9.8 percent decrease in unit sales, reflecting difficult year-over-year comparisons as a result of very strong replacement demand from Hurricane Harvey in the third quarter 2017 and emission testing-related supply constraints in the UK in September 2018. New vehicle gross profit decreased 12.1 percent (decreased 10.5 percent), to $77.6 million.
  • Retail used vehicle revenues increased 6.6 percent (7.5 percent) on 9.7 percent higher unit sales. Retail used vehicle gross profit increased 6.4 percent (7.2 percent), to $50.2 million. Total used vehicle gross profit was up 6.2 percent (7.1 percent), to $49.8 million.
  • Parts and service gross profit increased 3.5 percent (4.2 percent) on revenue growth of 3.3 percent (4.2 percent). Same Store parts and service gross profit increased 1.8 percent (2.5 percent) on Same Store parts and service revenue growth of 2.0 percent (2.9 percent).
  • Finance and Insurance (F&I) gross profit per retail unit (PRU) increased 6.4 percent (7.0 percent), to $1,429.
  • Selling, General and Administrative (SG&A) expenses as a percent of gross profit decreased 330 basis points, to 72.8 percent. Adjusted Same Store SG&A as a percent of gross profit increased 110 basis points, to 73.3 percent.

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

  • United States:
    The Company's U.S. operations accounted for 76.1 percent of total revenues and 81.0 percent of total gross profit. Total U.S. revenues were $2.2 billion, a decrease of 4.4 percent, reflecting the aforementioned challenging year-over-year comparisons from Hurricane Harvey in 3Q17.  New vehicle revenues decreased 7.7 percent.  F&I revenues increased 5.4 percent, parts and service revenue increased 1.9 percent, and retail used vehicle revenue increased 1.8 percent.  

    F&I gross profit PRU increased $122, or 7.8 percent per unit, to $1,688; and total gross profit was about flat at $352.5 million.  New vehicle retail gross profit PRU decreased $104, to $1,787. Total used vehicle gross profit PRU increased $18, to $1,068.

    SG&A expenses as a percent of gross profit improved 530 basis points, to 68.7 percent; and operating margin expanded 30 basis points, to 3.3 percent. Adjusted SG&A expenses as a percent of gross profit increased 60 basis points, to 70.6 percent. Adjusted operating margin was flat at 4.1 percent.
     
  • United Kingdom:
    The Company's U.K. operations accounted for 20.3 percent of total revenues and 15.8 percent of total gross profit.  As of September 1, 2018, all light vehicles sold in the EU are subject to mandatory emissions standards testing known as the Worldwide Harmonised Light Vehicle Test Procedure ("WLTP").  This testing procedure created a serious inventory supply delay in the release of many 2019 model year vehicles for sale, which resulted in a 10.2 percent industry sales decrease for the third quarter 2018 and a 20.5 percent industry decrease in the important sales month of September.  Various brands were more impacted than others.  The Company's most significantly impacted brand was Audi, which experienced an industry sales decrease of 28.6 percent for the third quarter 2018.  This manufacturer supply issue resulted in a Same Store new vehicle revenues decrease of 26.2 percent (decreased 25.3 percent) and Same Store new vehicle units sold decrease of 21.5 percent.  On a constant currency basis, strong Same Store used sales (up 14.3 percent) and after sales growth (up 5.9 percent) were partial offsets. The Company's total U.K. revenues decreased 0.8 percent (no change), to $585.9 million.  Consistent with the quarterly industry decrease, Same Store U.K. revenues decreased 11.0 percent (decreased 10.1 percent), to $496.4 million

    Total gross profit increased 8.1 percent (9.0 percent), to $68.7 million, while Same Store gross profit decreased 4.3 percent (decreased 3.4 percent), to $58.0 million.

    SG&A expenses as a percent of gross profit increased 290 basis points, to 86.9 percent; and operating margin decreased 30 basis points, to 1.0 percent. Same Store SG&A expenses as a percent of gross profit increased 580 basis points, to 87.7 percent; and Same Store operating margin decreased 70 basis points, to 0.9 percent, reflecting the deleveraging impact of the reduced new vehicle volumes.
     
  • Brazil:
    The Company's Brazilian operations accounted for 3.6 percent of total revenues and 3.2 percent of total gross profit.  The Company's Same Store new vehicle revenue decreased 24.3 percent (decreased 5.5 percent), with units down 8.9 percent. Same store total revenues decreased 19.4 percent (increased 0.5 percent), with the constant currency increase driven by revenue growth of 17.2 percent in F&I, 14.3 percent in total used vehicles, and 7.6 percent in parts & service. SG&A expenses as a percent of gross profit increased 14.6 percentage points, to 106.8 percent. Adjusted Same Store SG&A expenses as a percent of gross profit improved 460 basis points, to 85.1 percent

Share Repurchase Authorization

During the third quarter of 2018, the Company repurchased 789,509 shares at an average price per common share of $69.77, for a total of $55.1 million. Under SEC Rule 10b5-1, from October 1, 2018 to October 25, 2018, the Company repurchased an additional 399,872 shares at an average price per common share of $62.52, for a total of $25.0 million. Year-to-date through October 25, 2018, the Company has repurchased 1,935,738 shares at an average price per common share of $67.86, for a total of $131.4 million. These repurchases represented approximately 9.5 percent of the Company's share float at the beginning of the year and reduced the total outstanding share count to approximately 18.6 million common shares as of October 25, 2018.

On October 25, 2018, the Company's board of directors increased Group 1's common stock share repurchase authorization to $100.0 million.

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

In August 2018, the Company disposed of Ford Escondido, which generated approximately $60 million in trailing-twelve-month revenues.

Year-to-date 2018, the Company has acquired a total of 14 franchises, which are expected to generate an estimated $530 million in annual revenues; and the Company has disposed of 4 franchises that generated approximately $175 million in trailing-twelve-month revenues.

Third 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 third 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:

4290144

A telephonic replay will be available following the call through November 1, 2018 by dialing:

Domestic:

1-877-344-7529

International:

1-412-317-0088

Replay ID:

10125481

ABOUT GROUP 1 AUTOMOTIVE, INC.
Group 1 owns and operates 181 automotive dealerships, 237 franchises, and 47 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 September 30, 

 

2018

 

2017

 

% Increase/
(Decrease)

REVENUES:

         

New vehicle retail sales

$ 1,539,498

 

$ 1,710,241

 

(10.0)

Used vehicle retail sales

792,405

 

743,038

 

6.6

Used vehicle wholesale sales

86,570

 

104,827

 

(17.4)

Parts and service

354,501

 

343,193

 

3.3

Finance, insurance and other, net

116,084

 

110,993

 

4.6

Total revenues

2,889,058

 

3,012,292

 

(4.1)

           

COST OF SALES:

         

New vehicle retail sales

1,461,896

 

1,621,909

 

(9.9)

Used vehicle retail sales

742,250

 

695,915

 

6.7

Used vehicle wholesale sales

86,884

 

105,012

 

(17.3)

Parts and service

162,927

 

158,036

 

3.1

Total cost of sales

2,453,957

 

2,580,872

 

(4.9)

           

GROSS PROFIT

435,101

 

431,420

 

0.9

           

SELLING, GENERAL AND ADMINISTRATIVE EXPENSES

316,771

 

328,327

 

(3.5)

           

DEPRECIATION AND AMORTIZATION EXPENSE

16,981

 

15,059

 

12.8

           

ASSET IMPAIRMENTS

23,159

 

9,526

 

143.1

           

OPERATING INCOME

78,190

 

78,508

 

(0.4)

           

OTHER EXPENSE:

         

Floorplan interest expense

(14,685)

 

(13,491)

 

8.9

Other interest expense, net

(19,140)

 

(17,874)

 

7.1

INCOME BEFORE INCOME TAXES

44,365

 

47,143

 

(5.9)

           

PROVISION FOR INCOME TAXES

(9,587)

 

(17,262)

 

(44.5)

           

NET INCOME 

$      34,778

 

$      29,881

 

16.4

Less: Earnings allocated to participating securities

$        1,181

 

$        1,023

 

15.4

Earnings available to diluted common shares

$      33,597

 

$      28,858

 

16.4

DILUTED EARNINGS PER SHARE

$          1.74

 

$          1.43

 

21.7

Weighted average dilutive common shares outstanding

19,261

 

20,225

 

(4.8)

Weighted average participating securities

684

 

724

 

(5.5)

Total weighted average shares outstanding

19,945

 

20,949

 

(4.8)

           
 

 Nine Months Ended September 30, 

 

2018

 

2017

 

% Increase/
(Decrease)

REVENUES:

         

New vehicle retail sales

$ 4,608,658

 

$ 4,496,222

 

2.5

Used vehicle retail sales

2,394,828

 

2,089,914

 

14.6

Used vehicle wholesale sales

283,453

 

308,361

 

(8.1)

Parts and service

1,062,145

 

994,522

 

6.8

Finance, insurance and other, net

343,462

 

314,297

 

9.3

Total revenues

8,692,546

 

8,203,316

 

6.0

           

COST OF SALES:

         

New vehicle retail sales

4,379,047

 

4,263,752

 

2.7

Used vehicle retail sales

2,249,964

 

1,952,873

 

15.2

Used vehicle wholesale sales

281,871

 

308,713

 

(8.7)

Parts and service

488,637

 

458,144

 

6.7

Total cost of sales

7,399,519

 

6,983,482

 

6.0

           

GROSS PROFIT

1,293,027

 

1,219,834

 

6.0

           

SELLING, GENERAL AND ADMINISTRATIVE EXPENSES

949,210

 

916,674

 

3.5

           

DEPRECIATION AND AMORTIZATION EXPENSE

49,961

 

42,758

 

16.8

           

ASSET IMPAIRMENTS

27,427

 

9,526

 

187.9

           

OPERATING INCOME

266,429

 

250,876

 

6.2

           

OTHER EXPENSE:

         

Floorplan interest expense

(43,335)

 

(38,659)

 

12.1

Other interest expense, net

(57,374)

 

(52,188)

 

9.9

INCOME BEFORE INCOME TAXES

165,720

 

160,029

 

3.6

           

PROVISION FOR INCOME TAXES

(38,666)

 

(57,076)

 

(32.3)

           

NET INCOME

$    127,054

 

$    102,953

 

23.4

Less: Earnings allocated to participating securities

$        4,306

 

$        3,659

 

17.7

Earnings available to diluted common shares

$    122,748

 

$      99,294

 

23.6

DILUTED EARNINGS PER SHARE

$          6.18

 

$          4.85

 

27.4

Weighted average dilutive common shares outstanding

19,868

 

20,480

 

(3.0)

Weighted average participating securities

702

 

767

 

(8.5)

Total weighted average shares outstanding

20,570

 

21,247

 

(3.2)

 

Group 1 Automotive, Inc.

Consolidated Balance Sheets

(Dollars in thousands)

           
 

September 30,
2018

 

December 31,
2017

 

% Increase/
(Decrease)

 ASSETS: 

(Unaudited)

       

 CURRENT ASSETS: 

         

 Cash and cash equivalents 

$           32,027

 

$          28,787

 

11.3

 Contracts in transit and vehicle receivables, net 

235,609

 

306,433

 

(23.1)

 Accounts and notes receivable, net 

169,318

 

188,611

 

(10.2)

 Inventories, net 

1,733,756

 

1,763,293

 

(1.7)

 Prepaid expenses and other current assets 

77,996

 

42,062

 

85.4

 Total current assets 

2,248,706

 

2,329,186

 

(3.5)

 PROPERTY AND EQUIPMENT, net 

1,350,929

 

1,318,959

 

2.4

 GOODWILL AND INTANGIBLE FRANCHISE RIGHTS 

1,245,056

 

1,198,666

 

3.9

 OTHER ASSETS 

36,175

 

24,254

 

49.2

 Total assets 

$      4,880,866

 

$     4,871,065

 

0.2

           

 LIABILITIES AND STOCKHOLDERS' EQUITY: 

         

 CURRENT LIABILITIES: 

         

 Floorplan notes payable - credit facility and other 

$      1,155,034

 

$     1,240,695

 

(6.9)

 Offset account related to floorplan notes payable - credit facility 

(71,397)

 

(86,547)

 

(17.5)

 Floorplan notes payable - manufacturer affiliates 

415,615

 

397,183

 

4.6

 Offset account related to floorplan notes payable - manufacturer affiliates 

(20,500)

 

(22,500)

 

(8.9)

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

76,080

 

77,609

 

(2.0)

 Current liabilities from interest rate risk management activities 

311

 

1,996

 

(84.4)

 Accounts payable 

428,441

 

412,981

 

3.7

 Accrued expenses 

207,082

 

177,070

 

16.9

 Total current liabilities 

2,190,666

 

2,198,487

 

(0.4)

 5.00% SENIOR NOTES (principal of $550,000 at September 30, 2018 and December 31, 2017, respectively) 

543,306

 

542,063

 

0.2

 5.25% SENIOR NOTES (principal of $300,000 at September 30, 2018 and December 31, 2017, respectively) 

296,587

 

296,151

 

0.1

 ACQUISITION LINE 

32,584

 

26,988

 

20.7

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

384,541

 

405,950

 

(5.3)

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

47,109

 

47,032

 

0.2

 DEFERRED INCOME TAXES 

137,826

 

124,404

 

10.8

 LIABILITIES FROM INTEREST RATE RISK MANAGEMENT ACTIVITIES 

444

 

8,583

 

(94.8)

 OTHER LIABILITIES 

99,457

 

97,125

 

2.4

 STOCKHOLDERS' EQUITY: 

         

 Common stock 

255

 

255

 

-

 Additional paid-in capital 

290,666

 

291,461

 

(0.3)

 Retained earnings 

1,368,948

 

1,246,323

 

9.8

 Accumulated other comprehensive loss 

(128,894)

 

(123,226)

 

4.6

 Treasury stock 

(382,629)

 

(290,531)

 

31.7

 Total stockholders' equity 

$      1,148,346

 

$     1,124,282

 

2.1

 Total liabilities and stockholders' equity 

$      4,880,866

 

$     4,871,065

 

0.2

 

Group 1 Automotive, Inc.

Additional Information - Consolidated

(Unaudited)

                 
   

Three Months Ended

 

Nine Months Ended

   

September 30,

 

September 30,

   

2018 (%)

 

2017 (%)

 

2018 (%)

 

2017 (%)

NEW VEHICLE UNIT SALES GEOGRAPHIC MIX:

             

Region

Geographic Market

             

United States

Texas

37.2

 

37.8

 

35.8

 

36.5

 

Oklahoma

6.7

 

5.7

 

6.2

 

6.2

 

California

5.8

 

7.0

 

6.2

 

7.6

 

Massachusetts

5.2

 

4.8

 

4.9

 

4.7

 

Georgia

4.7

 

4.4

 

4.5

 

4.6

 

Florida

2.9

 

2.4

 

2.6

 

2.5

 

Louisiana

2.2

 

1.9

 

2.0

 

2.0

 

New Hampshire

2.0

 

1.9

 

1.9

 

2.0

 

South Carolina

1.6

 

1.3

 

1.6

 

1.3

 

New Jersey

1.5

 

1.7

 

1.6

 

1.7

 

Kansas

1.4

 

1.5

 

1.4

 

1.6

 

Mississippi

1.2

 

1.2

 

1.2

 

1.3

 

Alabama

0.7

 

0.9

 

0.7

 

1.0

 

Maryland

0.4

 

0.3

 

0.4

 

0.4

 

New Mexico 

0.1

 

0.1

 

0.1

 

   

73.6

 

72.9

 

71.1

 

73.4

                 

International

United Kingdom

21.4

 

22.6

 

23.9

 

21.8

 

Brazil

5.0

 

4.5

 

5.0

 

4.8

   

100.0

 

100.0

 

100.0

 

100.0

                 

NEW VEHICLE UNIT SALES BRAND MIX:

             

Toyota/Lexus

27.1

 

26.7

 

25.0

 

25.3

Volkswagen/Audi/Porsche

11.8

 

13.9

 

13.0

 

13.0

BMW/MINI

11.5

 

11.5

 

12.1

 

12.8

Ford/Lincoln

11.0

 

10.6

 

11.1

 

11.5

Honda/Acura

9.5

 

9.0

 

9.3

 

9.2

Nissan

6.8

 

7.0

 

6.5

 

7.5

Chevrolet/GMC/Buick/Cadillac

5.6

 

6.1

 

5.7

 

6.2

Mercedes-Benz/smart/Sprinter

4.2

 

3.4

 

4.7

 

3.8

Chrysler/Dodge/Jeep/RAM

3.9

 

3.9

 

4.0

 

3.9

Hyundai/Kia

4.0

 

4.2

 

3.9

 

4.0

Jaguar/Land Rover

1.7

 

1.6

 

1.8

 

0.8

Other

2.9

 

2.1

 

2.9

 

2.0

   

100.0

 

100.0

 

100.0

 

100.0

 

Group 1 Automotive, Inc.

Additional Information - U.S.

(Unaudited)

(Dollars in thousands, except per unit amounts)

           
 

Three Months Ended September 30,

 

2018

 

2017

 

% Increase/
(Decrease)

REVENUES:

         

New vehicle retail sales

$ 1,196,551

 

$ 1,296,267

 

(7.7)

Used vehicle retail sales

572,011

 

562,031

 

1.8

Used vehicle wholesale sales

40,724

 

63,363

 

(35.7)

Total used

612,735

 

625,394

 

(2.0)

Parts and service

289,334

 

283,915

 

1.9

Finance, insurance and other, net

101,610

 

96,383

 

5.4

Total

$ 2,200,230

 

$ 2,301,959

 

(4.4)

           

GROSS MARGIN %:

         

New vehicle retail sales

4.8

 

5.1

   

Used vehicle retail sales

6.5

 

6.8

   

Used vehicle wholesale sales

1.0

 

(0.1)

   

Total used

6.1

 

6.1

   

Parts and service

53.9

 

53.8

   

Finance, insurance and other, net

100.0

 

100.0

   

Total

16.0

 

15.4

   
           

GROSS PROFIT:

         

New vehicle retail sales

$      57,278

 

$      66,622

 

(14.0)

Used vehicle retail sales

37,241

 

37,962

 

(1.9)

Used vehicle wholesale sales

400

 

(54)

 

840.7

Total used

37,641

 

37,908

 

(0.7)

Parts and service

155,942

 

152,654

 

2.2

Finance, insurance and other, net

101,610

 

96,383

 

5.4

Total 

$    352,471

 

$    353,567

 

(0.3)

           

UNITS SOLD:

         

Retail new vehicles sold

32,058

 

35,233

 

(9.0)

Retail used vehicles sold

28,125

 

26,304

 

6.9

Wholesale used vehicles sold

7,118

 

9,786

 

(27.3)

Total used

35,243

 

36,090

 

(2.3)

           

AVERAGE RETAIL SALES PRICE:

         

New vehicle retail

$      37,325

 

$      36,791

 

1.5

Used vehicle retail

$      20,338

 

$      21,367

 

(4.8)

           

GROSS PROFIT PER UNIT SOLD:

         

New vehicle retail sales

$        1,787

 

$        1,891

 

(5.5)

Used vehicle retail sales

1,324

 

1,443

 

(8.2)

Used vehicle wholesale sales

56

 

(6)

 

1,033.3

Total used

1,068

 

1,050

 

1.7

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

$        1,688

 

$        1,566

 

7.8

           

OTHER: 

         

Adjusted Finance, insurance and other revenue, net (1)(2)

$    101,610

 

$    102,933

 

(1.3)

Adjusted Total Revenue (1) 

$ 2,200,230

 

$ 2,308,509

 

(4.7)

Adjusted Total Gross Profit (1) 

$    352,471

 

$    360,117

 

(2.1)

Adjusted Total Gross Margin(1) 

16.0

 

15.6

   

Adjusted Finance, insurance and other, net (per retail unit)(1) 

$        1,688

 

$        1,673

 

0.9

SG&A expenses

$    242,210

 

$    261,787

 

(7.5)

Adjusted SG&A expenses(1)

$    249,000

 

$    252,120

 

(1.2)

SG&A as % revenues

11.0

 

11.4

   

Adjusted SG&A as % revenues (1)

11.3

 

11.0

   

SG&A as % gross profit

68.7

 

74.0

   

Adjusted SG&A as % gross profit (1)

70.6

 

70.0

   

Operating margin %

3.3

 

3.0

   

Adjusted operating margin % (1)

4.1

 

4.1

   

Pretax margin %

2.0

 

1.8

   

Adjusted pretax margin %(1)

2.7

 

2.9

   
           

INTEREST EXPENSE:

         

Floorplan interest expense

$    (12,904)

 

$    (12,014)

 

7.4

Floorplan assistance

11,736

 

13,295

 

(11.7)

Net floorplan expense

$      (1,168)

 

$        1,281

 

(191.2)

Other interest expense, net

$    (17,273)

 

$    (16,727)

 

3.3

           
 

Nine Months Ended September 30,

 

2018

 

2017

 

% Increase/
(Decrease)

REVENUES:

         

New vehicle retail sales

$ 3,433,386

 

$ 3,458,287

 

(0.7)

Used vehicle retail sales

1,727,848

 

1,620,171

 

6.6

Used vehicle wholesale sales

137,507

 

200,384

 

(31.4)

Total used

1,865,355

 

1,820,555

 

2.5

Parts and service

862,737

 

837,772

 

3.0

Finance, insurance and other, net

295,239

 

276,754

 

6.7

Total 

$ 6,456,717

 

$ 6,393,368

 

1.0

           

GROSS MARGIN %:

         

New vehicle retail sales

4.9

 

5.1

   

Used vehicle retail sales

6.3

 

6.9

   

Used vehicle wholesale sales

2.5

 

(0.1)

   

Total used

6.1

 

6.2

   

Parts and service

53.8

 

53.8

   

Finance, insurance and other, net

100.0

 

100.0

   

Total

16.1

 

15.9

   
           

GROSS PROFIT:

         

New vehicle retail sales

$    166,771

 

$    174,831

 

(4.6)

Used vehicle retail sales

109,535

 

112,598

 

(2.7)

Used vehicle wholesale sales

3,387

 

(170)

 

2,092.4

Total used

112,922

 

112,428

 

0.4

Parts and service

463,894

 

450,623

 

2.9

Finance, insurance and other, net

295,239

 

276,754

 

6.7

Total 

$ 1,038,826

 

$ 1,014,636

 

2.4

           

UNITS SOLD:

         

Retail new vehicles sold

91,119

 

93,533

 

(2.6)

Retail used vehicles sold

83,919

 

76,435

 

9.8

Wholesale used vehicles sold

23,793

 

29,468

 

(19.3)

Total used

107,712

 

105,903

 

1.7

           

AVERAGE RETAIL SALES PRICE:

         

New vehicle retail

$      37,680

 

$      36,974

 

1.9

Used vehicle retail

$      20,589

 

$      21,197

 

(2.9)

           

GROSS PROFIT PER UNIT SOLD:

         

New vehicle retail sales

$        1,830

 

$        1,869

 

(2.1)

Used vehicle retail sales

1,305

 

1,473

 

(11.4)

Used vehicle wholesale sales

142

 

(6)

 

2,466.7

Total used

1,048

 

1,062

 

(1.3)

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

$        1,687

 

$        1,628

 

3.6

           

OTHER: 

         

Adjusted Finance, insurance and other revenue, net (1)(2)

$    295,239

 

$    283,304

 

4.2

Adjusted Total Revenue (1) 

$ 6,456,717

 

$ 6,399,918

 

0.9

Adjusted Total Gross Profit (1) 

$ 1,038,826

 

$ 1,021,186

 

1.7

Adjusted Total Gross Margin (1) 

16.1

 

16.0

 

-

Adjusted Finance, insurance and other, net (per retail unit) (1) 

$        1,687

 

$        1,667

 

1.2

SG&A expenses

$    729,430

 

$    741,904

 

(1.7)

Adjusted SG&A expenses (1)

$    748,527

 

$    733,427

 

2.1

SG&A as % revenues

11.3

 

11.6

   

Adjusted SG&A as % revenues (1)

11.6

 

11.5

   

SG&A as % gross profit

70.2

 

73.1

   

Adjusted SG&A as % gross profit (1)

72.1

 

71.8

   

Operating margin %

3.8

 

3.6

   

Adjusted operating margin % (1)

3.9

 

3.9

   

Pretax margin %

2.4

 

2.2

   

Adjusted pretax margin % (1)

2.5

 

2.6

   
           

INTEREST EXPENSE:

         

Floorplan interest expense

$    (38,050)

 

$    (34,954)

 

8.9

Floorplan assistance

$      33,692

 

$      35,031

 

(3.8)

Net floorplan expense

$      (4,358)

 

$             77

 

(5,759.7)

Other interest expense, net

$    (51,621)

 

$    (49,571)

 

4.1

 

(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.

(2)Finance, insurance and other revenue represents fees earned for the financing of vehicle sales transactions and from the sale of insurance and vehicle service contracts. Such amounts are reported net of estimated amounts to be charged in the future. As a result, finance, insurance and other revenue and gross profit are the same. 

 

Group 1 Automotive, Inc.

Additional Information - U.K.

(Unaudited)

(Dollars in thousands, except per unit amounts)

               
 

Three Months Ended September 30,

 

2018

 

2017

 

% Increase/
(Decrease)

 

Constant Currency (1)
% Increase/ (Decrease)

REVENUES:

             

New vehicle retail sales

$     278,046

 

$     334,772

 

(16.9)

 

(16.1)

Used vehicle retail sales

200,058

 

158,076

 

26.6

 

27.2

Used vehicle wholesale sales

41,696

 

38,647

 

7.9

 

8.5

Total used

241,754

 

196,723

 

22.9

 

23.6

Parts and service

53,817

 

46,783

 

15.0

 

15.6

Finance, insurance and other, net

12,319

 

12,448

 

(1.0)

 

(0.2)

Total

$     585,936

 

$     590,726

 

(0.8)

 

0.0

               

GROSS MARGIN %:

             

New vehicle retail sales

5.4

 

5.1

       

Used vehicle retail sales

5.8

 

4.7

       

Used vehicle wholesale sales

(2.1)

 

(0.9)

       

Total used

4.4

 

3.6

       

Parts and service

56.7

 

57.3

       

Finance, insurance and other, net

100.0

 

100.0

       

Total

11.7

 

10.8

       
               

GROSS PROFIT:

             

New vehicle retail sales

$       15,128

 

$       17,205

 

(12.1)

 

(10.8)

Used vehicle retail sales

11,625

 

7,471

 

55.6

 

56.6

Used vehicle wholesale sales

(880)

 

(347)

 

(153.6)

 

(148.1)

Total used

10,745

 

7,124

 

50.8

 

52.1

Parts and service

30,530

 

26,823

 

13.8

 

14.4

Finance, insurance and other, net

12,319

 

12,448

 

(1.0)

 

(0.2)

Total 

$       68,722

 

$       63,600

 

8.1

 

9.0

               

UNITS SOLD:

             

Retail new vehicles sold

9,333

 

10,909

 

(14.4)

   

Retail used vehicles sold

8,482

 

7,011

 

21.0

   

Wholesale used vehicles sold

5,382

 

4,939

 

9.0

   

Total used

13,864

 

11,950

 

16.0

   
               

AVERAGE RETAIL SALES PRICE:

             

New vehicle retail

$       29,792

 

$       30,688

 

(2.9)

 

(1.9)

Used vehicle retail

$       23,586

 

$       22,547

 

4.6

 

5.2

               

GROSS PROFIT PER UNIT SOLD:

             

New vehicle retail sales

$         1,621

 

$         1,577

 

2.8

 

4.2

Used vehicle retail sales

1,371

 

1,066

 

28.6

 

29.4

Used vehicle wholesale sales

(164)

 

(70)

 

(134.3)

 

(127.7)

Total used

775

 

596

 

30.0

 

31.1

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

$            691

 

$            695

 

(0.6)

 

0.4

               

OTHER: 

             

SG&A expenses

$       59,704

 

$       53,395

 

11.8

 

12.4

SG&A as % revenues

10.2

 

9.0

       

SG&A as % gross profit

86.9

 

84.0

       

Operating margin %

1.0

 

1.3

       

Pretax margin %

0.5

 

0.9

       
               

INTEREST EXPENSE:

             

Floorplan interest expense

$       (1,556)

 

$       (1,336)

 

16.5

 

17.3

Floorplan assistance

299

 

265

 

12.8

 

13.6

Net floorplan expense

$       (1,257)

 

$       (1,071)

 

17.4

 

18.3

Other interest expense, net

$       (1,693)

 

$       (1,121)

 

51.0

 

52.0

               
               
 

Nine Months Ended September 30,

 

2018

 

2017

 

% Increase/
(Decrease)

 

Constant Currency (1)
% Increase/ (Decrease)

REVENUES:

             

New vehicle retail sales

$     971,085

 

$     824,827

 

17.7

 

11.3

Used vehicle retail sales

600,715

 

401,851

 

49.5

 

41.6

Used vehicle wholesale sales

134,408

 

99,604

 

34.9

 

27.5

Total used

735,123

 

501,455

 

46.6

 

38.8

Parts and service

164,954

 

120,614

 

36.8

 

29.4

Finance, insurance and other, net

42,199

 

31,260

 

35.0

 

27.9

Total 

$  1,913,361

 

$  1,478,156

 

29.4

 

22.4

               

GROSS MARGIN %:

             

New vehicle retail sales

5.1

 

5.5

       

Used vehicle retail sales

5.2

 

4.9

       

Used vehicle wholesale sales

(1.6)

 

(0.9)

       

Total used

4.0

 

3.7

       

Parts and service

57.1

 

57.6

       

Finance, insurance and other, net

100.0

 

100.0

       

Total

11.2

 

11.2

       
               

GROSS PROFIT:

             

New vehicle retail sales

$       49,546

 

$       45,350

 

9.3

 

3.5

Used vehicle retail sales

31,288

 

19,579

 

59.8

 

51.4

Used vehicle wholesale sales

(2,188)

 

(851)

 

(157.1)

 

(149.7)

Total used

29,100

 

18,728

 

55.4

 

47.0

Parts and service

94,132

 

69,488

 

35.5

 

28.2

Finance, insurance and other, net

42,199

 

31,260

 

35.0

 

27.9

Total 

$     214,977

 

$     164,826

 

30.4

 

23.5

               

UNITS SOLD:

             

Retail new vehicles sold

30,697

 

27,821

 

10.3

   

Retail used vehicles sold

24,818

 

18,435

 

34.6

   

Wholesale used vehicles sold

16,924

 

13,245

 

27.8

   

Total used

41,742

 

31,680

 

31.8

   
               

AVERAGE RETAIL SALES PRICE:

             

New vehicle retail

$       31,635

 

$       29,648

 

6.7

 

0.8

Used vehicle retail

$       24,205

 

$       21,798

 

11.0

 

5.2

               

GROSS PROFIT PER UNIT SOLD:

             

New vehicle retail sales

$         1,614

 

$         1,630

 

(1.0)

 

(6.2)

Used vehicle retail sales

1,261

 

1,062

 

18.7

 

12.5

Used vehicle wholesale sales

(129)

 

(64)

 

(101.6)

 

(95.4)

Total used

697

 

591

 

17.9

 

11.5

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

$            760

 

$            676

 

12.4

 

6.5

               

OTHER: 

             

SG&A expenses

$     181,558

 

$     137,475

 

32.1

 

24.9

Adjusted SG&A expenses(1)

$     181,558

 

$     137,187

 

32.3

 

25.2

SG&A as % revenues

9.5

 

9.3

       

Adjusted SG&A as % revenues (1)

9.5

 

9.3

       

SG&A as % gross profit

84.5

 

83.4

       

Adjusted SG&A as % gross profit (1)

84.5

 

83.2

       

Operating margin %

1.3

 

1.5

       

Adjusted operating margin % (1)

1.3

 

1.5

       

Pretax margin %

0.8

 

1.1

       

Adjusted pretax margin % (1)

0.8

 

1.1

       
               

INTEREST EXPENSE:

             

Floorplan interest expense

$       (4,687)

 

$       (3,423)

 

36.9

 

29.7

Floorplan assistance

824

 

714

 

15.4

 

9.3

Net floorplan expense

$       (3,863)

 

$       (2,709)

 

42.6

 

35.1

Other interest expense, net

$       (5,015)

 

$       (2,386)

 

110.2

 

99.7

 

(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 September 30,

 

2018

 

2017

 

% Increase/
(Decrease)

 

Constant Currency (1)
% Increase/ (Decrease)

REVENUES:

             

New vehicle retail sales

$   64,901

 

$   79,202

 

(18.1)

 

2.3

Used vehicle retail sales

20,336

 

22,931

 

(11.3)

 

10.3

Used vehicle wholesale sales

4,150

 

2,817

 

47.3

 

84.7

Total used

24,486

 

25,748

 

(4.9)

 

18.4

Parts and service

11,350

 

12,495

 

(9.2)

 

13.1

Finance, insurance and other, net

2,155

 

2,162

 

(0.3)

 

24.5

Total

$ 102,892

 

$ 119,607

 

(14.0)

 

7.3

               

GROSS MARGIN %:

             

New vehicle retail sales

8.0

 

5.7

       

Used vehicle retail sales

6.3

 

7.4

       

Used vehicle wholesale sales

4.0

 

7.7

       

Total used

5.9

 

7.4

       

Parts and service

45.0

 

45.5

       

Finance, insurance and other, net

100.0

 

100.0

       

Total

13.5

 

11.9

       
               

GROSS PROFIT:

             

New vehicle retail sales

$     5,196

 

$     4,505

 

15.3

 

43.8

Used vehicle retail sales

1,289

 

1,690

 

(23.7)

 

(5.5)

Used vehicle wholesale sales

166

 

216

 

(23.1)

 

(3.6)

Total used

1,455

 

1,906

 

(23.7)

 

(5.2)

Parts and service

5,102

 

5,680

 

(10.2)

 

11.9

Finance, insurance and other, net

2,155

 

2,162

 

(0.3)

 

24.5

Total 

$   13,908

 

$   14,253

 

(2.4)

 

21.6

               

UNITS SOLD:

             

Retail new vehicles sold

2,193

 

2,179

 

0.6

   

Retail used vehicles sold

1,069

 

1,034

 

3.4

   

Wholesale used vehicles sold

402

 

242

 

66.1

   

Total used

1,471

 

1,276

 

15.3

   
               

AVERAGE RETAIL SALES PRICE:

             

New vehicle retail

$   29,595

 

$   36,348

 

(18.6)

 

1.6

Used vehicle retail

$   19,023

 

$   22,177

 

(14.2)

 

6.7

               

GROSS PROFIT PER UNIT SOLD:

             

New vehicle retail sales

$     2,369

 

$     2,067

 

14.6

 

42.8

Used vehicle retail sales

1,206

 

1,634

 

(26.2)

 

(8.5)

Used vehicle wholesale sales

413

 

893

 

(53.8)

 

(42.0)

Total used

989

 

1,494

 

(33.8)

 

(17.8)

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

$        661

 

$        673

 

(1.8)

 

22.6

               

OTHER: 

             

SG&A expenses

$   14,857

 

$   13,145

 

13.0

 

42.2

Adjusted SG&A expenses(1)

$   11,737

 

$   13,145

 

(10.7)

 

11.4

SG&A as % revenues

14.4

 

11.0

       

Adjusted SG&A as % revenues (1)

11.4

 

11.0

       

SG&A as % gross profit

106.8

 

92.2

       

Adjusted SG&A as % gross profit (1)

84.4

 

92.2

       

Operating margin %

(1.3)

 

0.6

       

Adjusted operating margin % (1)

1.8

 

0.6

       

Pretax margin %

(1.7)

 

0.5

       

Adjusted pretax margin % (1)

1.4

 

0.5

       
               

INTEREST EXPENSE:

             

Floorplan interest expense

$      (225)

 

$      (141)

 

59.6

 

99.7

Floorplan assistance

 

 

-

 

-

Net floorplan expense

$      (225)

 

$      (141)

 

59.6

 

99.7

Other interest expense, net

$      (174)

 

$        (26)

 

569.2

 

697.6

               
               
 

Nine Months Ended September 30,

 

2018

 

2017

 

% Increase/
(Decrease)

 

Constant Currency (1)
% Increase/ (Decrease)

REVENUES:

             

New vehicle retail sales

$ 204,187

 

$ 213,108

 

(4.2)

 

8.3

Used vehicle retail sales

66,265

 

67,892

 

(2.4)

 

9.8

Used vehicle wholesale sales

11,538

 

8,373

 

37.8

 

57.8

Total used

77,803

 

76,265

 

2.0

 

15.1

Parts and service

34,454

 

36,136

 

(4.7)

 

7.8

Finance, insurance and other, net

6,024

 

6,283

 

(4.1)

 

9.2

Total 

$ 322,468

 

$ 331,792

 

(2.8)

 

9.8

               

GROSS MARGIN %:

             

New vehicle retail sales

6.5

 

5.8

       

Used vehicle retail sales

6.1

 

7.2

       

Used vehicle wholesale sales

3.3

 

8.0

       

Total used

5.7

 

7.3

       

Parts and service

44.9

 

45.0

       

Finance, insurance and other, net

100.0

 

100.0

       

Total

12.2

 

12.2

       
               

GROSS PROFIT:

             

New vehicle retail sales

$   13,294

 

$   12,289

 

8.2

 

23.7

Used vehicle retail sales

4,041

 

4,864

 

(16.9)

 

(6.4)

Used vehicle wholesale sales

383

 

669

 

(42.8)

 

(35.5)

Total used

4,424

 

5,533

 

(20.0)

 

(10.0)

Parts and service

15,482

 

16,267

 

(4.8)

 

7.5

Finance, insurance and other, net

6,024

 

6,283

 

(4.1)

 

9.2

Total 

$   39,224

 

$   40,372

 

(2.8)

 

10.3

               

UNITS SOLD:

             

Retail new vehicles sold

6,429

 

6,133

 

4.8

   

Retail used vehicles sold

3,163

 

3,048

 

3.8

   

Wholesale used vehicles sold

1,081

 

858

 

26.0

   

Total used

4,244

 

3,906

 

8.7

   
               

AVERAGE RETAIL SALES PRICE:

             

New vehicle retail

$   31,760

 

$   34,748

 

(8.6)

 

3.3

Used vehicle retail

$   20,950

 

$   22,274

 

(5.9)

 

5.8

               

GROSS PROFIT PER UNIT SOLD:

             

New vehicle retail sales

$     2,068

 

$     2,004

 

3.2

 

18.0

Used vehicle retail sales

1,278

 

1,596

 

(19.9)

 

(9.8)

Used vehicle wholesale sales

354

 

780

 

(54.6)

 

(48.8)

Total used

1,042

 

1,417

 

(26.5)

 

(17.1)

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

$        628

 

$        684

 

(8.2)

 

4.5

               

OTHER: 

             

SG&A expenses

$   38,222

 

$   37,295

 

2.5

 

17.4

Adjusted SG&A expenses(1)

$   34,552

 

$   37,295

 

(7.4)

 

4.9

SG&A as % revenues

11.9

 

11.2

       

Adjusted SG&A as % revenues (1)

10.7

 

11.2

       

SG&A as % gross profit

97.4

 

92.4

       

Adjusted SG&A as % gross profit (1)

88.1

 

92.4

       

Operating margin %

(0.1)

 

0.6

       

Adjusted operating margin % (1)

1.1

 

0.6

       

Pretax margin %

(0.5)

 

0.4

       

Adjusted pretax margin % (1)

0.7

 

0.4

       
               

INTEREST EXPENSE:

             

Floorplan interest expense

$      (598)

 

$      (282)

 

112.1

 

139.1

Floorplan assistance

 

 

-

 

-

Net floorplan expense

$      (598)

 

$      (282)

 

112.1

 

139.1

Other interest expense, net

$      (738)

 

$      (231)

 

219.5

 

252.3

 

(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 September 30,

 

2018

 

2017

 

% Increase/
(Decrease)

 

Constant Currency % (1)
Increase/ (Decrease)

REVENUES:

             

New vehicle retail sales

$  1,539,498

 

$  1,710,241

 

(10.0)

 

(8.9)

Used vehicle retail sales

792,405

 

743,038

 

6.6

 

7.5

Used vehicle wholesale sales

86,570

 

104,827

 

(17.4)

 

(16.2)

Total used

878,975

 

847,865

 

3.7

 

4.5

Parts and service

354,501

 

343,193

 

3.3

 

4.2

Finance, insurance and other, net

116,084

 

110,993

 

4.6

 

5.2

Total

$  2,889,058

 

$  3,012,292

 

(4.1)

 

(3.1)

               

GROSS MARGIN %:

             

New vehicle retail sales

5.0

 

5.2

       

Used vehicle retail sales

6.3

 

6.3

       

Used vehicle wholesale sales

(0.4)

 

(0.2)

       

Total used

5.7

 

5.5

       

Parts and service

54.0

 

54.0

       

Finance, insurance and other, net

100.0

 

100.0

       

Total

15.1

 

14.3

       
               

GROSS PROFIT:

             

New vehicle retail sales

$       77,602

 

$       88,332

 

(12.1)

 

(10.5)

Used vehicle retail sales

50,155

 

47,123

 

6.4

 

7.2

Used vehicle wholesale sales

(314)

 

(185)

 

(69.7)

 

(36.3)

Total used

49,841

 

46,938

 

6.2

 

7.1

Parts and service

191,574

 

185,157

 

3.5

 

4.2

Finance, insurance and other, net

116,084

 

110,993

 

4.6

 

5.2

Total 

$     435,101

 

$     431,420

 

0.9

 

1.8

               

UNITS SOLD:

             

Retail new vehicles sold

43,584

 

48,321

 

(9.8)

   

Retail used vehicles sold

37,676

 

34,349

 

9.7

   

Wholesale used vehicles sold

12,902

 

14,967

 

(13.8)

   

Total used

50,578

 

49,316

 

2.6

   
               

AVERAGE RETAIL SALES PRICE:

             

New vehicle retail

$       35,323

 

$       35,393

 

(0.2)

 

1.0

Used vehicle retail

$       21,032

 

$       21,632

 

(2.8)

 

(2.0)

               

GROSS PROFIT PER UNIT SOLD:

             

New vehicle retail sales

$         1,781

 

$         1,828

 

(2.6)

 

(0.7)

Used vehicle retail sales

1,331

 

1,372

 

(3.0)

 

(2.2)

Used vehicle wholesale sales

(24)

 

(12)

 

(100.0)

 

(58.2)

Total used

985

 

952

 

3.5

 

4.5

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

$         1,429

 

$         1,343

 

6.4

 

7.0

               

OTHER: 

             

Adjusted Finance, insurance and other revenue, net (1)(2)

$     116,084

 

$     117,543

 

(1.2)

 

(0.7)

Adjusted Total Revenue (1) 

$  2,889,058

 

$  3,018,842

 

(4.3)

 

(3.3)

Adjusted Total Gross Profit (1) 

$     435,101

 

$     437,970

 

(0.7)

 

0.3

Adjusted Total Gross Margin(1) 

15.1

 

14.5

       

Adjusted Finance, insurance and other, net (per retail unit) (1) 

$         1,429

 

$         1,422

 

0.5

 

1.0

SG&A expenses

$     316,771

 

$     328,327

 

(3.5)

 

(2.3)

Adjusted SG&A expenses (1)

$     320,441

 

$     318,660

 

0.6

 

1.6

SG&A as % revenues

11.0

 

10.9

       

Adjusted SG&A as % revenues (1)

11.1

 

10.6

       

SG&A as % gross profit

72.8

 

76.1

       

Adjusted SG&A as % gross profit (1)

73.6

 

72.8

       

Operating margin %

2.7

 

2.6

       

Adjusted operating margin % (1)

3.4

 

3.5

       

Pretax margin %

1.5

 

1.6

       

Adjusted pretax margin %(1)

2.2

 

2.4

       
               

INTEREST EXPENSE:

             

Floorplan interest expense

$    (14,685.0)

 

$     (13,491)

 

8.9

 

9.4

Floorplan assistance

$        12,034

 

$       13,561

 

(11.3)

 

(11.2)

Net floorplan expense

$     (2,651.0)

 

$              70

 

(3,887.1)

 

(4,015.3)

Other interest expense, net

$   (19,140.0)

 

$     (17,874)

 

7.1

 

7.4

               
               
 

Nine Months Ended September 30,

 

2018

 

2017

 

% Increase/
(Decrease)

 

Constant Currency % (1)
Increase/ (Decrease)

REVENUES:

             

New vehicle retail sales

$  4,608,658

 

$  4,496,222

 

2.5

 

1.9

Used vehicle retail sales

2,394,828

 

2,089,914

 

14.6

 

13.5

Used vehicle wholesale sales

283,453

 

308,361

 

(8.1)

 

(9.9)

Total used

2,678,281

 

2,398,275

 

11.7

 

10.5

Parts and service

1,062,145

 

994,522

 

6.8

 

6.4

Finance, insurance and other, net

343,462

 

314,297

 

9.3

 

8.8

Total 

$  8,692,546

 

$  8,203,316

 

6.0

 

5.2

               

GROSS MARGIN %:

             

New vehicle retail sales

5.0

 

5.2

       

Used vehicle retail sales

6.0

 

6.6

       

Used vehicle wholesale sales

0.6

 

(0.1)

       

Total used

5.5

 

5.7

       

Parts and service

54.0

 

53.9

       

Finance, insurance and other, net

100.0

 

100.0

       

Total

14.9

 

14.9

       
               

GROSS PROFIT:

             

New vehicle retail sales

$     229,611

 

$     232,470

 

(1.2)

 

(1.5)

Used vehicle retail sales

144,864

 

137,041

 

5.7

 

4.9

Used vehicle wholesale sales

1,582

 

(352)

 

549.4

 

581.5

Total used

146,446

 

136,689

 

7.1

 

6.4

Parts and service

573,508

 

536,378

 

6.9

 

6.4

Finance, insurance and other, net

343,462

 

314,297

 

9.3

 

8.8

Total 

$  1,293,027

 

$  1,219,834

 

6.0

 

5.5

               

UNITS SOLD:

             

Retail new vehicles sold

128,245

 

127,487

 

0.6

   

Retail used vehicles sold

111,900

 

97,918

 

14.3

   

Wholesale used vehicles sold

41,798

 

43,571

 

(4.1)

   

Total used

153,698

 

141,489

 

8.6

   
               

AVERAGE RETAIL SALES PRICE:

             

New vehicle retail

$       35,936

 

$       35,268

 

1.9

 

1.3

Used vehicle retail

$       21,402

 

$       21,344

 

0.3

 

(0.7)

               

GROSS PROFIT PER UNIT SOLD:

             

New vehicle retail sales

$         1,790

 

$         1,823

 

(1.8)

 

(2.1)

Used vehicle retail sales

1,295

 

1,400

 

(7.5)

 

(8.2)

Used vehicle wholesale sales

38

 

(8)

 

575.0

 

601.9

Total used

953

 

966

 

(1.3)

 

(2.1)

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

$         1,430

 

$         1,394

 

2.6

 

2.2

               

OTHER: 

             

Adjusted Finance, insurance and other revenue, net (1)(2)

$     343,462

 

$     320,847

 

7.0

 

6.6

Adjusted Total Revenue (1) 

$  8,692,546

 

$  8,209,866

 

5.9

 

5.1

Adjusted Total Gross Profit(1) 

$  1,293,027

 

$  1,226,384

 

5.4

 

4.9

Adjusted Total Gross Margin(1) 

14.9

 

14.9

       

Adjusted Finance, insurance and other, net (per retail unit) (1) 

$         1,430

 

$         1,423

 

0.5

 

0.1

SG&A expenses

$     949,210

 

$     916,674

 

3.5

 

3.1

Adjusted SG&A expenses(1)

$     964,637

 

$     907,909

 

6.2

 

5.7

SG&A as % revenues

10.9

 

11.2

       

Adjusted SG&A as % revenues (1)

11.1

 

11.1

       

SG&A as % gross profit

73.4

 

75.1

       

Adjusted SG&A as % gross profit (1)

74.6

 

74.0

       

Operating margin %

3.1

 

3.1

       

Adjusted operating margin % (1)

3.2

 

3.4

       

Pretax margin %

1.9

 

2.0

       

Adjusted pretax margin % (1)

2.0

 

2.3

       
               

INTEREST EXPENSE:

             

Floorplan interest expense

$     (43,335)

 

$     (38,659)

 

12.1

 

11.7

Floorplan assistance

$       34,516

 

$       35,745

 

(3.4)

 

(3.6)

Net floorplan expense

$       (8,819)

 

$       (2,914)

 

202.6

 

198.3

Other interest expense, net

$     (57,374)

 

$     (52,188)

 

9.9

 

9.6

 

(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.

(2)Finance, insurance and other revenue represents fees earned for the financing of vehicle sales transactions and from the sale of insurance and vehicle service contracts. Such amounts are reported net of estimated amounts to be charged in the future. As a result, finance, insurance and other revenue and gross profit are the same. 

 

Group 1 Automotive, Inc.

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

(Unaudited)

(Dollars in thousands, except per unit amounts)

           
 

Three Months Ended September 30,

 

2018

 

2017

 

% Increase/

(Decrease)

REVENUES:

         

New vehicle retail sales

$  1,168,356

 

$  1,277,933

 

(8.6)

Used vehicle retail sales

556,910

 

552,925

 

0.7

Used vehicle wholesale sales

39,451

 

61,896

 

(36.3)

Total used

596,361

 

614,821

 

(3.0)

Parts and service

285,334

 

279,191

 

2.2

Finance, insurance and other, net

98,868

 

95,016

 

4.1

Total 

$  2,148,919

 

$  2,266,961

 

(5.2)

           

GROSS MARGIN %:

         

New vehicle retail sales

4.8

 

5.1

   

Used vehicle retail sales

6.6

 

6.7

   

Used vehicle wholesale sales

1.0

 

(0.2)

   

Total used

6.2

 

6.0

   

Parts and service

53.9

 

53.8

   

Finance, insurance and other, net

100.0

 

100.0

   

Total

16.1

 

15.3

   
           

GROSS PROFIT:

         

New vehicle retail sales

$       55,745

 

$       65,518

 

(14.9)

Used vehicle retail sales

36,505

 

37,316

 

(2.2)

Used vehicle wholesale sales

409

 

(130)

 

414.6

Total used

36,914

 

37,186

 

(0.7)

Parts and service

153,657

 

150,073

 

2.4

Finance, insurance and other, net

98,868

 

95,016

 

4.1

Total 

$     345,184

 

$     347,793

 

(0.8)

           

UNITS SOLD:

         

Retail new vehicles sold

31,275

 

34,860

 

(10.3)

Retail used vehicles sold

27,406

 

25,980

 

5.5

Wholesale used vehicles sold

6,932

 

9,638

 

(28.1)

Total used

34,338

 

35,618

 

(3.6)

           

AVERAGE RETAIL SALES PRICE:

         

New vehicle retail

$       37,358

 

$       36,659

 

1.9

Used vehicle retail

$       20,321

 

$       21,283

 

(4.5)

           

GROSS PROFIT PER UNIT SOLD:

         

New vehicle retail sales

$         1,782

 

$         1,879

 

(5.2)

Used vehicle retail sales

1,332

 

1,436

 

(7.2)

Used vehicle wholesale sales

59

 

(13)

 

553.8

Total used

1,075

 

1,044

 

3.0

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

$         1,685

 

$         1,562

 

7.9

           

OTHER: 

         
           

Adjusted Finance, insurance and other revenue, net(2)(3) 

$       98,868

 

$     101,566

 

(2.7)

Adjusted Total Revenue (2) 

$  2,148,919

 

$  2,273,511

 

(5.5)

Adjusted Total Gross Profit (2) 

$     345,184

 

$     354,343

 

(2.6)

Adjusted Total Gross Margin (2) 

16.1

 

15.6

   

Adjusted Finance, insurance and other, net (per retail unit) (2) 

$         1,685

 

$         1,669

 

1.0

SG&A expenses

$     239,268

 

$     257,330

 

(7.0)

Adjusted SG&A expenses(2)

$     243,036

 

$     247,663

 

(1.9)

SG&A as % revenues

11.1

 

11.4

   

Adjusted SG&A as % revenues (2)

11.3

 

10.9

   

SG&A as % gross profit

69.3

 

74.0

   

Adjusted SG&A as % gross profit (2)

70.4

 

69.9

   

Operating margin %

3.3

 

3.0

   

Adjusted operating margin % (2)

4.1

 

4.2

   
           
 

Nine Months Ended September 30,

 

2018

 

2017

 

% Increase/

(Decrease)

REVENUES:

         

New vehicle retail sales

$  3,357,715

 

$  3,435,980

 

(2.3)

Used vehicle retail sales

1,690,460

 

1,609,804

 

5.0

Used vehicle wholesale sales

133,389

 

198,628

 

(32.8)

Total used

1,823,849

 

1,808,432

 

0.9

Parts and service

850,231

 

831,905

 

2.2

Finance, insurance and other, net

288,317

 

274,338

 

5.1

Total 

$  6,320,112

 

$  6,350,655

 

(0.5)

           

GROSS MARGIN %:

         

New vehicle retail sales

4.8

 

5.0

   

Used vehicle retail sales

6.3

 

7.0

   

Used vehicle wholesale sales

2.5

 

(0.1)

   

Total used

6.1

 

6.2

   

Parts and service

53.7

 

53.8

   

Finance, insurance and other, net

100.0

 

100.0

   

Total

16.1

 

15.9

   
           

GROSS PROFIT:

         

New vehicle retail sales

$     162,465

 

$     173,509

 

(6.4)

Used vehicle retail sales

107,251

 

111,896

 

(4.2)

Used vehicle wholesale sales

3,395

 

(220)

 

1,643.2

Total used

110,646

 

111,676

 

(0.9)

Parts and service

456,654

 

447,420

 

2.1

Finance, insurance and other, net

288,317

 

274,338

 

5.1

Total 

$  1,018,082

 

$  1,006,943

 

1.1

           

UNITS SOLD:

         

Retail new vehicles sold

89,255

 

93,088

 

(4.1)

Retail used vehicles sold

82,235

 

76,078

 

8.1

Wholesale used vehicles sold

23,288

 

29,300

 

(20.5)

Total used

105,523

 

105,378

 

0.1

           

AVERAGE RETAIL SALES PRICE:

         

New vehicle retail

$       37,619

 

$       36,911

 

1.9

Used vehicle retail

$       20,556

 

$       21,160

 

(2.9)

           

GROSS PROFIT PER UNIT SOLD:

         

New vehicle retail sales

$         1,820

 

$         1,864

 

(2.4)

Used vehicle retail sales

1,304

 

1,471

 

(11.4)

Used vehicle wholesale sales

146

 

(8)

 

1,925.0

Total used

1,049

 

1,060

 

(1.0)

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

$         1,681

 

$         1,622

 

3.6

           

OTHER: 

         

Adjusted Finance, insurance and other revenue, net (2)(3)

$     288,317

 

$     280,888

 

2.6

Adjusted Total Revenue (2) 

$  6,320,112

 

$  6,357,205

 

(0.6)

Adjusted Total Gross Profit (2) 

1,018,082.0

 

1,013,493.0

 

0.5

Adjusted Total Gross Margin (2) 

16.1

 

15.9

   

Adjusted Finance, insurance and other, net (per retail unit)(2) 

1,681.0

 

1,660.0

 

1.3

SG&A expenses

735,914.0

 

735,942.0

 

(0.0)

Adjusted SG&A expenses (2)

731,870.0

 

727,465.0

 

0.6

SG&A as % revenues

11.6

 

11.6

   

Adjusted SG&A as % revenues (2)

11.6

 

11.4

   

SG&A as % gross profit

72.3

 

73.1

   

Adjusted SG&A as % gross profit (2)

71.9

 

71.8

   

Operating margin %

3.4

 

3.6

   

Adjusted operating margin % (2)

3.9

 

3.9

   
 

(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.

(3)Finance, insurance and other revenue represents fees earned for the financing of vehicle sales transactions and from the sale of insurance and vehicle service contracts. Such amounts are reported net of estimated amounts to be charged in the future. As a result, finance, insurance and other revenue and gross profit are the same. 

 

Group 1 Automotive, Inc.

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

(Unaudited)

(Dollars in thousands, except per unit amounts)

               
 

Three Months Ended September 30,

 

2018

 

2017

 

% Increase/
(Decrease)

 

Constant Currency (2)

% Increase/ (Decrease)

REVENUES:

             

New vehicle retail sales

$    236,127

 

$    319,782

 

(26.2)

 

(25.3)

Used vehicle retail sales

166,503

 

146,611

 

13.6

 

14.3

Used vehicle wholesale sales

36,763

 

35,808

 

2.7

 

3.4

Total used

203,266

 

182,419

 

11.4

 

12.2

Parts and service

46,187

 

43,851

 

5.3

 

5.9

Finance, insurance and other, net

10,809

 

11,706

 

(7.7)

 

(6.7)

Total 

$    496,389

 

$    557,758

 

(11.0)

 

(10.1)

               

GROSS MARGIN %:

             

New vehicle retail sales

5.6

 

5.2

       

Used vehicle retail sales

5.4

 

5.0

       

Used vehicle wholesale sales

(1.7)

 

(0.8)

       

Total used

4.1

 

3.9

       

Parts and service

55.6

 

57.5

       

Finance, insurance and other, net

100.0

 

100.0

       

Total

11.7

 

10.9

       
               

GROSS PROFIT:

             

New vehicle retail sales

$      13,224

 

$      16,625

 

(20.5)

 

(19.3)

Used vehicle retail sales

8,918

 

7,384

 

20.8

 

21.5

Used vehicle wholesale sales

(623)

 

(280)

 

(122.5)

 

(117.2)

Total used

8,295

 

7,104

 

16.8

 

17.7

Parts and service

25,701

 

25,208

 

2.0

 

2.6

Finance, insurance and other, net

10,809

 

11,706

 

(7.7)

 

(6.7)

Total 

$      58,029

 

$      60,643

 

(4.3)

 

(3.4)

               

UNITS SOLD:

             

Retail new vehicles sold

8,121

 

10,341

 

(21.5)

   

Retail used vehicles sold

6,982

 

6,483

 

7.7

   

Wholesale used vehicles sold

4,697

 

4,594

 

2.2

   

Total used

11,679

 

11,077

 

5.4

   
               

AVERAGE RETAIL SALES PRICE:

             

New vehicle retail

$      29,076

 

$      30,924

 

(6.0)

 

(4.9)

Used vehicle retail

$      23,847

 

$      22,615

 

5.4

 

6.1

               

GROSS PROFIT PER UNIT SOLD:

             

New vehicle retail sales

$        1,628

 

$        1,608

 

1.2

 

2.8

Used vehicle retail sales

1,277

 

1,139

 

12.1

 

12.8

Used vehicle wholesale sales

(133)

 

(61)

 

(118.0)

 

(112.4)

Total used

710

 

641

 

10.8

 

11.7

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

$           716

 

$           696

 

2.9

 

3.9

               

OTHER: 

             

SG&A expenses

$      50,901

 

$      49,651

 

2.5

 

3.2

SG&A as % revenues

10.3

 

8.9

       

SG&A as % gross profit

87.7

 

81.9

       

Operating margin %

0.9

 

1.6

       
               
 

Nine Months Ended September 30,

 

2018

 

2017

 

% Increase/
(Decrease)

 

Constant Currency (2)
% Increase/ (Decrease)

REVENUES:

             

New vehicle retail sales

$    760,304

 

$    806,364

 

(5.7)

 

(10.8)

Used vehicle retail sales

462,087

 

388,892

 

18.8

 

12.7

Used vehicle wholesale sales

107,775

 

96,470

 

11.7

 

5.7

Total used

569,862

 

485,362

 

17.4

 

11.3

Parts and service

130,198

 

117,105

 

11.2

 

5.3

Finance, insurance and other, net

33,339

 

30,413

 

9.6

 

4.0

Total 

$ 1,493,703

 

$ 1,439,244

 

3.8

 

(1.7)

               

GROSS MARGIN %:

             

New vehicle retail sales

5.4

 

5.5

       

Used vehicle retail sales

5.1

 

5.0

       

Used vehicle wholesale sales

(1.5)

 

(0.8)

       

Total used

3.9

 

3.8

       

Parts and service

56.9

 

57.7

       

Finance, insurance and other, net

100.0

 

100.0

       

Total

11.4

 

11.2

       
               

GROSS PROFIT:

             

New vehicle retail sales

$      41,058

 

$      44,623

 

(8.0)

 

(12.7)

Used vehicle retail sales

23,563

 

19,404

 

21.4

 

15.1

Used vehicle wholesale sales

(1,601)

 

(764)

 

(109.6)

 

(102.7)

Total used

21,962

 

18,640

 

17.8

 

11.5

Parts and service

74,110

 

67,596

 

9.6

 

3.9

Finance, insurance and other, net

33,339

 

30,413

 

9.6

 

4.0

Total 

$    170,469

 

$    161,272

 

5.7

 

0.2

               

UNITS SOLD:

             

Retail new vehicles sold

24,507

 

27,057

 

(9.4)

   

Retail used vehicles sold

18,844

 

17,819

 

5.8

   

Wholesale used vehicles sold

13,517

 

12,840

 

5.3

   

Total used

32,361

 

30,659

 

5.6

   
               

AVERAGE RETAIL SALES PRICE:

             

New vehicle retail

$      31,024

 

$      29,802

 

4.1

 

(1.5)

Used vehicle retail

$      24,522

 

$      21,825

 

12.4

 

6.5

               

GROSS PROFIT PER UNIT SOLD:

             

New vehicle retail sales

$        1,675

 

$        1,649

 

1.6

 

(3.7)

Used vehicle retail sales

1,250

 

1,089

 

14.8

 

8.9

Used vehicle wholesale sales

(118)

 

(60)

 

(96.7)

 

(92.5)

Total used

679

 

608

 

11.7

 

5.7

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

$           769

 

$           678

 

13.4

 

7.7

               

OTHER: 

             

SG&A expenses

$    144,035

 

$    132,667

 

8.6

 

2.8

Adjusted SG&A expenses(2)

$    144,035

 

$    132,379

 

8.8

 

3.0

SG&A as % revenues

9.6

 

9.2

       

Adjusted SG&A as % revenues (2)

9.6

 

9.2

       

SG&A as % gross profit

84.5

 

82.3

       

Adjusted SG&A as % gross profit (2)

84.5

 

82.1

       

Operating margin %

1.3

 

1.6

       

Adjusted operating margin % (2)

1.3

 

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 September 30,

 

2018

 

2017

 

% Increase/

(Decrease)

 

Constant Currency (2)
% Increase/ (Decrease)

REVENUES:

             

New vehicle retail sales

$   59,951

 

$   79,203

 

(24.3)

 

(5.5)

Used vehicle retail sales

19,679

 

22,930

 

(14.2)

 

6.7

Used vehicle wholesale sales

3,957

 

2,818

 

40.4

 

76.1

Total used

23,636

 

25,748

 

(8.2)

 

14.3

Parts and service

10,802

 

12,495

 

(13.5)

 

7.6

Finance, insurance and other, net

2,029

 

2,162

 

(6.2)

 

17.2

Total 

$   96,418

 

$ 119,608

 

(19.4)

 

0.5

               

GROSS MARGIN %:

             

New vehicle retail sales

8.2

 

5.7

       

Used vehicle retail sales

6.5

 

7.4

       

Used vehicle wholesale sales

3.9

 

7.7

       

Total used

6.1

 

7.4

       

Parts and service

44.3

 

45.5

       

Finance, insurance and other, net

100.0

 

100.0

       

Total

13.7

 

11.9

       
               

GROSS PROFIT:

             

New vehicle retail sales

$     4,930

 

$     4,505

 

9.4

 

36.4

Used vehicle retail sales

1,283

 

1,693

 

(24.2)

 

(6.1)

Used vehicle wholesale sales

155

 

216

 

(28.2)

 

(10.2)

Total used

1,438

 

1,909

 

(24.7)

 

(6.6)

Parts and service

4,787

 

5,681

 

(15.7)

 

4.9

Finance, insurance and other, net

2,029

 

2,162

 

(6.2)

 

17.2

Total 

$   13,184

 

$   14,257

 

(7.5)

 

15.2

               

UNITS SOLD:

             

Retail new vehicles sold

1,986

 

2,179

 

(8.9)

   

Retail used vehicles sold

1,027

 

1,034

 

(0.7)

   

Wholesale used vehicles sold

359

 

242

 

48.3

   

Total used

1,386

 

1,276

 

8.6

   
               

AVERAGE RETAIL SALES PRICE:

             

New vehicle retail

$   30,187

 

$   36,348

 

(17.0)

 

3.6

Used vehicle retail

$   19,162

 

$   22,176

 

(13.6)

 

7.4

               

GROSS PROFIT PER UNIT SOLD:

             

New vehicle retail sales

$     2,482

 

$     2,067

 

20.1

 

49.7

Used vehicle retail sales

1,249

 

1,637

 

(23.7)

 

(5.5)

Used vehicle wholesale sales

432

 

893

 

(51.6)

 

(39.4)

Total used

1,038

 

1,496

 

(30.6)

 

(14.0)

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

$        673

 

$        673

 

-

 

25.0

               

OTHER: 

             

SG&A expenses

$   13,725

 

$   12,794

 

7.3

 

34.8

Adjusted SG&A expenses(2)

$   11,218

 

$   12,794

 

(12.3)

 

9.4

SG&A as % revenues

14.2

 

10.7

       

Adjusted SG&A as % revenues (2)

11.6

 

10.7

       

SG&A as % gross profit

104.1

 

89.7

       

Adjusted SG&A as % gross profit (2)

85.1

 

89.7

       

Operating margin %

(0.9)

 

0.9

       

Adjusted operating margin % (2)

1.7

 

0.9

       
               
 

Nine Months Ended September 30,

 

2018

 

2017

 

% Increase/

(Decrease)

 

Constant Currency (2)
% Increase/ (Decrease)

REVENUES:

             

New vehicle retail sales

$ 196,338

 

$ 210,873

 

(6.9)

 

4.9

Used vehicle retail sales

65,139

 

66,081

 

(1.4)

 

10.8

Used vehicle wholesale sales

11,345

 

8,357

 

35.8

 

55.2

Total used

76,484

 

74,438

 

2.7

 

15.8

Parts and service

33,593

 

35,480

 

(5.3)

 

6.8

Finance, insurance and other, net

5,868

 

6,043

 

(2.9)

 

10.4

Total 

$ 312,283

 

$ 326,834

 

(4.5)

 

7.7

               

GROSS MARGIN %:

             

New vehicle retail sales

6.6

 

5.8

       

Used vehicle retail sales

6.2

 

7.3

       

Used vehicle wholesale sales

3.3

 

8.0

       

Total used

5.7

 

7.4

       

Parts and service

44.6

 

45.6

       

Finance, insurance and other, net

100.0

 

100.0

       

Total

12.2

 

12.2

       
               

GROSS PROFIT:

             

New vehicle retail sales

$   12,879

 

$   12,193

 

5.6

 

20.6

Used vehicle retail sales

4,011

 

4,821

 

(16.8)

 

(6.3)

Used vehicle wholesale sales

372

 

669

 

(44.4)

 

(37.7)

Total used

4,383

 

5,490

 

(20.2)

 

(10.1)

Parts and service

14,990

 

16,180

 

(7.4)

 

4.4

Finance, insurance and other, net

5,868

 

6,043

 

(2.9)

 

10.4

Total 

$   38,120

 

$   39,906

 

(4.5)

 

8.3

               

UNITS SOLD:

             

Retail new vehicles sold

6,116

 

6,035

 

1.3

   

Retail used vehicles sold

3,094

 

3,003

 

3.0

   

Wholesale used vehicles sold

1,030

 

748

 

37.7

   

Total used

4,124

 

3,751

 

9.9

   
               

AVERAGE RETAIL SALES PRICE:

             

New vehicle retail

$   32,102

 

$   34,942

 

(8.1)

 

3.5

Used vehicle retail

$   21,053

 

$   22,005

 

(4.3)

 

7.6

               

GROSS PROFIT PER UNIT SOLD:

             

New vehicle retail sales

$     2,106

 

$     2,020

 

4.3

 

19.0

Used vehicle retail sales

1,296

 

1,605

 

(19.3)

 

(9.1)

Used vehicle wholesale sales

361

 

894

 

(59.6)

 

(54.7)

Total used

1,063

 

1,464

 

(27.4)

 

(18.3)

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

$        637

 

$        669

 

(4.8)

 

8.4

               

OTHER: 

             

SG&A expenses

$   36,578

 

$   36,139

 

1.2

 

15.7

Adjusted SG&A expenses(2)

$   33,644

 

$   36,139

 

(6.9)

 

5.3

SG&A as % revenues

11.7

 

11.1

       

Adjusted SG&A as % revenues (2)

10.8

 

11.1

       

SG&A as % gross profit

96.0

 

90.6

       

Adjusted SG&A as % gross profit (2)

88.3

 

90.6

       

Operating margin %

0.1

 

0.8

       

Adjusted operating margin % (2)

1.0

 

0.8

       
 

(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 September 30,

 

2018

 

2017

 

% Increase/
(Decrease)

 

Constant Currency (2)
% Increase/ (Decrease)

REVENUES:

             

New vehicle retail sales

$   1,464,434

 

$   1,676,918

 

(12.7)

 

(11.6)

Used vehicle retail sales

743,092

 

722,466

 

2.9

 

3.7

Used vehicle wholesale sales

80,171

 

100,522

 

(20.2)

 

(19.0)

Total used

823,263

 

822,988

 

0.0

 

0.9

Parts and service

342,323

 

335,537

 

2.0

 

2.9

Finance, insurance and other, net

111,706

 

108,884

 

2.6

 

3.2

Total 

$   2,741,726

 

$   2,944,327

 

(6.9)

 

(5.9)

               

GROSS MARGIN %:

             

New vehicle retail sales

5.0

 

5.2

       

Used vehicle retail sales

6.3

 

6.4

       

Used vehicle wholesale sales

(0.1)

 

(0.2)

       

Total used

5.7

 

5.6

       

Parts and service

53.8

 

53.9

       

Finance, insurance and other, net

100.0

 

100.0

       

Total

15.2

 

14.4

       
               

GROSS PROFIT:

             

New vehicle retail sales

$        73,899

 

$        86,648

 

(14.7)

 

(13.1)

Used vehicle retail sales

46,706

 

46,393

 

0.7

 

1.5

Used vehicle wholesale sales

(59)

 

(194)

 

69.6

 

97.7

Total used

46,647

 

46,199

 

1.0

 

1.9

Parts and service

184,145

 

180,962

 

1.8

 

2.5

Finance, insurance and other, net

111,706

 

108,884

 

2.6

 

3.2

Total 

$      416,397

 

$      422,693

 

(1.5)

 

(0.6)

               

UNITS SOLD:

             

Retail new vehicles sold

41,382

 

47,380

 

(12.7)

   

Retail used vehicles sold

35,415

 

33,497

 

5.7

   

Wholesale used vehicles sold

11,988

 

14,474

 

(17.2)

   

Total used

47,403

 

47,971

 

(1.2)

   
               

AVERAGE RETAIL SALES PRICE:

             

New vehicle retail

$        35,388

 

$        35,393

 

(0.0)

 

1.2

Used vehicle retail

$        20,982

 

$        21,568

 

(2.7)

 

(1.9)

               

GROSS PROFIT PER UNIT SOLD:

             

New vehicle retail sales

$          1,786

 

$          1,829

 

(2.4)

 

(0.5)

Used vehicle retail sales

1,319

 

1,385

 

(4.8)

 

(4.0)

Used vehicle wholesale sales

(5)

 

(13)

 

61.5

 

97.3

Total used

984

 

963

 

2.2

 

3.1

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

$          1,455

 

$          1,346

 

8.1

 

8.6

               

OTHER: 

             

Adjusted Finance, insurance and other revenue, net (2)(3)

$      111,706

 

$      115,434

 

(3.2)

 

(2.7)

Adjusted Total Revenue (2) 

$   2,741,726

 

$   2,950,877

 

(7.1)

 

(6.1)

Adjusted Total Gross Profit (2) 

$      416,397

 

$      429,243

 

(3.0)

 

(2.1)

Adjusted Total Gross Margin (2) 

15.2

 

14.5

       

Adjusted Finance, insurance and other, net (per retail unit)(2) 

$          1,455

 

$          1,427

 

2.0

 

2.5

SG&A expenses

$      303,894

 

$      319,775

 

(5.0)

 

(3.8)

Adjusted SG&A expenses(2)

$      305,155

 

$      310,108

 

(1.6)

 

(0.6)

SG&A as % revenues

11.1

 

10.9

       

Adjusted SG&A as % revenues (2)

11.1

 

10.5

       

SG&A as % gross profit

73.0

 

75.7

       

Adjusted SG&A as % gross profit (2)

73.3

 

72.2

       

Operating margin %

2.7

 

2.7

       

Adjusted operating margin % (2)

3.5

 

3.5

       
               
 

Nine Months Ended September 30,

 

2018

 

2017

 

% Increase/
(Decrease)

 

Constant Currency (2)
% Increase/ (Decrease)

REVENUES:

             

New vehicle retail sales

$   4,314,357

 

$   4,453,217

 

(3.1)

 

(3.5)

Used vehicle retail sales

2,217,686

 

2,064,777

 

7.4

 

6.6

Used vehicle wholesale sales

252,509

 

303,455

 

(16.8)

 

(18.2)

Total used

2,470,195

 

2,368,232

 

4.3

 

3.5

Parts and service

1,014,022

 

984,490

 

3.0

 

2.7

Finance, insurance and other, net

327,524

 

310,794

 

5.4

 

5.1

Total 

$   8,126,098

 

$   8,116,733

 

0.1

 

(0.4)

               

GROSS MARGIN %:

             

New vehicle retail sales

5.0

 

5.2

       

Used vehicle retail sales

6.1

 

6.6

       

Used vehicle wholesale sales

0.9

 

(0.1)

       

Total used

5.5

 

5.7

       

Parts and service

53.8

 

54.0

       

Finance, insurance and other, net

100.0

 

100.0

       

Total

15.1

 

14.9

       
               

GROSS PROFIT:

             

New vehicle retail sales

$      216,402

 

$      230,325

 

(6.0)

 

(6.2)

Used vehicle retail sales

134,825

 

136,121

 

(1.0)

 

(1.5)

Used vehicle wholesale sales

2,166

 

(315)

 

787.6

 

819.3

Total used

136,991

 

135,806

 

0.9

 

0.4

Parts and service

545,754

 

531,196

 

2.7

 

2.4

Finance, insurance and other, net

327,524

 

310,794

 

5.4

 

5.1

Total 

$   1,226,671

 

$   1,208,121

 

1.5

 

1.2

               

UNITS SOLD:

             

Retail new vehicles sold

119,878

 

126,180

 

(5.0)

   

Retail used vehicles sold

104,173

 

96,900

 

7.5

   

Wholesale used vehicles sold

37,835

 

42,888

 

(11.8)

   

Total used

142,008

 

139,788

 

1.6

   
               

AVERAGE RETAIL SALES PRICE:

             

New vehicle retail

$        35,990

 

$        35,293

 

2.0

 

1.6

Used vehicle retail

$        21,288

 

$        21,308

 

(0.1)

 

(0.8)

               

GROSS PROFIT PER UNIT SOLD:

             

New vehicle retail sales

$          1,805

 

$          1,825

 

(1.1)

 

(1.2)

Used vehicle retail sales

1,294

 

1,405

 

(7.9)

 

(8.4)

Used vehicle wholesale sales

57

 

(7)

 

914.3

 

915.3

Total used

965

 

972

 

(0.7)

 

(1.2)

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

$          1,462

 

$          1,393

 

5.0

 

4.6

               

OTHER: 

             

Adjusted Finance, insurance and other revenue, net (2)(3)

$      327,524

 

$      317,344

 

3.2

 

2.9

Adjusted Total Revenue (2) 

$   8,126,098

 

$   8,123,283

 

0.0

 

(0.4)

Adjusted Total Gross Profit (2) 

$   1,226,671

 

$   1,214,671

 

1.0

 

0.7

Adjusted Total Gross Margin (2) 

15.1

 

15.0

       

Adjusted Finance, insurance and other, net (per retail unit) (2) 

$          1,462

 

$          1,423

 

2.7

 

2.5

SG&A expenses

$      916,527

 

$      904,748

 

1.3

 

1.0

Adjusted SG&A expenses(2)

$      909,549

 

$      895,983

 

1.5

 

1.2

SG&A as % revenues

11.3

 

11.1

       

Adjusted SG&A as % revenues (2)

11.2

 

11.0

       

SG&A as % gross profit

74.7

 

74.9

       

Adjusted SG&A as % gross profit (2)

74.1

 

73.8

       

Operating margin %

2.9

 

3.1

       

Adjusted operating margin % (2)

3.3

 

3.4

       
 

(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.

(3)Finance, insurance and other revenue represents fees earned for the financing of vehicle sales transactions and from the sale of insurance and vehicle service contracts. Such amounts are reported net of estimated amounts to be charged in the future. As a result, finance, insurance and other revenue and gross profit are the same. 

 

Group 1 Automotive, Inc.

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

(Unaudited)

 (Dollars in thousands, except per share amounts)

   

Three Months Ended September 30,

   

2018

 

2017

 

% Increase/
(Decrease)

 FINANCE, INSURANCE AND OTHER REVENUE, NET RECONCILIATION: 

         
 

As reported

$    101,610

 

$      96,383

 

5.4

 

  Pre-tax adjustments:

         
 

 Catastrophic events 

-

 

6,550

   
 

Adjusted Finance, insurance and other revenue, net (1)

$    101,610

 

$    102,933

 

(1.3)

             

 TOTAL REVENUES RECONCILIATION: 

         
 

As reported

$ 2,200,230

 

$ 2,301,959

 

(4.4)

 

  Pre-tax adjustments:

         
 

 Catastrophic events 

-

 

6,550

   
 

Adjusted Total Revenues (1)

$ 2,200,230

 

$ 2,308,509

 

(4.7)

             

 TOTAL GROSS PROFIT RECONCILIATION: 

         
 

As reported

$    352,471

 

$    353,567

 

(0.3)

 

  Pre-tax adjustments:

         
 

 Catastrophic events 

-

 

6,550

   
 

Adjusted Total Gross Profit (1)

$    352,471

 

$    360,117

 

(2.1)

             

SG&A RECONCILIATION:

         
 

As reported

$    242,210

 

$    261,787

 

(7.5)

 

  Pre-tax adjustments:

         
 

 Catastrophic events 

-

 

(8,149)

   
 

 Gain (loss) on real estate and dealership transactions 

5,394

 

(798)

   
 

 Legal settlements 

1,396

 

(720)

   
 

Adjusted SG&A (1)

$    249,000

 

$    252,120

 

(1.2)

             

TOTAL GROSS MARGIN %:

         
 

Unadjusted

16.0

 

15.4

   
 

Adjusted (1)

16.0

 

15.6

   
             

FINANCE, INSURANCE AND OTHER, NET (PER RETAIL UNIT):

         
 

Unadjusted

$        1,688

 

$        1,566

 

7.8

 

Adjusted (1)

$        1,688

 

$        1,673

 

0.9

             

SG&A AS % REVENUES:

         
 

Unadjusted

11.0

 

11.4

   
 

Adjusted (1)

11.3

 

11.0

   
             

SG&A AS % GROSS PROFIT:

         
 

Unadjusted

68.7

 

74.0

   
 

Adjusted (1)

70.6

 

70.0

   
             

OPERATING MARGIN %:

         
 

Unadjusted

3.3

 

3.0

   
 

Adjusted (1), (2)

4.1

 

4.1

   
             

PRETAX MARGIN %:

         
 

Unadjusted

2.0

 

1.8

   
 

Adjusted (1), (2)

2.7

 

2.9

   
             

 SAME STORE FINANCE, INSURANCE AND OTHER REVENUE, NET RECONCILIATION: 

         
 

As reported

$      98,868

 

$      95,016

 

4.1

 

  Pre-tax adjustments:

         
 

 Catastrophic events 

-

 

6,550

   
 

Adjusted Finance, insurance and other revenue, net (1)

$      98,868

 

$    101,566

 

(2.7)

             

 SAME STORE TOTAL REVENUES RECONCILIATION: 

         
 

As reported

$ 2,148,919

 

$ 2,266,961

 

(5.2)

 

  Pre-tax adjustments:

         
 

 Catastrophic events 

-

 

6,550

   
 

Adjusted Total Revenues (1)

$ 2,148,919

 

$ 2,273,511

 

(5.5)

             

 SAME STORE TOTAL GROSS PROFIT RECONCILIATION: 

         
 

As reported

$    345,184

 

$    347,793

 

(0.8)

 

  Pre-tax adjustments:

         
 

 Catastrophic events 

-

 

6,550

   
 

Adjusted Total Gross Profit (1)

$    345,184

 

$    354,343

 

(2.6)

             

SAME STORE SG&A RECONCILIATION:

         
             
 

As reported

$    239,268

 

$    257,330

 

(7.0)

 

  Pre-tax adjustments:

         
 

 Catastrophic events 

-

 

(8,149)

   
 

 Gain (loss) on real estate and dealership transactions 

2,372

 

(798)

   
 

 Legal settlements 

1,396

 

(720)

   
 

Adjusted Same Store SG&A (1)

$    243,036

 

$    247,663

 

(1.9)

             

SAME STORE TOTAL GROSS MARGIN %:

         
 

Unadjusted

16.1

 

15.3

   
 

Adjusted (1)

16.1

 

15.6

   
             

SAME STORE FINANCE, INSURANCE AND OTHER, NET (PER RETAIL UNIT):

         
 

Unadjusted

$        1,685

 

$        1,562

 

7.9

 

Adjusted (1)

$        1,685

 

$        1,669

 

1.0

             

SAME STORE SG&A AS % REVENUES:

         
 

Unadjusted

11.1

 

11.4

   
 

Adjusted (1)

11.3

 

10.9

   
             

SAME STORE SG&A AS % GROSS PROFIT:

         
 

Unadjusted

69.3

 

74.0

   
 

Adjusted (1)

70.4

 

69.9

   
             

SAME STORE OPERATING MARGIN %:

         
 

Unadjusted

3.3

 

3.0

   
 

Adjusted (1), (3)

4.1

 

4.2

   
             
   

Nine Months Ended September 30,

   

2018

 

2017

 

% Increase/

(Decrease)

 FINANCE, INSURANCE AND OTHER REVENUE, NET RECONCILIATION: 

         
 

As reported

$    295,239

 

$    276,754

 

6.7

 

  Pre-tax adjustments:

         
 

 Catastrophic events 

-

 

6,550

   
 

Adjusted Finance, insurance and other revenue, net (1)

$    295,239

 

$    283,304

 

4.2

             

TOTAL REVENUES RECONCILIATION:

         
 

As reported

$ 6,456,717

 

$ 6,393,368

 

1.0

 

  Pre-tax adjustments:

         
 

 Catastrophic events 

-

 

6,550

   
 

Adjusted Total Revenues (1)

$ 6,456,717

 

$ 6,399,918

 

0.9

             

TOTAL GROSS PROFIT RECONCILIATION:

         
 

As reported

$ 1,038,826

 

$ 1,014,636

 

2.4

 

  Pre-tax adjustments:

         
 

 Catastrophic events 

-

 

6,550

   
 

Adjusted Total Gross Profit (1)

$ 1,038,826

 

$ 1,021,186

 

1.7

             

SG&A RECONCILIATION:

         
 

As reported

$    729,430

 

$    741,904

 

(1.7)

 

  Pre-tax adjustments:

         
 

 Catastrophic events 

(5,812)

 

(8,792)

   
 

 Gain (loss) on real estate and dealership transactions 

25,513

 

(798)

   
 

 Legal settlements 

(604)

 

1,113

   
 

Adjusted SG&A (1)

$    748,527

 

$    733,427

 

2.1

             

 TOTAL GROSS MARGIN %: 

         
 

Unadjusted

16.1

 

15.9

   
 

Adjusted (1)

16.1

 

16.0

   
             

 FINANCE, INSURANCE AND OTHER, NET (PER RETAIL UNIT): 

         
 

Unadjusted

$        1,687

 

$        1,628

 

3.6

 

Adjusted (1)

$        1,687

 

$        1,667

 

1.2

             

SG&A AS % REVENUES:

         
 

Unadjusted

11.3

 

11.6

   
 

Adjusted (1)

11.6

 

11.5

   
             

SG&A AS % OF GROSS PROFIT:

         
 

Unadjusted

70.2

 

73.1

   
 

Adjusted (1)

72.1

 

71.8

   
             

OPERATING MARGIN %:

         
 

 Unadjusted 

3.8

 

3.6

   
 

Adjusted (1), (2)

3.9

 

3.9

   
             

PRETAX MARGIN %:

         
 

Unadjusted

2.4

 

2.2

   
 

Adjusted (1), (2)

2.5

 

2.6

   
             

 SAME STORE FINANCE, INSURANCE AND OTHER REVENUE, NET RECONCILIATION: 

         
 

As reported

$    288,317

 

$    274,338

 

5.1

 

  Pre-tax adjustments:

         
 

 Catastrophic events 

-

 

6,550

   
 

Adjusted Finance, insurance and other revenue, net (1)

$    288,317

 

$    280,888

 

2.6

             

 SAME STORE TOTAL REVENUES RECONCILIATION: 

         
 

As reported

$ 6,320,112

 

$ 6,350,655

 

(0.5)

 

  Pre-tax adjustments:

         
 

 Catastrophic events 

-

 

6,550

   
 

Adjusted Total Revenues (1)

$ 6,320,112

 

$ 6,357,205

 

(0.6)

             

 SAME STORE TOTAL GROSS PROFIT RECONCILIATION: 

         
 

As reported

$ 1,018,082

 

$ 1,006,943

 

1.1

 

  Pre-tax adjustments:

         
 

 Catastrophic events 

-

 

6,550

   
 

Adjusted Total Gross Profit (1)

$ 1,018,082

 

$ 1,013,493

 

0.5

             

SAME STORE SG&A RECONCILIATION:

         
 

As reported

$    735,914

 

$    735,942

 

(0.0)

 

  Pre-tax adjustments:

         
 

 Catastrophic events 

(5,812)

 

(8,792)

   
 

 Gain (loss) on real estate and dealership transactions 

2,372

 

(798)

   
 

 Legal settlements 

(604)

 

1,113

   
 

Adjusted Same Store SG&A (1)

$    731,870

 

$    727,465

 

0.6

             

 SAME STORE TOTAL GROSS MARGIN %: 

         
 

Unadjusted

16.1

 

15.9

   
 

Adjusted (1)

16.1

 

15.9

   
             

 SAME STORE FINANCE, INSURANCE AND OTHER, NET (PER RETAIL UNIT): 

         
 

Unadjusted

$        1,681

 

$        1,622

 

3.6

 

Adjusted (1)

$        1,681

 

$        1,660

 

1.3

             

SAME STORE SG&A AS % REVENUES:

         
 

Unadjusted

11.6

 

11.6

   
 

Adjusted (1)

11.6

 

11.4

   
             

SAME STORE SG&A AS % GROSS PROFIT:

         
 

Unadjusted

72.3

 

73.1

   
 

Adjusted (1)

71.9

 

71.8

   
             

SAME STORE OPERATING MARGIN %:

         
 

Unadjusted

3.4

 

3.6

   
 

Adjusted (1), (3)

3.9

 

3.9

   
 

(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)

Excludes the impact of SG&A reconciling items above, as well as non-cash asset impairment charges of $23,159 and $27,427 for the three and nine months ended September 30, 2018, respectively, and $9,526 for the three and nine months ended September 30, 2017.

   

(3)

Excludes the impact of Same Store SG&A reconciling items above, as well as non-cash asset impairment charges of $22,161 and $26,183 for the three and nine months ended September 30, 2018, respectively, and $9,526 for the three and nine months ended September 30, 2017.

 

Group 1 Automotive, Inc.

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

(Unaudited)

 (Dollars in thousands, except per share amounts)

             
   

 Nine Months Ended September 30, 

   

2018

 

2017

 

% Increase/

(Decrease)

SG&A RECONCILIATION:

         
 

As reported

$ 181,558

 

$ 137,475

 

32.1

 

  Pre-tax adjustments:

         
 

 Acquisition costs 

-

 

(288)

   
 

Adjusted SG&A (1)

$ 181,558

 

$ 137,187

 

32.3

             

SG&A AS % REVENUES:

         
 

Unadjusted

9.5

 

9.3

   
 

Adjusted (1)

9.5

 

9.3

   
             

SG&A AS % OF GROSS PROFIT:

         
 

Unadjusted

84.5

 

83.4

   
 

Adjusted (1)

84.5

 

83.2

   
             

OPERATING MARGIN %:

         
 

Unadjusted

1.3

 

1.5

   
 

Adjusted (1)

1.3

 

1.5

   
             

PRETAX MARGIN %:

         
 

Unadjusted

0.8

 

1.1

   
 

Adjusted (1)

0.8

 

1.1

   
             

SAME STORE SG&A RECONCILIATION:

         
 

As reported

$ 144,035

 

$ 132,667

 

8.6

 

  Pre-tax adjustments:

         
 

 Acquisition costs 

-

 

(288)

   
 

Adjusted Same Store SG&A (1)

$ 144,035

 

$ 132,379

 

8.8

             

SAME STORE SG&A AS % REVENUES:

         
 

Unadjusted

9.6

 

9.2

   
 

Adjusted (1)

9.6

 

9.2

   
             

SAME STORE SG&A AS % GROSS PROFIT:

         
 

Unadjusted

84.5

 

82.3

   
 

Adjusted (1)

84.5

 

82.1

   
             

SAME STORE OPERATING MARGIN %:

         
 

Unadjusted

1.3

 

1.6

   
 

Adjusted (1)

1.3

 

1.6

   
 

(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.

 

Group 1 Automotive, Inc.

Reconciliation of Certain Non-GAAP Financial Measures - Brazil

(Unaudited)

 (Dollars in thousands, except per share amounts)

             
   

Three Months Ended September 30,

   

2018

 

2017

 

% Increase/
(Decrease)

SG&A RECONCILIATION:

         
 

As reported

$  14,857

 

$ 13,145

 

13.0

 

  Pre-tax adjustments:

         
 

 Legal settlements 

(3,120)

 

-

   
 

Adjusted SG&A (1)

$  11,737

 

$ 13,145

 

(10.7)

             

SG&A AS % REVENUES:

         
 

Unadjusted

14.4

 

11.0

   
 

Adjusted (1)

11.4

 

11.0

   
             

SG&A AS % GROSS PROFIT:

         
 

Unadjusted

106.8

 

92.2

   
 

Adjusted (1)

84.4

 

92.2

   
             

OPERATING MARGIN %:

         
 

Unadjusted

(1.3)

 

0.6

   
 

Adjusted (1)

1.8

 

0.6

   
             

PRETAX MARGIN %:

         
 

Unadjusted

(1.7)

 

0.5

   
 

Adjusted (1)

1.4

 

0.5

   
             

SAME STORE SG&A RECONCILIATION:

         
 

As reported

$  13,725

 

$ 12,794

 

7.3

 

  Pre-tax adjustments:

         
 

 Legal settlements 

(2,507)

 

-

   
 

Adjusted Same Store SG&A (1)

$  11,218

 

$ 12,794

 

(12.3)

             

SAME STORE SG&A AS % REVENUES:

         
 

Unadjusted

14.2

 

10.7

   
 

Adjusted (1)

11.6

 

10.7

   
             

SAME STORE SG&A AS % GROSS PROFIT:

         
 

Unadjusted

104.1

 

89.7

   
 

Adjusted (1)

85.1

 

89.7

   
             

SAME STORE OPERATING MARGIN %:

         
 

Unadjusted

(0.9)

 

0.9

   
 

Adjusted (1)

1.7

 

0.9

   
             
   

 Nine Months Ended September 30, 

   

2018

 

2017

 

% Increase/
(Decrease)

SG&A RECONCILIATION:

         
 

As reported

$  38,222

 

$ 37,295

 

2.5

 

  Pre-tax adjustments:

         
 

 Legal settlements 

(3,670)

 

-

   
 

Adjusted SG&A (1)

$  34,552

 

$ 37,295

 

(7.4)

             

SG&A AS % REVENUES:

         
 

Unadjusted

11.9

 

11.2

   
 

Adjusted (1)

10.7

 

11.2

   
             

SG&A AS % OF GROSS PROFIT:

         
 

Unadjusted

97.4

 

92.4

   
 

Adjusted (1)

88.1

 

92.4

   
             

OPERATING MARGIN %:

         
 

Unadjusted

(0.1)

 

0.6

   
 

Adjusted (1)

1.1

 

0.6

   

PRETAX MARGIN %:

         
 

Unadjusted

(0.5)

 

0.4

   
 

Adjusted (1)

0.7

 

0.4

   
             

SAME STORE SG&A RECONCILIATION:

         
 

As reported

$  36,578

 

$ 36,139

 

1.2

 

  Pre-tax adjustments:

         
 

 Legal settlements 

(2,934)

 

-

   
 

Adjusted Same Store SG&A (1)

$  33,644

 

$ 36,139

 

(6.9)

             

SAME STORE SG&A AS % REVENUES:

         
 

Unadjusted

11.7

 

11.1

   
 

Adjusted (1)

10.8

 

11.1

   
             

SAME STORE SG&A AS % GROSS PROFIT:

         
 

Unadjusted

96.0

 

90.6

   
 

Adjusted (1)

88.3

 

90.6

   
             

SAME STORE OPERATING MARGIN %:

         
 

Unadjusted

0.1

 

0.8

   
 

Adjusted (1)

1.0

 

0.8

   
 

(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.

 

Group 1 Automotive, Inc.

Reconciliation of Certain Non-GAAP Financial Measures - Consolidated

(Unaudited)

 (Dollars in thousands, except per share amounts)

             
   

Three Months Ended September 30,

   

2018

 

2017

 

% Increase/

(Decrease)

             

NET INCOME RECONCILIATION:

         
 

As reported

         
 

  Pretax Net Income

$      44,365

 

$      47,143

   
 

   Income Tax Provision 

(9,587)

 

(17,262)

   
 

     Net Income  

$      34,778

 

$      29,881

 

16.4

 

       Effective Tax Rate 

21.6%

 

36.6%

   
 

 Adjustments:  

         
 

 Catastrophic events  

         
 

 Pre-tax 

-

 

14,699

   
 

 Tax impact 

-

 

(5,677)

   
 

 (Gain) loss on real estate and dealership transactions 

         
 

 Pre-tax 

(5,394)

 

798

   
 

 Tax impact 

1,249

 

(301)

   
 

 Legal settlements 

         
 

 Pre-tax 

1,724

 

720

   
 

 Tax impact 

(118)

 

(270)

   
 

 Non-cash asset impairment 

         
 

 Pre-tax  

23,159

 

9,526

   
 

 Tax impact 

(5,504)

 

(3,579)

   
 

 Allowance for uncertain tax positions 

         
 

 Pre-tax  

-

 

-

   
 

 Tax impact 

-

 

834

   
 

 Tax rate changes  

         
 

 Pre-tax  

-

 

-

   
 

 Tax impact 

(705)

 

-

   
 

 Adjusted 

         
 

   Pretax Net Income 

$      63,854

 

$      72,886

   
 

   Income Tax Provision 

(14,665)

 

(26,255)

   
 

   Adjusted net income (1)

$      49,189

 

$      46,631

 

5.5

 

       Effective Tax Rate 

23.0%

 

36.02%

   
             

 ADJUSTED NET INCOME ATTRIBUTABLE TO DILUTED COMMON SHARES RECONCILIATION:

         
 

Adjusted net income (1)

$      49,189

 

$      46,631

 

5.5

 

Less: Adjusted earnings allocated to participating securities

1,676

 

1,603

 

4.6

 

Adjusted net income available to diluted common shares (1)

$      47,513

 

$      45,028

 

5.5

             

 DILUTED (LOSS) INCOME PER COMMON SHARE RECONCILIATION: 

         
 

As reported

$          1.74

 

$          1.43

 

21.7

 

  After-tax adjustments:

         
 

 Catastrophic events  

-

 

0.44

   
 

 (Gain) loss on real estate and dealership transactions 

(0.21)

 

0.02

   
 

 Legal settlements  

0.08

 

0.02

   
 

 Non-cash asset impairment 

0.89

 

0.28

   
 

 Allowance for uncertain tax positions 

-

 

0.04

   
 

 Tax rate changes  

(0.03)

 

-

   
 

Adjusted diluted income per share (1)

$          2.47

 

$          2.23

 

10.8

             

 FINANCE, INSURANCE AND OTHER REVENUE, NET RECONCILIATION: 

         
 

As reported

$    116,084

 

$    110,993

 

4.6

 

  Pre-tax adjustments:

         
 

Catastrophic events

-

 

6,550

   
 

Adjusted Finance, insurance and other revenue, net (1)

$    116,084

 

$    117,543

 

(1.2)

             

 TOTAL REVENUES RECONCILIATION: 

         
 

As reported

$ 2,889,058

 

$ 3,012,292

 

(4.1)

 

  Pre-tax adjustments:

         
 

Catastrophic events

-

 

6,550

   
 

Adjusted Total Revenues (1)

$ 2,889,058

 

$ 3,018,842

 

(4.3)

             

 TOTAL GROSS PROFIT RECONCILIATION: 

         
 

As reported

$    435,101

 

$    431,420

 

0.9

 

  Pre-tax adjustments:

         
 

 Catastrophic events 

-

 

6,550

   
 

Adjusted Total Gross Profit (1)

$    435,101

 

$    437,970

 

(0.7)

             

SG&A RECONCILIATION:

         
 

As reported

$    316,771

 

$    328,327

 

(3.5)

 

  Pre-tax adjustments:

         
 

 Catastrophic events 

-

 

(8,149)

   
 

 Gain (loss) on real estate and dealership transactions 

5,394

 

(798)

   
 

 Legal settlements 

(1,724)

 

(720)

   
 

Adjusted SG&A (1)

$    320,441

 

$    318,660

 

0.6

             

 TOTAL GROSS MARGIN %: 

         
 

Unadjusted

15.1

 

14.3

   
 

Adjusted (1)

15.1

 

14.5

   
             

 FINANCE, INSURANCE AND OTHER, NET (PER RETAIL UNIT): 

         
 

Unadjusted

$        1,429

 

$        1,343

 

6.4

 

Adjusted (1)

$        1,429

 

$        1,422

 

0.5

             

SG&A AS % REVENUES:

         
 

Unadjusted

11.0

 

10.9

   
 

Adjusted (1)

11.1

 

10.6

   
             

SG&A AS % GROSS PROFIT:

         
 

Unadjusted

72.8

 

76.1

   
 

Adjusted (1)

73.6

 

72.8

   
             

OPERATING MARGIN %:

         
 

Unadjusted

2.7

 

2.7

   
 

Adjusted (1), (2)

3.4

 

3.5

   
             

PRETAX MARGIN %:

         
 

Unadjusted

1.5

 

1.6

   
 

Adjusted (1), (2)

2.2

 

2.4

   
             

 SAME STORE FINANCE, INSURANCE AND OTHER REVENUE, NET RECONCILIATION: 

       
 

As reported

$    111,706

 

$    108,884

 

2.6

 

  Pre-tax adjustments:

         
 

Catastrophic events

-

 

6,550

   
 

Adjusted Finance, insurance and other revenue, net (1)

$    111,706

 

$    115,434

 

(3.2)

             

 SAME STORE TOTAL REVENUES RECONCILIATION: 

         
 

As reported

$ 2,741,726

 

$ 2,944,327

 

(6.9)

 

  Pre-tax adjustments:

         
 

Catastrophic events

-

 

6,550

   
 

Adjusted Total Revenues (1)

$ 2,741,726

 

$ 2,950,877

 

(7.1)

             

 SAME STORE TOTAL GROSS PROFIT RECONCILIATION: 

         
 

As reported

$    416,397

 

$    422,693

 

(1.5)

 

  Pre-tax adjustments:

-

 

-

   
 

Catastrophic events

-

 

6,550

   
 

Adjusted Total Gross Profit (1)

$    416,397

 

$    429,243

 

(3.0)

             

SAME STORE SG&A RECONCILIATION:

         
 

As reported

$    303,894

 

$    319,775

 

(5.0)

 

  Pre-tax adjustments:

         
 

 Catastrophic events 

-

 

(8,149)

   
 

 Gain (loss) on real estate and dealership transactions 

2,372

 

(798)

   
 

 Legal settlements 

(1,111)

 

(720)

   
 

Adjusted Same Store SG&A (1)

$    305,155

 

$    310,108

 

(1.6)

             

SAME STORE TOTAL GROSS MARGIN %:

         
 

Unadjusted

15.2

 

14.4

   
 

Adjusted (1)

15.2

 

14.5

   
             

SAME STORE FINANCE, INSURANCE AND OTHER, NET (PER RETAIL UNIT):

         
 

Unadjusted

$        1,455

 

$        1,346

 

8.1

 

Adjusted (1)

$        1,455

 

$        1,427

 

2.0

             

SAME STORE SG&A AS % REVENUES:

         
 

Unadjusted

11.1

 

10.9

   
 

Adjusted (1)

11.1

 

10.5

   
             

SAME STORE SG&A AS % GROSS PROFIT:

         
 

Unadjusted

73.0

 

75.7

   
 

Adjusted (1)

73.3

 

72.2

   
             

SAME STORE OPERATING MARGIN %:

         
 

Unadjusted

2.7

 

2.7

   
 

Adjusted (1), (3)

3.5

 

3.5

   
             
   

 Nine Months Ended September 30, 

   

2018

 

2017

 

% Increase/
(Decrease)

NET INCOME RECONCILIATION:

         
 

As reported

         
 

  Pretax Net Income

$    165,720

 

$    160,029

   
 

   Income Tax Provision 

(38,666)

 

(57,076)

   
 

     Net Income  

$    127,054

 

$    102,953

 

23.4

 

       Effective Tax Rate 

23.3%

 

35.7%

   
 

 Adjustments: 

         
 

 Catastrophic events  

         
 

 Pre-tax 

5,812

 

15,341

   
 

 Tax impact 

(1,444)

 

(5,926)

   
 

 (Gain) loss on real estate and dealership transactions 

         
 

 Pre-tax 

(25,513)

 

798

   
 

 Tax impact 

6,166

 

(301)

   
 

 Acquisition costs  

         
 

 Pre-tax 

-

 

288

   
 

 Tax impact 

-

 

-

   
 

 Legal settlements