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20.10.2016 06:07
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Group 1 Automotive Reports Third Quarter 2016 Results
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PR Newswire
HOUSTON, Oct. 20, 2016
HOUSTON, Oct. 20, 2016 /PRNewswire/ -- Group 1 Automotive, Inc. (NYSE: GPI), an international, Fortune 500 automotive retailer, today reported third quarter 2016 net income of $35.4 million, diluted earnings per common share of $1.65, adjusted net income (a non-GAAP measure) of $42.0 million, and adjusted diluted earnings per common share (a non-GAAP measure) of $1.96.
As shown in the attached non-GAAP reconciliation tables, the 2016 third quarter adjusted results exclude approximately $6.6 million of net after-tax adjustments, or $0.31 per share, for non-core items. These adjustments primarily consist of non-cash asset impairment charges of approximately $6.7 million after-tax, or $0.32 per share; catastrophic losses (primarily storm damage) of approximately $281 thousand after-tax, or $0.01 per share; foreign transaction tax expense of approximately $274 thousand after-tax, or $0.01 per share; and, were partially offset by dealership transaction net gains of approximately $700 thousand, or $0.03 per share.
"Our third quarter earnings were negatively impacted by ongoing sales weakness in our energy-dependent markets, especially Texas and Oklahoma, and some slight market weakness in the U.K. due to uncertainty associated with Brexit," said Earl J. Hesterberg, Group 1's president and chief executive officer. "While our U.K. sales decreased in July and August, we did see recovery in September, but not enough to offset the weakness that occurred immediately following the vote. Additionally, the weakening pound, versus the dollar, lowered this quarter's earnings per share by about four cents. Within the U.S. results, we were encouraged by another quarter of improving new vehicle margins and the progress we have made in reducing new vehicle inventory during the quarter, with days' supply improving nine days from second-quarter levels to 74 days' supply at quarter end."
Consolidated Results for Third Quarter 2016 (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 increased 0.8 percent (3.3 percent) to a third-quarter record of $2.8 billion; total gross profit grew 2.1 percent (4.0 percent) to $406.7 million.
- New vehicle revenues decreased 0.8 percent (but increased 1.6 percent on a constant currency basis) driven by a 3.2 percent decrease in unit sales. New vehicle gross profit improved 1.2 percent (3.8 percent) to $80.4 million.
- Retail used vehicle revenues increased 2.2 percent (4.8 percent) on 1.6 percent higher unit sales. Retail used vehicle gross profit decreased 1.3 percent (but increased 0.5 percent on a constant currency basis) to $46.0 million.
- Parts and service gross profit increased 4.2 percent (6.1 percent) on revenue growth of 5.3 percent (7.1 percent). Same Store parts and service gross profit increased 1.2 percent (2.5 percent) on revenue growth of 2.6 percent (3.8 percent). U.S. Same Store parts and service gross profit increased 2.4 percent on revenue growth of 3.4 percent.
- Same Store Finance and Insurance (F&I) gross profit per retail unit (PRU) increased 4.0 percent (5.0 percent) to $1,421. U.S. F&I gross profit PRU increased $73 to $1,588.
- On a GAAP basis, Selling, General and Administrative (SG&A) expenses as a percent of gross profit increased 100 basis points to 73.5 percent. Adjusted SG&A expenses as a percent of gross profit increased 110 basis points to 73.6 percent.
Segment Results for Third Quarter 2016 (year-over-year comparable basis)
- United States:
The Company's U.S. operations accounted for 80.6 percent of total revenues and 85.3 percent of total gross profit. Total U.S. revenues were $2.3 billion, a decrease of 2.9 percent, driven by a 5.5 percent decrease in retail new vehicle revenue. While new vehicle sales volume decreased, new vehicle gross profit per unit sold grew $154, or 9.5 percent per unit, to $1,783 and total gross profit of $346.7 million was only down 0.5 percent. New vehicle inventory improved 9 days from second-quarter levels and ended the quarter at 74 days' supply.
On a GAAP basis, SG&A expenses as a percent of gross profit improved 30 basis points to 71.1 percent and operating margin decreased 40 basis points to 3.4 percent. Adjusted SG&A expenses as a percent of gross profit and adjusted operating margin both improved 10 basis points to 71.3 percent and 3.9, respectively.
- United Kingdom:
The Company's U.K. operations accounted for 15.4 percent of total revenues and 11.7 percent of total gross profit. Total U.K. revenues increased 33.2 percent (56.7 percent) to $436.0 million, and gross profit increased 31.0 percent (54.2 percent) to $47.5 million. Revenue growth was primarily driven by the acquisition of the Spire dealer group in February of this year. On a constant currency basis, Same Store total revenue increased 5.5 percent, driven by a 6.1 percent increase in new vehicle revenues, 7.9 percent increase in parts and service revenues, and a 15.0 percent increase in F&I gross profit PRU.
On a Same Store GAAP basis, SG&A expenses as a percent of gross profit and operating margin both improved 10 basis points to 77.5 percent and 2.2 percent, respectively. On a Same Store basis, adjusted SG&A expenses as a percent of gross profit improved 10 basis points to 77.5 percent and adjusted operating margin was unchanged at 2.2 percent.
- Brazil:
The Company's Brazilian operations accounted for 4.0 percent of total revenues and 3.1 percent of total gross profit. The Company's Same Store new vehicle revenue declined 24.2 percent on a constant currency basis in a continued weak economic environment. Year-to-date, Brazil's new vehicle industry volumes have declined about 23 percent. For the quarter, Same Store total revenue was down 18.7 percent on a constant currency basis, as F&I gross profit PRU growth of 44.3 percent and parts and service revenue growth of 2.0 percent partially offset the decline in new and used vehicles.
The Company continues to improve its used vehicle operations in Brazil, with used vehicle retail margins improving 360 basis points to 7.6 percent and total used vehicle gross profit increasing $0.7 million or 69.7 percent on a constant currency basis.
Corporate Development
During the third quarter of 2016, the Company divested two dealerships in the U.S., which included Hyundai of Escondido, California and Ira Porsche of Danvers, Massachusetts. In October 2016, the Company divested Honda of Van Nuys, California. In total, these dealerships generated approximately $120 million in trailing-twelve-month revenues. These divestitures are consistent with Group 1's portfolio management strategy.
Additionally, in the U.S., during third quarter of 2016, the Company was awarded a Porsche open point in El Paso, Texas. The store's opening is targeted for late 2017. The Company will provide expected annual revenues for this franchise when its opening is announced.
In October 2016, in the U.K., the Company acquired the Ford Basingstoke and Ford Newbury dealerships, which are located southwest and west of London, respectively and are contiguous with Group 1's existing U.K. Ford operations. These stores, which will be rebranded as Think Ford Basingstoke and Think Ford Newbury, are expected to generate approximately $65 million in annualized revenues.
Share Repurchase Authorization
During the third quarter of 2016, the Company repurchased 244,205 shares at an average price of $50.61 for a total of $12.4 million, which were previously announced purchases in July 2016. As of October 20, 2016, $22.4 million remains available under the Company's prior common stock share repurchase authorization. Year to date, the Company has repurchased 2.3 million shares representing a 10 percent reduction from the previously announced share count as of December 31, 2015. Purchases may be made from time to time in the open market or in privately negotiated transactions, based on market conditions, legal requirements and other corporate considerations and subject to Board approval and covenant restrictions.
THIRD QUARTER EARNINGS CONFERENCE CALL DETAILS
The Company's senior management will host a conference call today at 9 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: | 6474498 |
A telephonic replay will be available following the call through October 27, 2016 by dialing:
| Domestic: | 1-877-344-7529 |
| International: | 1-412-317-0088 |
| Replay ID: | 10094717 |
About Group 1 Automotive, Inc.
Group 1 owns and operates 160 automotive dealerships, 211 franchises, and 37 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
Certain statements in this release may constitute "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. These 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. 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. 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," "plans," "believes," "may" or "will" and similar expressions. 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
This press release and the attached financial tables contain certain non-GAAP financial performance measures as defined under SEC rules, such as adjusted net income and adjusted earnings per share from continuing operations, which exclude certain items disclosed in the attached financial tables. As required by SEC rules, the Company provides reconciliations of these measures to the most directly comparable GAAP measures. Management believes that these non-GAAP financial performance measures improve the transparency of the Company's disclosure, present useful information to investors, and provide a meaningful presentation of the Company's results from its core business operations excluding the impact of items not related to the Company's ongoing core business operations, and improve the period-to-period comparability of the Company's results from its core business operations.
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
V.P. 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, | ||||
| | 2016 | | 2015 | | % Increase/ |
| REVENUES: | | | | | |
| New vehicle retail sales | $ 1,587,952 | | $ 1,601,213 | | (0.8) |
| Used vehicle retail sales | 702,620 | | 687,637 | | 2.2 |
| Used vehicle wholesale sales | 104,218 | | 100,483 | | 3.7 |
| Parts and service | 319,676 | | 303,557 | | 5.3 |
| Finance and insurance | 108,710 | | 107,679 | | 1.0 |
| Total revenues | 2,823,176 | | 2,800,569 | | 0.8 |
| | | | | | |
| COST OF SALES: | | | | | |
| New vehicle retail sales | 1,507,517 | | 1,521,721 | | (0.9) |
| Used vehicle retail sales | 656,652 | | 641,055 | | 2.4 |
| Used vehicle wholesale sales | 106,077 | | 102,318 | | 3.7 |
| Parts and service | 146,262 | | 137,093 | | 6.7 |
| Total cost of sales | 2,416,508 | | 2,402,187 | | 0.6 |
| | | | | | |
| GROSS PROFIT | 406,668 | | 398,382 | | 2.1 |
| | | | | | |
| SELLING, GENERAL AND ADMINISTRATIVE EXPENSES | 299,006 | | 289,012 Werbung Mehr Nachrichten zur Group 1 Automotive Inc. Aktie kostenlos abonnieren
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