AutoCanada Reports 2017 Annual and Fourth Quarter Results

EDMONTON, March 15, 2018

• 2017 annual revenue reaches new threshold exceeding $3 billion
• 2017 annual basic earnings per share of $2.11
• 3^rd straight quarter of same store revenue and gross profit growth
• Added two new brands to the portfolio

"This was a very good year for AutoCanada and we continue to strengthen our foundation for future growth," said Steven J. Landry, President & Chief Executive Officer. "In 2017, we established new relationships with two OEMs, adding our first Mercedes-Benz and Mazda dealerships to our portfolio. We also cemented our relationship with General Motors, allowing us to exercise voting control over GM dealerships for the first time. These changes are key to our long-term success as they enable new acquisition opportunities, the cornerstone of our growth agenda."

2017 Full Year Highlights

• Revenue was $3.1 billion, up 7.3% compared with 2016. Revenue from same stores was up 2.0% year-over-year.
• Sales of new vehicles were 43,773 in the year, up 9.3% over the prior year. Revenue from the sale of new vehicles was $1.8 billion, up 10.6% from 2016. New vehicles accounted for 58.9% of the Company's total revenue and 25.3% of gross profit versus 57.2% of revenue and 24.3% of gross profit in 2016.
• Sales of used vehicles were 19,379 in 2017, down 1.0% from last year. Revenue from used vehicle sales was $716.0 million, down 1.3% from the prior year. Used vehicles accounted for 23.1% of the Company's total revenue and 8.4% of gross profit, versus 25.1% of revenue and 9.7% of gross profit in 2016.
• Parts, service and collision repair generated $416.7 million of revenue, up 8.8% from 2016. This accounted for 13.4% of the Company's total revenue and 41.3% of its gross profit, versus 13.2% of revenue and 41.4% of gross profit in 2016.
• Finance and insurance generated $141.3 million of revenue, an improvement of 8.6% from 2016. This accounted for 4.6% of the Company's total revenue and 25.0% of its gross profit, up from 4.5% of revenue and 24.6% of profit in 2016.
• Gross profit was $518.6 million, up 6.7% compared with 2016, with gross profit as a percentage of revenue relatively flat at 16.7% from 16.8%.
• EBITDA attributable to AutoCanada shareholders increased by $17.3 million or 18.3% to $111.8 million from $94.5 million in the prior year.
• Operating expenses were $426.3 million as a percentage of gross profit improved to 82.2% from 82.4% in 2016.
• The Company generated net earnings attributable to AutoCanada shareholders of $57.8 million ($42.7 million on an adjusted basis), or $2.11 per share ($1.56 adjusted) versus $2.6 million in 2016 ($39.9 million adjusted) or $0.09 per share ($1.46 adjusted). 

Fourth Quarter Highlights

• Revenue was $733.1 million, up 16.5% compared with the fourth quarter of 2016. Same store revenue growth was up 11.1% in the fourth quarter of this year.
• New vehicle sales were 9,822, up 16.3% from same period in 2016. Revenue from the sale of new vehicles was $417.6 million, up 20.0% from same period in 2016. The sale of new vehicles accounted for 57.0% of the Company's total revenue and 24.0% of gross profit versus 55.3% of revenue and 21.4% of gross profit in the fourth quarter of 2016.
• Used vehicle sales were 4,653, up 4.3% from the same quarter last year. Revenue from the sale of used vehicles sales was $175.3 million, up 11.1% from same time last year. The sale of used vehicles accounted for 23.4% of the Company's total revenue and 6.0% of gross profit, versus 21.4% of revenue and 8.6% of gross profit in the fourth quarter of 2016.
• Parts, service and collision repair generated $107.2 million of revenue, up 16.1% from same time 2016. This accounted for 14.6% of the Company's total revenue and 45.5% of its gross profit, versus 14.7% of revenue and 45.3% of gross profit in the same quarter of 2016.
• Finance and insurance generated $33.0 million of revenue, an improvement of 6.1% from same period in 2016. This accounted for 4.5% of the Company's total revenue and 24.5% of its gross profit, down from 4.9% of revenue and 24.6% of profit in the fourth quarter of 2016.
• Gross profit was $125.2 million, up 7.2% compared with the same quarter in 2016, with gross profit as a percentage of revenue decreasing to 17.1% from 18.6%.
• EBITDA attributable to AutoCanada shareholders increased by $2.9 million or 11.3% to $28.1 million from $25.3 million same time last year.
• Operating profit of $26.5 million is up 27.7% from 20.7 million in the fourth quarter of 2016.
• Operating expenses were $104.6 million, as a percentage of gross profit were up to 83.6% from 83.4% over the same period in 2016.
• The Company generated net earnings attributable to AutoCanada shareholders of $17.1 million ($8.9 million on an adjusted basis), or $0.62 per share ($0.33 adjusted) versus $13.8 million in 2016 ($7.5 million adjusted) or $0.50 per share ($0.28 adjusted). 

"We continued our momentum in the second half and ended the year strongly," said Chris Burrows, Senior Vice-President and Chief Financial Officer. "Performance across the business was very good in the fourth quarter, and we saw double-digit year-over-year revenue growth at our same stores. With the market poised for another good year of new vehicle sales, we believe 2018 holds great promise for AutoCanada."

The following table summarizes the Company's results for the quarter and year ended December 31, 2017: