Asbury Automotive Group Announces 2019 Second Quarter Financial Results
DULUTH, Ga., July 26, 2019 /PRNewswire/ -- Asbury Automotive Group, Inc. (NYSE: ABG), one of the largest automotive retail and service companies in the U.S., reported net income for the second quarter 2019 of $54.9 million ($2.84 per diluted share) and adjusted net income (a non-GAAP measure) of $45.9 million ($2.38 per diluted share). This compares to net income of $43.2 million ($2.11 per diluted share) in the prior year quarter and adjusted net income of $42.7 million ($2.08 per diluted share).
Net income for the second quarter 2019 was adjusted for a gain on divestiture of our Nissan Houston store of $11.7 million pre-tax ($0.45 per diluted share) and gain on sale of land of $0.3 million ($0.01 per diluted share). Net income for the second quarter 2018 was adjusted for gains from legal settlements of $0.7 million pre-tax ($0.03 per diluted share)
"In a lower SAAR environment, we grew revenue 5%, delivered 10% parts and service revenue growth, improved our SG&A as a percentage of gross profit 60 basis points, and grew adjusted EPS 14%," said David Hult, Asbury's President and Chief Executive Officer. "While we experienced new vehicle margin pressure, we were able to grow our total front end yield by over $50 per vehicle."
Second Quarter 2019 Operational Summary
Total company:
-- Total revenue increased 5%; gross profit increased 6%
-- Gross margin increased 30 basis points to 16.4%
-- SG&A as a percentage of gross profit decreased 60 basis points to 68.0%
-- Adjusted income from operations increased 8%
-- Adjusted operating margin increased 20 basis points to 4.8%
-- Adjusted EPS from continuing operations increased 14%
Same store:
-- Total revenue increased 2%; gross profit increased 4%
-- New vehicle revenue was flat; gross profit decreased 9%
-- Used vehicle retail revenue increased 1%; gross profit decreased 1%
-- Finance and insurance revenue and gross profit increased 7%
-- Parts and service revenue increased 8%; gross profit increased 6%
Strategic Highlights:
-- Divested our Nissan store in Houston, TX
-- Signed agreements to acquire two import stores, one in the Indianapolis
market and one in a new market. We expect to close both in the third
quarter, subject to customary closing conditions, and these stores to
generate approximately $175 million in combined annualized revenue.
-- Repurchased $4 million of common stock.
Additional commentary regarding the second quarter results will be provided during the earnings conference call on July 26, 2019 at 10:00 a.m. The conference call will be simulcast live on the internet and can be accessed at www.asburyauto.com. A replay will be available at these sites for 30 days.
In addition, a live audio of the call will be accessible to the public by calling (323) 994-2093 (domestic), or (888) 254-3590 (international); passcode - 1004437. Callers should dial in approximately 5 to 10 minutes before the call begins.
A conference call replay will be available two hours following the call for seven days, and can be accessed by calling (888) 203-1112 (domestic), or (719) 457-0820 (international); passcode - 1004437.
About Asbury Automotive Group, Inc.
Asbury Automotive Group, Inc. ("Asbury"), a Fortune 500 company headquartered in Duluth, GA, is one of the largest automotive retailers in the U.S. Asbury currently operates 86 dealerships, consisting of 105 franchises, representing 30 domestic and foreign brands of vehicles. Asbury also operates 24 collision repair centers. Asbury offers customers an extensive range of automotive products and services, including new and used vehicle sales and related financing and insurance, vehicle maintenance and repair services, replacement parts and service contracts.
Forward-Looking Statements
This press release contains "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are statements other than historical fact, and may include statements relating to goals, plans, market conditions and projections regarding Asbury's financial position, liquidity, results of operations, market position and dealership portfolio, and other initiatives and future business strategy. These statements are based on management's current expectations and beliefs and involve significant risks and uncertainties that may cause results to differ materially from those set forth in the statements. These risks and uncertainties include, among other things, market factors, Asbury's relationships with, and the financial and operational stability of, vehicle manufacturers and other suppliers, acts of God or other incidents which may adversely impact supply from vehicle manufacturers and/or present retail sales challenges, risks associated with Asbury's indebtedness (including available borrowing capacity, compliance with its financial covenants and ability to refinance or repay such indebtedness, on favorable terms), Asbury's relationships with, and the financial stability of, its lenders and lessors, risks related to competition in the automotive retail and service industries, general economic conditions both nationally and locally, governmental regulations, legislation, adverse results in litigation and other proceedings, and Asbury's ability to execute its digital initiatives and other operational strategies, Asbury's ability to leverage gains from its dealership portfolio, Asbury's ability to capitalize on opportunities to repurchase its debt and equity securities or purchase properties that it currently leases, and Asbury's ability to stay within its targeted range for capital expenditures. There can be no guarantees that Asbury's plans for future operations will be successfully implemented or that they will prove to be commercially successful.
These and other risk factors that could cause actual results to differ materially from those expressed or implied in our forward-looking statements are and will be discussed in Asbury's filings with the U.S. Securities and Exchange Commission from time to time, including its most recent annual report on Form 10-K and any subsequently filed quarterly reports on Form 10-Q. We undertake no obligation to publicly update any forward-looking statement, whether as a result of new information, future events or otherwise.
ASBURY AUTOMOTIVE GROUP, INC.
CONSOLIDATED STATEMENTS OF INCOME (In millions, except per share data)
(Unaudited)
For the Three Months Increase %
Ended June 30, (Decrease) Change
2019 2018
REVENUE:
New vehicle $
965.2 $
928.7 $
36.5 4
%
Used vehicle:
Retail 486.6 470.9 15.7 3
%
Wholesale 47.0 46.0 1.0 2
%
Total used vehicle 533.6 516.9 16.7 3
%
Parts and service 224.5 204.5 20.0 10
%
Finance and insurance, net 80.2 73.5 6.7 9
%
TOTAL REVENUE 1,803.5 1,723.6 79.9 5
%
GROSS PROFIT:
New vehicle 38.3 40.6 (2.3) (6)
%
Used vehicle:
Retail 34.7 33.6 1.1 3
%
Wholesale 1.2 0.5 0.7 140
%
Total used vehicle 35.9 34.1 1.8 5
%
Parts and service 140.6 129.6 11.0 8
%
Finance and insurance, net 80.2 73.5 6.7 9
%
TOTAL GROSS PROFIT 295.0 277.8 17.2 6
%
OPERATING EXPENSES:
Selling, general and administrative 200.7 190.6 10.1 5
%
Depreciation and amortization 9.0 8.5 0.5 6
%
Other operating (income) expenses, net (0.6) (0.9) 0.3 33
%
INCOME FROM OPERATIONS 85.9 79.6 6.3 8
%
OTHER EXPENSES (INCOME):
Floor plan interest expense 10.5 8.0 2.5 31
%
Other interest expense, net 13.6 13.2 0.4 3
%
Swap interest expense - 0.2 (0.2) (100)
%
Gain on divestiture (11.7) (11.7)
NM
Total other expenses, net 12.4 21.4 (9.0) (42)
%
INCOME BEFORE INCOME TAXES 73.5 58.2 15.3 26
%
Income tax expense 18.6 15.0 3.6 24
%
NET INCOME $
54.9 $
43.2 $
11.7 27
%
EARNINGS PER COMMON SHARE:
Basic-
Net income $
2.87 $
2.13 $
0.74 35
%
Diluted-
Net income $
2.84 $
2.11 $
0.73 35
%
WEIGHTED AVERAGE COMMON SHARES OUTSTANDING:
Basic 19.1 20.3 (1.2) (6)
%
Restricted stock 0.1 0.1
%
Performance share units 0.1 0.1
%
Diluted 19.3 20.5 (1.2) (6)
%
____________________________________
NM-Not Meaningful
ASBURY AUTOMOTIVE GROUP, INC.
KEY OPERATING HIGHLIGHTS (In millions, except per unit data)
(Unaudited)
For the Three Months Increase %
Ended June 30, (Decrease) Change
2019 2018
Unit sales
---
New vehicle:
Luxury 5,746 5,590 156 3
%
Import 15,256 15,478 (222) (1)
%
Domestic 5,447 5,001 446 9
%
Total new vehicle 26,449 26,069 380 1
%
Used vehicle retail 22,259 21,685 574 3
%
Used to new ratio 84.2 83.2
% % 100 bps
Average selling price
---
New vehicle $
36,493 $
35,625 $
868 2
%
Used vehicle retail 21,861 21,715 146 1
%
Average gross profit per unit
---
New vehicle:
Luxury $
3,341 $
3,470 $
(129) (4)
%
Import 623 808 (185) (23)
%
Domestic 1,762 1,740 22 1
%
Total new vehicle 1,448 1,557 (109) (7)
%
Used vehicle retail 1,559 1,549 10 1
%
Finance and insurance, net 1,647 1,539 108 7
%
Front end yield (1) 3,145 3,093 52 2
%
Gross margin
---
New vehicle:
Luxury 6.1
% 6.5
% (40) bps
Import 2.2
% 2.9
% (70) bps
Domestic 4.4
% 4.5
% (10) bps
Total new vehicle 4.0
% 4.4
% (40) bps
Used vehicle retail 7.1
% 7.1
% 0 bps
Parts and service 62.6 63.4
% % (80) bps
Total gross profit margin 16.4 16.1
% % 30 bps
SG&A metrics
---
Rent expense $
6.8 $
6.3 $
0.5 8
%
Total SG&A as a percentage of gross profit 68.0 68.6
% % (60) bps
SG&A, excluding rent expense as a percentage of gross profit 65.7 66.3
% % (60) bps
Operating metrics
---
Income from operations as a percentage of revenue 4.8
% 4.6
% 20 bps
Income from operations as a percentage of gross profit 29.1 28.7
% % 40 bps
Adjusted income from operations as a percentage of revenue 4.7
% 4.6
% 10 bps
Adjusted income from operations as a percentage of gross profit 29.0 28.4
% % 60 bps
Revenue mix
---
New vehicle 53.5 53.9
% %
Used vehicle retail 27.1 27.2
% %
Used vehicle wholesale 2.6
% 2.7
%
Parts and service 12.4 11.9
% %
Finance and insurance 4.4
% 4.3
%
Total revenue 100.0 100.0
% %
Gross profit mix
---
New vehicle 13.0 14.6
% %
Used vehicle retail 11.7 12.0
% %
Used vehicle wholesale 0.4
% 0.2
%
Parts and service 47.7 46.7
% %
Finance and insurance 27.2 26.5
% %
Total gross profit 100.0 100.0
% %
_____________________________
(1) Front end yield is calculated as gross profit from new vehicles, used retail vehicles and finance and insurance (net), divided by combined new
and used retail unit sales.
ASBURY AUTOMOTIVE GROUP, INC.
SAME STORE OPERATING HIGHLIGHTS (In millions)
(Unaudited)
For the Three Months Increase %
Ended June 30, (Decrease) Change
2019 2018
Revenue
---
New vehicle:
Luxury $
315.1 $
299.9 $
15.2 5
%
Import 423.3 423.8 (0.5) %
Domestic 181.4 193.2 (11.8) (6)
%
Total new vehicle 919.8 916.9 2.9 %
Used Vehicle:
Retail 465.2 462.5 2.7 1
%
Wholesale 45.3 44.9 0.4 1
%
Total used vehicle 510.5 507.4 3.1 1
%
Parts and service 217.5 201.8 15.7 8
%
Finance and insurance 77.0 71.8 5.2 7
%
Total revenue $
1,724.8 $
1,697.9 $
26.9 2
%
Gross profit
---
New vehicle:
Luxury $
19.2 $
19.4 $
(0.2) (1)
%
Import 9.5 12.0 (2.5) (21)
%
Domestic 7.6 8.7 (1.1) (13)
%
Total new vehicle 36.3 40.1 (3.8) (9)
%
Used Vehicle:
Retail 32.9 33.3 (0.4) (1)
%
Wholesale 1.2 0.5 0.7 140
%
Total used vehicle 34.1 33.8 0.3 1
%
Parts and service:
Customer pay 77.2 73.3 3.9 5
%
Warranty 21.6 18.2 3.4 19
%
Wholesale parts 5.7 5.4 0.3 6
%
Parts and service, excluding reconditioning and preparation 104.5 96.9 7.6 8
%
Reconditioning and preparation 31.3 31.0 0.3 1
%
Total parts and service 135.8 127.9 7.9 6
%
Finance and insurance 77.0 71.8 5.2 7
%
Total gross profit $
283.2 $
273.6 $
9.6 4
%
SG&A expense $
192.1 $
187.3 $
4.8 3
%
SG&A expense as a percentage of gross profit 67.8 68.5
% % (70) bps
_____________________________
Same store amounts consist of information from dealerships for identical months in each comparative period, commencing with the first month we owned the
dealership. Additionally, amounts related to divested dealerships are excluded from each comparative period.
ASBURY AUTOMOTIVE GROUP, INC.
SAME STORE OPERATING HIGHLIGHTS (Continued)
(Unaudited)
For the Three Months Increase %
Ended June 30, (Decrease) Change
2019 2018
Unit sales
---
New vehicle:
Luxury 5,719 5,590 129 2
%
Import 15,031 15,053 (22) %
Domestic 4,483 5,001 (518) (10)
%
Total new vehicle 25,233 25,644 (411) (2)
%
Used vehicle retail 21,176 21,252 (76) %
Used to new ratio 83.9 82.9
% % 100
bps
Average selling price
---
New vehicle $
36,452 $
35,755 $
697 2
%
Used vehicle retail 21,968 21,763 205 1
%
Average gross profit per unit
---
New vehicle:
Luxury $
3,357 $
3,470 $
(113) (3)
%
Import 632 797 (165) (21)
%
Domestic 1,695 1,740 (45) (3)
%
Total new vehicle 1,439 1,564 (125) (8)
%
Used vehicle retail 1,554 1,567 (13) (1)
%
Finance and insurance, net 1,659 1,531 128 8
%
Front end yield (1) 3,150 3,096 54 2
%
Gross margin
---
New vehicle:
Luxury 6.1
% 6.5
% (40)
bps
Import 2.2
% 2.8
% (60)
bps
Domestic 4.2
% 4.5
% (30)
bps
Total new vehicle 3.9
% 4.4
% (50)
bps
Used vehicle retail 7.1
% 7.2
% (10)
bps
Parts and service:
Parts and service, excluding reconditioning and preparation 48.0 48.0
% % 0
bps
Parts and service, including reconditioning and preparation 62.4 63.4
% % (100)
bps
Total gross profit margin 16.4 16.1
% % 30
bps
_____________________________
Same store amounts consist of information from dealerships for identical months in each comparative period, commencing with the first month we owned the dealership. Additionally, amounts related to divested dealerships are excluded from each comparative period.
(1) Front end yield is calculated as gross profit from new vehicles, used retail vehicles and finance and insurance (net), divided by combined new and
used retail unit sales.
ASBURY AUTOMOTIVE GROUP, INC.
CONSOLIDATED STATEMENTS OF INCOME (In millions, except per share data)
(Unaudited)
For the Six Months Ended Increase %
June 30, (Decrease) Change
2019 2018
REVENUE:
New vehicle $
1,837.0 $
1,785.8 $
51.2 3
%
Used vehicle:
Retail 944.8 906.7 38.1 4
%
Wholesale 98.7 94.8 3.9 4
%
Total used vehicle 1,043.5 1,001.5 42.0 4
%
Parts and service 442.1 403.8 38.3 9
%
Finance and insurance, net 151.7 141.7 10.0 7
%
TOTAL REVENUE 3,474.3 3,332.8 141.5 4
%
GROSS PROFIT:
New vehicle 76.2 79.2 (3.0) (4)
%
Used vehicle:
Retail 68.3 65.8 2.5 4
%
Wholesale 2.1 1.8 0.3 17
%
Total used vehicle 70.4 67.6 2.8 4
%
Parts and service 275.9 254.7 21.2 8
%
Finance and insurance, net 151.7 141.7 10.0 7
%
TOTAL GROSS PROFIT 574.2 543.2 31.0 6
%
OPERATING EXPENSES:
Selling, general and administrative 391.7 374.8 16.9 5
%
Depreciation and amortization 17.6 16.7 0.9 5
%
Other operating expense (income), net 1.2 (1.1) 2.3
NM
INCOME FROM OPERATIONS 163.7 152.8 10.9 7
%
OTHER EXPENSES (INCOME):
Floor plan interest expense 20.7 14.6 6.1 42
%
Other interest expense, net 27.5 26.2 1.3 5
%
Swap interest expense - 0.4 (0.4) (100)
%
Gain on divestiture (11.7) (11.7)
NM
Total other expenses, net 36.5 41.2 (4.7) (11)
%
INCOME BEFORE INCOME TAXES 127.2 111.6 15.6 14
%
Income tax expense 31.4 28.3 3.1 11
%
NET INCOME $
95.8 $
83.3 $
12.5 15
%
EARNINGS PER COMMON SHARE:
Basic-
Net income $
4.99 $
4.08 $
0.91 22
%
Diluted-
Net income $
4.96 $
4.02 $
0.94 23
%
WEIGHTED AVERAGE COMMON SHARES OUTSTANDING:
Basic 19.2 20.4 (1.2) (6)
%
Restricted stock - 0.1 (0.1) (100)
%
Performance share units 0.1 0.2 (0.1) (50)
%
Diluted 19.3 20.7 (1.4) (7)
%
______________________________
NM-Not Meaningful
ASBURY AUTOMOTIVE GROUP, INC.
KEY OPERATING HIGHLIGHTS (In millions, except per unit data)
(Unaudited)
For the Six Months Ended Increase %
June 30, (Decrease) Change
2019 2018
Unit sales
---
New vehicle:
Luxury 10,908 10,842 66 1
%
Import 29,699 29,499 200 1
%
Domestic 9,951 9,387 564 6
%
Total new vehicle 50,558 49,728 830 2
%
Used vehicle retail 43,342 42,255 1,087 3
%
Used to new ratio 85.7 85.0
% % 70
bps
Average selling price
---
New vehicle $
36,335 $
35,911 $
424 1
%
Used vehicle retail 21,799 21,458 341 2
%
Average gross profit per unit
---
New vehicle:
Luxury $
3,511 $
3,588 $
(77) (2)
%
Import 717 803 (86) (11)
%
Domestic 1,668 1,768 (100) (6)
%
Total new vehicle 1,507 1,593 (86) (5)
%
Used vehicle retail 1,576 1,557 19 1
%
Finance and insurance, net 1,616 1,541 75 5
%
Front end yield (1) 3,154 3,117 37 1
%
Gross margin
---
New vehicle:
Luxury 6.3
% 6.6
% (30)
bps
Import 2.6
% 2.8
% (20)
bps
Domestic 4.2
% 4.5
% (30)
bps
Total new vehicle 4.1
% 4.4
% (30)
bps
Used vehicle retail 7.2
% 7.3
% (10)
bps
Parts and service 62.4 63.1
% % (70)
bps
Total gross profit margin 16.5 16.3
% % 20
bps
SG&A metrics
---
Rent expense $
13.6 $
12.6 $
1.0 8
%
Total SG&A as a percentage of gross profit 68.2 69.0
% % (80)
bps
SG&A, excluding rent expense as a percentage of gross profit 65.8 66.7
% % (90)
bps
Operating metrics
---
Income from operations as a percentage of revenue 4.7
% 4.6
% 10
bps
Income from operations as a percentage of gross profit 28.5 28.1
% % 40
bps
Adjusted income from operations as a percentage of revenue 4.8
% 4.6
% 20
bps
Adjusted income from operations as a percentage of gross profit 28.9 28.0
% % 90
bps
Revenue mix
---
New vehicle 52.9 53.6
% %
Used vehicle retail 27.2 27.2
% %
Used vehicle wholesale 2.8
% 2.8
%
Parts and service 12.7 12.1
% %
Finance and insurance 4.4
% 4.3
%
Total revenue 100.0 100.0
% %
Gross profit mix
---
New vehicle 13.3 14.6
% %
Used vehicle retail 11.9 12.1
% %
Used vehicle wholesale 0.4
% 0.3
%
Parts and service 48.0 46.9
% %
Finance and insurance 26.4 26.1
% %
Total gross profit 100.0 100.0
% %
_____________________________
(1) Front end yield is calculated as gross profit from new vehicles, used retail vehicles and finance and insurance (net), divided by combined new and
used retail unit sales.
ASBURY AUTOMOTIVE GROUP, INC.
SAME STORE OPERATING HIGHLIGHTS (In millions)
(Unaudited)
For the Six Months Ended Increase %
June 30, (Decrease) Change
2019 2018
Revenue
---
New vehicle:
Luxury $
603.6 $
586.0 $
17.6 3
%
Import 809.4 810.0 (0.6) %
Domestic 342.8 365.7 (22.9) (6)
%
Total new vehicle 1,755.8 1,761.7 (5.9) %
Used Vehicle:
Retail 901.7 890.7 11.0 1
%
Wholesale 95.4 93.2 2.2 2
%
Total used vehicle 997.1 983.9 13.2 1
%
Parts and service 427.8 398.3 29.5 7
%
Finance and insurance, net 145.0 138.5 6.5 5
%
Total revenue $
3,325.7 $
3,282.4 $
43.3 1
%
Gross profit
---
New vehicle:
Luxury $
38.3 $
38.9 $
(0.6) (2)
%
Import 20.6 22.9 (2.3) (10)
%
Domestic 13.7 16.6 (2.9) (17)
%
Total new vehicle 72.6 78.4 (5.8) (7)
%
Used Vehicle:
Retail 64.6 64.8 (0.2) %
Wholesale 2.1 1.8 0.3 17
%
Total used vehicle 66.7 66.6 0.1 %
Parts and service:
Customer pay 151.9 143.1 8.8 6
%
Warranty 42.6 36.9 5.7 15
%
Wholesale parts 11.6 11.1 0.5 5
%
Parts and service, excluding reconditioning and preparation 206.1 191.1 15.0 8
%
Reconditioning and preparation 60.5 60.0 0.5 1
%
Total parts and service 266.6 251.1 15.5 6
%
Finance and insurance 145.0 138.5 6.5 5
%
Total gross profit $
550.9 $
534.6 $
16.3 3
%
SG&A expense $
374.8 $
368.1 $
6.7 2
%
SG&A expense as a percentage of gross profit 68.0 68.9
% % (90) bps
_____________________________
Same store amounts consist of information from dealerships for identical months in each comparative period, commencing with the first month we owned the dealership. Additionally, amounts related to divested dealerships are excluded from each comparative period.
ASBURY AUTOMOTIVE GROUP, INC.
SAME STORE OPERATING HIGHLIGHTS (Continued)
(Unaudited)
For the Six Months Ended Increase %
June 30, (Decrease) Change
2019 2018
Unit sales
---
New vehicle:
Luxury 10,869 10,842 27
%
Import 28,789 28,639 150 1
%
Domestic 8,543 9,387 (844) (9)
%
Total new vehicle 48,201 48,868 (667) (1)
%
Used vehicle retail 41,107 41,402 (295) (1)
%
Used to new ratio 85.3 84.7
% % 60
bps
Average selling price
---
New vehicle $
36,427 $
36,050 $
377 1
%
Used vehicle retail 21,935 21,513 422 2
%
Average gross profit per unit
---
New vehicle:
Luxury $
3,524 $
3,588 $
(64) (2)
%
Import 716 800 (84) (11)
%
Domestic 1,604 1,768 (164) (9)
%
Total new vehicle 1,506 1,604 (98) (6)
%
Used vehicle retail 1,572 1,565 7
%
Finance and insurance, net 1,624 1,534 90 6
%
Front end yield (1) 3,160 3,121 39 1
%
Gross margin
---
New vehicle:
Luxury 6.3
% 6.6
% (30)
bps
Import 2.5
% 2.8
% (30)
bps
Domestic 4.0
% 4.5
% (50)
bps
Total new vehicle 4.1
% 4.5
% (40)
bps
Used vehicle retail 7.2
% 7.3
% (10)
bps
Parts and service:
Parts and service, excluding reconditioning and preparation 48.2 48.0
% % 20
bps
Parts and service, including reconditioning and preparation 62.3 63.0
% % (70)
bps
Total gross profit margin 16.6 16.3
% % 30
bps
_____________________________
Same store amounts consist of information from dealerships for identical months in each comparative period, commencing with the first month we owned the dealership. Additionally, amounts related to divested dealerships are excluded from each comparative period.
(1) Front end yield is calculated as gross profit from new vehicles, used retail vehicles and finance and insurance (net), divided by combined new and
used retail unit sales.
ASBURY AUTOMOTIVE GROUP, INC.
Additional Disclosures (In millions)
(Unaudited)
June 30, December 31, Increase % Change
2019 2018
(Decrease)
---
SELECTED BALANCE SHEET DATA
Cash and cash equivalents $
9.6 $
8.3 $
1.3 16
%
New vehicle inventory 895.1 867.2 27.9 3
%
Used vehicle inventory 162.2 158.9 3.3 2
%
Parts inventory 43.5 41.5 2.0 5
%
Total current assets 1,529.5 1,553.0 (23.5) (2)
%
Floor plan notes payable 918.7 966.1 (47.4) (5)
%
Total current liabilities 1,272.6 1,303.3 (30.7) (2)
%
CAPITALIZATION:
Long-term debt (including current portion) $
909.6 $
905.3 $
4.3
%
Shareholders' equity 556.3 473.2 83.1 18
%
Total $
1,465.9 $
1,378.5 $
87.4 6
%
June December
30, 31, 2018
2019
---
DAYS SUPPLY
New vehicle
inventory 86 67
Used vehicle
inventory 33 34
_____________________________
Days supply of inventory is calculated based on new and used inventory
levels at the end of each reporting period and a 30-day historical cost of
sales.
Brand Mix - New Vehicle Revenue by Brand-
For the Six Months
Ended
June 30,
2019 2018
---
Luxury:
Mercedes-Benz 7 7
% %
Lexus 6 6
% %
BMW 6 5
% %
Acura 4 4
% %
Infiniti 3 3
% %
Other luxury 7 8
% %
---
Total luxury 33 33
% %
Imports:
Honda 19 20
% %
Nissan 9 11
% %
Toyota 12 11
% %
Other imports 5 5
% %
---
Total imports 45 47
% %
Domestic:
Ford 10 10
% %
Chevrolet 6 5
% %
Dodge 3 2
% %
Other domestics 3 3
% %
---
Total domestic 22 20
% %
Total New Vehicle Revenue 100 100
% %
===
ASBURY AUTOMOTIVE GROUP INC.
Supplemental Disclosures
(Unaudited)
Non-GAAP Financial Disclosure and Reconciliation
In addition to evaluating the financial condition and results of our operations in accordance with GAAP, from time to time 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 certain alternative financial measures not prepared in accordance with GAAP. These measures include "Adjusted leverage ratio," "Adjusted income from operations," "Adjusted net income," " Adjusted operating margins," and "Adjusted diluted earnings per share ("EPS")." Further, management assesses the organic growth of our revenue and gross profit on a same store basis. We believe that our assessment on a same store basis represents an important indicator of comparative financial performance and provides relevant information to assess our performance at our existing locations. Same store amounts consist of information from dealerships for identical months in each comparative period, commencing with the first month we owned the dealership. Additionally, amounts related to divested dealerships are excluded from each comparative period. 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. Management cautions investors not to place undue reliance on such non-GAAP measures, but also to consider them with the most directly comparable GAAP measures. In their evaluation of results from time to time, management excludes items that do not arise directly from core operations, or are otherwise of an unusual or non-recurring nature. Because these non-core, unusual or non-recurring charges and gains materially affect Asbury'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. Management discloses these non-GAAP measures, and the related reconciliations, because it believes 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 following tables provide reconciliations for our non-GAAP metrics:
For the Twelve Months Ended
June 30, 2019 March 31, 2019
(Dollars in millions)
Adjusted leverage ratio:
---
Long-term debt (including current portion) $
909.6 $
913.4
Calculation of earnings before interest, taxes,
depreciation and amortization ("EBITDA"):
Net Income $
180.5 $
168.8
Add:
Depreciation and amortization 34.7 34.1
Income tax expense 59.8 56.3
Swap and other interest expense 54.4 54.1
Earnings before interest, taxes, depreciation
and amortization ("EBITDA") $
329.4 $
313.3
Non-core items - expense (income):
Gain on divestiture $
(11.7)
$
Gain on sale of real estate (0.3)
$
Franchise rights impairment 3.7 3.7
Fixed assets write-off 2.4 2.4
Legal settlements (0.7)
Total non-core items (5.9) 5.4
Adjusted EBITDA $
323.5 $
318.7
Adjusted leverage ratio 2.8 2.9
For the Three Months Ended
June 30,
2019 2018
(In millions, except per share
data)
Adjusted income from operations:
---
Income from operations $
85.9 $
79.6
Gain on sale of real estate (0.3)
Legal settlements (0.7)
Adjusted income from operations $
85.6 $
78.9
Adjusted net income:
---
Net income $
54.9 $
43.2
Non-core items - (income)
expense:
Gain on divestiture (11.7)
Gain on sale of real estate (0.3)
Legal settlements (0.7)
Income tax on non-core items
above 3.0 0.2
Total non-core items (9.0) (0.5)
Adjusted net income $
45.9 $
42.7
Adjusted diluted earnings per
share (EPS):
---
Diluted EPS $
2.84 $
2.11
Total non-core items (0.46) (0.03)
Adjusted diluted EPS $
2.38 $
2.08
Weighted average common shares
outstanding -diluted 19.3 20.5
For the Six Months Ended
June 30,
2019 2018
(In millions, except per share
data)
Adjusted income from operations:
---
Income from operations $
163.7 $
152.8
Gain on sale of real estate (0.3)
Fixed assets write-off 2.4
Legal settlements (0.7)
Adjusted income from operations $
165.8 $
152.1
Adjusted net income:
---
Net income $
95.8 $
83.3
Non-core items - (income)
expense:
Gain on divestiture (11.7)
Gain on sale of real estate (0.3)
Fixed assets write-off 2.4
Legal settlements (0.7)
Income tax on non-core items
above 2.4 0.2
Total non-core items (7.2) (0.5)
Adjusted net income $
88.6 $
82.8
Adjusted diluted earnings per
share (EPS):
---
Diluted EPS $
4.96 $
4.02
Total non-core items (0.37) (0.02)
Adjusted diluted EPS $
4.59 $
4.0
Weighted average common shares
outstanding -diluted 19.3 20.7
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SOURCE Asbury Automotive Group, Inc.
