|View printer-friendly version|
|Penske Automotive Reports First Quarter Results|
Income from Continuing Operations Increases to $20.8 Million and RelatedEarnings per Share Increases to $0.23
Adjusted Income from Continuing Operations Increases 105% to $20.4 Million
SG&A to Gross Profit Improves 182 Basis Points to 83.1%
$71.1 Million of Convertible Notes Repurchased in Q1 2010
BLOOMFIELD HILLS, Mich., Apr 30, 2010 (BUSINESS WIRE) --Penske Automotive Group, Inc. (NYSE: PAG), an international automotive retailer, today reported first quarter income from continuing operations attributable to PAG of $20.8 million, or $0.23 per share. This compares to income from continuing operations attributable to PAG of $16.5 million, or $0.18 per share, in the first quarter last year. The Company recorded after-tax gains of $0.4 million and $6.5 million ($0.07 per share) in the first quarter of 2010 and 2009, respectively, relating to purchases of the Company's 3.5% Senior Subordinated Convertible Notes due 2026. Excluding these gains, adjusted income from continuing operations attributable to PAG in the first quarter of 2010 and 2009 amounted to $20.4 million, or $0.22 per share, and $10.0 million, or $0.11 per share, respectively. Net income attributable to common shareholders in the first quarter of 2010 was $20.4 million, or $0.22 per share.
Total revenue increased $332 million, or 15.4%, to $2.5 billion in the first quarter 2010. The increase in revenue was driven by 9.2% increase in total retail unit sales. On a same-store basis, total retail revenue increased 16.4%, including increases of 14.0% in the United States and 20.4% internationally. During the first quarter, selling, general and administrative expenses as a percentage of gross profit declined 182 basis points to 83.1%.
"I am extremely pleased with the performance of our business in the first quarter," said Penske Automotive Group Chairman Roger Penske. "Despite difficult weather conditions in many of our markets and the challenging market dynamics facing the smart brand, an improving overall retail environment and the continued strong performance of our premium/luxury brands in all of our markets contributed to our strong operating results. On an adjusted basis, income from continuing operations increased 105% and earnings per share doubled compared to the first quarter last year."
During the first quarter, smart USA wholesaled 956 units, which compares to 5,714 units in the first quarter last year. In response to the continuing slow selling environment, smart USA further enhanced its efforts to reduce vehicle stock and offered increased incentives on certain 2009 smart fortwos, which resulted in an after-tax expense of $0.7 million, or $0.01 per share. These challenging conditions contributed to a loss of $0.04 per share in the distribution segment in the first quarter.
Securities Repurchase Authority
The Company repurchased $71.1 million principal amount of its 3.5% Senior Subordinated Convertible Notes due 2026 in open market transactions for $71.7 million in cash during the first quarter, leaving approximately $235 million principal amount of these securities outstanding.
The Company has $123 million remaining under its previously announced authority to repurchase its outstanding common stock, debt and convertible debt, depending on market conditions, price and other factors. Securities may be acquired from time to time either through open market purchases, negotiated transactions or other means.
Penske Automotive will host a conference call discussing financial results relating to the first quarter of 2010 on April 30, 2010, at 2:00 p.m.Eastern Daylight Time. To listen to the conference call, participants must dial (800) 230-1093 [International, please dial (612) 288-0329]. The call will also be simultaneously broadcast over the Internet through the Penske Automotive Group website at http://www.penskeautomotive.com.
About Penske Automotive
Penske Automotive Group, Inc. (http://www.penskeautomotive.com), headquartered in Bloomfield Hills, Michigan, operates 326 retail automotive franchises, representing 40 different brands and 25 collision repair centers. Penske Automotive, which sells new and previously owned vehicles, finance and insurance products and replacement parts, and offers maintenance and repair services on all brands it represents, has 174 franchises in 17 states and Puerto Rico and 152 franchises located outside the United States, primarily in the United Kingdom.
Penske Automotive, through its wholly-owned subsidiary smart USA Distributor LLC (http://www.smartusa.com), is the exclusive distributor of the smart fortwo vehicle and related parts in the United States. smart USA supports more than 75 smart retail centers in the United States.
Penske Automotive is a member of the Fortune 500 and Russell 1000 and has approximately 14,000 employees. smart and fortwo are registered trademarks of Daimler AG.
Caution Concerning Forward Looking Statements
Statements in this press release may involve forward-looking statements, including forward-looking statements regarding Penske Automotive Group, Inc.'s future sales potential. Actual results may vary materially because of risks and uncertainties, including external factors such as consumer credit conditions, adverse conditions affecting a particular manufacturer, macro-economic factors, interest rate fluctuations, changes in consumer spending, and other factors over which management has no control. These forward-looking statements should be evaluated together with additional information about Penske Automotive's business, markets, conditions and other uncertainties, which could affect Penske Automotive's future performance. These risks and uncertainties are addressed in Penske Automotive's Form 10-K for the year ended December 31, 2009, and its other filings with the Securities and Exchange Commission ("SEC"). This press release speaks only as of its date, and Penske Automotive disclaims any duty to update the information herein.
Non-GAAP Financial Measures
This release contains certain non-GAAP financial measures as defined under SEC rules, such as adjusted income from continuing operations attributable to PAG and related earnings per share. The Company has reconciled these measures to the most directly comparable GAAP measures in the release. The Company believes that these non-GAAP financial measures improve the transparency of the Company's disclosure by providing period-to-period comparability of the Company's results from operations.
SOURCE: Penske Automotive Group, Inc.