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UnitedAuto Reports For Third Quarter 1999; Net Income Increases 13% to $9.3 Million, or Earnings Per Fully Diluted Share of $0.32 on 21% Revenue Increase of $1.09 Billion; Same-store Dealership Retail Revenues Increase $127 Million, or 17.9% and Retail Gr
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Net Income Increases 13% to $9.3 Million, or Earnings Per Fully Diluted Share of $0.32 on 21% Revenue Increase of $1.09 Billion

Same-store Dealership Retail Revenues Increase $127 Million, or 17.9% and Retail Gross Profit Increases 12.9% Versus the Prior Year

NEW YORK, NY, OCTOBER 26, 1999 - UnitedAuto Group, Inc. (NYSE: UAG), the nation's second largest publicly-traded automotive retailer, today announced results for the quarter which ended September 30, 1999.

Third quarter revenues increased 21.0% to $1.09 billion versus $897.0 million in the comparable prior year period. Of the $1.09 billion in third quarter dealership revenues, vehicle sales represented 86.2%, or $935.3 million of the total; finance and insurance revenues represented 4.2%, or $45.7 million of the total; and service and parts revenues of $104.4 million represented the remaining 9.6%.

Net income for the third quarter of 1999 increased by 13% to $9.3 million, or earnings per share of $0.32 on a fully diluted basis after an extraordinary gain of $0.3 million; versus net income of $8.2 million, or earnings per share of $0.39, in the comparable prior year period. Weighted average shares increased by approximately 40.1% to 29,048,000 in the third quarter of 1999 compared to 20,726,000 in the comparable prior year period. The increase resulted primarily from the issuance of $83 million in convertible preferred stock to Penske Capital Partners in connection with its investment in UnitedAuto.

The Companys total retail, new and used units sold, increased by 18.1%. The Companys retail sales of new and used vehicles during the third quarter of 1999 amounted to 26,060 and 14,106, respectively; versus new and used retail unit sales of 21,125 and 12,871, respectively, during the comparable 1998 period.

Roger Penske, Chairman, said: "We continue to be pleased with our operational progress in the third quarter as we position the Company to initiate certain operational and strategic changes we believe will enhance UnitedAutos profitability."

Sam DiFeo, Jr., President, added: "For the third quarter, same-store total retail revenue showed positive results increasing by 17.9%. Same-store retail gross profit also increased 12.9%. These improvements were driven by a 15.2% increase in retail units sold, and a 9.0% increase in service and parts revenue versus the third quarter of 1998."

For the nine months, which ended September 30, 1999, revenues were $3.03 billion, as compared to $2.51 billion in the comparable prior year period.

Net income for the first nine months of 1999 increased 23.7% to $21.6 million, or earnings per share of $0.86 on a fully diluted basis, after an extraordinary gain of $0.3 million. Net income was $17.5 million, or earnings per share of $0.86 on a fully diluted basis, for the first nine months of 1998 after an extraordinary charge of $1.2 million. Weighted average shares outstanding were 25,207,000 in the first nine months of 1999 and 20,349,000 in the comparable prior year period.

Of the $3.03 billion in dealership revenues in the first nine months, vehicle sales represented 86.1%, or $2.61 billion of the total; finance and insurance revenues represented 4.1%, or $125.7 million of the total; and service and parts revenues of $297.2 million represented the remaining 9.8%.

The Companys total retail units sold increased by 17.6% in the first nine months of 1999 versus the comparable period in 1998. The Companys retail sales of new and used vehicles during the first nine months of 1999 amounted to 70,318 and 40,192, respectively; versus new and used retail unit sales of 58,069 and 35,934, respectively, during the comparable 1998 period.

Investment from Penske Capital Partners

As previously announced, affiliates of Penske Capital Partners completed the transaction involving $83.0 million in new capital. As a result, UnitedAuto received the final installment relating to the investment, amounting to approximately $49.5 million, on August 3, 1999. Proceeds from the investment were used to retire debt.

UnitedAuto, which has pursued a strategy based on internal growth from its existing dealerships as well as from strategic acquisitions, operates [104] franchises in 16 states and Puerto Rico. UnitedAuto dealerships sell new and used vehicles and market a complete line of aftermarket automotive products and services.

Penske Capital Partners was formed in 1997 to make investments in the transportation and transportation services industries.

This press release contains forward-looking information, and actual results may materially vary from those expressed or implied herein. Factors, including economic conditions, manufacturer approvals, and acquisition risks that could affect these results are described in reports and documents filed by the Company with the Securities and Exchange Commission.


                    
                           UNITEDAUTO GROUP, INC.

              Consolidated Statements of Operations (unaudited)

                (Amounts in Thousands, Except Per Share Data)

                                     Third Quarter

                                     1999      1998



 Vehicle Sales                     $935,270  $766,885

 Finance and Insurance               45,679    37,333

 Service and Parts                  104,417    92,788

 Total Revenues                   1,085,366   897,006

 Cost of Sales, Including Floor     945,881   774,948
 Plan Interest

 Gross Profit                       139,485   122,058

 Selling, General and               117,323   101,676
 Administrative Expenses

 Operating Income                    22,162    20,382

 Other Interest Expense             (7,255)   (8,407)

 Other Income (a)                       874     1,779

 Income From Continuing
 Operations Before
                                     15,781    13,754
 Minority Interests, Income Tax
 Provision and

 Extraordinary Item

 Minority Interests                   (181)      (42)

 Income Tax Provision               (6,631)   (5,652)

 Income From Continuing               8,969     8,060
 Operations

 Income From Discontinued
 Operations, Net of Income Tax
                                         28       167
 Provision

 Income Before Extraordinary          8,997     8,227
 Item

 Extraordinary Item, Net of             320         --
 Income Tax Benefit (b)

 Net Income                          $9,317    $8,227

 Diluted Earnings Per Share From      $0.31     $0.39
 Continuing Operations

 Diluted Earnings Per Share           $0.32     $0.40

 Diluted Weighted Average Shares     29,048    20,726
 Outstanding (c)

 EBITDA (d)                         $27,982   $27,573



  a. Represents fees received pursuant to management agreements at certain
     dealerships for which acquisition is pending final manufacturer
     approval.
  b. Represents the gain on the effective retirement of $12.0 million of the
     Companys Senior Subordinated Notes (the "Notes"), offset in part by
     the write-off of a portion of the debt issuance costs related to the
     Notes.
  c. The 1999 weighted average share calculation includes the dilutive
     effect of 3.7 million shares of common stock equivalents issued to
     affiliates of Penske Capital Partners on May 3, 1999, as well as the
     dilutive effect of 4.6 million shares of common stock equivalents and
     warrants to purchase 5.0 million shares of voting and non-voting common
     stock issued to affiliates of Penske Capital Partners on August 3,
     1999.
  d. EBITDA is defined as income from continuing operations before minority
     interests, income tax provision, extraordinary item, interest expense
     (exclusive of interest expense relating to floor plan notes payable),
     depreciation and amortization.



                           UNITEDAUTO GROUP, INC.

              Consolidated Statements of Operations (unaudited)

                (Amounts in Thousands, Except Per Share Data)

                                     Nine Months

                                  1999        1998



 Vehicle Sales                 $2,610,785  $2,163,492

 Finance and Insurance            125,678      95,341

 Service and Parts                297,233     246,301

 Total Revenues                 3,033,696   2,505,134

 Cost of Sales, Including       2,641,345   2,181,290
 Floor Plan Interest

 Gross Profit                     392,351     323,844

 Selling, General and             332,359     272,683
 Administrative Expenses

 Operating Income                  59,992      51,161

 Other Interest Expense          (23,510)    (23,381)

 Other Income (a)                   2,270       3,627

 Income From Continuing
 Operations Before
                                   38,752      31,407
 Minority Interests, Income
 Tax Provision And

 Extraordinary Item

 Minority Interests                 (542)       (126)

 Income Tax Provision            (16,923)    (12,903)

 Income From Continuing            21,287      18,378
 Operations

 Income From Discontinued
 Operations, Net of Income
 Tax                                   28         341

 Provision

 Income Before Extraordinary       21,315      18,719
 Item

 Extraordinary Item, Net of           320      (1,235)
 Income Tax (b)

 Net Income                       $21,635     $17,484

 Diluted Earnings Per Share         $0.84       $0.90
 From Continuing Operations

 Diluted Earnings Per Share         $0.86       $0.86

 Diluted Weighted Average          25,207      20,349
 Shares Outstanding (c)

 EBITDA (d)                       $76,442     $68,654

  a. Represents fees received pursuant to management agreements at certain
     dealerships for which acquisition is pending final manufacturer
     approval.
  b. In 1999 represents the gain on the effective retirement of $12.0
     million of the Notes, offset in part by the write-off of a portion of
     the debt issuance costs related to the Notes. In 1998 represents the
     write-off of debt issuance costs related to the termination of the
     Companys then existing credit facility in the first quarter of 1998.
  c. The 1999 weighted average share calculation includes the dilutive
     effect of 3.7 million shares of common stock equivalents issued to
     affiliates of Penske Capital Partners on May 3, 1999, as well as the
     dilutive effect of 4.6 million shares of common stock equivalents and
     warrants to purchase 5.0 million shares of voting and non-voting common
     stock issued to affiliates of Penske Capital Partners on August 3,
     1999.
  d. EBITDA is defined as income from continuing operations before minority
     interests, income tax provision, extraordinary item, interest expense
     (exclusive of interest expense relating to floor plan notes payable),
     depreciation and amortization.

Media Contact:

Phillip M. Hartz
Director, Corporate Communications
212 715-8629