PENSKE AUTOMOTIVE GROUP, INC. 
By BLOOMFIELD HILLS, Mich., April 24, 2014 /PRNewswire/ --
Revenue Increases 20.9% to $4.0 Billion
Same-store Retail Revenue Increases
14.9%
Income from Continuing Operations
Increases 15.4% to $66.1 Million
EPS from Continuing Operations Rises
15.9% to $0.73 per Share
EBITDA Increases 16.6% to $130.2
Million
--------------------------------
Penske Automotive Group, Inc. (NYSE: PAG), an international transportation services company, announced today record first quarter 2014 performance, including the highest quarterly income from continuing operations in the history of the company. For the first quarter, income from continuing operations attributable to common shareholders increased 15.4% to $66.1 million and related earnings per share increased 15.9% to $0.73 per share when compared to the same period last year.
http://photos.prnewswire.com/prnvar/20130530/MM23675LOGO
Total revenue increased 20.9% to $4.0 billion. The revenue increase was driven by a 13.1% increase in total retail unit sales, including a 9.9% increase on a same-store basis. Gross profit improved 18.5% to $624.0 million while operating income increased 13.8% to $119.7 million.
Chairman Roger S. Penske said, "Penske Automotive Group delivered another solid quarter, achieving double-digit growth in unit volume, revenue, operating income, net income and earnings per share. Despite the challenging weather conditions experienced in the northeast and central United States, the company's performance in the first quarter displays the benefit of our brand mix and the geographical diversification of our revenue base. Our automotive dealership business generated a 14.9% increase in same-store retail revenue, including 7.5% in the U.S. and 28.2% internationally."
Highlights of the First Quarter
-- Total Retail Unit Sales increased 13.1% to 95,658
-- +9.4% in the United States; +21.0% Internationally
-- New unit retail sales +11.6%
-- Used unit retail sales +14.8%
-- Same-store Retail Revenue increased +14.9%
-- New +14.2%; Used +18.7%; Finance & Insurance +18.6%; Service and
Parts +7.3%
-- +7.5% in the United States; +28.2% Internationally
-- Average Transaction Price Per Unit
-- New $40,294; +5.8%
-- Used $26,484; +5.9%
-- Average Gross Profit Per Unit
-- New $3,116, +$150/unit; Gross Margin 7.7%, -10 basis points
-- Used $1,918, -$39/unit; Gross Margin 7.2%, -60 basis points
-- Finance & Insurance $1,097, +$82/unit
Conference Call
Penske Automotive will host a conference call discussing financial results relating to the first quarter of 2014 on April 24, 2014, at 2:00 p.m. Eastern Daylight Time. To listen to the conference call, participants must dial (800) 230-1085 [International, please dial (612) 288-0329]. The call will also be simultaneously broadcast over the Internet through the Investors Relations section of the Penske Automotive Group website. Additionally, an investor presentation relating to the first quarter 2014 financial results has been posted to the company's website. To access the presentation or to listen to the company's webcast, please refer to www.penskeautomotive.com.
About Penske Automotive
Penske Automotive Group, Inc., (NYSE:PAG) headquartered in Bloomfield Hills, Michigan, is an international transportation services company, operating automotive dealerships, commercial vehicle distribution and car rental franchises principally in the United States, Western Europe, Australia and New Zealand, employs approximately 18,000 people worldwide and is a member of the Fortune 500 and Russell 2000. For additional information, visit the company's website at www.penskeautomotive.com.
Non-GAAP Financial Measures
This release contains certain non-GAAP financial measures as defined under SEC rules, such as income from continuing operations, earnings before interest, taxes, depreciation and amortization ("EBITDA"). The company has reconciled these measures to the most directly comparable GAAP measures in the release. The company believes that these widely accepted measures of operating profitability improve the transparency of the company's disclosures 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. These non-GAAP financial measures are not substitutes for GAAP financial results, and should only be considered in conjunction with the company's financial information that is presented in accordance with GAAP.
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 and potential earnings outlook. Actual results may vary materially because of risks and uncertainties that are difficult to predict. These risks and uncertainties include, among others: economic conditions generally, conditions in the credit markets and changes in interest rates, adverse conditions affecting a particular manufacturer, including the adverse impact to the vehicle and parts supply chain due to natural disasters or other disruptions that interrupt the supply of vehicles or parts to us; changes in consumer credit availability, the outcome of legal and administrative matters, and other factors over which management has limited 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, 2013, 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.
Find a vehicle: http://www.penskecars.com
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Inquiries should contact:
David K. Jones Anthony R. Pordon
Executive Vice President and Executive Vice President Investor Relations
Chief Financial Officer and Corporate Development
Penske Automotive Group, Inc. Penske Automotive Group, Inc.
248-648-2800 248-648-2540
dave.jones@penskeautomotive.com tpordon@penskeautomotive.com
PENSKE AUTOMOTIVE GROUP, INC.
Consolidated Condensed Statements of Income
(Amounts In Millions, Except Per Share Data)
(Unaudited)
Three Months Ended
March 31,
---------
2014 2013 % Increase/
(Decrease)
----------
Revenues:
New Vehicle $2,026.3 $1,716.8 18.0%
Used Vehicle 1,201.6 988.2 21.6%
Finance and Insurance, Net 104.9 85.9 22.1%
Service and Parts 417.5 379.7 10.0%
Fleet and Wholesale 187.9 171.9 9.3%
Commercial Vehicle, Car Rental and other 109.8 6.8 NM
----- --- ---
Total Revenues $4,048.0 $3,349.3 20.9%
Cost of Sales:
New Vehicle $1,869.6 $1,583.1 18.1%
Used Vehicle 1,114.6 910.9 22.4%
Service and Parts 170.3 158.5 7.4%
Fleet and Wholesale 183.5 167.7 9.4%
Commercial Vehicle, Car Rental and other 86.0 2.5 NM
---- --- ---
Total Cost of Sales $3,424.0 $2,822.7 21.3%
Gross Profit 624.0 526.6 18.5%
SG&A Expenses 487.8 407.1 19.8%
Depreciation 16.5 14.3 15.4%
---- ---- ----
Operating Income 119.7 105.2 13.8%
Floor Plan Interest Expense (11.1) (10.1) 9.9%
Other Interest Expense (13.1) (11.5) 13.9%
Equity in Earnings of Affiliates 5.1 2.3 121.7%
Income from Continuing Operations Before Income Taxes 100.6 85.9 17.1%
Income Taxes (34.1) (28.3) 20.5%
----- ----- ----
Income from Continuing Operations 66.5 57.6 15.5%
Gain from Discontinued Operations, Net of Tax 1.4 0.4 250.0%
--- --- -----
Net Income 67.9 58.0 17.1%
Less: Income Attributable to Non-Controlling Interests (0.4) (0.3) 33.3%
---- ---- ----
Net Income Attributable to Common Shareholders $67.5 $57.7 17.0%
===== ===== ====
Income from Continuing Operations Per Share $0.73 $0.63 15.9%
===== ===== ====
Income Per Share $0.75 $0.64 17.2%
===== ===== ====
Weighted Average Shares Outstanding 90,473,732 90,456,509 --
========== ========== ===
Amounts Attributable to Common Shareholders:
Reported Income from Continuing Operations $66.5 $57.6 15.5%
Less: Income Attributable to Non-Controlling Interests (0.4) (0.3) 33.3%
---- ---- ----
Income from Continuing Operations, net of tax $66.1 $57.3 15.4%
Gain from Discontinued Operations, net of tax 1.4 0.4 250.0%
--- --- -----
Net Income $67.5 $57.7 17.0%
===== ===== ====
NM - not meaningful
PENSKE AUTOMOTIVE GROUP, INC.
Consolidated Condensed Balance Sheets
(Amounts In Millions)
(Unaudited)
March 31, December 31,
2014 2013
---- ----
Assets
Cash and Cash
Equivalents $54.9 $49.8
Accounts Receivable,
Net 677.7 600.8
Inventories 2,547.3 2,518.3
Other Current Assets 101.8 88.4
Assets Held for Sale 55.6 107.3
---- -----
Total Current Assets 3,437.3 3,364.6
Property and Equipment,
Net 1,301.2 1,232.2
Intangibles 1,501.9 1,439.9
Other Long-Term Assets 371.8 378.8
----- -----
Total Assets $6,612.2 $6,415.5
======== ========
Liabilities and Equity
Floor Plan Notes
Payable $1,721.6 $1,685.1
Floor Plan Notes
Payable - Non-Trade 908.7 901.6
Accounts Payable 411.7 373.3
Accrued Expenses 319.1 262.6
Current Portion Long-
Term Debt 65.1 50.0
Liabilities Held for
Sale 36.9 59.7
---- ----
Total Current
Liabilities 3,463.1 3,332.3
Long-Term Debt 1,010.3 1,033.2
Other Long-Term
Liabilities 555.6 527.9
----- -----
Total Liabilities 5,029.0 4,893.4
Equity 1,583.2 1,522.1
------- -------
Total Liabilities and
Equity $6,612.2 $6,415.5
======== ========
PENSKE AUTOMOTIVE GROUP, INC.
Consolidated Selected Data
(Unaudited)
Three Months
Ended
March 31,
---------
2014 2013
---- ----
Geographic Revenue Mix:
U.S. 58% 63%
U.K. 38% 36%
Other International 4% 1%
--- ---
Total 100% 100%
Revenue Mix:
Automotive Dealership 97% 100%
Commercial Vehicle, Car Rental
and other 3% --
Total 100% 100%
Automotive Dealership Revenue Mix:
Premium/Luxury:
BMW 25% 25%
Audi 14% 13%
Mercedes-Benz 10% 10%
Lexus 4% 4%
Land Rover 7% 5%
Porsche 5% 5%
Ferrari / Maserati 2% 2%
Bentley 2% 1%
Acura 1% 2%
Others 2% 3%
--- ---
Total Premium/Luxury 72% 70%
Volume Foreign:
Toyota 11% 11%
Honda 8% 9%
Nissan 1% 1%
Volkswagen 2% 2%
Others 2% 3%
--- ---
Total Volume Foreign 24% 26%
Domestic Big 3:
General Motors / Chrysler / Ford 4% 4%
--- ---
Total Automotive Dealership
Revenue 100% 100%
Gross Profit Mix:
New Vehicles 25.1% 25.4%
Used Vehicles 13.9% 14.7%
Service and Parts 16.8% 16.3%
Finance and Insurance 39.6% 42.0%
Fleet and Wholesale 0.8% 0.8%
Commercial Vehicle, Car Rental
and other 3.8% 0.8%
--- ---
Total 100.0% 100.0%
PENSKE AUTOMOTIVE GROUP, INC.
Consolidated Selected Data
(Unaudited)
Three Months Ended
March 31,
---------
2014 2013 Increase/
(Decrease)
---- ---- ----------
Operating items as a percentage of revenue:
Gross Profit:
New Vehicle 7.7% 7.8% -10 bps
Used Vehicle 7.2% 7.8% -60 bps
Service and Parts 59.2% 58.3% 90 bps
Fleet and Wholesale 2.3% 2.4% -10 bps
Commercial Vehicle, Car Rental and other 21.6% NM NM
---- ---
Total Gross Profit 15.4% 15.7% -30 bps
Selling, General and Admin. Expenses 12.1% 12.2% -10 bps
Operating Income 3.0% 3.1% -10 bps
Inc. From Cont. Ops. Before Inc. Taxes 2.5% 2.6% -10 bps
Operating items as a percentage of total gross profit:
Selling, General and Administrative Expenses 78.2% 77.3% 90 bps
Operating Income 19.2% 20.0% -80 bps
Three Months Ended
March 31,
---------
2014 2013 % Increase/
(Decrease)
----------
Other (Amounts in Millions):
EBITDA* $130.2 $111.7 16.6%
Rent Expense 47.8 43.5 9.9%
Floorplan Credits 6.1 6.0 1.7%
* See the following Non-GAAP reconciliation table
NM - not meaningful
PENSKE AUTOMOTIVE GROUP, INC.
Automotive Retail Operations Selected Data
(Unaudited)
Three Months Ended
March 31,
---------
2014 2013 %
Increase/
(Decrease)
---- ---- ----------
Total Retail Units:
New Retail 50,288 45,060 11.6%
Used Retail 45,370 39,510 14.8%
------ ------ ----
Total Retail 95,658 84,570 13.1%
====== ====== ====
Same-Store Retail Units:
New Same-Store Retail 48,243 44,693 7.9%
Used Same-Store Retail 43,832 39,063 12.2%
------ ------ ----
Total Same-Store Retail 92,075 83,756 9.9%
====== ====== ===
Same-Store Retail Revenue: (Amounts in millions)
New Vehicles $1,944.9 $1,702.5 14.2%
Used Vehicles 1,164.6 980.9 18.7%
Finance and Insurance, Net 101.8 85.8 18.6%
Service and Parts 402.6 375.1 7.3%
----- ----- ---
Total Same-Store Retail $3,613.9 $3,144.3 14.9%
======== ======== ====
Retail Revenue Mix:
New Vehicles 54.0% 54.1% -10 bps
Used Vehicles 32.0% 31.2% 80 bps
Finance and Insurance, Net 2.8% 2.7% 10 bps
Service and Parts 11.2% 12.0% -80 bps
Average Revenue per Vehicle Retailed:
New Vehicles $40,294 $38,100 5.8%
Used Vehicles 26,484 25,012 5.9%
Gross Profit per Vehicle Retailed:
New Vehicles $3,116 $2,966 5.1%
Used Vehicles 1,918 1,957 -2.0%
Finance and Insurance 1,097 1,015 8.1%
PENSKE AUTOMOTIVE GROUP, INC.
Consolidated Non-GAAP Reconciliation
(Unaudited)
Reconciliation of reported net income to earnings before interest, taxes, depreciation and amortization
("EBITDA") for the three months ended March 31, 2014 and 2013:
Three Months Ended
March 31,
---------
(Amounts in Millions) 2014 2013 %
Increase/
(Decrease)
---- ---- ----------
Net Income $67.9 $58.0 17.1%
Depreciation 16.5 14.3 15.4%
Other Interest Expense 13.1 11.5 13.9%
Income Taxes 34.1 28.3 20.5%
Gain from Discontinued
Operations, net (1.4) (0.4) 250.0%
---- ---- -----
EBITDA $130.2 $111.7 16.6%
====== ====== ====
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SOURCE Penske Automotive Group, Inc.
