PENSKE AUTOMOTIVE GROUP, INC. BLOOMFIELD HILLS, Mich., April 26, 2016 /PRNewswire/ --
First Quarter 2016 Highlights
-----------------------------
Revenue Increases 7.6% to $4.8 Billion
Same-Store Retail Revenue Increases 2.5%,
Excluding Foreign Exchange 4.7%
Income from Continuing Operations Attributable to
Common Shareholders Increases 4.2% to $79.3
Million
Earnings Per Share from Continuing Operations
Attributable to Common Shareholders Increases 7.1%
to $0.90
EBITDA Increases 4.7% to $157.6 Million
---------------------------------------
Penske Automotive Group, Inc. (NYSE: PAG), an international transportation services company, announced today record first quarter 2016 results. For the three months ended March 31, 2016, income from continuing operations attributable to common shareholders increased 4.2% to $79.3 million, and related earnings per share increased 7.1% to $0.90 when compared to the same period last year. During the first quarter of 2016, foreign exchange rates negatively impacted earnings per share attributable to common shareholders by $0.03. Total automotive retail units increased 9.9% and total revenue increased 7.6% to $4.8 billion. Excluding foreign exchange, total revenue increased 10.0%, including 4.7% on a same-store basis.
"The resiliency of the U.S. and U.K. automotive markets and a solid performance from our truck dealership operations drove Penske Automotive to another quarter of record results," said Chairman Roger S. Penske. "We believe the diversification provided by our business model continues to reward our shareholders. Further, I am particularly pleased with the 50-basis-point improvement of selling, general and administrative expenses as a percent of gross profit and gross profit flow-through of greater than 30% in the quarter."
Automotive Retail Highlights of the First Quarter
-- Retail Unit Sales Increased 9.9% to 111,494
-- New unit retail sales +10.2%
-- Used unit retail sales +9.6%
-- Same-Store Retail Revenue Increased 2.5%
-- New +1.6%; Used +3.3%; Finance & Insurance +5.9% Service and Parts
+3.7%
-- Excluding f/x, Same-Store retail revenue increased 4.7%
-- Average Transaction Price Per Unit
-- New vehicles $38,607, -$1,532/unit, or -3.8%
-- Used vehicles $26,780, +$108/unit, or +0.4%
-- Average Gross Profit Per Unit
-- New $2,988, -$162/unit; Gross Margin 7.7%, -10 basis points
-- Excluding f/x $3,051, -$99/unit; Gross Margin 7.7%, -10 basis
points
-- Used $1,598, -$165/unit; Gross Margin 6.0%, -60 basis points
-- Excluding f/x $1,633, -$130/unit; Gross Margin 5.9%, -70 basis
points
-- Finance & Insurance $1,062, -$34/unit
-- Excluding f/x $1,085, -$11/unit
Note: f/x = foreign exchange
Commercial Truck Dealership Operations
The company operates commercial truck dealership locations in the U.S. and Canada under the "Premier Truck Group" brand name offering primarily the Freightliner and Western Star brands. For the three months ended March 31, 2016 and 2015, Premier Truck Group generated $206.7 million and $192.7 million of revenue, and $33.2 million and $32.8 million of gross profit, respectively, principally through the retail sale of new/used medium and heavy-duty trucks and service/parts sales. Service and parts gross profit represents approximately 79.5% and 71.3% of total Premier Truck Group gross profit, respectively.
Share Repurchases
During the three months ended March 31, 2016, the company acquired 4.5 million shares of its common stock for approximately $167.9 million. As of March 31, 2016, the company has a remaining share repurchase authorization of approximately $32.1 million.
Acquisitions Update
On April 12, 2016, the company announced that its Premier Truck Group subsidiary had acquired Harper Truck Centres, located in Ontario, Canada. Harper Truck Centres has five dealership locations in the greater Toronto, Ontario market area. The acquisition is expected to generate approximately $130 million in annualized revenue.
Conference Call
Penske Automotive will host a conference call discussing financial results relating to the first quarter of 2016 on April 26, 2016, at 2:00 p.m. Eastern Daylight Time. To listen to the conference call, participants must dial 800-230-1092 [International, please dial 612-234-9960]. The call will also be simultaneously broadcast over the Internet through the Investor Relations section of the Penske Automotive Group website. Additionally, an investor presentation relating to the first quarter 2016 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 that operates automotive and commercial truck dealerships principally in the United States, Canada and Western Europe, and distributes commercial vehicles, diesel engines, gas engines, power systems and related parts and services principally in Australia and New Zealand. PAG employs more than 22,000 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 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. They 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. 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 and foreign currency exchange rates, adverse conditions affecting a particular manufacturer, including the adverse impact to the vehicle and parts supply chain due to natural disasters, recall 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, 2015, 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:
J.D. Carlson 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.
248-648-2810 248-648-2540
jcarlson@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,
---------
2016 2015 Increase/
(Decrease)
----------
Revenue $4,824.6 $4,482.9 7.6%
Cost of Sales 4,100.8 3,793.0 8.1%
------- ------- ---
Gross Profit $723.8 $689.9 4.9%
SG&A Expenses 558.9 535.8 4.3%
Depreciation 20.8 18.6 11.8%
---- ---- ----
Operating Income $144.1 $135.5 6.3%
Floor Plan Interest Expense (12.8) (10.3) 24.3%
Other Interest Expense (17.2) (16.3) 5.5%
Equity in Earnings of Affiliates 5.5 6.7 (17.9%)
--- --- ------
Income from Continuing Operations Before Income Taxes $119.6 $115.6 3.5%
Income Taxes (39.4) (38.8) 1.5%
----- ----- ---
Income from Continuing Operations $80.2 $76.8 4.4%
Loss from Discontinued Operations, net of tax --- (0.9) nm
--- ---- ---
Net Income $80.2 $75.9 5.7%
Less: Income Attributable to Non-Controlling Interests 0.9 0.7 28.6%
--- --- ----
Net Income Attributable to Common Shareholders $79.3 $75.2 5.5%
===== ===== ===
Amounts Attributable to Common Shareholders:
Reported Income from Continuing Operations $80.2 $76.8 4.4%
Less: Income Attributable to Non-Controlling Interests 0.9 0.7 28.6%
--- --- ----
Income from Continuing Operations, net of tax $79.3 $76.1 4.2%
Loss from Discontinued Operations, net of tax --- (0.9) nm
--- ---- ---
Net Income Attributable to Common Shareholders $79.3 $75.2 5.5%
===== ===== ===
Income from Continuing Operations Per Share $0.90 $0.84 7.1%
===== ===== ===
Net Income Per Share $0.90 $0.83 8.4%
===== ===== ===
Weighted Average Shares Outstanding 88.3 90.3 (2.2%)
==== ==== =====
nm - not meaningful
PENSKE AUTOMOTIVE GROUP, INC.
Consolidated Condensed Balance Sheets
(Amounts In Millions)
(Unaudited)
March 31, December 31,
2016 2015
---- ----
Assets:
Cash and Cash Equivalents $45.6 $62.4
Accounts Receivable, Net 835.6 782.3
Inventories 3,513.4 3,463.5
Other Current Assets 101.5 85.6
Assets Held for Sale 9.8 13.1
--- ----
Total Current Assets 4,505.9 4,406.9
Property and Equipment, Net 1,545.8 1,520.1
Intangibles 1,734.8 1,730.8
Other Long-Term Assets 386.4 355.6
----- -----
Total Assets $8,172.9 $8,013.4
======== ========
Liabilities and Equity:
Floor Plan Notes Payable $2,262.5 $2,247.2
Floor Plan Notes Payable - Non-Trade 1,187.3 1,132.4
Accounts Payable 541.5 493.8
Accrued Expenses 388.0 378.1
Current Portion Long-Term Debt 54.5 28.0
Liabilities Held for Sale 5.1 6.2
--- ---
Total Current Liabilities 4,438.9 4,285.7
Long-Term Debt 1,330.1 1,247.0
Other Long-Term Liabilities 679.9 645.8
----- -----
Total Liabilities 6,448.9 6,178.5
Equity 1,724.0 1,834.9
------- -------
Total Liabilities and Equity $8,172.9 $8,013.4
======== ========
PENSKE AUTOMOTIVE GROUP, INC.
Consolidated Operations
Selected Data
(Unaudited)
Three Months Ended
March 31,
---------
2016 2015
---- ----
Geographic Revenue Mix:
U.S. 57.3% 60.4%
U.K. 35.4% 35.5%
Other International 7.3% 4.1%
--- ---
Total 100.0% 100.0%
===== =====
Revenue: (Amounts in Millions)
Retail Automotive $4,512.9 $4,186.8
Retail Commercial Trucks 206.7 192.7
Commercial Vehicles Australia/
Power Systems and Other 105.0 103.4
Total $4,824.6 $4,482.9
======== ========
Gross Profit: (Amounts in Millions)
Retail Automotive $665.0 $629.3
Retail Commercial Trucks 33.2 32.8
Commercial Vehicles Australia/
Power Systems and Other 25.6 27.8
---- ----
Total $723.8 $689.9
====== ======
Gross Margin:
Retail Automotive 14.7% 15.0%
Retail Commercial Trucks 16.1% 17.0%
Commercial Vehicles Australia/
Power Systems and Other 24.4% 26.9%
---- ----
Total 15.0% 15.4%
==== ====
PENSKE AUTOMOTIVE GROUP, INC.
Consolidated Operations
Selected Data
(Unaudited)
Three Months Ended
March 31,
---------
2016 2015 Increase/
(Decrease)
----------
Operating Items as a Percentage of Revenue:
Gross Profit 15.0% 15.4% -40 bps
Selling, General and
Administrative Expenses 11.6% 12.0% -40 bps
Operating Income 3.0% 3.0% ---
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 77.2% 77.7% -50 bps
Operating Income 19.9% 19.6% +30 bps
Three Months Ended
March 31,
---------
2016 2015 Increase/
(Decrease)
----------
(Amounts in Millions)
EBITDA* $157.6 $150.5 4.7%
Floorplan Credits $8.9 $6.7 32.8%
Rent Expense $51.5 $50.1 2.8%
* See the following Non-GAAP reconciliation table.
PENSKE AUTOMOTIVE GROUP, INC.
Retail Automotive Operations
Selected Data
(Unaudited)
Three Months Ended
March 31,
---------
2016 2015
---- ----
Retail Automotive Units:
New Retail 58,753 53,318
Used Retail 52,741 48,102
Total 111,494 101,420
======= =======
Retail Automotive Revenue: (Amounts in Millions)
New Vehicles $2,268.2 $2,140.1
Used Vehicles 1,412.4 1,283.0
Finance and Insurance,
Net 118.4 111.1
Service and Parts 478.1 438.4
Fleet and Wholesale 235.8 214.2
Total Revenue $4,512.9 $4,186.8
======== ========
Retail Automotive Gross Profit: (Amounts in Millions)
New Vehicles $175.5 $167.9
Used Vehicles 84.3 84.9
Finance and Insurance,
Net 118.4 111.1
Service and Parts 281.4 260.8
Fleet and Wholesale 5.4 4.6
--- ---
Total Gross Profit $665.0 $629.3
====== ======
Retail Automotive Revenue Per Vehicle Retailed:
New Vehicles $38,607 $40,139
Used Vehicles 26,780 26,672
Retail Automotive Gross Profit Per Vehicle Retailed:
New Vehicles $2,988 $3,150
Used Vehicles 1,598 1,763
Finance & Insurance 1,062 1,096
PENSKE AUTOMOTIVE GROUP, INC.
Retail Automotive Operations
Selected Data
(Unaudited)
Three Months Ended
March 31,
---------
2016 2015
---- ----
Retail Automotive Revenue Mix Percentages:
New Vehicles 50.3% 51.1%
Used Vehicles 31.3% 30.6%
Finance and Insurance, Net 2.6% 2.7%
Service and Parts 10.6% 10.5%
Fleet and Wholesale 5.2% 5.1%
--- ---
Total 100.0% 100.0%
===== =====
Retail Automotive Gross Profit Mix Percentages:
New Vehicles 26.4% 26.7%
Used Vehicles 12.7% 13.5%
Finance and Insurance, Net 17.8% 17.7%
Service and Parts 42.3% 41.4%
Fleet and Wholesale 0.8% 0.7%
Total 100.0% 100.0%
===== =====
Three Months Ended
March 31,
---------
2016 2015 Increase/
(Decrease)
---------
Retail Automotive
Gross Margin:
New Vehicles 7.7% 7.8% -10 bps
Used Vehicles 6.0% 6.6% -60 bps
Service and Parts 58.9% 59.5% -60 bps
Fleet and Wholesale 2.3% 2.1% +20 bps
--- --- -------
Total Gross Margin 14.7% 15.0% -30 bps
==== ==== =======
PENSKE AUTOMOTIVE GROUP, INC.
Retail Automotive Operations
Selected Data
(Unaudited)
Three Months Ended
March 31,
---------
2016 2015
---- ----
Retail Automotive Revenue Mix:
Premium:
BMW / MINI 25% 27%
Audi 14% 13%
Mercedes-Benz 10% 10%
Land Rover 7% 7%
Porsche 5% 5%
Lexus 4% 4%
Ferrari / Maserati 2% 2%
Acura 1% 1%
Bentley 1% 1%
Others 3% 2%
--- ---
Total Premium 72% 72%
Volume Non-U.S.:
Toyota 11% 11%
Honda 7% 7%
Volkswagen 3% 3%
Nissan 1% 1%
Others 2% 2%
--- ---
Total Volume Non-U.S. 24% 24%
U.S.:
General Motors / Chrysler / Ford 4% 4%
--- ---
Total 100% 100%
=== ===
Retail Automotive Geographic Revenue Mix:
U.S. 56.6% 60.0%
U.K. 37.8% 38.0%
Other International 5.6% 2.0%
--- ---
Total 100% 100%
=== ===
PENSKE AUTOMOTIVE GROUP, INC.
Retail Automotive Operations
Same-Store
Selected Data
(Unaudited)
Three Months Ended
March 31,
---------
2016 2015
---- ----
Retail Automotive Same-Store Units:
New Retail 55,457 53,239
Used Retail 48,711 48,089
Total 104,168 101,328
======= =======
Retail Automotive Same-Store Revenue: (Amounts in Millions)
New Vehicles $2,166.5 $2,133.4
Used Vehicles 1,325.0 1,282.5
Finance and Insurance, Net 117.4 110.9
Service and Parts 453.5 437.5
Fleet and Wholesale 230.3 213.6
Total Revenue $4,292.7 $4,177.9
======== ========
Retail Automotive Same-Store Gross Profit: (Amounts in Millions)
New Vehicles $167.2
$162.4
Used Vehicles 80.2 84.8
Finance and Insurance, Net 117.4 110.9
Service and Parts 268.8 260.4
Fleet and Wholesale 5.3 4.6
--- ---
Total Gross Profit $634.1 $627.9
====== ======
Retail Automotive Same-Store Revenue Per Vehicle Retailed:
New Vehicles $40,072
$39,066
Used Vehicles 27,201 26,668
Retail Automotive Same-Store Gross Profit Per Vehicle Retailed:
New Vehicles $2,928 $3,140
Used Vehicles 1,646 1,763
Finance & Insurance 1,127 1,095
PENSKE AUTOMOTIVE GROUP, INC.
Retail Commercial Truck Operations
Selected Data
(Unaudited)
Three Months Ended
March 31,
---------
Retail Commercial Truck Units: 2016 2015
---- ----
New Retail 1,160 1,039
Used Retail 271 296
Total 1,431 1,335
===== =====
Retail Commercial Truck Revenue: (Amounts in Millions)
New Vehicles $116.7 $102.2
Used Vehicles 13.5 15.9
Finance and Insurance, Net 1.9 1.3
Service and Parts 71.4 63.1
Lease, Rental & Wholesale 3.2 10.2
Total Revenue $206.7 $192.7
====== ======
Retail Commercial Truck Gross Profit: (Amounts in Millions)
New Vehicles $4.9 $4.9
Used Vehicles (0.4) 1.7
Finance and Insurance, Net 1.9 1.3
Service and Parts 26.4 23.4
Lease, Rental & Wholesale 0.4 1.5
Total Gross Profit $33.2 $32.8
===== =====
Retail Commercial Truck Revenue Per Vehicle Retailed:
New Vehicles $100,618 $98,345
Used Vehicles 49,727 53,700
Retail Commercial Truck Gross Profit Per Vehicle Retailed:
New Vehicles $4,201 $4,691
Used Vehicles (1,471) 5,882
Finance & Insurance 1,311 1,008
Retail Commercial Truck Gross Profit as a Percentage of Revenue
Gross Profit:
New Vehicle 4.2% 4.8%
Used Vehicle (3.0%) 10.7%
Service and Parts 37.0% 37.1%
Lease, Rental & Wholesale 12.5% 14.7%
---- ----
Total Gross Profit 16.1% 17.0%
PENSKE AUTOMOTIVE GROUP, INC.
Consolidated Non-GAAP Reconciliations
(Unaudited)
The following table reconciles reported net income to earnings before interest, taxes, depreciation and amortization
("EBITDA") for the three months ended March 31, 2016 and 2015:
Three Months Ended
March 31,
---------
2016 2015 Increase/
(Decrease)
----------
(Amounts in Millions)
Net Income $80.2 $75.9 5.7%
Add: Depreciation 20.8 18.6 11.8%
Other Interest Expense 17.2 16.3 5.5%
Income Taxes 39.4 38.8 1.5%
Loss from Discontinued
Operations, net of
tax --- 0.9 nm
--- --- ---
EBITDA $157.6 $150.5 4.7%
====== ====== ===
nm - not meaningful
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SOURCE Penske Automotive Group, Inc.
