Asbury Automotive Group Q2 Net Income Falls to $115M

By Philip Seaworth • Tuesday, July 28 10:56 • Permanent Link

Asbury Automotive Group said second-quarter net income fell to $115 million, or $6.25 a diluted share, from $153 million, or $7.76, a year earlier. Adjusted net income declined to $125 million, or $6.82 a share, from $146 million, or $7.43.

Revenue totaled $4.4 billion, while gross profit was $753 million. Gross margin was 17.2%.

Used retail gross profit per unit rose 16% to $2,002. Used vehicle retail revenue reached $1.1 billion and used vehicle retail gross profit was $66 million.

Finance and insurance per vehicle retailed was $2,216. Parts and service revenue came in at $635 million, with gross profit of $374 million.

Selling, general and administrative expenses were 67.2% of gross profit, compared with an adjusted 66.0%.

Operating margin was 5.0%, while adjusted operating margin was 5.3%.

In the same-store business, revenue was $3.8 billion and gross profit was $643 million. Same-store gross margin was 17.1%. Used vehicle retail revenue was $930 million, with used vehicle retail gross profit of $56 million. Parts and service revenue was $551 million, with gross profit of $323 million.

Same-store SG&A was 66.4% of gross profit, and adjusted SG&A was 65.3%. Operating margin was 5.2%, with adjusted operating margin at 5.4%.

The company said it repurchased about 668,000 shares for $131 million in the quarter. Through June 30, it had bought back about 1.35 million shares for $278 million, leaving about $322 million under its authorization.

As of June 30, Asbury reported $154 million in cash, short-term investments and floorplan offset accounts, plus $812 million of availability under its used vehicle floorplan line and revolver, for total liquidity of $966 million. Transaction adjusted net leverage was 3.4 times.

The company said about 70% of stores had been converted to Tekion as of July 28, up from prior stages of the rollout, and it remains on track to complete the conversion this fall. Following these announcements, the company's shares moved 1.72%, and are now trading at a price of $230.53. Check out the company's full 8-K submission here.

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