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þ
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QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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¨
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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Delaware
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73-1105145
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(State or other jurisdiction of incorporation or organization)
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(I.R.S. Employer Identification No.)
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200 SW 1st Avenue, Fort Lauderdale, Florida
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33301
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(Address of principal executive offices)
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(Zip Code)
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Large accelerated filer
þ
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Accelerated filer
o
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Non-accelerated filer
o
(Do not check if a smaller reporting company)
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Smaller reporting company
o
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Page
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Item 1.
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Item 2.
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Item 3.
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Item 4.
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Item 1A.
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Item 2.
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Item 6.
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March 31,
2012 |
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December 31,
2011 |
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ASSETS
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CURRENT ASSETS:
|
|
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|
||||
Cash and cash equivalents
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$
|
76.3
|
|
|
$
|
86.6
|
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Receivables, net
|
518.1
|
|
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587.4
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Inventory
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1,984.6
|
|
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1,809.2
|
|
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Other current assets
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202.8
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193.0
|
|
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Total Current Assets
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2,781.8
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2,676.2
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PROPERTY AND EQUIPMENT, net of accumulated depreciation of $773.9 million and $756.8 million, respectively
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1,960.9
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1,950.7
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GOODWILL
|
1,172.2
|
|
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1,172.2
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|
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OTHER INTANGIBLE ASSETS, NET
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217.5
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|
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217.8
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|
||
OTHER ASSETS
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200.0
|
|
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181.9
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Total Assets
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$
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6,332.4
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$
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6,198.8
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LIABILITIES AND SHAREHOLDERS’ EQUITY
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CURRENT LIABILITIES:
|
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|
||||
Vehicle floorplan payable - trade
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$
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1,412.0
|
|
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$
|
1,362.3
|
|
Vehicle floorplan payable - non-trade
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604.3
|
|
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536.5
|
|
||
Accounts payable
|
217.2
|
|
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202.4
|
|
||
Current maturities of long-term obligations
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31.7
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|
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12.6
|
|
||
Other current liabilities
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396.6
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|
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348.8
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Total Current Liabilities
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2,661.8
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2,462.6
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LONG-TERM DEBT, NET OF CURRENT MATURITIES
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1,887.2
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1,634.4
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DEFERRED INCOME TAXES
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65.5
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62.3
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OTHER LIABILITIES
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149.8
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144.9
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COMMITMENTS AND CONTINGENCIES (Note 10)
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SHAREHOLDERS’ EQUITY:
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|
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Preferred stock, par value $0.01 per share; 5,000,000 shares authorized; none issued
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—
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—
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Common stock, par value $0.01 per share; 1,500,000,000 shares authorized; 163,562,149 shares issued at March 31, 2012, and December 31, 2011, including shares held in treasury
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1.6
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1.6
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Additional paid-in capital
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20.7
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19.6
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Retained earnings
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2,719.6
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2,646.6
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Treasury stock, at cost; 39,293,562 and 27,777,625 shares held, respectively
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(1,173.8
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)
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(773.2
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)
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Total Shareholders’ Equity
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1,568.1
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1,894.6
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Total Liabilities and Shareholders’ Equity
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$
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6,332.4
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$
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6,198.8
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Three Months Ended
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||||||
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March 31,
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||||||
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2012
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|
2011
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||||
Revenue:
|
|
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|
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New vehicle
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$
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1,994.3
|
|
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$
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1,785.1
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Used vehicle
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918.8
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831.4
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Parts and service
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599.9
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570.0
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Finance and insurance, net
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130.2
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110.7
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Other
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13.8
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13.9
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TOTAL REVENUE
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3,657.0
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3,311.1
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|
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Cost of sales:
|
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New vehicle
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1,860.3
|
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1,659.8
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Used vehicle
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837.7
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753.3
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Parts and service
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349.7
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325.5
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Other
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6.3
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6.3
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TOTAL COST OF SALES
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3,054.0
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2,744.9
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Gross Profit:
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New vehicle
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134.0
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125.3
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Used vehicle
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81.1
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78.1
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Parts and service
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250.2
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244.5
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Finance and insurance
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130.2
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110.7
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Other
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7.5
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7.6
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TOTAL GROSS PROFIT
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603.0
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566.2
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Selling, general, and administrative expenses
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432.9
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407.7
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Depreciation and amortization
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21.2
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20.7
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Other expenses (income), net
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0.2
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(2.2
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)
|
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OPERATING INCOME
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148.7
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140.0
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Non-operating income (expense) items:
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|
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Floorplan interest expense
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(10.7
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)
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(11.2
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)
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Other interest expense
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(20.5
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)
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(16.3
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)
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Interest income
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0.1
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0.3
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Other income, net
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2.0
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1.7
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INCOME FROM CONTINUING OPERATIONS BEFORE INCOME TAXES
|
119.6
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114.5
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Income tax provision
|
46.1
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44.2
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NET INCOME FROM CONTINUING OPERATIONS
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73.5
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70.3
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|
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Loss from discontinued operations, net of income taxes
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(0.5
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)
|
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(0.9
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)
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NET INCOME
|
$
|
73.0
|
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$
|
69.4
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BASIC EARNINGS (LOSS) PER SHARE:
|
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|
|
||||
Continuing operations
|
$
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0.56
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$
|
0.47
|
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Discontinued operations
|
$
|
—
|
|
|
$
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(0.01
|
)
|
Net income
|
$
|
0.56
|
|
|
$
|
0.47
|
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Weighted average common shares outstanding
|
130.3
|
|
|
149.1
|
|
||
DILUTED EARNINGS (LOSS) PER SHARE:
|
|
|
|
||||
Continuing operations
|
$
|
0.56
|
|
|
$
|
0.46
|
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Discontinued operations
|
$
|
—
|
|
|
$
|
(0.01
|
)
|
Net income
|
$
|
0.55
|
|
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$
|
0.46
|
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Weighted average common shares outstanding
|
132.3
|
|
|
151.8
|
|
||
COMMON SHARES OUTSTANDING, net of treasury stock
|
124.3
|
|
|
148.6
|
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Common Stock
|
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Additional
Paid-In
Capital
|
|
Retained
Earnings
|
|
Treasury
Stock
|
|
Total
|
|||||||||||||
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Shares
|
|
Amount
|
|
|
|
|
|||||||||||||||
December 31, 2011
|
163,562,149
|
|
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$
|
1.6
|
|
|
$
|
19.6
|
|
|
$
|
2,646.6
|
|
|
$
|
(773.2
|
)
|
|
$
|
1,894.6
|
|
Net income
|
—
|
|
|
—
|
|
|
—
|
|
|
73.0
|
|
|
—
|
|
|
73.0
|
|
|||||
Repurchases of common stock
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(405.7
|
)
|
|
(405.7
|
)
|
|||||
Stock-based compensation expense
|
—
|
|
|
—
|
|
|
5.8
|
|
|
—
|
|
|
—
|
|
|
5.8
|
|
|||||
Shares awarded under stock-based compensation plans, including excess income tax benefit of $0.1
|
—
|
|
|
—
|
|
|
(4.7
|
)
|
|
—
|
|
|
5.1
|
|
|
0.4
|
|
|||||
March 31, 2012
|
163,562,149
|
|
|
$
|
1.6
|
|
|
$
|
20.7
|
|
|
$
|
2,719.6
|
|
|
$
|
(1,173.8
|
)
|
|
$
|
1,568.1
|
|
|
Three Months Ended
|
||||||
|
March 31,
|
||||||
|
2012
|
|
2011
|
||||
CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES:
|
|
|
|
||||
Net income
|
$
|
73.0
|
|
|
$
|
69.4
|
|
Adjustments to reconcile net income to net cash provided by operating activities:
|
|
|
|
||||
Loss from discontinued operations
|
0.5
|
|
|
0.9
|
|
||
Depreciation and amortization
|
21.2
|
|
|
20.7
|
|
||
Amortization of debt issuance costs and discounts
|
1.3
|
|
|
1.1
|
|
||
Stock-based compensation expense
|
5.8
|
|
|
5.9
|
|
||
Deferred income tax provision
|
3.2
|
|
|
3.0
|
|
||
Net gain on asset sales and dispositions
|
(0.1
|
)
|
|
(1.7
|
)
|
||
Other
|
(1.9
|
)
|
|
(2.2
|
)
|
||
(Increase) decrease, net of effects from business combinations and divestitures:
|
|
|
|
||||
Receivables
|
68.8
|
|
|
36.0
|
|
||
Inventory
|
(175.4
|
)
|
|
147.6
|
|
||
Other assets
|
(14.2
|
)
|
|
(9.3
|
)
|
||
Increase (decrease), net of effects from business combinations and divestitures:
|
|
|
|
||||
Vehicle floorplan payable-trade, net
|
49.7
|
|
|
(181.2
|
)
|
||
Accounts payable
|
16.8
|
|
|
47.6
|
|
||
Other liabilities
|
51.3
|
|
|
15.6
|
|
||
Net cash provided by continuing operations
|
100.0
|
|
|
153.4
|
|
||
Net cash provided by discontinued operations
|
0.1
|
|
|
0.1
|
|
||
Net cash provided by operating activities
|
100.1
|
|
|
153.5
|
|
||
CASH PROVIDED BY (USED IN) INVESTING ACTIVITIES:
|
|
|
|
||||
Purchases of property and equipment
|
(36.3
|
)
|
|
(24.7
|
)
|
||
Proceeds from the sale of property and equipment
|
0.5
|
|
|
1.1
|
|
||
Proceeds from assets held for sale
|
10.7
|
|
|
—
|
|
||
Cash used in business acquisitions, net of cash acquired
|
—
|
|
|
(64.2
|
)
|
||
Proceeds from the sale of restricted investments
|
0.4
|
|
|
—
|
|
||
Cash received from business divestitures, net of cash relinquished
|
—
|
|
|
1.2
|
|
||
Other
|
(0.1
|
)
|
|
(2.0
|
)
|
||
Net cash used in continuing operations
|
(24.8
|
)
|
|
(88.6
|
)
|
||
Net cash provided by discontinued operations
|
—
|
|
|
0.1
|
|
||
Net cash used in investing activities
|
(24.8
|
)
|
|
(88.5
|
)
|
|
Three Months Ended
|
||||||
|
March 31,
|
||||||
|
2012
|
|
2011
|
||||
CASH PROVIDED BY (USED IN) FINANCING ACTIVITIES:
|
|
|
|
||||
Repurchases of common stock
|
(400.5
|
)
|
|
(58.9
|
)
|
||
Proceeds from revolving credit facility
|
405.0
|
|
|
65.0
|
|
||
Payment of revolving credit facility
|
(500.0
|
)
|
|
(80.0
|
)
|
||
Proceeds from 5.5% Senior Notes due 2020
|
350.0
|
|
|
—
|
|
||
Payment of debt issuance costs
|
(6.0
|
)
|
|
—
|
|
||
Net proceeds from (payments of) vehicle floorplan payable - non-trade
|
67.8
|
|
|
(43.1
|
)
|
||
Payments of mortgage facilities
|
(2.0
|
)
|
|
(1.9
|
)
|
||
Payments of capital leases
|
(0.3
|
)
|
|
(0.2
|
)
|
||
Proceeds from the exercise of stock options
|
0.3
|
|
|
31.9
|
|
||
Excess tax benefit from stock-based awards
|
0.1
|
|
|
11.4
|
|
||
Net cash used in continuing operations
|
(85.6
|
)
|
|
(75.8
|
)
|
||
Net cash used in discontinued operations
|
—
|
|
|
—
|
|
||
Net cash used in financing activities
|
(85.6
|
)
|
|
(75.8
|
)
|
||
DECREASE IN CASH AND CASH EQUIVALENTS
|
(10.3
|
)
|
|
(10.8
|
)
|
||
CASH AND CASH EQUIVALENTS at beginning of period
|
86.6
|
|
|
95.1
|
|
||
CASH AND CASH EQUIVALENTS at end of period
|
$
|
76.3
|
|
|
$
|
84.3
|
|
1.
|
INTERIM FINANCIAL STATEMENTS
|
2.
|
RECEIVABLES, NET
|
|
March 31, 2012
|
|
December 31, 2011
|
||||
Trade receivables
|
$
|
93.8
|
|
|
$
|
94.3
|
|
Manufacturer receivables
|
125.8
|
|
|
138.4
|
|
||
Other
|
29.3
|
|
|
41.4
|
|
||
|
248.9
|
|
|
274.1
|
|
||
Less: Allowances
|
(2.8
|
)
|
|
(3.0
|
)
|
||
|
246.1
|
|
|
271.1
|
|
||
Contracts-in-transit and vehicle receivables
|
272.0
|
|
|
306.1
|
|
||
Income tax refundable (see Note 6)
|
—
|
|
|
10.2
|
|
||
Receivables, net
|
$
|
518.1
|
|
|
$
|
587.4
|
|
3.
|
INVENTORY AND VEHICLE FLOORPLAN PAYABLE
|
|
March 31, 2012
|
|
December 31, 2011
|
||||
New vehicles
|
$
|
1,556.3
|
|
|
$
|
1,397.1
|
|
Used vehicles
|
301.0
|
|
|
286.3
|
|
||
Parts, accessories, and other
|
127.3
|
|
|
125.8
|
|
||
|
$
|
1,984.6
|
|
|
$
|
1,809.2
|
|
|
March 31, 2012
|
|
December 31, 2011
|
||||
Vehicle floorplan payable - trade
|
$
|
1,412.0
|
|
|
$
|
1,362.3
|
|
Vehicle floorplan payable - non-trade
|
604.3
|
|
|
536.5
|
|
||
|
$
|
2,016.3
|
|
|
$
|
1,898.8
|
|
4.
|
GOODWILL AND INTANGIBLE ASSETS
|
|
March 31, 2012
|
|
December 31, 2011
|
||||
Goodwill
|
$
|
1,172.2
|
|
|
$
|
1,172.2
|
|
|
|
|
|
||||
Franchise rights - indefinite-lived
|
$
|
212.6
|
|
|
$
|
212.6
|
|
Other intangibles
|
8.4
|
|
|
8.4
|
|
||
|
221.0
|
|
|
221.0
|
|
||
Less: accumulated amortization
|
(3.5
|
)
|
|
(3.2
|
)
|
||
Other intangible assets, net
|
$
|
217.5
|
|
|
$
|
217.8
|
|
5.
|
LONG-TERM DEBT
|
|
March 31, 2012
|
|
December 31, 2011
|
||||
7% Senior Notes due 2014
|
$
|
14.7
|
|
|
$
|
14.7
|
|
6.75% Senior Notes due 2018
|
395.1
|
|
|
395.0
|
|
||
5.5% Senior Notes due 2020
|
350.0
|
|
|
—
|
|
||
Term loan facility due 2016
|
500.0
|
|
|
500.0
|
|
||
Revolving credit facility due 2016
|
400.0
|
|
|
495.0
|
|
||
Mortgage facility
(1)
|
209.5
|
|
|
211.5
|
|
||
Capital leases due from 2012 to 2031
|
49.6
|
|
|
30.8
|
|
||
|
1,918.9
|
|
|
1,647.0
|
|
||
Less: current maturities
|
(31.7
|
)
|
|
(12.6
|
)
|
||
Long-term debt, net of current maturities
|
$
|
1,887.2
|
|
|
$
|
1,634.4
|
|
(1)
|
The mortgage facility requires monthly principal and interest payments of
$1.7 million
based on a fixed amortization schedule with a balloon payment of
$155.4 million
due November 2017.
|
6.
|
INCOME TAXES
|
7.
|
SHAREHOLDERS’ EQUITY
|
|
Three Months Ended
|
||||||
|
March 31,
|
||||||
|
2012
|
|
2011
|
||||
Shares repurchased
|
11.7
|
|
|
1.8
|
|
||
Aggregate purchase price
|
$
|
405.4
|
|
|
$
|
58.8
|
|
Average purchase price per share
|
$
|
34.72
|
|
|
$
|
32.84
|
|
|
Three Months Ended
|
||||||
|
March 31,
|
||||||
|
2012
|
|
2011
|
||||
Shares issued
|
16,489
|
|
|
1.9
|
million
|
||
Proceeds from exercise of stock options
|
$
|
310,019
|
|
|
$
|
31.9
|
million
|
Average exercise price per share
|
$18.80
|
|
$16.86
|
|
Three Months Ended
|
||||
|
March 31,
|
||||
|
2012
|
|
2011
|
||
Shares issued
|
155,740
|
|
|
163,892
|
|
Shares surrendered to AutoNation to satisfy tax withholding obligations in connection with the vesting of restricted stock
|
8,632
|
|
|
8,289
|
|
8.
|
EARNINGS PER SHARE
|
|
Three Months Ended
|
||||
|
March 31,
|
||||
|
2012
|
|
2011
|
||
Weighted average common shares outstanding used in calculating basic earnings per share
|
130.3
|
|
|
149.1
|
|
Effect of dilutive stock options
|
2.0
|
|
|
2.7
|
|
Weighted average common and common equivalent shares used in calculating diluted earnings per share
|
132.3
|
|
|
151.8
|
|
|
Three Months Ended
|
||||
|
March 31,
|
||||
|
2012
|
|
2011
|
||
Anti-dilutive options excluded from the computation of diluted earnings per share
|
0.9
|
|
|
0.3
|
|
9.
|
ACQUISITIONS
|
10.
|
COMMITMENTS AND CONTINGENCIES
|
11.
|
DISCONTINUED OPERATIONS
|
12.
|
SEGMENT INFORMATION
|
|
Three Months Ended
|
||||||
|
March 31,
|
||||||
|
2012
|
|
2011
|
||||
Segment income*:
|
|
|
|
||||
Domestic
|
$
|
49.7
|
|
|
$
|
42.9
|
|
Import
|
61.9
|
|
|
55.0
|
|
||
Premium Luxury
|
58.8
|
|
|
57.7
|
|
||
Corporate and other
|
(32.4
|
)
|
|
(26.8
|
)
|
||
Total segment income
|
138.0
|
|
|
128.8
|
|
||
Other interest expense
|
(20.5
|
)
|
|
(16.3
|
)
|
||
Interest income
|
0.1
|
|
|
0.3
|
|
||
Other income, net
|
2.0
|
|
|
1.7
|
|
||
Income from continuing operations before income taxes
|
$
|
119.6
|
|
|
$
|
114.5
|
|
13.
|
BUSINESS AND CREDIT CONCENTRATIONS
|
14.
|
FINANCIAL INSTRUMENTS AND FAIR VALUE MEASUREMENTS
|
Level 1
|
Quoted prices in active markets for identical assets or liabilities
|
|
|
Level 2
|
Observable inputs other than Level 1 prices such as quoted prices for similar assets or liabilities; quoted market prices in markets that are not active; or model-derived valuations or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities
|
|
|
Level 3
|
Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities
|
•
|
Cash and cash equivalents, accounts receivable, other current assets, vehicle floorplan payable, accounts payable, other current liabilities, and variable rate debt
: The amounts reported in the accompanying Unaudited Condensed Consolidated Balance Sheets approximate fair value due to their short-term nature or the existence of variable interest rates that approximate prevailing market rates.
|
•
|
Fixed rate debt
: Our fixed rate debt consists of amounts outstanding under our senior unsecured notes, mortgages, and capital leases. We estimate the fair value of our senior unsecured notes using quoted prices for the identical liability (Level 1) and we estimate the fair value of our mortgages using a present value technique based on our current market interest rates for similar types of financial instruments (Level 2). A summary of the aggregate carrying values and fair values of our senior unsecured notes, mortgage facility, and capital leases are as follows:
|
|
March 31, 2012
|
|
December 31, 2011
|
||||
Carrying value
|
$
|
1,018.9
|
|
|
$
|
652.0
|
|
Fair value
|
$
|
1,059.7
|
|
|
$
|
675.6
|
|
15.
|
CASH FLOW INFORMATION
|
($ in millions, except per vehicle data)
|
Three Months Ended March 31,
|
|||||||||||||
2012
|
|
2011
|
|
Variance
Favorable /
(Unfavorable)
|
|
%
Variance
|
||||||||
Revenue:
|
|
|
|
|
|
|
|
|||||||
New vehicle
|
$
|
1,994.3
|
|
|
$
|
1,785.1
|
|
|
$
|
209.2
|
|
|
11.7
|
|
Used vehicle
|
918.8
|
|
|
831.4
|
|
|
87.4
|
|
|
10.5
|
|
|||
Parts and service
|
599.9
|
|
|
570.0
|
|
|
29.9
|
|
|
5.2
|
|
|||
Finance and insurance, net
|
130.2
|
|
|
110.7
|
|
|
19.5
|
|
|
17.6
|
|
|||
Other
|
13.8
|
|
|
13.9
|
|
|
(0.1
|
)
|
|
|
||||
Total revenue
|
$
|
3,657.0
|
|
|
$
|
3,311.1
|
|
|
$
|
345.9
|
|
|
10.4
|
|
Gross profit:
|
|
|
|
|
|
|
|
|||||||
New vehicle
|
$
|
134.0
|
|
|
$
|
125.3
|
|
|
$
|
8.7
|
|
|
6.9
|
|
Used vehicle
|
81.1
|
|
|
78.1
|
|
|
3.0
|
|
|
3.8
|
|
|||
Parts and service
|
250.2
|
|
|
244.5
|
|
|
5.7
|
|
|
2.3
|
|
|||
Finance and insurance
|
130.2
|
|
|
110.7
|
|
|
19.5
|
|
|
17.6
|
|
|||
Other
|
7.5
|
|
|
7.6
|
|
|
(0.1
|
)
|
|
|
||||
Total gross profit
|
603.0
|
|
|
566.2
|
|
|
36.8
|
|
|
6.5
|
|
|||
Selling, general and administrative expenses
|
432.9
|
|
|
407.7
|
|
|
(25.2
|
)
|
|
(6.2
|
)
|
|||
Depreciation and amortization
|
21.2
|
|
|
20.7
|
|
|
(0.5
|
)
|
|
|
||||
Other expenses (income), net
|
0.2
|
|
|
(2.2
|
)
|
|
(2.4
|
)
|
|
|
||||
Operating income
|
148.7
|
|
|
140.0
|
|
|
8.7
|
|
|
6.2
|
|
|||
Non-operating income (expense) items:
|
|
|
|
|
|
|
|
|||||||
Floorplan interest expense
|
(10.7
|
)
|
|
(11.2
|
)
|
|
0.5
|
|
|
|
||||
Other interest expense
|
(20.5
|
)
|
|
(16.3
|
)
|
|
(4.2
|
)
|
|
|
||||
Interest income
|
0.1
|
|
|
0.3
|
|
|
(0.2
|
)
|
|
|
||||
Other income, net
|
2.0
|
|
|
1.7
|
|
|
0.3
|
|
|
|
||||
Income from continuing operations before income taxes
|
$
|
119.6
|
|
|
$
|
114.5
|
|
|
$
|
5.1
|
|
|
4.5
|
|
Retail vehicle unit sales:
|
|
|
|
|
|
|
|
|||||||
New vehicle
|
61,516
|
|
|
55,710
|
|
|
5,806
|
|
|
10.4
|
|
|||
Used vehicle
|
46,116
|
|
|
42,089
|
|
|
4,027
|
|
|
9.6
|
|
|||
|
107,632
|
|
|
97,799
|
|
|
9,833
|
|
|
10.1
|
|
|||
Revenue per vehicle retailed:
|
|
|
|
|
|
|
|
|||||||
New vehicle
|
$
|
32,419
|
|
|
$
|
32,043
|
|
|
$
|
376
|
|
|
1.2
|
|
Used vehicle
|
$
|
17,371
|
|
|
$
|
17,282
|
|
|
$
|
89
|
|
|
0.5
|
|
Gross profit per vehicle retailed:
|
|
|
|
|
|
|
|
|||||||
New vehicle
|
$
|
2,178
|
|
|
$
|
2,249
|
|
|
$
|
(71
|
)
|
|
(3.2
|
)
|
Used vehicle
|
$
|
1,702
|
|
|
$
|
1,753
|
|
|
$
|
(51
|
)
|
|
(2.9
|
)
|
Finance and insurance
|
$
|
1,210
|
|
|
$
|
1,132
|
|
|
$
|
78
|
|
|
6.9
|
|
|
Three Months Ended
|
||
|
March 31,
|
||
|
2012 (%)
|
|
2011 (%)
|
Revenue mix percentages:
|
|
|
|
New vehicle
|
54.5
|
|
53.9
|
Used vehicle
|
25.1
|
|
25.1
|
Parts and service
|
16.4
|
|
17.2
|
Finance and insurance, net
|
3.6
|
|
3.3
|
Other
|
0.4
|
|
0.5
|
Total
|
100.0
|
|
100.0
|
Gross profit mix percentages:
|
|
|
|
New vehicle
|
22.2
|
|
22.1
|
Used vehicle
|
13.4
|
|
13.8
|
Parts and service
|
41.5
|
|
43.2
|
Finance and insurance
|
21.6
|
|
19.6
|
Other
|
1.3
|
|
1.3
|
Total
|
100.0
|
|
100.0
|
Operating items as a percentage of revenue:
|
|
|
|
Gross profit:
|
|
|
|
New vehicle
|
6.7
|
|
7.0
|
Used vehicle - retail
|
9.8
|
|
10.1
|
Parts and service
|
41.7
|
|
42.9
|
Total
|
16.5
|
|
17.1
|
Selling, general and administrative expenses
|
11.8
|
|
12.3
|
Operating income
|
4.1
|
|
4.2
|
Operating items as a percentage of total gross profit:
|
|
|
|
Selling, general and administrative expenses
|
71.8
|
|
72.0
|
Operating income
|
24.7
|
|
24.7
|
|
March 31, 2012
|
|
March 31, 2011
|
Days supply:
|
|
|
|
New vehicle (industry standard of selling days, including fleet)
|
54 days
|
|
50 days
|
Used vehicle (trailing 31 days)
(1)
|
29 days
|
|
33 days
|
(1)
|
As of December 31, 2011, we have revised our method of calculating used vehicle days supply from a dollar day supply to a unit day supply (including wholesale units). We have revised prior periods to conform to our revised method of calculation.
|
|
Three Months Ended March 31,
|
||||||||||
($ in millions)
|
2012
|
|
2011
|
|
Variance
|
||||||
Floorplan assistance
|
$
|
17.2
|
|
|
$
|
15.3
|
|
|
$
|
1.9
|
|
Floorplan interest expense (new vehicles)
|
(10.4
|
)
|
|
(10.6
|
)
|
|
0.2
|
|
|||
Net new vehicle inventory carrying benefit
|
$
|
6.8
|
|
|
$
|
4.7
|
|
|
$
|
2.1
|
|
|
Three Months Ended March 31,
|
|||||||||||||
($ in millions, except per vehicle data)
|
2012
|
|
2011
|
|
Variance
Favorable /
(Unfavorable)
|
|
%
Variance
|
|||||||
Revenue:
|
|
|
|
|
|
|
|
|||||||
New vehicle
|
$
|
1,958.5
|
|
|
$
|
1,785.1
|
|
|
$
|
173.4
|
|
|
9.7
|
|
Used vehicle
|
900.1
|
|
|
831.4
|
|
|
68.7
|
|
|
8.3
|
|
|||
Parts and service
|
593.0
|
|
|
570.0
|
|
|
23.0
|
|
|
4.0
|
|
|||
Finance and insurance, net
|
128.4
|
|
|
110.7
|
|
|
17.7
|
|
|
16.0
|
|
|||
Other
|
13.7
|
|
|
13.9
|
|
|
(0.2
|
)
|
|
|
||||
Total revenue
|
$
|
3,593.7
|
|
|
$
|
3,311.1
|
|
|
$
|
282.6
|
|
|
8.5
|
|
Gross profit:
|
|
|
|
|
|
|
|
|||||||
New vehicle
|
$
|
131.7
|
|
|
$
|
125.3
|
|
|
$
|
6.4
|
|
|
5.1
|
|
Used vehicle
|
79.8
|
|
|
78.1
|
|
|
1.7
|
|
|
2.2
|
|
|||
Parts and service
|
247.1
|
|
|
244.5
|
|
|
2.6
|
|
|
1.1
|
|
|||
Finance and insurance
|
128.4
|
|
|
110.7
|
|
|
17.7
|
|
|
16.0
|
|
|||
Other
|
7.5
|
|
|
7.6
|
|
|
(0.1
|
)
|
|
|
||||
Total gross profit
|
$
|
594.5
|
|
|
$
|
566.2
|
|
|
$
|
28.3
|
|
|
5.0
|
|
Retail vehicle unit sales:
|
|
|
|
|
|
|
|
|||||||
New vehicle
|
60,327
|
|
|
55,710
|
|
|
4,617
|
|
|
8.3
|
|
|||
Used vehicle
|
45,495
|
|
|
42,089
|
|
|
3,406
|
|
|
8.1
|
|
|||
|
105,822
|
|
|
97,799
|
|
|
8,023
|
|
|
8.2
|
|
|||
Revenue per vehicle retailed:
|
|
|
|
|
|
|
|
|||||||
New vehicle
|
$
|
32,465
|
|
|
$
|
32,043
|
|
|
$
|
422
|
|
|
1.3
|
|
Used vehicle
|
$
|
17,347
|
|
|
$
|
17,282
|
|
|
$
|
65
|
|
|
0.4
|
|
Gross profit per vehicle retailed:
|
|
|
|
|
|
|
|
|||||||
New vehicle
|
$
|
2,183
|
|
|
$
|
2,249
|
|
|
$
|
(66
|
)
|
|
(2.9
|
)
|
Used vehicle
|
$
|
1,697
|
|
|
$
|
1,753
|
|
|
$
|
(56
|
)
|
|
(3.2
|
)
|
Finance and insurance
|
$
|
1,213
|
|
|
$
|
1,132
|
|
|
$
|
81
|
|
|
7.2
|
|
|
Three Months Ended
|
||
|
March 31,
|
||
|
2012 (%)
|
|
2011 (%)
|
Revenue mix percentages:
|
|
|
|
New vehicle
|
54.5
|
|
53.9
|
Used vehicle
|
25.0
|
|
25.1
|
Parts and service
|
16.5
|
|
17.2
|
Finance and insurance, net
|
3.6
|
|
3.3
|
Other
|
0.4
|
|
0.5
|
Total
|
100.0
|
|
100.0
|
Gross profit mix percentages:
|
|
|
|
New vehicle
|
22.2
|
|
22.1
|
Used vehicle
|
13.4
|
|
13.8
|
Parts and service
|
41.6
|
|
43.2
|
Finance and insurance
|
21.6
|
|
19.6
|
Other
|
1.2
|
|
1.3
|
Total
|
100.0
|
|
100.0
|
Operating items as a percentage of revenue:
|
|
|
|
Gross profit:
|
|
|
|
New vehicle
|
6.7
|
|
7.0
|
Used vehicle - retail
|
9.8
|
|
10.1
|
Parts and service
|
41.7
|
|
42.9
|
Total
|
16.5
|
|
17.1
|
|
Three Months Ended March 31,
|
|||||||||||||
($ in millions, except per vehicle data)
|
2012
|
|
2011
|
|
Variance
Favorable /
(Unfavorable)
|
|
%
Variance
|
|||||||
Reported:
|
|
|
|
|
|
|
|
|||||||
Revenue
|
$
|
1,994.3
|
|
|
$
|
1,785.1
|
|
|
$
|
209.2
|
|
|
11.7
|
|
Gross profit
|
$
|
134.0
|
|
|
$
|
125.3
|
|
|
$
|
8.7
|
|
|
6.9
|
|
Retail vehicle unit sales
|
61,516
|
|
|
55,710
|
|
|
5,806
|
|
|
10.4
|
|
|||
Revenue per vehicle retailed
|
$
|
32,419
|
|
|
$
|
32,043
|
|
|
$
|
376
|
|
|
1.2
|
|
Gross profit per vehicle retailed
|
$
|
2,178
|
|
|
$
|
2,249
|
|
|
$
|
(71
|
)
|
|
(3.2
|
)
|
Gross profit as a percentage of revenue
|
6.7
|
%
|
|
7.0
|
%
|
|
|
|
|
|||||
Days supply (industry standard of selling days, including fleet)
|
54 days
|
|
|
50 days
|
|
|
|
|
|
|||||
|
Three Months Ended March 31,
|
|||||||||||||
|
2012
|
|
2011
|
|
Variance
Favorable /
(Unfavorable)
|
|
%
Variance
|
|||||||
Same Store:
|
|
|
|
|
|
|
|
|||||||
Revenue
|
$
|
1,958.5
|
|
|
$
|
1,785.1
|
|
|
$
|
173.4
|
|
|
9.7
|
|
Gross profit
|
$
|
131.7
|
|
|
$
|
125.3
|
|
|
$
|
6.4
|
|
|
5.1
|
|
Retail vehicle unit sales
|
60,327
|
|
|
55,710
|
|
|
4,617
|
|
|
8.3
|
|
|||
Revenue per vehicle retailed
|
$
|
32,465
|
|
|
$
|
32,043
|
|
|
$
|
422
|
|
|
1.3
|
|
Gross profit per vehicle retailed
|
$
|
2,183
|
|
|
$
|
2,249
|
|
|
$
|
(66
|
)
|
|
(2.9
|
)
|
Gross profit as a percentage of revenue
|
6.7
|
%
|
|
7.0
|
%
|
|
|
|
|
|
Three Months Ended March 31,
|
||||||||||
($ in millions)
|
2012
|
|
2011
|
|
Variance
|
||||||
Floorplan assistance
|
$
|
17.2
|
|
|
$
|
15.3
|
|
|
$
|
1.9
|
|
Floorplan interest expense (new vehicles)
|
(10.4
|
)
|
|
(10.6
|
)
|
|
0.2
|
|
|||
Net new vehicle inventory carrying benefit
|
$
|
6.8
|
|
|
$
|
4.7
|
|
|
$
|
2.1
|
|
|
Three Months Ended March 31,
|
||||||||||||
($ in millions)
|
2012
|
|
2011
|
|
Variance
Favorable /
(Unfavorable)
|
|
%
Variance
|
||||||
Reported:
|
|
|
|
|
|
|
|
||||||
Revenue
|
$
|
599.9
|
|
|
$
|
570.0
|
|
|
$
|
29.9
|
|
|
5.2
|
Gross Profit
|
$
|
250.2
|
|
|
$
|
244.5
|
|
|
$
|
5.7
|
|
|
2.3
|
Gross profit as a percentage of revenue
|
41.7
|
%
|
|
42.9
|
%
|
|
|
|
|
||||
Same Store:
|
|
|
|
|
|
|
|
||||||
Revenue
|
$
|
593.0
|
|
|
$
|
570.0
|
|
|
$
|
23.0
|
|
|
4.0
|
Gross Profit
|
$
|
247.1
|
|
|
$
|
244.5
|
|
|
$
|
2.6
|
|
|
1.1
|
Gross profit as a percentage of revenue
|
41.7
|
%
|
|
42.9
|
%
|
|
|
|
|
|
Three Months Ended March 31,
|
||||||||||||
($ in millions, except per vehicle data)
|
2012
|
|
2011
|
|
Variance
Favorable /
(Unfavorable)
|
|
%
Variance
|
||||||
Reported:
|
|
|
|
|
|
|
|
||||||
Revenue and gross profit
|
$
|
130.2
|
|
|
$
|
110.7
|
|
|
$
|
19.5
|
|
|
17.6
|
Gross profit per vehicle retailed
|
$
|
1,210
|
|
|
$
|
1,132
|
|
|
$
|
78
|
|
|
6.9
|
Same Store:
|
|
|
|
|
|
|
|
||||||
Revenue and gross profit
|
$
|
128.4
|
|
|
$
|
110.7
|
|
|
$
|
17.7
|
|
|
16.0
|
Gross profit per vehicle retailed
|
$
|
1,213
|
|
|
$
|
1,132
|
|
|
$
|
81
|
|
|
7.2
|
|
Three Months Ended March 31,
|
||||||||||||
($ in millions)
|
2012
|
|
2011
|
|
Variance
Favorable /
(Unfavorable)
|
|
%
Variance
|
||||||
Revenue
|
$
|
1,229.1
|
|
|
$
|
1,096.3
|
|
|
$
|
132.8
|
|
|
12.1
|
Segment income
|
$
|
49.7
|
|
|
$
|
42.9
|
|
|
$
|
6.8
|
|
|
15.9
|
Retail new vehicle unit sales
|
20,513
|
|
|
17,736
|
|
|
2,777
|
|
|
15.7
|
|
Three Months Ended March 31,
|
||||||||||||
($ in millions)
|
2012
|
|
2011
|
|
Variance
Favorable /
(Unfavorable)
|
|
%
Variance
|
||||||
Revenue
|
$
|
1,366.6
|
|
|
$
|
1,257.6
|
|
|
$
|
109.0
|
|
|
8.7
|
Segment income
|
$
|
61.9
|
|
|
$
|
55.0
|
|
|
$
|
6.9
|
|
|
12.5
|
Retail new vehicle unit sales
|
31,038
|
|
|
29,230
|
|
|
1,808
|
|
|
6.2
|
|
Three Months Ended March 31,
|
||||||||||||
($ in millions)
|
2012
|
|
2011
|
|
Variance
Favorable /
(Unfavorable)
|
|
%
Variance
|
||||||
Revenue
|
$
|
1,022.2
|
|
|
$
|
918.1
|
|
|
$
|
104.1
|
|
|
11.3
|
Segment income
|
$
|
58.8
|
|
|
$
|
57.7
|
|
|
$
|
1.1
|
|
|
1.9
|
Retail new vehicle unit sales
|
9,965
|
|
|
8,744
|
|
|
1,221
|
|
|
14.0
|
|
Three Months Ended March 31,
|
|||||||||||||
($ in millions)
|
2012
|
|
2011
|
|
Variance
Favorable /
(Unfavorable)
|
|
%
Variance
|
|||||||
Reported:
|
|
|
|
|
|
|
|
|||||||
Compensation
|
$
|
289.9
|
|
|
$
|
269.9
|
|
|
$
|
(20.0
|
)
|
|
(7.4
|
)
|
Advertising
|
31.7
|
|
|
30.9
|
|
|
(0.8
|
)
|
|
(2.6
|
)
|
|||
Store and corporate overhead
|
111.3
|
|
|
106.9
|
|
|
(4.4
|
)
|
|
(4.1
|
)
|
|||
Total
|
$
|
432.9
|
|
|
$
|
407.7
|
|
|
$
|
(25.2
|
)
|
|
(6.2
|
)
|
|
|
|
|
|
|
|
|
|||||||
SG&A as a % of total gross profit:
|
|
|
|
|
|
|
|
|||||||
Compensation
|
48.1
|
|
|
47.7
|
|
|
(40
|
)
|
|
bps
|
||||
Advertising
|
5.3
|
|
|
5.5
|
|
|
20
|
|
|
bps
|
||||
Store and corporate overhead
|
18.4
|
|
|
18.8
|
|
|
40
|
|
|
bps
|
||||
Total
|
71.8
|
|
|
72.0
|
|
|
20
|
|
|
bps
|
(In millions)
|
March 31, 2012
|
|
December 31, 2011
|
|
||||
Cash and Cash Equivalents
|
$
|
76.3
|
|
|
$
|
86.6
|
|
|
Revolving Credit Facility
|
$
|
495.0
|
|
(1)
|
$
|
648.5
|
|
(2)
|
Secured Used Vehicle Floorplan Facilities
(3)
|
$
|
74.0
|
|
|
$
|
75.4
|
|
|
(1)
|
As limited by the applicable maximum leverage ratio contained in our credit agreement. See “Long-Term Debt – Credit Agreement” for additional information.
|
(2)
|
Based on aggregate borrowings outstanding of
$495.0 million
and outstanding letters of credit of
$56.5 million
at
December 31, 2011
. See “Long-Term Debt – Credit Agreement” for additional information.
|
(3)
|
Based on the eligible used vehicle inventory that could have been pledged as collateral. See “Long-Term Debt – Vehicle Floorplan Payable” for additional information.
|
|
Three Months Ended
|
||||||
|
March 31,
|
||||||
(In millions, except per share data)
|
2012
|
|
2011
|
||||
Shares repurchased
|
11.7
|
|
|
1.8
|
|
||
Aggregate purchase price
|
$
|
405.4
|
|
|
$
|
58.8
|
|
Average purchase price per share
|
$
|
34.72
|
|
|
$
|
32.84
|
|
|
Three Months Ended
|
||||||
|
March 31,
|
||||||
(In millions)
|
2012
|
|
2011
|
||||
Purchases of property and equipment, including operating lease buy-outs
(1)
|
$
|
29.1
|
|
|
$
|
24.7
|
|
(1)
|
Includes accrued construction in progress and excludes property acquired under capital leases.
|
|
Three Months Ended
|
||||||
|
March 31,
|
||||||
(In millions)
|
2012
|
|
2011
|
||||
Cash received from (used in) business acquisitions, net
|
$
|
—
|
|
|
$
|
(64.2
|
)
|
Cash received from (used in) business divestitures, net
|
$
|
—
|
|
|
$
|
1.2
|
|
(In millions)
|
March 31, 2012
|
|
December 31, 2011
|
||||
7% Senior Notes due 2014
|
$
|
14.7
|
|
|
$
|
14.7
|
|
6.75% Senior Notes due 2018
|
395.1
|
|
|
395.0
|
|
||
5.5% Senior Notes due 2020
|
350.0
|
|
|
—
|
|
||
Term loan facility due 2016
|
500.0
|
|
|
500.0
|
|
||
Revolving credit facility due 2016
|
400.0
|
|
|
495.0
|
|
||
Mortgage facility
(1)
|
209.5
|
|
|
211.5
|
|
||
Capital leases due from 2012 to 2031
|
49.6
|
|
|
30.8
|
|
||
|
1,918.9
|
|
|
1,647.0
|
|
||
Less: current maturities
|
(31.7
|
)
|
|
(12.6
|
)
|
||
Long-term debt, net of current maturities
|
$
|
1,887.2
|
|
|
$
|
1,634.4
|
|
(1)
|
The mortgage facility requires monthly principal and interest payments of $1.7 million based on a fixed amortization schedule with a balloon payment of $155.4 million due November 2017.
|
|
Three Months Ended
|
||||||
|
March 31,
|
||||||
(In millions)
|
2012
|
|
2011
|
||||
Net cash provided by operating activities
|
$
|
100.1
|
|
|
$
|
153.5
|
|
Net cash used in investing activities
|
$
|
(24.8
|
)
|
|
$
|
(88.5
|
)
|
Net cash used in financing activities
|
$
|
(85.6
|
)
|
|
$
|
(75.8
|
)
|
•
|
The automotive retail industry is sensitive to changing economic conditions and various other factors. Our business and results of operations are substantially dependent on new vehicle sales levels in the United States and in our
|
•
|
Our results of operations and financial condition have been and could continue to be adversely affected by the unfavorable economic conditions in the United States and/or Europe.
|
•
|
Our debt agreements contain certain financial ratios and other restrictions on our ability to conduct our business, and our substantial indebtedness could adversely affect our financial condition and operations and prevent us from fulfilling our debt service obligations.
|
•
|
We are dependent upon the success and continued financial viability of the vehicle manufacturers and distributors with which we hold franchises.
|
•
|
Goodwill and other intangible assets comprise a significant portion of our total assets. We must test our goodwill and other intangible assets for impairment at least annually, which could result in a material, non-cash write-down of goodwill or franchise rights and could have a material adverse impact on our results of operations and shareholders’ equity.
|
•
|
Our new vehicle sales are impacted by the consumer incentive and marketing programs of vehicle manufacturers.
|
•
|
Natural disasters and adverse weather events can disrupt our business.
|
•
|
We are subject to restrictions imposed by, and significant influence from, vehicle manufacturers that may adversely impact our business, financial condition, results of operations, cash flows, and prospects, including our ability to acquire additional stores.
|
•
|
We are subject to numerous legal and administrative proceedings, which, if the outcomes are adverse to us, could materially adversely affect our business, results of operations, financial condition, cash flows, and prospects.
|
•
|
Our operations are subject to extensive governmental laws and regulations. If we are found to be in violation of or subject to liabilities under any of these laws or regulations, or if new laws or regulations are enacted that adversely affect our operations, our business, operating results, and prospects could suffer.
|
•
|
We are subject to interest rate risk in connection with our vehicle floorplan payables, revolving credit facility, and term loan facility that could have a material adverse effect on our profitability.
|
•
|
Our largest stockholders, as a result of their ownership stakes in us, have the ability to exert substantial influence over actions to be taken or approved by our stockholders. These stockholders are represented on our Board of Directors and, therefore, may also have the ability to exert substantial influence over actions to be taken or approved by our Board. In addition, future share repurchases and purchases by our affiliates could further reduce our public float and could adversely impact the liquidity of our common stock.
|
•
|
A failure of our information systems or any security breach or unauthorized disclosure of confidential information could have a material adverse effect on our business.
|
Period
|
Total Number of
Shares Purchased
(1)
|
|
Avg. Price
Paid Per
Share
|
|
Total Number of
Shares Purchased as
Part of Publicly
Announced Plans or
Programs
|
|
Approximate Dollar Value of
Shares That May Yet Be
Purchased Under The
Programs (in millions)
(1)
|
||||||
January 1, 2012 - January 31, 2012
|
3,564,919
|
|
|
$
|
34.77
|
|
|
3,564,052
|
|
|
$
|
275.9
|
|
February 1, 2012 - February 29, 2012
|
3,057,770
|
|
|
$
|
35.02
|
|
|
3,056,315
|
|
|
$
|
168.9
|
|
March 1, 2012 - March 31, 2012
|
5,064,452
|
|
|
$
|
34.49
|
|
|
5,058,142
|
|
|
$
|
244.4
|
|
Total
|
11,687,141
|
|
|
|
|
11,678,509
|
|
|
|
(1)
|
Our Board of Directors from time to time authorizes the repurchase of shares of our common stock up to a certain monetary limit. As of
December 31, 2011
,
$149.8 million
remained available under our stock repurchase authorization limit. On each of January 24, 2012 and March 23, 2012, our Board authorized the repurchase of an additional $250 million in shares of our common stock. As of March 31, 2012,
$244.4 million
remained available under our stock repurchase authorization limit. The Board’s authorization has no expiration date. In the
first
quarter of
2012
, all stock repurchases were made pursuant to our Board’s authorization, except for
8,632
shares that were surrendered to AutoNation to satisfy tax withholding obligations in connection with the vesting of restricted stock.
|
Exhibit No.
|
Description
|
|
|
3.1
|
Amended and Restated By-Laws of AutoNation, Inc. (incorporated by reference to Exhibit 3.1 to the Company’s Current Report on Form 8-K filed with the SEC on March 23, 2012)
|
4.1
|
Indenture, dated as of April 14, 2010, between AutoNation, Inc. and Wells Fargo Bank, National Association, as trustee (incorporated by reference to Exhibit 4.1 to the Company’s Current Report on Form 8-K filed withe SEC on April 15, 2010)
|
4.2
|
Supplemental Indenture, dated February 1, 2012, relating to the Company’s 5.5% Senior Notes due 2020 (incorporated by reference to Exhibit 4.2 to the Company’s Current Report on Form 8-K filed with the SEC on February 1, 2012)
|
4.3
|
Form of 5.5% Senior Notes due 2020 (included in Exhibit 4.1)
|
4.4*
|
Supplemental Indenture, dated March 7, 2012, relating to the Company’s 7% Senior Notes due 2014
|
4.5*
|
Supplemental Indenture, dated March 7, 2012, relating to the Company’s 6.75% Senior Notes due 2018
|
4.6*
|
Supplemental Indenture, dated March 7, 2012, relating to the Company’s 5.5% Senior Notes due 2020
|
10.1**
|
Employment Letter dated January 3, 2012, between AutoNation, Inc. and Alan J. McLaren, Senior Vice President, Customer Care (incorporated by reference to Exhibit 10.23 to the Company’s Annual Report on Form 10-K filed with the SEC on February 13, 2012)
|
10.2**
|
AutoNation, Inc. Senior Executive Incentive Bonus Plan, approved by the Company's Board of Directors on February 1, 2012, subject to stockholder approval (incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed with the SEC on February 2, 2012)
|
10.3**
|
Amendment to the AutoNation, Inc. 2007 Non-Employee Director Stock Option Plan, effective as of February 1, 2012 (incorporated by reference to Exhibit 10.2 to the Company’s Current Report on Form 8-K filed with the SEC on February 2, 2012)
|
31.1*
|
Certification of Chief Executive Officer Pursuant to Rule 13a-14(a) of the Exchange Act
|
31.2*
|
Certification of Chief Financial Officer Pursuant to Rule 13a-14(a) of the Exchange Act
|
32.1***
|
Certification of Chief Executive Officer Pursuant to Rule 13a-14(b) of the Exchange Act and 18 U.S.C. Section 1350
|
32.2***
|
Certification of Chief Financial Officer Pursuant to Rule 13a-14(b) of the Exchange Act and 18 U.S.C. Section 1350
|
101.INS†
|
XBRL Instance Document
|
101.SCH†
|
XBRL Taxonomy Extension Schema Document
|
101.CAL†
|
XBRL Taxonomy Extension Calculation Linkbase Document
|
101.DEF†
|
XBRL Taxonomy Extension Definition Linkbase Document
|
101.LAB†
|
XBRL Taxonomy Extension Label Linkbase Document
|
101.PRE†
|
XBRL Taxonomy Extension Presentation Linkbase Document
|
*
|
Filed herewith.
|
**
|
Management contract or compensatory plan or arrangement.
|
***
|
Furnished herewith.
|
†
|
Pursuant to Rule 406T of Regulation S-T, these interactive data files are deemed not filed or part of a registration statement or prospectus for purposes of Sections 11 or 12 of the Securities Act of 1933, are deemed not filed for purposes of Section 18 of the Securities Exchange Act of 1934 and otherwise are not subject to liability under those sections.
|
|
|
AUTONATION, INC.
|
|
|
|
|
|
Date:
|
April 25, 2012
|
By:
|
/s/ Michael J. Stephan
|
|
|
|
Michael J. Stephan
Vice President – Corporate Controller
|
|
|
|
|
|
|
|
(Duly Authorized Officer and
Principal Accounting Officer)
|
(a)
|
To jointly and severally Guarantee to each Holder of a Note authenticated and delivered by the Trustee and to the Trustee and its successors and assigns, irrespective of the validity and enforceability of the Indenture, the Notes or the obligations of the Company hereunder or thereunder, that:
|
(i)
|
the principal of and interest on the Notes will be promptly paid by the Company in full when due, whether at maturity, by acceleration, redemption or otherwise, and interest on the overdue principal of and interest on the Notes, if any, if lawful, and all other obligations of the Company to the Holders or the Trustee hereunder or thereunder will be promptly paid by the Company in full or performed by the Company, all in accordance with the terms hereof and thereof; and
|
(ii)
|
in case of any extension of time of payment or renewal of any Notes or any of such other obligations, that same will be promptly paid by the Company in full when due or performed by the Company in accordance with the terms of the extension or renewal, whether at stated maturity, by acceleration or otherwise. Failing payment when due by the Company of any amount so guaranteed or any performance so guaranteed which failure continues for three days after demand therefor is made to the Company for whatever reason, the Guarantors shall be jointly and severally obligated to pay the same immediately. Each Guarantor agrees that this is a guarantee of payment and not a guarantee of collection.
|
(b)
|
The obligations hereunder shall be unconditional, irrespective of the validity, regularity or enforceability of the Notes or the Indenture, the absence of any action to enforce the same, any waiver or consent by any Holder of the Notes with respect to any provisions hereof or thereof, the recovery of any judgment against the Company, any action to enforce the same or any other circumstance which might otherwise constitute a legal or equitable discharge or defense of a Guarantor.
|
(c)
|
The following is hereby waived: diligence, presentment, demand of payment (except as specifically provided in (a) above), filing of claims with a court in the event of insolvency or bankruptcy of the Company, any right to require a proceeding first against the Company, protest, notice and all demands (except as specifically provided in (a) above) whatsoever.
|
(d)
|
This Guarantee shall not be discharged except (i) by complete performance of the obligations contained in the Notes and the Indenture. Each Guarantor also expressly waives, without any requirement of any notice to or further assent by such Guarantor, to the fullest extent permitted by applicable law, the benefit of all principles or provisions of applicable law which are or might be in conflict with the terms hereof, including, without limitation, Section 10-7-23 and Section 10-7-24 of the Official Code of Georgia Annotated.
|
(e)
|
If any Holder or the Trustee is required by any court or otherwise to return to the Company, the Guarantors, or any Custodian, Trustee, liquidator or other similar official acting in relation to either the Company or the Guarantors, any amount paid by either to the Trustee or such Holder, this Guarantee, to the extent theretofore discharged, shall be reinstated in full force and effect.
|
(f)
|
The Guaranteeing Subsidiaries shall not be entitled to any right of subrogation in relation to the Holders in respect of any obligations guaranteed hereby until payment in full of all obligations guaranteed hereby.
|
(g)
|
As between the Guarantors, on the one hand, and the Holders and the Trustee, on the other hand, (x) the maturity of the obligations guaranteed hereby may be accelerated as provided in Article 6 of the Indenture for the purposes of this Guarantee, notwithstanding any stay, injunction or other prohibition preventing such acceleration in respect of the obligations guaranteed hereby, and (y) in the event of any declaration of acceleration of such obligations as provided in Article 6 of the Indenture, such obligations (whether or not due and payable) shall forthwith become due and payable by the Guarantors for the purpose of this Guarantee, failing payment when due by the Company which failure continues for three days after demand therefor is made to the Company.
|
(h)
|
The Guarantors shall have the right to seek contribution from any non-paying Guarantor so long as the exercise of such right does not impair the rights of the Holders under the Guarantee.
|
By:
|
/s/ C. Coleman G. Edmunds
|
By:
|
/s/ C. Coleman G. Edmunds
|
By:
|
/s/ Cheryl Scully
|
By:
|
/s/ Stefan Victory
|
(a)
|
To jointly and severally Guarantee to each Holder of a Note authenticated and delivered by the Trustee and to the Trustee and its successors and assigns, irrespective of the validity and enforceability of the Indenture, the Notes or the obligations of the Company hereunder or thereunder, that:
|
(i)
|
the principal of and interest on the Notes shall be promptly paid by the Company in full when due, whether at maturity, by acceleration, redemption or otherwise, and interest on the overdue principal of and interest on the Notes, if any, if lawful, and all other obligations of the Company to the Holders or the Trustee hereunder or thereunder shall be promptly paid by the Company in full or performed by the Company, all in accordance with the terms hereof and thereof; and
|
(ii)
|
in case of any extension of time of payment or renewal of any Notes or any of such other obligations, that same shall be promptly paid by the Company in full when due or performed by the Company in accordance with the terms of the extension or renewal, whether at stated maturity, by acceleration or otherwise. Failing payment when due by the Company of any amount so guaranteed or any performance so guaranteed which failure continues for three days after demand therefor is made to the Company for whatever reason, the Guarantors shall be jointly and severally obligated to pay the same immediately. Each Guarantor agrees that this is a guarantee of payment and not a guarantee of collection.
|
(b)
|
The obligations hereunder shall be unconditional, irrespective of the validity, regularity or enforceability of the Notes or the Indenture, the absence of any action to enforce the same, any waiver or consent by any Holder of the Notes with respect to any provisions hereof or thereof, the recovery of any judgment against the Company, any action to enforce the same or any other circumstance which might otherwise constitute a legal or equitable discharge or defense of a Guarantor.
|
(c)
|
The following is hereby waived: diligence, presentment, demand of payment (except as specifically provided in (a) above), filing of claims with a court in the event of insolvency or bankruptcy of the Company, any right to require a proceeding first against the Company, protest, notice and all demands (except as specifically provided in (a) above) whatsoever.
|
(d)
|
This Guarantee shall not be discharged except (i) by complete performance of the obligations contained in the Notes and the Indenture. Each Guarantor also expressly waives, without any requirement of any notice to or further assent by such Guarantor, to the fullest extent permitted by applicable law, the benefit of all principles or provisions of applicable law which are or might be in conflict with the terms hereof, including, without limitation, Section 10-7-23 and Section 10-7-24 of the Official Code of Georgia Annotated.
|
(e)
|
If any Holder or the Trustee is required by any court or otherwise to return to the Company, the Guarantors, or any Custodian, Trustee, liquidator or other similar official acting in relation to either the Company or the Guarantors, any amount paid by either to the Trustee or such Holder, this Guarantee, to the extent theretofore discharged, shall be reinstated in full force and effect.
|
(f)
|
The Guaranteeing Subsidiaries shall not be entitled to any right of subrogation in relation to the Holders in respect of any obligations guaranteed hereby until payment in full of all obligations guaranteed hereby.
|
(g)
|
As between the Guarantors, on the one hand, and the Holders and the Trustee, on the other hand, (x) the maturity of the obligations guaranteed hereby may be accelerated as provided in Article VII of the Base Indenture for the purposes of this Guarantee, notwithstanding any stay, injunction or other prohibition preventing such acceleration in respect of the obligations guaranteed hereby, and (y) in the event of any declaration of acceleration of such obligations as provided in Article VII of the Base Indenture, such obligations (whether or not due and payable) shall forthwith become due and payable by the Guarantors for the purpose of this Guarantee, failing payment when due by the Company which failure continues for three days after demand therefor is made to the Company.
|
(h)
|
The Guarantors shall have the right to seek contribution from any non-paying Guarantor so long as the exercise of such right does not impair the rights of the Holders under the Guarantee.
|
By:
|
/s/ C. Coleman G. Edmunds
|
By:
|
/s/ C. Coleman G. Edmunds
|
By:
|
/s/ Cheryl Scully
|
By:
|
/s/ Stefan Victory
|
(a)
|
To jointly and severally Guarantee to each Holder of a Note authenticated and delivered by the Trustee and to the Trustee and its successors and assigns, irrespective of the validity and enforceability of the Indenture, the Notes or the obligations of the Company hereunder or thereunder, that:
|
(i)
|
the principal of and interest on the Notes shall be promptly paid by the Company in full when due, whether at maturity, by acceleration, redemption or otherwise, and interest on the overdue principal of and interest on the Notes, if any, if lawful, and all other obligations of the Company to the Holders or the Trustee hereunder or thereunder shall be promptly paid by the Company in full or performed by the Company, all in accordance with the terms hereof and thereof; and
|
(ii)
|
in case of any extension of time of payment or renewal of any Notes or any of such other obligations, that same shall be promptly paid by the Company in full when due or performed by the Company in accordance with the terms of the extension or renewal, whether at stated maturity, by acceleration or otherwise. Failing payment when due by the Company of any amount so guaranteed or any performance so guaranteed which failure continues for three days after demand therefor is made to the Company for whatever reason, the Guarantors shall be jointly and severally obligated to pay the same immediately. Each Guarantor agrees that this is a guarantee of payment and not a guarantee of collection.
|
(b)
|
The obligations hereunder shall be unconditional, irrespective of the validity, regularity or enforceability of the Notes or the Indenture, the absence of any action to enforce the same, any waiver or consent by any Holder of the Notes with respect to any provisions hereof or thereof, the recovery of any judgment against the Company, any action to enforce the same or any other circumstance which might otherwise constitute a legal or equitable discharge or defense of a Guarantor.
|
(c)
|
The following is hereby waived: diligence, presentment, demand of payment (except as specifically provided in (a) above), filing of claims with a court in the event of insolvency or bankruptcy of the Company, any right to require a proceeding first against the Company, protest, notice and all demands (except as specifically provided in (a) above) whatsoever.
|
(d)
|
This Guarantee shall not be discharged except (i) by complete performance of the obligations contained in the Notes and the Indenture. Each Guarantor also expressly waives, without any requirement of any notice to or further assent by such Guarantor, to the fullest extent permitted by applicable law, the benefit of all principles or provisions of applicable law which are or might be in conflict with the terms hereof, including, without limitation, Section 10-7-23 and Section 10-7-24 of the Official Code of Georgia Annotated.
|
(e)
|
If any Holder or the Trustee is required by any court or otherwise to return to the Company, the Guarantors, or any Custodian, Trustee, liquidator or other similar official acting in relation to either the Company or the Guarantors, any amount paid by either to the Trustee or such Holder, this Guarantee, to the extent theretofore discharged, shall be reinstated in full force and effect.
|
(f)
|
The Guaranteeing Subsidiaries shall not be entitled to any right of subrogation in relation to the Holders in respect of any obligations guaranteed hereby until payment in full of all obligations guaranteed hereby.
|
(g)
|
As between the Guarantors, on the one hand, and the Holders and the Trustee, on the other hand, (x) the maturity of the obligations guaranteed hereby may be accelerated as provided in Article VII of the Base Indenture for the purposes of this Guarantee, notwithstanding any stay, injunction or other prohibition preventing such acceleration in respect of the obligations guaranteed hereby, and (y) in the event of any declaration of acceleration of such obligations as provided in Article VII of the Base Indenture, such obligations (whether or not due and payable) shall forthwith become due and payable by the Guarantors for the purpose of this Guarantee, failing payment when due by the Company which failure continues for three days after demand therefor is made to the Company.
|
(h)
|
The Guarantors shall have the right to seek contribution from any non-paying Guarantor so long as the exercise of such right does not impair the rights of the Holders under the Guarantee.
|
By:
|
/s/ C. Coleman G. Edmunds
|
By:
|
/s/ C. Coleman G. Edmunds
|
By:
|
/s/ Cheryl Scully
|
By:
|
/s/ Stefan Victory
|
1.
|
I have reviewed this quarterly report on Form 10-Q of AutoNation, Inc.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c)
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d)
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
/s/ Michael J. Jackson
|
Michael J. Jackson
|
Chairman and Chief Executive Officer
|
1.
|
I have reviewed this quarterly report on Form 10-Q of AutoNation, Inc.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c)
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d)
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
/s/ Michael J. Short
|
Michael J. Short
|
Executive Vice President and Chief Financial Officer
|
(1)
|
the Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and
|
(2)
|
the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
|
/s/ Michael J. Jackson
|
Michael J. Jackson
|
Chairman and Chief Executive Officer
|
(1)
|
the Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and
|
(2)
|
the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
|
/s/ Michael J. Short
|
Michael J. Short
|
Executive Vice President and Chief Financial Officer
|