PENSKE AUTOMOTIVE GROUP, INC. (Form: 8-K, Received: 02/08/2023 12:02:23)

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934



Date of Report (Date of Earliest Event Reported):			February 6, 2023

Penske Automotive Group, Inc.

(Exact name of registrant as specified in its charter)

Delaware

1-12297

22-3086739

(State or other jurisdiction

(Commission

(I.R.S. Employer

of incorporation)

File Number)

Identification No.)

2555 Telegraph Road,

Bloomfield Hills, Michigan

48302

(Address of principal executive offices)

(Zip Code)

Registrant's telephone number, including area code:

248-648-2500

Not Applicable

Former name or former address, if changed since last report

Securities registered pursuant to Section 12(b) of the Act:



Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Voting Common Stock, par value $0.0001 per share	PAG	New York Stock Exchange

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

☐ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

☐ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

☐ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

☐ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Item 1.01 Entry into a Material Definitive Agreement.

Amendment No. 1 to PTS Partnership Agreement.

On February 6, 2023, we, Penske Truck Leasing Corporation, PTL GP, LLC and MBK USA Commercial Vehicles Inc. (“Mitsui MBK”) amended the Seventh Amended and Restated Agreement of Limited Partnership of Penske Truck Leasing Co., L.P. (the “PTS Partnership Agreement”). Penske Transportation Solutions (“PTS”) is the universal brand name for Penske Truck Leasing Co., L.P.'s various business lines. We hold a 28.9% ownership interest in PTS, with the remaining 41.1% owned by subsidiaries of Penske Corporation and 30.0% owned by Mitsui MBK. The PTS Partnership Agreement was amended principally to augment PTS' governance to replace a six-member advisory committee with an eleven-member advisory board. We retain the right to appoint one advisory board member and appointed Robert H. Kurnick, Jr., our President. Lisa Davis, one of our directors, was also appointed to the expanded advisory board. The amendments also authorize the advisory board to appoint committees with such powers and authority of the advisory board granted to the committee by the advisory board. We are entitled to designate a non-voting observer to all committees as long as we retain the right to appoint an advisory board member.

The PTS Partnership Agreement continues to provide us with the right to pro rata quarterly distributions equal to at least 50% of PTS' consolidated net income, as well as specified minority rights which require our and/or Mitsui MBK's consent for certain actions taken by PTS as specified in the PTS Partnership Agreement. We may to transfer our directly owned interests in PTS with the unanimous consent of the other partners, or if we provide the remaining partners with a right of first offer to acquire our interests, except that we may transfer up to 9.02% of our interest to Penske Corporation without complying with the right of first offer to the remaining partners. We and Penske Corporation have previously agreed that (1) in the event of any transfer by Penske Corporation of their partnership interests to a third party, we will be entitled to “tag-along” by transferring a pro rata amount of our partnership interests on similar terms and conditions, and (2) Penske Corporation is entitled to a right of first refusal in the event of any transfer of our partnership interests, subject to the terms of the PTS Partnership Agreement. Additionally, PTS has agreed to indemnify the general partner for any actions in connection with managing PTS, except those taken in bad faith or in violation of the PTS Partnership Agreement.

The PTS Partnership Agreement allows Penske Corporation to give notice to require PTS to begin to effect an initial public offering of equity securities, subject to certain limitations, as soon as practicable after the first anniversary of the initial notice, and, beginning in 2025, we and Mitsui MBK continue to have a similar right to require PTS to begin an initial public offering of equity securities, subject to certain limitations, as soon as reasonably practicable.

The foregoing description of the PTS Partnership Agreement, as amended, is qualified in its entirety by reference to Amendment No. 1 to the PTS Partnership Agreement, a copy of which is filed as an exhibit and incorporated by reference herein, and the PTS Partnership Agreement, a copy of which is filed as exhibit 10.3 to our Current Report on Form 8-K filed with the Securities and Exchange Commission on September 8, 2017 and is incorporated herein by reference.

Related Party Disclosure.

The following disclosure provides a brief description of certain related party arrangements between us, Mitsui, PTS and Penske Corporation. For additional disclosure, see the “Related Party Transactions” section of our proxy statement filed on March 18, 2022, which is incorporated herein by reference.

Stockholders Agreement. Entities affiliated with Roger Penske, our Chair of the Board and Chief Executive Officer, are parties to a stockholders agreement described below. Mr. Penske is also Chair of the Board and Chief Executive Officer of Penske Corporation, and, through entities affiliated with Penske Corporation, our largest stockholder. The parties to the stockholders agreement are Mitsui & Co., Ltd., Mitsui & Co, (USA), Inc. (collectively, “Mitsui”), Penske Corporation and Penske Automotive Holdings Corp. (collectively the “Penske companies”).

Pursuant to the stockholders agreement, which expires March 26, 2030, the Penske companies agreed to vote their shares for two directors who are representatives of Mitsui as long as Mitsui owns in excess of 20% of our

outstanding common stock, and for one director as long as Mitsui owns in excess of 10% of our outstanding common stock. Mitsui agreed to vote its shares for up to fourteen directors voted for by the Penske companies. In addition, the Penske companies agreed that if they transfer any of our shares of common stock, Mitsui would be entitled to “tag along” by transferring a pro rata amount of its shares upon similar terms and conditions, subject to certain limitations. We and Mitsui have agreed that Mitsui has a right to (1) an observer at all of our Board of Directors meetings so long as Mitsui owns at least 2.5% of our outstanding common stock, and (2) designate a senior executive so long as Mitsui owns at least 10% of our outstanding common stock.

Registration Rights Agreements. Both the Penske companies and Mitsui possess registration rights pursuant to which they are able on two remaining occasions each to register all or part of our common stock held by them, subject to specified limitations. They are also entitled to request inclusion of all or any part of their common stock in any registration of securities by us on Forms S-1 or S-3 under the Securities Act of 1933, as amended.

Other Related Party Interests. Several of our directors and officers are affiliated with Penske Corporation or related entities. The Vice Chair of our Board of Directors, Greg Penske, is the son of our CEO, Roger S. Penske, and Greg Penske also serves as a director of Penske Corporation. Robert H. Kurnick, Jr., our President and a Director, is also the Vice Chair and a Director of Penske Corporation. Mr. Denker, our Executive Vice President – Human Resources is the President of Penske Corporation. Mr. Eisenson, one of our directors, is a director of Penske Corporation. These employees or directors may receive salary, bonus or other compensation from Penske Corporation or its affiliates unrelated to their service at Penske Automotive.

Penske Transportation Solutions. Certain rights and obligations set forth in the PTS Partnership Agreement, as amended, are disclosed above. Our Chair and Chief Executive Officer also serves as Chair of PTS, for which he is compensated by PTS. Our Australian subsidiary, Penske Transportation Group International owns a 28.33% interest in a joint venture with a PTS subsidiary to lease trucks in Australia and New Zealand. The joint venture combines our sales expertise in Australia with PTS' truck leasing experience. We continue to be party to a stockholder's agreement relating to this investment that provides us with specified distribution and governance rights and restricts our ability to transfer our interests.

We are party to a license agreement with an affiliate of Penske Corporation for a license of the “Penske Automotive” name. This agreement provides us with a perpetual license of the name “Penske Automotive” and related trade names so long as Penske Corporation and its affiliates own in excess of 20% of our outstanding common stock and we adhere to the other terms of the license agreement. From time to time, we enter into arrangements with PTS and/or other Penske Corporation affiliates and third-party vendors in order to achieve the benefits of scale or synergy opportunities as between the companies. These arrangements are reviewed by the Board in accordance with our written related party transaction policy. For example, we aggregate several Penske entities in connection with sourcing certain telecommunications services to achieve the benefits of scale.

On December 16, 2021, we entered into a Services Agreement with Mitsui under which Mitsui employee Kota Odagiri, one of our directors, assists us in strategic development of business opportunities and relationships in transportation related industries and the evaluation of new technologies in the automotive and trucking sectors.

Item 2.02 Results of Operations and Financial Condition.

On February 8, 2023, we issued a press release announcing our fourth quarter and full year 2022 financial results and other information. A copy of the press release is furnished as Exhibit 99.1.

The information contained in Item 2.02 of this Current Report on Form 8-K shall not be deemed "filed" for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), or incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act, except as shall be expressly set forth by specific reference in such a filing.

Item 7.01 Regulation FD Disclosure.

The information set forth in Item 2.02 is incorporated into this Item 7.01 by reference.

Item 8.01 Other Events.

Investors and others should note that we announce material financial information using our company website (www.penskeautomotive.com), our investor relations website (investors.penskeautomotive.com), SEC filings, press releases, public conference calls, and webcasts. Information about Penske Automotive Group, Inc. ("Penske Automotive"), its business, and its results of operations may also be announced by posts on the following social media channels:

● Penske Automotive's Twitter feed (www.twitter.com/penskecars)

● Penske Automotive's Facebook page (www.facebook.com/penskecars)

● Penske Automotive's Instagram page (www.instagram.com/penskecars)

● Penske Automotive's Social website (www.penskesocial.com)

The information that we post on these social media channels could be deemed to be material information. As a result, we encourage investors, the media, and others interested in Penske Automotive to review the information that we post on these social media channels. These channels may be updated from time to time on Penske Automotive's investor relations website.

Item 9.01 Financial Statements and Exhibits.

(d) Exhibits

Exhibit Index



Exhibit No.						Description
10.1						Amendment No. 1 , dated February 6, 202 3 , to Seventh Amended and Restated Agreement of Limited Partnership of Penske Truck Leasing Co., L.P., dated September 8, 2017, by and among Penske Truck Leasing Corporation, PTL GP, LLC, MBK USA Commercial Vehicles Inc. and us .
99.1						Press Release.
104						Cover Page Interactive Data File (formatted as inline XBRL).

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.



	Penske Automotive Group, Inc.

February 8, 2023	By:	/s/ Shane M. Spradlin
		Name: Shane M. Spradlin
		Title: Executive Vice President

Exhibit 10.1

EXECUTION VERSION

AMENDMENT NO. 1

SEVENTH AMENDED AND RESTATED

AGREEMENT OF LIMITED PARTNERSHIP

PENSKE TRUCK LEASING CO., L.P.

THIS AMENDMENT NO. 1 (this “Amendment”) to that certain SEVENTH AMENDED AND RESTATED AGREEMENT OF LIMITED PARTNERSHIP dated as of September 7, 2017 (the “Original Agreement”), is made as of the 6th day of February, 2023 (the “Effective Time”) by and among Penske Truck Leasing Corporation, a Delaware corporation with its offices at 2675 Morgantown Road, Reading, Pennsylvania 19607 (as further defined in the Original Agreement, “PTLC”), PTL GP, LLC, a Delaware limited liability company (formerly known as LJ VP, LLC) with its offices at 2675 Morgantown Road, Reading, Pennsylvania 19607 (as further defined in the Original Agreement, “PTL GP”), Penske Automotive Group, Inc., a Delaware corporation with its offices at 2555 Telegraph Road, Bloomfield Hills, Michigan 48302 (as further defined in the Original Agreement, “PAG”), and MBK USA Commercial Vehicles Inc., a Delaware corporation, with its offices at 2-1, Otemachi 1-chome, Chiyoda-ku Tokyo, Japan (as further defined in the Original Agreement, “MBK USA CV”).

WITNESSETH:

WHEREAS, the Original Agreement provides for an Advisory Committee consisting of up to six (6) members;

WHEREAS, the Partners desire to change the name and membership of the Advisory Committee, to add additional members and provide for the creation of committees;

WHEREAS, this Amendment modifies certain provisions of Sections 2.1, 6.4 and 6.5 of the Original Agreement; and

NOW, THEREFORE, in consideration of the foregoing premises, the undertakings set forth and described herein, and for other good and valuable consideration, the receipt and sufficiency of which are hereby mutually acknowledged, the parties to the Original Agreement, intending to be legally bound, covenant and agree as follows, effective immediately:

1.Schedule B of the Partnership Agreement is hereby amended and restated in its entirety as set forth on Exhibit A to this Amendment.

2.The following defined terms are added to Section 2.1:

“Advisory Board” shall have the meaning ascribed to such term in Subsection 6.4(a).

“Mitsui Board Member” shall have the meaning ascribed to such term in Subsection 6.4(a).

“PAG Board Member” shall have the meaning ascribed to such term in Subsection 6.4(a).

“PTLC Board Member” shall have the meaning ascribed to such term in Subsection 6.4(a).

3.Subsection 6.4(a) is amended in its entirety and replaced with the following:

Selection of the Advisory Board. The Partnership shall have an Advisory Board (the “Advisory Board”) consisting as of the Effective Time of eleven (11) members. Of the eleven (11) Advisory Board members, nine (9) shall be designated by PTLC (each, a “PTLC Board Member”). One (1) member of the Advisory Board shall be designated by PAG and shall be the “PAG Board Member”, and one (1) member shall be designated by MBK USA CV and shall be the “Mitsui Board Member”. Schedule B annexed hereto sets forth the members of the Advisory Board as of the Effective Time.

4.Subsection 6.4(b)(i)(A) is amended in its entirety and replaced with the following:

“at any meeting of the Advisory Board at which an action requiring Unanimous Approval shall be considered, the presence of at least eight (8) members of the Advisory Board, including the PAG Board Member and the Mitsui Board Member, shall be a quorum for the consideration of such action;”

5.Subsection 6.4(b)(i)(B) is amended in its entirety and replaced with the following:

“at any meeting of the Advisory Board at which an action requiring Requisite Approval shall be considered, the presence of at least five (5) PTLC Board Members and fifty percent (50%) of the members of the Advisory Board designated by Significant Limited Partners, shall be a quorum for the consideration of such actions; and”

6.Subsection 6.4(b)(i)(C) is amended in its entirety and replaced with the following:

“at any other meeting of the Advisory Board, including a meeting at which an action requiring Majority Approval shall be considered, the presence of at least eight (8) members of the Advisory Board shall be a quorum for the consideration of such action or for the conduct of any other business.”

7.Subsection 6.4(k) is added as follows:

(k)Committees. The Advisory Board may appoint any committees from time to time as it may by Majority Approval approve, which as of the Effective Time includes an audit committee (the “Audit Committee”), and may include additional committees as the Advisory Board determines (such committees, collectively with the Audit Committee, the “Committees”). The Committees shall have duly adopted charters, which may be amended by the Advisory Board. Each such committee shall consist of such members of the Advisory Board as the Advisory Board shall determine from time to time. Any member of a committee may be removed, or any authority granted thereto may be revoked, at any time for any or no reason by Majority Approval.

(i) Any such Committee, to the extent provided in the approving resolution of the Advisory Board, shall, subject in all events to Section 6.5, have and may exercise all the powers and authority of the Advisory Board in the management of the business and affairs of the Partnership. Unless the Advisory Board provides otherwise, at all meetings of such Committee, a majority of the then authorized members of the Committee shall constitute a quorum for the transaction of business, and the vote of a majority of the members of the committee present at any meeting at which there is a quorum shall be the act of the committee.

(ii) Each Committee shall keep regular minutes of its meetings and, except as otherwise provided in the resolutions of the Advisory Board establishing such committee, will report the same to the Advisory Board as requested by the Advisory Board or as otherwise required.

(iii) Unless the Advisory Board otherwise provides, each Committee designated by the Advisory Board may make, alter and repeal rules for the conduct of its business. In the absence of such rules each committee will conduct its business in the same manner as the Advisory Board conducts its business under this Agreement.

(iv) Each Partner, for so long as it has the right to appoint a member of the Advisory Board pursuant to Subsection 6.4(a), may designate one person to attend as a non-voting observer each meeting of any Committee of which an Advisory Board member appointed by such Partner is not a member. Such observer shall not be a member of such Committee and shall not have any voting or consent rights to which members of such Committee are entitled. Such observer shall be entitled to receive all materials and information distributed to the members of such Committee (in such capacity); provided that that the General Partner may exclude any such observers from any portion of any meeting of such Committee, or deny access to any information or portions thereof provided to members of such Committee, if the General Partner reasonably determines that the participation of such observer, or access to the applicable information, could reasonably be expected to result in a waiver of the attorney-client privilege (based on the advice of the Partnership’s counsel) with respect to any matters to be discussed or any matters included in the information to be distributed. Each such observer shall have the same obligation to keep confidential any information furnished to it in connection with its role as an observer as members of the Advisory Board have in regard to such information.

8.The first paragraph of Subsection 6.5(c) is amended in its entirety and replaced with the following:

“Subject to Subsection 6.4(h), the General Partner shall not have the authority to do any of the following without the prior approval of at least five (5) PTLC Board Members, the PAG Board Member and the Mitsui Board Member, obtained in accordance with Subsections 6.4(b) and 6.4(c) (“Unanimous Approval”):”

9.The first paragraph of Subsection 6.5(d) is amended in its entirety and replaced with the following:

“Subject to Subsections 6.4(h) and 6.5(c), the General Partner shall not have the authority to do any of the following without the prior approval of at least five (5) PTLC Board Members and at least fifty percent (50%) of the members of the Advisory Board designated by the Significant Limited Partners, obtained in accordance with Subsections 6.4(b) and 6.4(c) (“Requisite Approval”):”

10.The first paragraph of Subsection 6.5(e) is amended in its entirety and replaced with the following:

“Notwithstanding any other provision of this Agreement, other than Subsections 6.4(h), 6.5(c) and 6.5(d), the General Partner shall not have authority to do any of the following without the prior approval of any six (6) members of the Advisory Board, obtained in accordance with Subsections 6.4(b) and 6.4(c) (“Majority Approval”):”

11.The defined term “Advisory Committee” is hereby deleted in its entirety from the Original Agreement and all references to the “Advisory Committee” in the Original Agreement are hereby replaced with the term “Advisory Board.”

12.The defined term “Mitsui Committee Member” is hereby deleted in its entirety from the Original Agreement and all references to the “Mitsui Committee Member” in the Original Agreement are hereby replaced with the term “Mitsui Board Member.”

13.The defined term “PAG Committee Member” is hereby deleted in its entirety from the Original Agreement and all references to the “PAG Committee Member” in the Original Agreement are hereby replaced with the term “PAG Board Member.”

14.The defined term “PTLC Committee Member” is hereby deleted in its entirety from the Original Agreement and all references to the “PTLC Committee Member” in the Original Agreement are hereby replaced with the term “PTLC Board Member.”

15. Entire Understanding; Amendments. Except as expressly amended by this Amendment, the Original Agreement remains in full force and effect. The Original Agreement as amended by this Agreement constitutes the entire understanding among the parties hereto relative to the subject matter thereof.

16.Advice of Counsel. Each of the parties hereto acknowledges that it has been advised by counsel in connection with the execution of this Amendment and is not relying upon oral representations or statements inconsistent with the terms and provisions of this Amendment.

17.Severability. If any part of this Amendment is contrary to, prohibited by, or deemed invalid under applicable Laws as defined in the Original Agreement, such provision shall be inapplicable and deemed omitted to the extent so contrary, prohibited or invalid, but the remainder hereof shall not be invalidated thereby and shall be given effect so far as possible.

18.Captions; Interpretation. The captions at various places in this Amendment are intended for convenience only and do not constitute and shall not be interpreted as part of this Amendment. For the avoidance of doubt, any reference to “the date hereof” or “the date of this Agreement” included in the amended provisions of the Original Agreement as set forth above is a reference to September 7, 2017 and not the Effective Time.

19.Counterparts; Electronic Signatures. This Amendment may be executed in any number of separate counterparts and by different parties hereto on separate counterparts, each of which, when so executed, shall be deemed an original, but all such counterparts shall constitute one and the same agreement. Delivery of a counterpart hereto by facsimile transmission or by electronic transmission of an Adobe portable document format file (also known as a “PDF file”) shall be as effective as delivery of an original counterpart hereto.

20.GOVERNING LAW. THIS AMENDMENT SHALL BE GOVERNED BY, AND CONSTRUED AND ENFORCED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF DELAWARE APPLIED TO CONTRACTS TO BE PERFORMED WHOLLY WITHIN THE STATE OF DELAWARE AND WITHOUT REFERENCE TO ANY CONFLICT OF LAW RULES THAT MIGHT LEAD TO THE APPLICATION OF THE LAWS OF ANY OTHER JURISDICTION.

Signatures begin on next page

IN WITNESS WHEREOF, the parties hereto have executed this Amendment as of the Effective Time.

GENERAL PARTNER:

PTL GP, LLC

By: LJ VP Holdings LLC,
its sole member

By: Penske Truck Leasing Corporation,
its sole managing member

By: /s/ Brian Hard

Name: Brian Hard
Title: President

LIMITED PARTNER:

PENSKE TRUCK LEASING
CORPORATION

By: /s/ Brian Hard

Name: Brian Hard
Title: President

LIMITED PARTNER:

PENSKE AUTOMOTIVE GROUP, INC.

By: /s/ Shelley Hulgrave

Name: Shelley Hulgrave
Title: EVP and Chief Financial Officer

LIMITED PARTNER:

MBK USA COMMERCIAL VEHICLES INC.

By: /s/ Hidenori Yamano

Name: Hidenori Yamano
Title: CEO

Schedule B

Effective as of the Effective Time

Members of Advisory Board


PTLC Board Members:			Roger S. Penske (Chair) Roger S. Penske, Jr. (Vice Chair) J. Patrick Conroy (Vice Chair) Stephen R. D’Arcy Lisa Davis Michael R. Eisenson John L. Flannery Brian Hard Charles G. McClure

PAG Board Member:			Robert H. Kurnick, Jr.


Mitsui Board Member:			Daisuke Hori

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EXHIBIT 99.1




FOR IMMEDIATE RELEASE

PENSKE AUTOMOTIVE GROUP REPORTS RECORD RESULTS

Record Q4 Revenue and Earnings Per Share

Q4 Revenue Increased 11% to $7.0 Billion; Earnings Per Share Increased 6% to $4.21

Full Year 2022 Record Results for Revenue, Earnings Before Taxes, Income From Continuing Operations, and Earnings Per Share

Full Year 2022 Revenue Increased 9% to $27.8 Billion; Earnings Before Taxes Increased 16% to $1.9 Billion

Full Year 2022 Income From Continuing Operations Increased 16% to $1.4 Billion

Full Year 2022 Earnings Per Share Increased 25% to $18.55

Repurchased 8.2 Million Shares of Common Stock for $886.5 Million During 2022

BLOOMFIELD HILLS, MI, February 8, 2023 – Penske Automotive Group, Inc. (NYSE: PAG), a diversified international transportation services company and one of the world’s premier automotive and commercial truck retailers, today announced fourth quarter and twelve months 2022 results. For the quarter, revenue increased 11% to $7.0 billion, and related earnings per share increased 6% to $4.21 from $3.97 when compared to the same period of 2021. Foreign currency exchange negatively impacted revenue by $380.9 million and earnings per share by $0.09. Excluding the impact from foreign currency exchange, revenues increased 17%, and earnings per share increased approximately 8%.

Fourth Quarter 2022 Operating Highlights Compared to Fourth Quarter 2021

(Percentage Change Excluding Foreign Currency Exchange Shown in Parenthesis)

•Retail Automotive Same-Store Revenue – increased 4% (+10%)

•New Vehicle +13% (+18%); Used Vehicle -9% (-2%); Finance & Insurance -1% (+4%); Service & Parts +6% (+11%)

•Retail Automotive Same-Store Gross Profit – decreased 5% (flat)

•New Vehicle +4% (+9%); Used Vehicle -43% (-39%); Finance & Insurance -1% (+4%); Service & Parts +6% (+11%)

•Retail Commercial Truck Same-Store Revenue – increased 33%

•New Vehicle +53%; Used Vehicle -40%; Finance & Insurance -19%; Service & Parts +16%

Commenting on the Company's performance, Chair and CEO Roger Penske said, "Our international diversified transportation services company produced record results in 2022. We retailed more than 447,000 new and used vehicles through our retail automotive operations and over 20,000 new and used commercial trucks through our commercial truck dealerships while our investment in Penske Transportation Solutions continues to benefit from the growth in its vehicle fleet. I am also pleased to report a strong fourth quarter driven by demand for new vehicles in both our automotive and commercial truck dealerships coupled with continued service and parts revenue growth and expense control. On a same-store basis, fourth quarter retail automotive new unit sales increased 11% and commercial truck new units increased 36% while service and parts revenue increased 6% for retail automotive and 16% for commercial trucks."

For the twelve months ended December 31, 2022, revenue increased 9% to $27.8 billion. Income from continuing operations before taxes increased 16% to $1,859.2 million from $1,607.7 million, income from continuing operations attributable to common stockholders increased 16% to $1,380.0 million from $1,186.5 million, and related earnings per share


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increased 25% to $18.55 from $14.88 when compared to the same period last year. Foreign currency exchange negatively impacted revenue by $1.0 billion, income from continuing operations before taxes by $38.0 million, income from continuing operations attributable to common stockholders by $29.4 million, and earnings per share by $0.40. Excluding the impact from foreign currency exchange, revenues increased 13%, income from continuing operations before taxes increased 18%, income from continuing operations attributable to common stockholders increased 19%, and earnings per share increased approximately 27%.

Full Year 2022 Operating Highlights Compared to Full Year 2021

(Percentage Change Excluding Foreign Currency Exchange Shown in Parenthesis)

•Retail Automotive Same-Store Revenue – increased 1% (+6%)

•New Vehicle -3% (+1%); Used Vehicle +2% (+8%); Finance & Insurance +5% (+10%); Service & Parts +7% (+11%)

•Retail Automotive Same-Store Gross Profit – increased 2% (+7%)

•New Vehicle +14% (+18%); Used Vehicle -21% (-17%); Finance & Insurance +5% (+10%); Service & Parts +5% (+9%)

•Retail Commercial Truck Same-Store Revenue – increased 29%

•New Vehicle +37%; Used Vehicle -5%; Finance & Insurance +7%; Service & Parts +22%

Retail Automotive Dealerships

For the three months ended December 31, 2022, total retail automotive revenue increased 8% to $5.9 billion, including a 4% increase on a same-store basis. Total retail automotive gross profit decreased 1% to $1.0 billion, including a 5% decrease on a same-store basis. Excluding the impact from foreign currency exchange, total retail automotive revenue increased 14% (same-store +10%) and total retail automotive gross profit increased 4% (same-store flat).

Retail Commercial Truck Dealerships

As of December 31, 2022, Premier Truck Group operated 39 North American retail commercial truck locations. For the three months ended December 31, 2022, revenue increased 40% to $960.8 million, same-store revenue increased 33% to $887.4 million, and earnings before taxes increased 14% to $51.1 million when compared to the same period in 2021. For the twelve months ended December 31, 2022, revenue increased 44% to $3.5 billion, same-store revenue increased 29% to $2.8 billion, and earnings before taxes increased 34% to $214.7 million when compared to the same period in 2021.

Penske Transportation Solutions Investment

Penske Transportation Solutions (“PTS”) is a leading provider of full-service truck leasing, truck rental, contract maintenance, and logistics services. Penske Automotive Group has a 28.9% ownership interest in PTS and accounts for its ownership interest using the equity method of accounting. For the three and twelve months ended December 31, 2022, the Company recorded $99.4 million and $490.0 million in earnings compared to $91.3 million and $365.8 million for the same periods in 2021, representing increases of 9% and 34%, respectively. During the fourth quarter, PTS continued to expand its managed fleet with over 414,500 trucks, tractors, and trailers under lease, rental, and/or maintenance contracts. The increase in earnings was principally driven by increased demand for PTS' full-service leasing, rental and logistics services, and remarketing of used trucks.

Corporate Development and Capital Allocation

For the twelve months ended December 31, 2022, the Company added approximately $1.3 billion in annualized revenue consisting of 19 retail automotive franchises, two open points, and four full-service dealerships for commercial trucks.

Based on the Company's strong earnings and cash flow, the Board of Directors has increased the quarterly dividend, most recently approving a 7% increase in the quarterly dividend to $0.61 per share. During the twelve months ended December 31, 2022, the Company repurchased 8.2 million shares of common stock for approximately $886.5 million. From January 1, 2023,


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through February 7, 2023, the Company repurchased an additional 0.6 million shares for an aggregate purchase price of $70.7 million under our securities repurchase program.

Conference Call

Penske Automotive Group will host a conference call discussing financial results relating to the fourth quarter of 2022 on Wednesday, February 8, 2023, at 2:00 p.m. Eastern Standard Time. To listen to the conference call, participants must dial (877) 336-4436 [International, please dial (234) 720-6984] using access code 440822. The call will also be simultaneously broadcast over the Internet, available through the Investors section of the Penske Automotive Group website. Additionally, an investor presentation relating to the fourth quarter 2022 financial results has been posted to the Investors section of 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 a diversified international transportation services company and one of the world's premier automotive and commercial truck retailers. PAG operates dealerships in the United States, the United Kingdom, Canada, Germany, Italy, and Japan and is one of the largest retailers of commercial trucks in North America for Freightliner. PAG also distributes and retails commercial vehicles, diesel and gas engines, power systems, and related parts and services principally in Australia and New Zealand. PAG employs over 26,500 people worldwide. Additionally, PAG owns 28.9% of Penske Transportation Solutions ("PTS"), a business that employs over 41,500 people worldwide, manages one of the largest, most comprehensive and modern trucking fleets in North America with over 414,500 trucks, tractors, and trailers under lease, rental, and/or maintenance contracts and provides innovative transportation, supply chain, and technology solutions to its customers. PAG is a member of the Fortune 500, Russell 1000, and Russell 3000 indexes. 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 adjusted income from continuing operations, adjusted earnings per share, earnings before interest, taxes, depreciation, and amortization (“EBITDA”), adjusted EBITDA, and leverage ratio. 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 financial performance and future plans. Actual results may vary materially because of risks and uncertainties that are difficult to predict. These risks and uncertainties include, among others, those related to macro-economic, geo-political and industry conditions and events, including their impact on new and used vehicle sales, the availability of consumer credit, changes in consumer demand, consumer confidence levels, fuel prices, personal discretionary spending levels, interest rates, and unemployment rates; our ability to obtain vehicles and parts from our manufacturers, especially in light of supply chain disruptions due to natural disasters, the shortage of microchips or other components, the COVID-19 pandemic, the war in Ukraine, challenges in sourcing labor, or other disruptions; changes in the retail model either


			3

from direct sales by manufacturers, a transition to an agency model of sales, sales by online competitors, or from the expansion of electric vehicles; the continued effect of COVID-19 on the global economy, including our ability to react effectively to changing business conditions in light of the COVID-19 pandemic; the rate of inflation, including its impact on vehicle affordability; changes in interest rates and foreign currency exchange rates; our ability to consummate and integrate acquisitions; with respect to PTS, changes in the financial health of its customers, labor strikes or work stoppages by its employees, a reduction in PTS’ asset utilization rates, continued availability from truck manufacturers and suppliers of vehicles and parts for its fleet, changes in values of used trucks which affects PTS’ profitability on truck sales and regulatory risks and related compliance costs; our ability to realize returns on our significant capital investment in new and upgraded dealership facilities; our ability to navigate a rapidly changing automotive and truck landscape; our ability to respond to new or enhanced regulations in both our domestic and international markets relating to automotive dealerships and vehicles sales, including those related to emissions standards, as well as changes in consumer sentiment relating to commercial truck sales that may hinder our or PTS' ability to maintain, acquire, sell, or operate trucks; the success of our distribution of commercial vehicles, engines, and power systems; natural disasters; recall initiatives or other disruptions that interrupt the supply of vehicles or parts to us; 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 Group's business, markets, conditions, risks, and other uncertainties, which could affect Penske Automotive Group's future performance. The risks and uncertainties discussed above are not exhaustive and additional risk and uncertainties are addressed in Penske Automotive Group's Form 10-K for the year ended December 31, 2021, Form 10-Q for the quarterly periods ended March 31, 2022, June 30, 2022, and September 30, 2022, and its other filings with the Securities and Exchange Commission ("SEC"). This press release speaks only as of its date, and Penske Automotive Group disclaims any duty to update the information herein.

Inquiries should contact:



Shelley Hulgrave			Anthony Pordon
Executive Vice President and			Executive Vice President Investor Relations
Chief Financial Officer			and Corporate Development
Penske Automotive Group, Inc.			Penske Automotive Group, Inc.
248-648-2812			248-648-2540
shulgrave@penskeautomotive.com			tpordon@penskeautomotive.com

# # #


			4

PENSKE AUTOMOTIVE GROUP, INC.

Consolidated Condensed Statements of Income

(Amounts In Millions, Except Per Share Data)

(Unaudited)


	Three Months Ended						Twelve Months Ended
	December 31,						December 31,
	2022		2021		Change		2022		2021		Change
Revenue	$	7,011.8	$	6,296.1	11.4	%	$	27,814.8	$	25,554.7	8.8	%
Cost of Sales	5,828.6		5,116.9		13.9	%	22,976.0		21,113.9		8.8	%
Gross Profit	$	1,183.2	$	1,179.2	0.3	%	$	4,838.8	$	4,440.8	9.0	%
SG&A Expenses	815.5		791.1		3.1	%	3,223.7		2,962.9		8.8	%
Depreciation	32.2		31.8		1.3	%	127.3		121.5		4.8	%
Operating Income	$	335.5	$	356.3	(5.8)	%	$	1,487.8	$	1,356.4	9.7	%
Floor Plan Interest Expense	(22.1)		(2.8)		689.3	%	(52.4)		(26.2)		100.0	%
Other Interest Expense	(19.0)		(14.8)		28.4	%	(70.4)		(68.6)		2.6	%
Debt Redemption Costs	—		—		nm		—		(17.0)		nm
Loss on Investment	—		(11.4)		nm		—		(11.4)		nm
Equity in Earnings of Affiliates	100.4		93.0		8.0	%	494.2		374.5		32.0	%
Income from Continuing Operations Before Income Taxes	$	394.8	$	420.3	(6.1)	%	$	1,859.2	$	1,607.7	15.6	%
Income Taxes	(95.5)		(108.3)		(11.8)	%	(473.0)		(416.3)		13.6	%
Income from Continuing Operations	$	299.3	$	312.0	(4.1)	%	$	1,386.2	$	1,191.4	16.4	%
Income from Discontinued Operations, net of tax	—		0.9		nm		—		1.3		nm
Net Income	$	299.3	$	312.9	(4.3)	%	$	1,386.2	$	1,192.7	16.2	%
Less: Income Attributable to Non-Controlling Interests	1.3		1.6		nm		6.2		4.9		nm
Net Income Attributable to Common Stockholders	$	298.0	$	311.3	(4.3)	%	$	1,380.0	$	1,187.8	16.2	%

Amounts Attributable to Common Stockholders:
Reported Income from Continuing Operations	$	299.3	$	312.0	(4.1)	%	$	1,386.2	$	1,191.4	16.4	%
Less: Income Attributable to Non-Controlling Interests	1.3		1.6		nm		6.2		4.9		nm
Income from Continuing Operations, net of tax	$	298.0	$	310.4	(4.0)	%	$	1,380.0	$	1,186.5	16.3	%
Income from Discontinued Operations, net of tax	—		0.9		nm		—		1.3		nm
Net Income Attributable to Common Shareholders	$	298.0	$	311.3	(4.3)	%	$	1,380.0	$	1,187.8	16.2	%
Income from Continuing Operations Per Share	$	4.21	$	3.97	6.0	%	$	18.55	$	14.88	24.7	%
Income Per Share	$	4.21	$	3.99	5.5	%	$	18.55	$	14.89	24.5	%
Weighted Average Shares Outstanding	70.8		78.1		(9.3)	%	74.4		79.7		(6.7)	%

nm – not meaningful


			5

PENSKE AUTOMOTIVE GROUP, INC.

Consolidated Condensed Balance Sheets

(Amounts In Millions)

(Unaudited)


	December 31,			December 31,
	2022			2021
Assets:
Cash and Cash Equivalents	$	106.5		$	100.7
Accounts Receivable, Net			906.7			734.0
Inventories			3,509.1			3,129.0
Other Current Assets			141.9			111.7
Total Current Assets			4,664.2			4,075.4
Property and Equipment, Net			2,496.5			2,442.2
Operating Lease Right-of-Use Assets			2,416.1			2,451.4
Intangibles			2,845.6			2,765.6
Other Long-Term Assets			1,692.2			1,730.0
Total Assets	$	14,114.6		$	13,464.6

Liabilities and Equity:
Floor Plan Notes Payable	$	1,565.7		$	1,144.8
Floor Plan Notes Payable – Non-Trade			1,430.6			1,409.9
Accounts Payable			853.5			767.1
Accrued Expenses and Other Current Liabilities			788.1			870.3
Current Portion Long-Term Debt			75.2			82.0
Liabilities Held for Sale			—			0.5
Total Current Liabilities			4,713.1			4,274.6
Long-Term Debt			1,546.9			1,392.0
Long-Term Operating Lease Liabilities			2,335.7			2,373.6
Other Long-Term Liabilities			1,344.1			1,329.4
Total Liabilities			9,939.8			9,369.6
Equity			4,174.8			4,095.0
Total Liabilities and Equity	$	14,114.6		$	13,464.6


			6

PENSKE AUTOMOTIVE GROUP, INC.

Consolidated Operations

Selected Data

(Unaudited)


	Three Months Ended						Twelve Months Ended
	December 31,						December 31,
	2022			2021			2022			2021
Geographic Revenue Mix:
North America	64.0		%	61.5		%	62.0		%	60.8		%
U.K.	28.3		%	29.9		%	30.4		%	31.2		%
Other International	7.7		%	8.6		%	7.6		%	8.0		%
Total	100.0		%	100.0		%	100.0		%	100.0		%

Revenue: (Amounts in Millions)
Retail Automotive	$	5,910.4		$	5,473.9		$	23,694.7		$	22,513.3
Retail Commercial Truck	960.8			688.4			3,541.3			2,465.7
Commercial Vehicle Distribution and Other	140.6			133.8			578.8			575.7
Total	$	7,011.8		$	6,296.1		$	27,814.8		$	25,554.7

Gross Profit: (Amounts in Millions)
Retail Automotive	$	1,008.8		$	1,019.0		$	4,126.4		$	3,870.2
Retail Commercial Truck	138.2			118.9			555.1			416.9
Commercial Vehicle Distribution and Other	36.2			41.3			157.3			153.7
Total	$	1,183.2		$	1,179.2		$	4,838.8		$	4,440.8

Gross Margin:
Retail Automotive	17.1		%	18.6		%	17.4		%	17.2		%
Retail Commercial Truck	14.4		%	17.3		%	15.7		%	16.9		%
Commercial Vehicle Distribution and Other	25.7		%	30.9		%	27.2		%	26.7		%
Total	16.9		%	18.7		%	17.4		%	17.4		%


	Three Months Ended				Twelve Months Ended
	December 31,				December 31,
	2022		2021		2022		2021
Operating Items as a Percentage of Revenue:
Gross Profit	16.9	%	18.7	%	17.4	%	17.4	%
Selling, General and Administrative Expenses	11.6	%	12.6	%	11.6	%	11.6	%
Operating Income	4.8	%	5.7	%	5.3	%	5.3	%
Income from Continuing Operations Before Income Taxes	5.6	%	6.7	%	6.7	%	6.3	%

Operating Items as a Percentage of Total Gross Profit:
Selling, General and Administrative Expenses	68.9	%	67.1	%	66.6	%	66.7	%
Operating Income	28.4	%	30.2	%	30.7	%	30.5	%


	Three Months Ended				Twelve Months Ended
	December 31,				December 31,
(Amounts in Millions)	2022		2021		2022		2021

EBITDA(1)	$	446.0	$	466.9	$	2,056.9	$	1,797.8
Floor Plan Credits	$	10.3	$	9.4	$	40.3	$	47.5
Rent Expense	$	61.2	$	60.2	$	243.3	$	237.9
_______________________
(1)See the following Non-GAAP reconciliation table.


			7

PENSKE AUTOMOTIVE GROUP, INC.

Retail Automotive Operations

(Unaudited)


	Three Months Ended								Twelve Months Ended
	December 31,								December 31,
	2022			2021			Change		2022			2021			Change
Retail Automotive Units:
New Retail		50,342			42,813		17.6	%		185,831			195,384		(4.9)	%
Used Retail		57,991			58,919		(1.6)	%		261,739			264,520		(1.1)	%
Total		108,333			101,732		6.5	%		447,570			459,904		(2.7)	%

Retail Automotive Revenue: (Amounts in Millions)
New Vehicles	$	2,763.8		$	2,335.3		18.3	%	$	10,050.5		$	9,843.2		2.1	%
Used Vehicles		1,992.1			2,111.1		(5.6)	%		9,011.6			8,549.0		5.4	%
Finance and Insurance, Net		201.3			196.7		2.3	%		848.1			780.5		8.7	%
Service and Parts		633.7			560.9		13.0	%		2,426.7			2,165.6		12.1	%
Fleet and Wholesale		319.5			269.9		18.4	%		1,357.8			1,175.0		15.6	%
Total Revenue	$	5,910.4		$	5,473.9		8.0	%	$	23,694.7		$	22,513.3		5.2	%

Retail Automotive Gross Profit: (Amounts in Millions)
New Vehicles	$	325.6		$	299.9		8.6	%	$	1,246.1		$	1,045.5		19.2	%
Used Vehicles		100.8			169.9		(40.7)	%		543.1			666.6		(18.5)	%
Finance and Insurance, Net		201.3			196.7		2.3	%		848.1			780.5		8.7	%
Service and Parts		370.3			331.2		11.8	%		1,439.4			1,307.3		10.1	%
Fleet and Wholesale		10.8			21.3		(49.3)	%		49.7			70.3		(29.3)	%
Total Gross Profit	$	1,008.8		$	1,019.0		(1.0)	%	$	4,126.4		$	3,870.2		6.6	%

Retail Automotive Revenue Per Vehicle Retailed:
New Vehicles	$	54,900		$	54,547		0.6	%	$	54,084		$	50,379		7.4	%
Used Vehicles		34,352			35,831		(4.1)	%		34,430			32,319		6.5	%

Retail Automotive Gross Profit Per Vehicle Retailed:
New Vehicles	$	6,467		$	7,006		(7.7)	%	$	6,705		$	5,351		25.3	%
Used Vehicles		1,739			2,884		(39.7)	%		2,075			2,520		(17.7)	%
Finance and Insurance		1,858			1,933		(3.9)	%		1,895			1,697		11.7	%

Retail Automotive Gross Margin:
New Vehicles		11.8	%		12.8	%	(100)bps			12.4	%		10.6	%	+180bps
Used Vehicles		5.1	%		8.0	%	(290)bps			6.0	%		7.8	%	(180)bps
Service and Parts		58.4	%		59.0	%	(60)bps			59.3	%		60.4	%	(110)bps
Fleet and Wholesale		3.4	%		7.9	%	(450)bps			3.7	%		6.0	%	(230)bps
Total Gross Margin		17.1	%		18.6	%	(150)bps			17.4	%		17.2	%	+20bps

Retail Automotive Revenue Mix Percentages:
New Vehicles		46.8	%		42.7	%	+410bps			42.4	%		43.7	%	(130)bps
Used Vehicles		33.7	%		38.6	%	(490)bps			38.0	%		38.0	%	—bps
Finance and Insurance, Net		3.4	%		3.6	%	(20)bps			3.6	%		3.5	%	+10bps
Service and Parts		10.7	%		10.2	%	+50bps			10.2	%		9.6	%	+60bps
Fleet and Wholesale		5.4	%		4.9	%	+50bps			5.8	%		5.2	%	+60bps
Total		100.0	%		100.0	%				100.0	%		100.0	%

Retail Automotive Gross Profit Mix Percentages:
New Vehicles		32.3	%		29.4	%	+290bps			30.2	%		27.0	%	+320bps
Used Vehicles		10.0	%		16.7	%	(670)bps			13.2	%		17.2	%	(400)bps
Finance and Insurance, Net		20.0	%		19.3	%	+70bps			20.6	%		20.2	%	+40bps
Service and Parts		36.7	%		32.5	%	+420bps			34.9	%		33.8	%	+110bps
Fleet and Wholesale		1.0	%		2.1	%	(110)bps			1.1	%		1.8	%	(70)bps
Total		100.0	%		100.0	%				100.0	%		100.0	%


			8

PENSKE AUTOMOTIVE GROUP, INC.

Retail Automotive Operations Same-Store

(Unaudited)


	Three Months Ended								Twelve Months Ended
	December 31,								December 31,
	2022			2021			Change		2022			2021			Change
Retail Automotive Same-Store Units:
New Retail		47,323			42,554		11.2	%		173,936			192,711		(9.7)	%
Used Retail		55,583			58,078		(4.3)	%		247,041			259,489		(4.8)	%
Total		102,906			100,632		2.3	%		420,977			452,200		(6.9)	%

Retail Automotive Same-Store Revenue: (Amounts in Millions)
New Vehicles	$	2,618.8		$	2,324.4		12.7	%	$	9,399.0		$	9,678.2		(2.9)	%
Used Vehicles		1,909.2			2,086.7		(8.5)	%		8,527.8			8,380.4		1.8	%
Finance and Insurance, Net		193.6			195.5		(1.0)	%		811.0			770.1		5.3	%
Service and Parts		591.1			557.2		6.1	%		2,272.7			2,130.3		6.7	%
Fleet and Wholesale		307.3			268.0		14.7	%		1,263.4			1,149.4		9.9	%
Total Revenue	$	5,620.0		$	5,431.8		3.5	%	$	22,273.9		$	22,108.4		0.7	%

Retail Automotive Same-Store Gross Profit: (Amounts in Millions)
New Vehicles	$	311.1		$	298.7		4.2	%	$	1,164.2		$	1,023.2		13.8	%
Used Vehicles		96.8			168.4		(42.5)	%		515.5			652.4		(21.0)	%
Finance and Insurance, Net		193.6			195.5		(1.0)	%		811.0			770.1		5.3	%
Service and Parts		348.6			328.7		6.1	%		1,355.9			1,285.6		5.5	%
Fleet and Wholesale		10.7			21.3		(49.8)	%		44.9			67.4		(33.4)	%
Total Gross Profit	$	960.8		$	1,012.6		(5.1)	%	$	3,891.5		$	3,798.7		2.4	%

Retail Automotive Same-Store Revenue Per Vehicle Retailed:
New Vehicles	$	55,340		$	54,623		1.3	%	$	54,037		$	50,221		7.6	%
Used Vehicles		34,348			35,929		(4.4)	%		34,520			32,296		6.9	%

Retail Automotive Same-Store Gross Profit Per Vehicle Retailed:
New Vehicles	$	6,573		$	7,020		(6.4)	%	$	6,693		$	5,309		26.1	%
Used Vehicles		1,742			2,900		(39.9)	%		2,087			2,514		(17.0)	%
Finance and Insurance		1,881			1,943		(3.2)	%		1,926			1,703		13.1	%

Retail Automotive Same-Store Gross Margin:
New Vehicles		11.9	%		12.9	%	(100)bps			12.4	%		10.6	%	+180bps
Used Vehicles		5.1	%		8.1	%	(300)bps			6.0	%		7.8	%	(180)bps
Service and Parts		59.0	%		59.0	%	—bps			59.7	%		60.3	%	(60)bps
Fleet and Wholesale		3.5	%		7.9	%	(440)bps			3.6	%		5.9	%	(230)bps
Total Gross Margin		17.1	%		18.6	%	(150)bps			17.5	%		17.2	%	+30bps

Retail Automotive Same-Store Revenue Mix Percentages:
New Vehicles		46.6	%		42.8	%	+380bps			42.2	%		43.8	%	(160)bps
Used Vehicles		34.0	%		38.4	%	(440)bps			38.3	%		37.9	%	+40bps
Finance and Insurance, Net		3.4	%		3.6	%	(20)bps			3.6	%		3.5	%	+10bps
Service and Parts		10.5	%		10.3	%	+20bps			10.2	%		9.6	%	+60bps
Fleet and Wholesale		5.5	%		4.9	%	+60bps			5.7	%		5.2	%	+50bps
Total		100.0	%		100.0	%				100.0	%		100.0	%

Retail Automotive Same-Store Gross Profit Mix Percentages:
New Vehicles		32.4	%		29.5	%	+290bps			29.9	%		26.9	%	+300bps
Used Vehicles		10.1	%		16.6	%	(650)bps			13.2	%		17.2	%	(400)bps
Finance and Insurance, Net		20.1	%		19.3	%	+80bps			20.8	%		20.3	%	+50bps
Service and Parts		36.3	%		32.5	%	+380bps			34.8	%		33.8	%	+100bps
Fleet and Wholesale		1.1	%		2.1	%	(100)bps			1.3	%		1.8	%	(50)bps
Total		100.0	%		100.0	%				100.0	%		100.0	%


			9

PENSKE AUTOMOTIVE GROUP, INC.

Retail Commercial Truck Operations

(Unaudited)


	Three Months Ended								Twelve Months Ended
	December 31,								December 31,
	2022			2021			Change		2022			2021			Change
Retail Commercial Truck Units:
New Retail		5,181			3,629		42.8	%		17,932			13,000		37.9	%
Used Retail		523			830		(37.0)	%		2,669			3,431		(22.2)	%
Total		5,704			4,459		27.9	%		20,601			16,431		25.4	%

Retail Commercial Truck Revenue: (Amounts in Millions)
New Vehicles	$	685.0		$	429.3		59.6	%	$	2,308.7		$	1,540.1		49.9	%
Used Vehicles		48.1			79.4		(39.4)	%		301.3			270.6		11.3	%
Finance and Insurance, Net		4.2			5.0		(16.0)	%		20.5			16.8		22.0	%
Service and Parts		211.7			166.2		27.4	%		852.2			609.0		39.9	%
Wholesale and Other		11.8			8.5		38.8	%		58.6			29.2		100.7	%
Total Revenue	$	960.8		$	688.4		39.6	%	$	3,541.3		$	2,465.7		43.6	%

Retail Commercial Truck Gross Profit: (Amounts in Millions)
New Vehicles	$	34.5		$	24.1		43.2	%	$	126.4		$	80.2		57.6	%
Used Vehicles		4.5			15.7		(71.3)	%		22.0			48.1		(54.3)	%
Finance and Insurance, Net		4.2			5.0		(16.0)	%		20.5			16.8		22.0	%
Service and Parts		89.1			70.2		26.9	%		360.5			257.0		40.3	%
Wholesale and Other		5.9			3.9		51.3	%		25.7			14.8		73.6	%
Total Gross Profit	$	138.2		$	118.9		16.2	%	$	555.1		$	416.9		33.1	%

Retail Commercial Truck Revenue Per Vehicle Retailed:
New Vehicles	$	132,217		$	118,300		11.8	%	$	128,750		$	118,467		8.7	%
Used Vehicles		91,927			95,667		(3.9)	%		112,900			78,874		43.1	%

Retail Commercial Truck Gross Profit Per Vehicle Retailed:
New Vehicles	$	6,663		$	6,650		0.2	%	$	7,048		$	6,166		14.3	%
Used Vehicles		8,658			18,891		(54.2)	%		8,247			14,015		(41.2)	%
Finance and Insurance		732			1,113		(34.2)	%		997			1,020		(2.3)	%

Retail Commercial Truck Gross Margin:
New Vehicles		5.0	%		5.6	%	(60)bps			5.5	%		5.2	%	+30bps
Used Vehicles		9.4	%		19.8	%	(1,040)bps			7.3	%		17.8	%	(1,050)bps
Service and Parts		42.1	%		42.2	%	(10)bps			42.3	%		42.2	%	+10bps
Wholesale and Other		50.0	%		45.9	%	+410bps			43.9	%		50.7	%	(680)bps
Total Gross Margin		14.4	%		17.3	%	(290)bps			15.7	%		16.9	%	(120)bps

Retail Commercial Truck Revenue Mix Percentages:
New Vehicles		71.3	%		62.4	%	+890bps			65.2	%		62.5	%	+270bps
Used Vehicles		5.0	%		11.5	%	(650)bps			8.5	%		11.0	%	(250)bps
Finance and Insurance, Net		0.4	%		0.7	%	(30)bps			0.6	%		0.7	%	(10)bps
Service and Parts		22.0	%		24.1	%	(210)bps			24.1	%		24.7	%	(60)bps
Wholesale and Other		1.3	%		1.3	%	—bps			1.6	%		1.1	%	+50bps
Total		100.0	%		100.0	%				100.0	%		100.0	%

Retail Commercial Truck Gross Profit Mix Percentages:
New Vehicles		25.0	%		20.3	%	+470bps			22.8	%		19.2	%	+360bps
Used Vehicles		3.3	%		13.2	%	(990)bps			4.0	%		11.5	%	(750)bps
Finance and Insurance, Net		3.0	%		4.2	%	(120)bps			3.7	%		4.0	%	(30)bps
Service and Parts		64.5	%		59.0	%	+550bps			64.9	%		61.6	%	+330bps
Wholesale and Other		4.2	%		3.3	%	+90bps			4.6	%		3.7	%	+90bps
Total		100.0	%		100.0	%				100.0	%		100.0	%


			10

PENSKE AUTOMOTIVE GROUP, INC.

Retail Commercial Truck Operations Same-Store

(Unaudited)


	Three Months Ended								Twelve Months Ended
	December 31,								December 31,
	2022			2021			Change		2022			2021			Change
Retail Commercial Truck Same-Store Units:
New Retail		4,789			3,530		35.7	%		14,078			10,983		28.2	%
Used Retail		498			808		(38.4)	%		2,115			3,191		(33.7)	%
Total		5,287			4,338		21.9	%		16,193			14,174		14.2	%

Retail Commercial Truck Same-Store Revenue: (Amounts in Millions)
New Vehicles	$	637.5		$	416.7		53.0	%	$	1,813.6		$	1,322.3		37.2	%
Used Vehicles		45.9			76.9		(40.3)	%		239.1			251.3		(4.9)	%
Finance and Insurance, Net		3.9			4.8		(18.8)	%		17.2			16.1		6.8	%
Service and Parts		188.5			162.0		16.4	%		653.7			537.6		21.6	%
Wholesale and Other		11.6			7.4		56.8	%		53.6			28.1		90.7	%
Total Revenue	$	887.4		$	667.8		32.9	%	$	2,777.2		$	2,155.4		28.8	%

Retail Commercial Truck Same-Store Gross Profit: (Amounts in Millions)
New Vehicles	$	30.7		$	22.8		34.6	%	$	101.7		$	72.8		39.7	%
Used Vehicles		4.2			15.3		(72.5)	%		17.1			44.3		(61.4)	%
Finance and Insurance, Net		3.9			4.8		(18.8)	%		17.2			16.1		6.8	%
Service and Parts		79.3			68.4		15.9	%		277.8			228.3		21.7	%
Wholesale and Other		5.8			3.9		48.7	%		25.2			14.6		72.6	%
Total Gross Profit	$	123.9		$	115.2		7.6	%	$	439.0		$	376.1		16.7	%

Retail Commercial Truck Same-Store Revenue Per Vehicle Retailed:
New Vehicles	$	133,114		$	118,033		12.8	%	$	128,828		$	120,399		7.0	%
Used Vehicles		92,136			95,126		(3.1)	%		113,072			78,766		43.6	%

Retail Commercial Truck Same-Store Gross Profit Per Vehicle Retailed:
New Vehicles	$	6,414		$	6,471		(0.9)	%	$	7,225		$	6,628		9.0	%
Used Vehicles		8,526			18,914		(54.9)	%		8,064			13,872		(41.9)	%
Finance and Insurance		740			1,113		(33.5)	%		1,060			1,135		(6.6)	%

Retail Commercial Truck Same-Store Gross Margin:
New Vehicles		4.8	%		5.5	%	(70)bps			5.6	%		5.5	%	+10bps
Used Vehicles		9.2	%		19.9	%	(1,070)bps			7.2	%		17.6	%	(1,040)bps
Service and Parts		42.1	%		42.2	%	(10)bps			42.5	%		42.5	%	—bps
Wholesale and Other		50.0	%		52.7	%	(270)bps			47.0	%		52.0	%	(500)bps
Total Gross Margin		14.0	%		17.3	%	(330)bps			15.8	%		17.4	%	(160)bps

Retail Commercial Truck Same-Store Revenue Mix Percentages:
New Vehicles		71.8	%		62.4	%	+940bps			65.3	%		61.3	%	+400bps
Used Vehicles		5.2	%		11.5	%	(630)bps			8.6	%		11.7	%	(310)bps
Finance and Insurance, Net		0.4	%		0.7	%	(30)bps			0.6	%		0.7	%	(10)bps
Service and Parts		21.2	%		24.3	%	(310)bps			23.5	%		24.9	%	(140)bps
Wholesale and Other		1.4	%		1.1	%	+30bps			2.0	%		1.4	%	+60bps
Total		100.0	%		100.0	%				100.0	%		100.0	%

Retail Commercial Truck Same-Store Gross Profit Mix Percentages:
New Vehicles		24.8	%		19.8	%	+500bps			23.2	%		19.4	%	+380bps
Used Vehicles		3.4	%		13.3	%	(990)bps			3.9	%		11.8	%	(790)bps
Finance and Insurance, Net		3.1	%		4.2	%	(110)bps			3.9	%		4.3	%	(40)bps
Service and Parts		64.0	%		59.4	%	+460bps			63.3	%		60.7	%	+260bps
Wholesale and Other		4.7	%		3.3	%	+140bps			5.7	%		3.8	%	+190bps
Total		100.0	%		100.0	%				100.0	%		100.0	%


			11

PENSKE AUTOMOTIVE GROUP, INC.

Supplemental Data

(Unaudited)


	Three Months Ended				Twelve Months Ended
	December 31,				December 31,
	2022		2021		2022		2021
Retail Automotive Revenue Mix:
Premium:
BMW / MINI	27	%	26	%	26	%	24	%
Audi	10	%	10	%	11	%	12	%
Mercedes-Benz	11	%	10	%	10	%	10	%
Land Rover / Jaguar	7	%	7	%	7	%	8	%
Porsche	8	%	9	%	7	%	7	%
Ferrari / Maserati	3	%	3	%	3	%	3	%
Lexus	2	%	3	%	3	%	3	%
Acura	1	%	1	%	1	%	1	%
Bentley	1	%	1	%	1	%	1	%
Others	3	%	2	%	2	%	2	%
Total Premium	73	%	72	%	71	%	71	%
Volume Non-U.S.:
Toyota	11	%	10	%	11	%	11	%
Honda	6	%	5	%	5	%	6	%
Volkswagen	1	%	2	%	2	%	2	%
Hyundai	1	%	1	%	1	%	1	%
Others	1	%	2	%	2	%	1	%
Total Volume Non-U.S.	20	%	20	%	21	%	21	%
U.S.:
General Motors / Stellantis	1	%	1	%	1	%	1	%
CarShop Used Vehicle Centers	6	%	7	%	7	%	7	%
Total	100	%	100	%	100	%	100	%


	Three Months Ended				Twelve Months Ended
	December 31,				December 31,
Capital Expenditures / Stock Repurchases:	2022		2021		2022		2021
(Amounts in Millions)
Capital expenditures	$	86.8	$	91.4	$	282.5	$	248.9
Cash paid for acquisitions, net of cash acquired	$	—	$	153.8	$	393.4	$	431.8
Stock repurchases: (1)
Aggregate purchase price	$	284.5	$	73.7	$	886.5	$	293.5
Shares repurchased		2.5		0.8		8.2		3.3


Balance Sheet and Other Highlights:	December 31, 2022		December 31, 2021
(Amounts in Millions)
Cash and Cash Equivalents	$	106.5	$	100.7
Inventories	$	3,509.1	$	3,129.0
Total Floor Plan Notes Payable	$	2,996.3	$	2,554.7
Total Long-Term Debt	$	1,622.1	$	1,474.0
Equity	$	4,174.8	$	4,095.0

Debt to Total Capitalization Ratio		28.0%		26.4%
Leverage Ratio (2)		0.8x		0.8x
New vehicle days' supply		25 days		17 days
Used vehicle days' supply		53 days		60 days
__________________________
(1)For the twelve months ended December 31, 2022 and 2021, includes 0.15 million shares acquired for $17.2 million and $12.9 million, respectively, from employees in connection with a net share settlement feature of employee equity awards
(2)See the following Non-GAAP reconciliation table


			12

PENSKE AUTOMOTIVE GROUP, INC.

Consolidated Non-GAAP Reconciliations

(Unaudited)

The following tables reconcile reported income from continuing operations and earnings per share to adjusted income from continuing operations and adjusted earnings per share for the three and twelve months ended December 31, 2022, and 2021:


	Three Months Ended						Twelve Months Ended
(Amounts in Millions)	December 31,						December 31,
	2022		2021		% Change		2022		2021		% Change

Income from Continuing Operations	$	298.0	$	310.4	(4.0)	%	$	1,380.0	$	1,186.5	16.3	%
Tax legislation changes (1)		—		1.0	nm			—		10.8	nm

Loss on investment for revaluation (2)		—		9.1	nm			—		9.1	nm
Debt redemption costs (3)		—		—	nm			—		12.6	nm
Adjusted Income from Continuing Operations	$	298.0	$	320.5	(7.0)	%	$	1,380.0	$	1,219.0	13.2	%


	Three Months Ended						Twelve Months Ended
	December 31,						December 31,
	2022		2021		% Change		2022		2021		% Change

Earnings Per Share from Continuing Operations	$	4.21	$	3.97	6.0	%	$	18.55	$	14.88	24.7	%
Tax legislation changes (1)		—		0.01	nm			—		0.13	nm

Loss on investment for revaluation (2)		—		0.12	nm			—		0.11	nm
Debt redemption costs (3)		—		—	nm			—		0.16	nm
Adjusted Earnings Per Share from Continuing Operations	$	4.21	$	4.10	2.7	%	$	18.55	$	15.28	21.4	%

The following table reconciles income from continuing operations before taxes (EBT) to adjusted income from continuing operations before taxes (EBT) for the three and twelve months ending December 31, 2022, and 2021:


	Three Months Ended						Twelve Months Ended
(Amounts in Millions)	December 31,						December 31,
	2022		2021		% Change		2022		2021		% Change

Income from Continuing Operations Before Taxes	$	394.8	$	420.3	(6.1)	%	$	1,859.2	$	1,607.7	15.6	%

Loss on investment for revaluation (2)		—		11.4	nm			—		11.4	nm
Debt redemption costs (3)		—		—	nm			—		17.0	nm
Adjusted Income from Continuing Operations Before Taxes	$	394.8	$	431.7	(8.5)	%	$	1,859.2	$	1,636.1	13.6	%

(1)For the three and twelve months ended December 31, 2021, represents a revaluation of our U.K. deferred tax assets and liabilities due to an increase in the U.K. corporate tax rate from 19% currently to 25%, effective April 1, 2023

(2)Loss on investment for the revaluation of the Nicole Group

(3)Related to expenses in connection with the redemption of our 5.5% senior subordinated notes due 2026 in 2021


			13

PENSKE AUTOMOTIVE GROUP, INC.

Consolidated Non-GAAP Reconciliations

(Unaudited)

The following tables reconcile reported net income to earnings before interest, taxes, depreciation, and amortization (“EBITDA”) for the three and twelve months ended December 31, 2022, and 2021:


	Three Months Ended
	December 31,				2022 vs. 2021
(Amounts in Millions)	2022		2021		Change		% Change

Net Income	$	299.3	$	312.9	$	(13.6)	(4.3)	%
Add: Depreciation		32.2		31.8		0.4	1.3	%
Other Interest Expense		19.0		14.8		4.2	28.4	%
Income Taxes		95.5		108.3		(12.8)	(11.8)	%
Income from Discontinued Operations, net of tax		—		(0.9)		0.9	nm
EBITDA	$	446.0	$	466.9	$	(20.9)	(4.5)	%

Add: Loss on investment for revaluation (1)		—		11.4		(11.4)	nm
Add: Debt redemption costs (2)		—		—		—	nm
Adjusted EBITDA	$	446.0	$	478.3	$	(32.3)	(6.8)	%


	Twelve Months Ended
	December 31,				2022 vs. 2021
(Amounts in Millions)	2022		2021		Change		% Change

Net Income	$	1,386.2	$	1,192.7	$	193.5	16.2	%
Add: Depreciation		127.3		121.5		5.8	4.8	%
Other Interest Expense		70.4		68.6		1.8	2.6	%
Income Taxes		473.0		416.3		56.7	13.6	%
Income from Discontinued Operations, net of tax		—		(1.3)		1.3	nm
EBITDA	$	2,056.9	$	1,797.8	$	259.1	14.4	%

Add: Loss on investment for revaluation (1)		—		11.4		(11.4)	nm
Add: Debt redemption costs (2)		—		17.0		(17.0)	nm
Adjusted EBITDA	$	2,056.9	$	1,826.2	$	230.7	12.6	%

nm – not meaningful

The following table reconciles the leverage ratio as of December 31, 2022, and December 31, 2021:


	Twelve			Twelve
	Months Ended			Months Ended
(Amounts in Millions)	December 31, 2022			December 31, 2021

Net Income	$	1,386.2		$	1,192.7
Add: Depreciation			127.3			121.5
Other Interest Expense			70.4			68.6
Income Taxes			473.0			416.3
Income from Discontinued Operations, net of tax			—			(1.3)
EBITDA	$	2,056.9		$	1,797.8
Add: Loss on investment for revaluation (1)			—			11.4
Add: Debt redemption costs (2)			—			17.0
Adjusted EBITDA	$	2,056.9		$	1,826.2

Total Non-Vehicle Long-Term Debt	$	1,622.1		$	1,474.0
Leverage Ratio			0.8x			0.8x

(1)Loss on investment for the revaluation of the Nicole Group

(2)Related to expenses in connection with the redemption of our 5.50% senior subordinated notes due 2026 in 2021

# # # # # # #


			14