|
|
|
x
|
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
o
|
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
|
|
|
Delaware
|
|
01-0609375
|
|
|
(State or other jurisdiction of
incorporation or organization)
|
|
(I.R.S. Employer
Identification No.)
|
|
|
|
|
|
|
|
2905 Premiere Parkway NW, Suite 300
Duluth, Georgia
|
|
30097
|
|
|
(Address of principal executive offices)
|
|
(Zip Code)
|
|
|
Large Accelerated Filer
|
x
|
|
Accelerated Filer
|
o
|
|
|
|
|
|
Non-Accelerated Filer
|
o
|
|
Smaller Reporting Company
|
o
|
|
|
|
Page
|
PART I—Financial Information
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
|
|
|
|
|
|
PART II—Other Information
|
|
|
|
|
|
||
|
||
|
|
|
Item 1.
|
Condensed Consolidated Financial Statements
|
|
September 30, 2015
|
|
December 31, 2014
|
||||
ASSETS
|
|
|
|
||||
CURRENT ASSETS:
|
|
|
|
||||
Cash and cash equivalents
|
$
|
3.9
|
|
|
$
|
2.9
|
|
Contracts-in-transit
|
132.3
|
|
|
155.6
|
|
||
Accounts receivable (net of allowance of $1.1 and $1.2, respectively)
|
103.8
|
|
|
107.0
|
|
||
Inventories
|
887.6
|
|
|
886.0
|
|
||
Deferred income taxes
|
11.7
|
|
|
10.2
|
|
||
Assets held for sale
|
46.6
|
|
|
6.4
|
|
||
Other current assets
|
96.1
|
|
|
108.6
|
|
||
Total current assets
|
1,282.0
|
|
|
1,276.7
|
|
||
PROPERTY AND EQUIPMENT, net
|
761.6
|
|
|
741.6
|
|
||
GOODWILL
|
130.2
|
|
|
104.0
|
|
||
OTHER LONG-TERM ASSETS
|
69.6
|
|
|
69.7
|
|
||
Total assets
|
$
|
2,243.4
|
|
|
$
|
2,192.0
|
|
LIABILITIES AND SHAREHOLDERS’ EQUITY
|
|
|
|
||||
CURRENT LIABILITIES:
|
|
|
|
||||
Floor plan notes payable—trade
|
$
|
108.6
|
|
|
$
|
116.5
|
|
Floor plan notes payable—non-trade
|
729.3
|
|
|
650.3
|
|
||
Current maturities of long-term debt
|
13.8
|
|
|
28.7
|
|
||
Accounts payable and accrued liabilities
|
264.5
|
|
|
245.6
|
|
||
Liabilities associated with assets held for sale
|
30.4
|
|
|
—
|
|
||
Total current liabilities
|
1,146.6
|
|
|
1,041.1
|
|
||
LONG-TERM DEBT
|
747.9
|
|
|
678.7
|
|
||
DEFERRED INCOME TAXES
|
4.5
|
|
|
3.9
|
|
||
OTHER LONG-TERM LIABILITIES
|
29.9
|
|
|
23.4
|
|
||
COMMITMENTS AND CONTINGENCIES (Note 9)
|
|
|
|
||||
SHAREHOLDERS’ EQUITY:
|
|
|
|
||||
Preferred stock, $.01 par value, 10,000,000 shares authorized; none issued or outstanding
|
—
|
|
|
—
|
|
||
Common stock, $.01 par value, 90,000,000 shares authorized; 40,505,112 and 40,327,625 shares issued, including shares held in treasury, respectively
|
0.4
|
|
|
0.4
|
|
||
Additional paid-in capital
|
534.9
|
|
|
522.6
|
|
||
Retained earnings
|
403.2
|
|
|
275.1
|
|
||
Treasury stock, at cost; 15,123,007 and 11,803,711 shares, respectively
|
(619.4
|
)
|
|
(351.7
|
)
|
||
Accumulated other comprehensive loss
|
(4.6
|
)
|
|
(1.5
|
)
|
||
Total shareholders’ equity
|
314.5
|
|
|
444.9
|
|
||
Total liabilities and shareholders’ equity
|
$
|
2,243.4
|
|
|
$
|
2,192.0
|
|
|
For the Three Months Ended September 30,
|
|
For the Nine Months Ended September 30,
|
||||||||||||
|
2015
|
|
2014
|
|
2015
|
|
2014
|
||||||||
REVENUE:
|
|
|
|
|
|
|
|
||||||||
New vehicle
|
$
|
964.0
|
|
|
$
|
821.3
|
|
|
$
|
2,720.7
|
|
|
$
|
2,378.8
|
|
Used vehicle
|
493.0
|
|
|
457.0
|
|
|
1,474.0
|
|
|
1,319.2
|
|
||||
Parts and service
|
190.6
|
|
|
168.3
|
|
|
555.5
|
|
|
495.9
|
|
||||
Finance and insurance, net
|
68.8
|
|
|
59.0
|
|
|
197.6
|
|
|
170.8
|
|
||||
TOTAL REVENUE
|
1,716.4
|
|
|
1,505.6
|
|
|
4,947.8
|
|
|
4,364.7
|
|
||||
COST OF SALES:
|
|
|
|
|
|
|
|
||||||||
New vehicle
|
911.7
|
|
|
772.1
|
|
|
2,568.2
|
|
|
2,232.4
|
|
||||
Used vehicle
|
459.6
|
|
|
425.8
|
|
|
1,371.6
|
|
|
1,220.6
|
|
||||
Parts and service
|
72.4
|
|
|
63.1
|
|
|
207.6
|
|
|
189.1
|
|
||||
TOTAL COST OF SALES
|
1,443.7
|
|
|
1,261.0
|
|
|
4,147.4
|
|
|
3,642.1
|
|
||||
GROSS PROFIT
|
272.7
|
|
|
244.6
|
|
|
800.4
|
|
|
722.6
|
|
||||
OPERATING EXPENSES:
|
|
|
|
|
|
|
|
||||||||
Selling, general and administrative
|
188.8
|
|
|
171.5
|
|
|
546.4
|
|
|
500.5
|
|
||||
Depreciation and amortization
|
7.5
|
|
|
6.7
|
|
|
22.0
|
|
|
19.4
|
|
||||
Other operating (income) expense, net
|
(0.2
|
)
|
|
0.3
|
|
|
0.1
|
|
|
0.2
|
|
||||
INCOME FROM OPERATIONS
|
76.6
|
|
|
66.1
|
|
|
231.9
|
|
|
202.5
|
|
||||
OTHER (INCOME) EXPENSES:
|
|
|
|
|
|
|
|
||||||||
Floor plan interest expense
|
4.1
|
|
|
3.0
|
|
|
12.0
|
|
|
9.3
|
|
||||
Other interest expense, net
|
10.7
|
|
|
9.6
|
|
|
31.5
|
|
|
28.2
|
|
||||
Swap interest expense
|
1.0
|
|
|
0.5
|
|
|
2.0
|
|
|
1.5
|
|
||||
Gain on divestitures
|
(21.4
|
)
|
|
—
|
|
|
(21.4
|
)
|
|
—
|
|
||||
Total other (income) expenses, net
|
(5.6
|
)
|
|
13.1
|
|
|
24.1
|
|
|
39.0
|
|
||||
INCOME FROM CONTINUING OPERATIONS BEFORE INCOME TAXES
|
82.2
|
|
|
53.0
|
|
|
207.8
|
|
|
163.5
|
|
||||
Income tax expense
|
31.0
|
|
|
20.6
|
|
|
79.6
|
|
|
63.4
|
|
||||
INCOME FROM CONTINUING OPERATIONS
|
51.2
|
|
|
32.4
|
|
|
128.2
|
|
|
100.1
|
|
||||
Discontinued operations, net of tax
|
(0.1
|
)
|
|
0.1
|
|
|
(0.1
|
)
|
|
(0.3
|
)
|
||||
NET INCOME
|
$
|
51.1
|
|
|
$
|
32.5
|
|
|
$
|
128.1
|
|
|
$
|
99.8
|
|
EARNINGS PER COMMON SHARE:
|
|
|
|
|
|
|
|
||||||||
Basic—
|
|
|
|
|
|
|
|
||||||||
Continuing operations
|
$
|
1.98
|
|
|
$
|
1.09
|
|
|
$
|
4.80
|
|
|
$
|
3.31
|
|
Discontinued operations
|
(0.01
|
)
|
|
—
|
|
|
—
|
|
|
(0.01
|
)
|
||||
Net income
|
$
|
1.97
|
|
|
$
|
1.09
|
|
|
$
|
4.80
|
|
|
$
|
3.30
|
|
Diluted—
|
|
|
|
|
|
|
|
||||||||
Continuing operations
|
$
|
1.96
|
|
|
$
|
1.08
|
|
|
$
|
4.77
|
|
|
$
|
3.29
|
|
Discontinued operations
|
—
|
|
|
—
|
|
|
(0.01
|
)
|
|
(0.01
|
)
|
||||
Net income
|
$
|
1.96
|
|
|
$
|
1.08
|
|
|
$
|
4.76
|
|
|
$
|
3.28
|
|
WEIGHTED AVERAGE COMMON SHARES OUTSTANDING:
|
|
|
|
|
|
|
|
||||||||
Basic
|
25.9
|
|
|
29.8
|
|
|
26.7
|
|
|
30.2
|
|
||||
Restricted stock
|
0.1
|
|
|
0.1
|
|
|
0.1
|
|
|
0.1
|
|
||||
Performance share units
|
0.1
|
|
|
0.1
|
|
|
0.1
|
|
|
0.1
|
|
||||
Diluted
|
26.1
|
|
|
30.0
|
|
|
26.9
|
|
|
30.4
|
|
|
For the Three Months Ended September 30,
|
|
For the Nine Months Ended September 30,
|
||||||||||||
|
2015
|
|
2014
|
|
2015
|
|
2014
|
||||||||
|
|
|
|
|
|
||||||||||
Net income
|
$
|
51.1
|
|
|
$
|
32.5
|
|
|
$
|
128.1
|
|
|
$
|
99.8
|
|
Other comprehensive income:
|
|
|
|
|
|
|
|
||||||||
Change in fair value of cash flow swaps
|
(4.0
|
)
|
|
0.1
|
|
|
(5.0
|
)
|
|
(1.7
|
)
|
||||
Income tax benefit associated with cash flow swaps
|
1.5
|
|
|
—
|
|
|
1.9
|
|
|
0.7
|
|
||||
Comprehensive income
|
$
|
48.6
|
|
|
$
|
32.6
|
|
|
$
|
125.0
|
|
|
$
|
98.8
|
|
|
For the Nine Months Ended September 30,
|
||||||
|
2015
|
|
2014
|
||||
CASH FLOW FROM OPERATING ACTIVITIES:
|
|
|
|
||||
Net income
|
$
|
128.1
|
|
|
$
|
99.8
|
|
Adjustments to reconcile net income to net cash provided by operating activities—
|
|
|
|
||||
Depreciation and amortization
|
22.0
|
|
|
19.4
|
|
||
Stock-based compensation
|
7.7
|
|
|
6.7
|
|
||
Deferred income taxes
|
1.0
|
|
|
3.1
|
|
||
Loaner vehicle amortization
|
13.0
|
|
|
9.9
|
|
||
Excess tax benefit on share-based arrangements
|
(4.5
|
)
|
|
(3.4
|
)
|
||
Loss on disposal of fixed assets
|
0.7
|
|
|
1.0
|
|
||
Gain on divestitures
|
(21.4
|
)
|
|
—
|
|
||
Other adjustments, net
|
2.3
|
|
|
1.1
|
|
||
Changes in operating assets and liabilities, net of acquisitions and divestitures—
|
|
|
|
||||
Contracts-in-transit
|
23.3
|
|
|
29.1
|
|
||
Accounts receivable
|
4.4
|
|
|
5.1
|
|
||
Proceeds from the sale of accounts receivable
|
—
|
|
|
2.5
|
|
||
Inventories
|
55.2
|
|
|
47.4
|
|
||
Other current assets
|
(90.8
|
)
|
|
(62.7
|
)
|
||
Floor plan notes payable—trade
|
(19.0
|
)
|
|
(3.4
|
)
|
||
Accounts payable and accrued liabilities
|
19.3
|
|
|
2.7
|
|
||
Other long-term assets and liabilities, net
|
3.7
|
|
|
0.3
|
|
||
Net cash provided by operating activities
|
145.0
|
|
|
158.6
|
|
||
CASH FLOW FROM INVESTING ACTIVITIES:
|
|
|
|
||||
Capital expenditures—excluding real estate
|
(34.5
|
)
|
|
(43.9
|
)
|
||
Capital expenditures—real estate
|
(22.4
|
)
|
|
(11.5
|
)
|
||
Capital expenditures—capitalized interest
|
(0.1
|
)
|
|
(0.7
|
)
|
||
Purchases of previously leased real estate
|
—
|
|
|
(5.0
|
)
|
||
Acquisitions
|
(69.4
|
)
|
|
(21.9
|
)
|
||
Divestitures
|
56.3
|
|
|
—
|
|
||
Proceeds from the sale of assets
|
2.3
|
|
|
—
|
|
||
Net cash used in investing activities
|
(67.8
|
)
|
|
(83.0
|
)
|
||
CASH FLOW FROM FINANCING ACTIVITIES:
|
|
|
|
||||
Floor plan borrowings—non-trade
|
3,151.2
|
|
|
2,564.6
|
|
||
Floor plan borrowings—non-trade acquisitions
|
16.7
|
|
|
6.5
|
|
||
Floor plan repayments—non-trade
|
(3,036.7
|
)
|
|
(2,620.1
|
)
|
||
Floor plan repayments—non-trade divestitures
|
(17.2
|
)
|
|
—
|
|
||
Proceeds from borrowings
|
82.9
|
|
|
59.8
|
|
||
Repayments of borrowings
|
(8.6
|
)
|
|
(7.9
|
)
|
||
Payment of debt issuance costs
|
(1.3
|
)
|
|
(0.7
|
)
|
||
Repurchases of common stock, including those associated with net share settlement of employee share-based awards
|
(267.7
|
)
|
|
(75.5
|
)
|
||
Excess tax benefit on share-based arrangements
|
4.5
|
|
|
3.4
|
|
||
Net cash used in financing activities
|
(76.2
|
)
|
|
(69.9
|
)
|
||
Net increase in cash and cash equivalents
|
1.0
|
|
|
5.7
|
|
||
CASH AND CASH EQUIVALENTS, beginning of period
|
2.9
|
|
|
5.4
|
|
||
CASH AND CASH EQUIVALENTS, end of period
|
$
|
3.9
|
|
|
$
|
11.1
|
|
|
As of
|
||
|
September 30, 2015
|
||
|
(In millions)
|
||
Inventory
|
$
|
19.0
|
|
Real estate
|
15.2
|
|
|
Property and equipment
|
0.9
|
|
|
Goodwill
|
28.3
|
|
|
Manufacturer franchise rights
|
6.3
|
|
|
Liabilities assumed
|
(0.3
|
)
|
|
Total purchase price
|
$
|
69.4
|
|
|
As of
|
||||||
|
September 30, 2015
|
|
December 31, 2014
|
||||
|
(In millions)
|
||||||
New vehicles
|
$
|
696.4
|
|
|
$
|
699.5
|
|
Used vehicles
|
147.1
|
|
|
141.7
|
|
||
Parts and accessories
|
44.1
|
|
|
44.8
|
|
||
Total inventories
|
$
|
887.6
|
|
|
$
|
886.0
|
|
|
As of
|
||||||
|
September 30, 2015
|
|
December 31, 2014
|
||||
|
(In millions)
|
||||||
Assets:
|
|
|
|
||||
Inventories
|
$
|
27.1
|
|
|
$
|
—
|
|
Property and equipment, net
|
18.1
|
|
|
6.4
|
|
||
Franchise rights
|
0.4
|
|
|
—
|
|
||
Goodwill
|
1.0
|
|
|
—
|
|
||
Total assets
|
46.6
|
|
|
6.4
|
|
||
Liabilities:
|
|
|
|
||||
Floor plan notes payable
|
23.9
|
|
|
—
|
|
||
Mortgage notes payable
|
6.5
|
|
|
—
|
|
||
Total liabilities
|
30.4
|
|
|
—
|
|
||
Net assets held for sale
|
$
|
16.2
|
|
|
$
|
6.4
|
|
|
As of
|
||||||
September 30, 2015
|
|
December 31, 2014
|
|||||
(In millions)
|
|||||||
6.0% Senior Subordinated Notes due 2024
|
$
|
400.0
|
|
|
$
|
400.0
|
|
Mortgage notes payable bearing interest at fixed and variable rates
|
196.0
|
|
|
232.3
|
|
||
Real estate credit agreement (a)
|
64.9
|
|
|
71.5
|
|
||
Master loan agreement (b)
|
97.3
|
|
|
—
|
|
||
Capital lease obligations
|
3.5
|
|
|
3.6
|
|
||
Long-term debt, including current portion
|
761.7
|
|
|
707.4
|
|
||
Less: current portion
|
(13.8
|
)
|
|
(28.7
|
)
|
||
Long-term debt
|
$
|
747.9
|
|
|
$
|
678.7
|
|
(a)
|
Real estate credit agreement does not include a
$3.8 million
mortgage note payable classified as Liabilities Associated with Assets Held for Sale as of
September 30, 2015
.
|
(b)
|
Master loan agreement does not include a
$2.7 million
mortgage note payable classified as Liabilities Associated with Assets Held for Sale as of
September 30, 2015
.
|
|
As of
|
||||||
|
September 30, 2015
|
|
December 31, 2014
|
||||
|
(In millions)
|
||||||
Carrying Value:
|
|
|
|
||||
6.0% Senior Subordinated Notes due 2024
|
$
|
400.0
|
|
|
$
|
400.0
|
|
Mortgage notes payable (a)
|
358.2
|
|
|
303.8
|
|
||
Total carrying value
|
$
|
758.2
|
|
|
$
|
703.8
|
|
|
|
|
|
||||
Fair Value:
|
|
|
|
||||
6.0% Senior Subordinated Notes due 2024
|
$
|
413.0
|
|
|
$
|
407.0
|
|
Mortgage notes payable (a)
|
368.0
|
|
|
318.0
|
|
||
Total fair value
|
$
|
781.0
|
|
|
$
|
725.0
|
|
(a)
|
Mortgage notes payable do not include mortgages with a
$6.5 million
carrying value classified as Liabilities Associated with Assets Held for Sale as of
September 30, 2015
.
|
For the Three Months Ended September 30,
|
|
Derivative in Cash Flow Hedging Relationships
|
|
Results
Recognized in AOCI (Effective Portion) |
|
Location of Results
Reclassified from AOCI to Earnings |
|
Amount Reclassified from AOCI to Earnings–Active Swaps
|
|
Ineffective Results Recognized in Earnings
|
|
Location of
Ineffective Results |
||||||
2015
|
|
Interest rate swaps
|
|
$
|
(5.0
|
)
|
|
Swap interest expense
|
|
$
|
(1.0
|
)
|
|
$
|
—
|
|
|
N/A
|
2014
|
|
Interest rate swaps
|
|
$
|
(0.4
|
)
|
|
Swap interest expense
|
|
$
|
(0.5
|
)
|
|
$
|
—
|
|
|
N/A
|
For the Nine Months Ended September 30,
|
|
Derivative in Cash Flow Hedging Relationships
|
|
Results
Recognized
in AOCI
(Effective
Portion)
|
|
Location of Results
Reclassified from
AOCI to Earnings
|
|
Amount Reclassified from AOCI to Earnings–Active Swaps
|
|
Ineffective Results Recognized in Earnings
|
|
Location of
Ineffective Results
|
||||||
2015
|
|
Interest rate swaps
|
|
$
|
(7.0
|
)
|
|
Swap interest expense
|
|
$
|
(2.0
|
)
|
|
$
|
—
|
|
|
N/A
|
2014
|
|
Interest rate swaps
|
|
$
|
(3.2
|
)
|
|
Swap interest expense
|
|
$
|
(1.5
|
)
|
|
$
|
—
|
|
|
N/A
|
Information about adjustments to AOCI
|
|
(In millions)
|
||
Accumulated other comprehensive loss
—
December 31, 2014
|
|
$
|
(1.5
|
)
|
Change in fair value of cash flow swaps
|
|
(5.0
|
)
|
|
Income tax impact associated with cash flow swaps
|
|
1.9
|
|
|
Accumulated other comprehensive loss—September 30, 2015
|
|
$
|
(4.6
|
)
|
Type of Derivative
|
|
Notional Size
|
|
Underlying Rate
|
|
Expiration
|
|
Fair Value
|
||||
Interest Rate Swap*
|
|
$
|
100.0
|
|
|
1 month LIBOR
|
|
February 2025
|
|
$
|
(4.2
|
)
|
Interest Rate Swap*
|
|
$
|
68.7
|
|
|
1 month LIBOR
|
|
September 2023
|
|
$
|
(3.6
|
)
|
Interest Rate Swap*
|
|
$
|
16.2
|
|
|
1 month LIBOR
|
|
October 2015
|
|
$
|
(0.1
|
)
|
Type of Derivative
|
|
Notional Size
|
|
Underlying Rate
|
|
Expiration
|
|
Fair Value
|
||||
Interest Rate Swap*
|
|
$
|
71.5
|
|
|
1 month LIBOR
|
|
September 2023
|
|
$
|
(2.5
|
)
|
Interest Rate Swap*
|
|
$
|
17.2
|
|
|
1 month LIBOR
|
|
October 2015
|
|
$
|
(0.2
|
)
|
•
|
our ability to execute our business strategy;
|
•
|
the seasonally adjusted annual rate (“SAAR”) of new vehicle sales in the U.S.;
|
•
|
our ability to further improve our operating cash flows, and the availability of capital and liquidity;
|
•
|
our estimated future capital expenditures;
|
•
|
the duration of the economic recovery process and its impact on our revenues and expenses;
|
•
|
our parts and service revenue due to, among other things, improvements in manufacturing quality;
|
•
|
the variable nature of significant components of our cost structure;
|
•
|
our ability to limit our exposure to regional economic downturns due to our geographic diversity and brand mix;
|
•
|
manufacturers’ willingness to continue to use incentive programs to drive demand for their product offerings;
|
•
|
our ability to leverage our common systems, infrastructure and processes in a cost-efficient manner;
|
•
|
our capital allocation strategy, including acquisitions and divestitures, stock repurchases and capital expenditures;
|
•
|
the continued availability of financing, including floor plan financing for inventory;
|
•
|
the ability of consumers to secure vehicle financing, including at favorable rates;
|
•
|
the growth of mid-line import and luxury brands over the long-term;
|
•
|
our ability to mitigate any future negative trends in new vehicle sales; and
|
•
|
our ability to increase our cash flow and net income as a result of the foregoing and other factors.
|
•
|
our ability to execute our balanced automotive retailing and service business strategy;
|
•
|
changes in the mix, and total number, of vehicles we are able to sell;
|
•
|
changes in general economic and business conditions, including changes in consumer confidence levels, interest rates, consumer credit availability and employment levels;
|
•
|
changes in laws and regulations governing the operation of automobile franchises, including trade restrictions, consumer protections, accounting standards, taxation requirements and environmental laws;
|
•
|
changes in the price of oil and gasoline;
|
•
|
the timing and extent of any manufacturer recalls;
|
•
|
our ability to generate sufficient cash flows, maintain our liquidity and obtain any necessary additional funds for working capital, capital expenditures, acquisitions, stock repurchases, debt maturity payments and other corporate purposes, if necessary or desirable;
|
•
|
our continued ability to comply with applicable covenants in various of our financing and lease agreements, or to obtain waivers of these covenants as necessary;
|
•
|
our relationships with, and the reputation and financial health and viability of, the vehicle manufacturers whose brands we sell, and their ability to design, manufacture, deliver and market their vehicles successfully;
|
•
|
significant disruptions in the production and delivery of vehicles and parts for any reason, including natural disasters, product recalls, work stoppages or other occurrences that are outside of our control;
|
•
|
adverse results from litigation or other similar proceedings involving us;
|
•
|
our relationships with, and the financial stability of, our lenders and lessors;
|
•
|
our ability to execute our initiatives and other strategies;
|
•
|
high levels of competition in our industry, which may create pricing and margin pressures on our products and services;
|
•
|
our ability to renew, and enter into new, framework and dealer agreements with vehicle manufacturers whose brands we sell, on terms acceptable to us;
|
•
|
our ability to attract and to retain key personnel;
|
•
|
our ability to leverage gains from our dealership portfolio; and
|
•
|
any disruptions in the financial markets, which may impact our ability to access capital.
|
|
For the Three Months Ended September 30,
|
|
Increase
(Decrease)
|
|
%
Change
|
|||||||||
|
2015
|
|
2014
|
|
||||||||||
|
(Dollars in millions, except per share data)
|
|||||||||||||
REVENUE:
|
|
|
|
|
|
|
|
|||||||
New vehicle
|
$
|
964.0
|
|
|
$
|
821.3
|
|
|
$
|
142.7
|
|
|
17
|
%
|
Used vehicle
|
493.0
|
|
|
457.0
|
|
|
36.0
|
|
|
8
|
%
|
|||
Parts and service
|
190.6
|
|
|
168.3
|
|
|
22.3
|
|
|
13
|
%
|
|||
Finance and insurance, net
|
68.8
|
|
|
59.0
|
|
|
9.8
|
|
|
17
|
%
|
|||
TOTAL REVENUE
|
1,716.4
|
|
|
1,505.6
|
|
|
210.8
|
|
|
14
|
%
|
|||
GROSS PROFIT:
|
|
|
|
|
|
|
|
|||||||
New vehicle
|
52.3
|
|
|
49.2
|
|
|
3.1
|
|
|
6
|
%
|
|||
Used vehicle
|
33.4
|
|
|
31.2
|
|
|
2.2
|
|
|
7
|
%
|
|||
Parts and service
|
118.2
|
|
|
105.2
|
|
|
13.0
|
|
|
12
|
%
|
|||
Finance and insurance, net
|
68.8
|
|
|
59.0
|
|
|
9.8
|
|
|
17
|
%
|
|||
TOTAL GROSS PROFIT
|
272.7
|
|
|
244.6
|
|
|
28.1
|
|
|
11
|
%
|
|||
OPERATING EXPENSES:
|
|
|
|
|
|
|
|
|||||||
Selling, general and administrative
|
188.8
|
|
|
171.5
|
|
|
17.3
|
|
|
10
|
%
|
|||
Depreciation and amortization
|
7.5
|
|
|
6.7
|
|
|
0.8
|
|
|
12
|
%
|
|||
Other operating (income) expense, net
|
(0.2
|
)
|
|
0.3
|
|
|
(0.5
|
)
|
|
NM
|
|
|||
INCOME FROM OPERATIONS
|
76.6
|
|
|
66.1
|
|
|
10.5
|
|
|
16
|
%
|
|||
OTHER (INCOME) EXPENSES:
|
|
|
|
|
|
|
|
|||||||
Floor plan interest expense
|
4.1
|
|
|
3.0
|
|
|
1.1
|
|
|
37
|
%
|
|||
Other interest expense, net
|
10.7
|
|
|
9.6
|
|
|
1.1
|
|
|
11
|
%
|
|||
Swap interest expense
|
1.0
|
|
|
0.5
|
|
|
0.5
|
|
|
100
|
%
|
|||
Gain on divestitures
|
(21.4
|
)
|
|
—
|
|
|
(21.4
|
)
|
|
NM
|
|
|||
Total other (income) expenses, net
|
(5.6
|
)
|
|
13.1
|
|
|
(18.7
|
)
|
|
NM
|
|
|||
INCOME FROM CONTINUING OPERATIONS BEFORE INCOME TAXES
|
82.2
|
|
|
53.0
|
|
|
29.2
|
|
|
55
|
%
|
|||
Income tax expense
|
31.0
|
|
|
20.6
|
|
|
10.4
|
|
|
50
|
%
|
|||
INCOME FROM CONTINUING OPERATIONS
|
51.2
|
|
|
32.4
|
|
|
18.8
|
|
|
58
|
%
|
|||
Discontinued operations, net of tax
|
(0.1
|
)
|
|
0.1
|
|
|
(0.2
|
)
|
|
NM
|
|
|||
NET INCOME
|
$
|
51.1
|
|
|
$
|
32.5
|
|
|
$
|
18.6
|
|
|
57
|
%
|
Income from continuing operations per common share—Diluted
|
$
|
1.96
|
|
|
$
|
1.08
|
|
|
$
|
0.88
|
|
|
81
|
%
|
Net income per common share—Diluted
|
$
|
1.96
|
|
|
$
|
1.08
|
|
|
$
|
0.88
|
|
|
81
|
%
|
|
For the Three Months Ended September 30,
|
||||
|
2015
|
|
2014
|
||
REVENUE MIX PERCENTAGES:
|
|
|
|
||
New vehicles
|
56.2
|
%
|
|
54.5
|
%
|
Used retail vehicles
|
25.5
|
%
|
|
26.6
|
%
|
Used vehicle wholesale
|
3.2
|
%
|
|
3.8
|
%
|
Parts and service
|
11.1
|
%
|
|
11.2
|
%
|
Finance and insurance, net
|
4.0
|
%
|
|
3.9
|
%
|
Total revenue
|
100.0
|
%
|
|
100.0
|
%
|
GROSS PROFIT MIX PERCENTAGES:
|
|
|
|
||
New vehicles
|
19.2
|
%
|
|
20.1
|
%
|
Used retail vehicles
|
13.0
|
%
|
|
13.4
|
%
|
Used vehicle wholesale
|
(0.7
|
)%
|
|
(0.6
|
)%
|
Parts and service
|
43.3
|
%
|
|
43.0
|
%
|
Finance and insurance, net
|
25.2
|
%
|
|
24.1
|
%
|
Total gross profit
|
100.0
|
%
|
|
100.0
|
%
|
GROSS PROFIT MARGIN
|
15.9
|
%
|
|
16.2
|
%
|
SG&A EXPENSES AS A PERCENTAGE OF GROSS PROFIT
|
69.2
|
%
|
|
70.1
|
%
|
|
For the Three Months Ended September 30,
|
|
Increase (Decrease)
|
|
%
Change
|
|||||||||
|
2015
|
|
2014
|
|
||||||||||
|
(Dollars in millions, except for per vehicle data)
|
|||||||||||||
As Reported:
|
|
|
|
|
|
|
|
|||||||
Revenue:
|
|
|
|
|
|
|
|
|||||||
Luxury
|
$
|
322.3
|
|
|
$
|
300.5
|
|
|
$
|
21.8
|
|
|
7
|
%
|
Mid-line import
|
442.5
|
|
|
408.7
|
|
|
33.8
|
|
|
8
|
%
|
|||
Mid-line domestic
|
199.2
|
|
|
112.1
|
|
|
87.1
|
|
|
78
|
%
|
|||
Total new vehicle revenue
|
$
|
964.0
|
|
|
$
|
821.3
|
|
|
$
|
142.7
|
|
|
17
|
%
|
Gross profit:
|
|
|
|
|
|
|
|
|||||||
Luxury
|
$
|
20.4
|
|
|
$
|
21.5
|
|
|
$
|
(1.1
|
)
|
|
(5
|
)%
|
Mid-line import
|
20.5
|
|
|
21.0
|
|
|
(0.5
|
)
|
|
(2
|
)%
|
|||
Mid-line domestic
|
11.4
|
|
|
6.7
|
|
|
4.7
|
|
|
70
|
%
|
|||
Total new vehicle gross profit
|
$
|
52.3
|
|
|
$
|
49.2
|
|
|
$
|
3.1
|
|
|
6
|
%
|
New vehicle units:
|
|
|
|
|
|
|
|
|||||||
Luxury
|
6,381
|
|
|
5,939
|
|
|
442
|
|
|
7
|
%
|
|||
Mid-line import
|
16,501
|
|
|
15,457
|
|
|
1,044
|
|
|
7
|
%
|
|||
Mid-line domestic
|
5,482
|
|
|
3,258
|
|
|
2,224
|
|
|
68
|
%
|
|||
Total new vehicle units
|
28,364
|
|
|
24,654
|
|
|
3,710
|
|
|
15
|
%
|
|||
|
|
|
|
|
|
|
|
|||||||
Same Store (1):
|
|
|
|
|
|
|
|
|||||||
Revenue:
|
|
|
|
|
|
|
|
|||||||
Luxury
|
$
|
321.8
|
|
|
$
|
290.2
|
|
|
$
|
31.6
|
|
|
11
|
%
|
Mid-line import
|
431.6
|
|
|
405.1
|
|
|
26.5
|
|
|
7
|
%
|
|||
Mid-line domestic
|
137.1
|
|
|
112.1
|
|
|
25.0
|
|
|
22
|
%
|
|||
Total new vehicle revenue
|
$
|
890.5
|
|
|
$
|
807.4
|
|
|
$
|
83.1
|
|
|
10
|
%
|
Gross profit:
|
|
|
|
|
|
|
|
|||||||
Luxury
|
$
|
20.4
|
|
|
$
|
20.8
|
|
|
$
|
(0.4
|
)
|
|
(2
|
)%
|
Mid-line import
|
20.0
|
|
|
20.7
|
|
|
(0.7
|
)
|
|
(3
|
)%
|
|||
Mid-line domestic
|
7.8
|
|
|
6.7
|
|
|
1.1
|
|
|
16
|
%
|
|||
Total new vehicle gross profit
|
$
|
48.2
|
|
|
$
|
48.2
|
|
|
$
|
—
|
|
|
—
|
%
|
New vehicle units
|
|
|
|
|
|
|
|
|||||||
Luxury
|
6,371
|
|
|
5,740
|
|
|
631
|
|
|
11
|
%
|
|||
Mid-line import
|
16,096
|
|
|
15,326
|
|
|
770
|
|
|
5
|
%
|
|||
Mid-line domestic
|
3,763
|
|
|
3,258
|
|
|
505
|
|
|
16
|
%
|
|||
Total new vehicle units
|
26,230
|
|
|
24,324
|
|
|
1,906
|
|
|
8
|
%
|
(1)
|
Same store amounts consist of information from dealerships which we operated for all of the months in both comparative periods
|
|
For the Three Months Ended September 30,
|
|
Increase (Decrease)
|
|
%
Change
|
|||||||||
|
2015
|
|
2014
|
|
||||||||||
As Reported:
|
|
|
|
|
|
|
|
|||||||
Revenue per new vehicle sold
|
$
|
33,987
|
|
|
$
|
33,313
|
|
|
$
|
674
|
|
|
2
|
%
|
Gross profit per new vehicle sold
|
$
|
1,844
|
|
|
$
|
1,996
|
|
|
$
|
(152
|
)
|
|
(8
|
)%
|
New vehicle gross margin
|
5.4
|
%
|
|
6.0
|
%
|
|
(0.6
|
)%
|
|
|
|
|||
|
|
|
|
|
|
|
|
|||||||
Same Store (1):
|
|
|
|
|
|
|
|
|||||||
Revenue per new vehicle sold
|
$
|
33,950
|
|
|
$
|
33,194
|
|
|
$
|
756
|
|
|
2
|
%
|
Gross profit per new vehicle sold
|
$
|
1,838
|
|
|
$
|
1,982
|
|
|
$
|
(144
|
)
|
|
(7
|
)%
|
New vehicle gross margin
|
5.4
|
%
|
|
6.0
|
%
|
|
(0.6
|
)%
|
|
|
|
(1)
|
Same store amounts consist of information from dealerships which we operated for all of the months in both comparative periods
|
|
For the Three Months Ended September 30,
|
|
Increase (Decrease)
|
|
%
Change
|
|||||||||
|
2015
|
|
2014
|
|
||||||||||
|
(Dollars in millions, except for per vehicle data)
|
|||||||||||||
As Reported:
|
|
|
|
|
|
|
|
|||||||
Revenue:
|
|
|
|
|
|
|
|
|||||||
Used vehicle retail revenues
|
$
|
438.8
|
|
|
$
|
399.6
|
|
|
$
|
39.2
|
|
|
10
|
%
|
Used vehicle wholesale revenues
|
54.2
|
|
|
57.4
|
|
|
(3.2
|
)
|
|
(6
|
)%
|
|||
Used vehicle revenue
|
$
|
493.0
|
|
|
$
|
457.0
|
|
|
$
|
36.0
|
|
|
8
|
%
|
Gross profit:
|
|
|
|
|
|
|
|
|||||||
Used vehicle retail gross profit
|
$
|
35.2
|
|
|
$
|
32.6
|
|
|
$
|
2.6
|
|
|
8
|
%
|
Used vehicle wholesale gross profit
|
(1.8
|
)
|
|
(1.4
|
)
|
|
(0.4
|
)
|
|
(29
|
)%
|
|||
Used vehicle gross profit
|
$
|
33.4
|
|
|
$
|
31.2
|
|
|
$
|
2.2
|
|
|
7
|
%
|
Used vehicle retail units:
|
|
|
|
|
|
|
|
|||||||
Used vehicle retail units
|
21,306
|
|
|
19,625
|
|
|
1,681
|
|
|
9
|
%
|
|||
|
|
|
|
|
|
|
|
|||||||
Same Store (1):
|
|
|
|
|
|
|
|
|||||||
Revenue:
|
|
|
|
|
|
|
|
|||||||
Used vehicle retail revenues
|
$
|
407.0
|
|
|
$
|
391.8
|
|
|
$
|
15.2
|
|
|
4
|
%
|
Used vehicle wholesale revenues
|
50.8
|
|
|
56.1
|
|
|
(5.3
|
)
|
|
(9
|
)%
|
|||
Used vehicle revenue
|
$
|
457.8
|
|
|
$
|
447.9
|
|
|
$
|
9.9
|
|
|
2
|
%
|
Gross profit:
|
|
|
|
|
|
|
|
|||||||
Used vehicle retail gross profit
|
$
|
32.7
|
|
|
$
|
32.0
|
|
|
$
|
0.7
|
|
|
2
|
%
|
Used vehicle wholesale gross profit
|
(1.7
|
)
|
|
(1.4
|
)
|
|
(0.3
|
)
|
|
(21
|
)%
|
|||
Used vehicle gross profit
|
$
|
31.0
|
|
|
$
|
30.6
|
|
|
$
|
0.4
|
|
|
1
|
%
|
Used vehicle retail units:
|
|
|
|
|
|
|
|
|||||||
Used vehicle retail units
|
19,649
|
|
|
19,303
|
|
|
346
|
|
|
2
|
%
|
|
For the Three Months Ended September 30,
|
|
Increase (Decrease)
|
|
%
Change
|
|||||||||
|
2015
|
|
2014
|
|
||||||||||
As Reported:
|
|
|
|
|
|
|
|
|||||||
Revenue per used vehicle retailed
|
$
|
20,595
|
|
|
$
|
20,362
|
|
|
$
|
233
|
|
|
1
|
%
|
Gross profit per used vehicle retailed
|
$
|
1,652
|
|
|
$
|
1,661
|
|
|
$
|
(9
|
)
|
|
(1
|
)%
|
Used vehicle retail gross margin
|
8.0
|
%
|
|
8.2
|
%
|
|
(0.2
|
)%
|
|
|
|
|||
|
|
|
|
|
|
|
|
|||||||
Same Store (1):
|
|
|
|
|
|
|
|
|||||||
Revenue per used vehicle retailed
|
$
|
20,714
|
|
|
$
|
20,297
|
|
|
$
|
417
|
|
|
2
|
%
|
Gross profit per used vehicle retailed
|
$
|
1,664
|
|
|
$
|
1,658
|
|
|
$
|
6
|
|
|
—
|
%
|
Used vehicle retail gross margin
|
8.0
|
%
|
|
8.2
|
%
|
|
(0.2
|
)%
|
|
|
|
(1)
|
Same store amounts consist of information from dealerships which we operated for all of the months in both comparative periods
|
|
For the Three Months Ended September 30,
|
|
Increase
(Decrease)
|
|
%
Change
|
|||||||||
|
2015
|
|
2014
|
|
||||||||||
|
(Dollars in millions)
|
|||||||||||||
As Reported:
|
|
|
|
|
|
|
|
|||||||
Parts and service revenue
|
$
|
190.6
|
|
|
$
|
168.3
|
|
|
$
|
22.3
|
|
|
13
|
%
|
Parts and service gross profit:
|
|
|
|
|
|
|
|
|||||||
Customer pay
|
$
|
63.5
|
|
|
$
|
58.3
|
|
|
$
|
5.2
|
|
|
9
|
%
|
Reconditioning and preparation
|
30.9
|
|
|
27.5
|
|
|
3.4
|
|
|
12
|
%
|
|||
Warranty
|
18.5
|
|
|
14.3
|
|
|
4.2
|
|
|
29
|
%
|
|||
Wholesale parts
|
5.3
|
|
|
5.1
|
|
|
0.2
|
|
|
4
|
%
|
|||
Total parts and service gross profit
|
$
|
118.2
|
|
|
$
|
105.2
|
|
|
$
|
13.0
|
|
|
12
|
%
|
Parts and service gross margin
|
62.0
|
%
|
|
62.5
|
%
|
|
(0.5
|
)%
|
|
|
|
|||
|
|
|
|
|
|
|
|
|||||||
Same Store (1):
|
|
|
|
|
|
|
|
|||||||
Parts and service revenue
|
$
|
181.3
|
|
|
$
|
163.9
|
|
|
$
|
17.4
|
|
|
11
|
%
|
Parts and service gross profit:
|
|
|
|
|
|
|
|
|||||||
Customer pay
|
$
|
60.8
|
|
|
$
|
57.5
|
|
|
$
|
3.3
|
|
|
6
|
%
|
Reconditioning and preparation
|
29.1
|
|
|
27.2
|
|
|
1.9
|
|
|
7
|
%
|
|||
Warranty
|
17.4
|
|
|
13.4
|
|
|
4.0
|
|
|
30
|
%
|
|||
Wholesale parts
|
5.1
|
|
|
4.9
|
|
|
0.2
|
|
|
4
|
%
|
|||
Total parts and service gross profit
|
$
|
112.4
|
|
|
$
|
103.0
|
|
|
$
|
9.4
|
|
|
9
|
%
|
Parts and service gross margin
|
62.0
|
%
|
|
62.8
|
%
|
|
(0.8
|
)%
|
|
|
|
(1)
|
Same store amounts consist of information from dealerships which we operated for all of the months in both comparative periods
|
|
For the Three Months Ended September 30,
|
|
Increase
|
|
%
Change
|
|||||||||
|
2015
|
|
2014
|
|
||||||||||
|
(Dollars in millions, except for per vehicle data)
|
|||||||||||||
As Reported:
|
|
|
|
|
|
|
|
|||||||
Finance and insurance, net
|
$
|
68.8
|
|
|
$
|
59.0
|
|
|
$
|
9.8
|
|
|
17
|
%
|
Finance and insurance, net per vehicle sold
|
$
|
1,385
|
|
|
$
|
1,332
|
|
|
$
|
53
|
|
|
4
|
%
|
|
|
|
|
|
|
|
|
|||||||
Same Store (1):
|
|
|
|
|
|
|
|
|||||||
Finance and insurance, net
|
$
|
62.5
|
|
|
$
|
58.2
|
|
|
$
|
4.3
|
|
|
7
|
%
|
Finance and insurance, net per vehicle sold
|
$
|
1,362
|
|
|
$
|
1,334
|
|
|
$
|
28
|
|
|
2
|
%
|
(1)
|
Same store amounts consist of information from dealerships which we operated for all of the months in both comparative periods
|
|
For the Three Months Ended September 30,
|
|
Increase
(Decrease)
|
|
% of Gross
Profit (Decrease) Increase
|
|||||||||||||||
|
2015
|
|
% of Gross
Profit
|
|
2014
|
|
% of Gross
Profit
|
|
||||||||||||
|
(Dollars in millions)
|
|||||||||||||||||||
As Reported:
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Personnel costs
|
$
|
86.1
|
|
|
31.6
|
%
|
|
$
|
77.0
|
|
|
31.5
|
%
|
|
$
|
9.1
|
|
|
0.1
|
%
|
Sales compensation
|
30.3
|
|
|
11.1
|
%
|
|
26.1
|
|
|
10.7
|
%
|
|
4.2
|
|
|
0.4
|
%
|
|||
Share-based compensation
|
2.4
|
|
|
0.9
|
%
|
|
2.4
|
|
|
1.0
|
%
|
|
—
|
|
|
(0.1
|
)%
|
|||
Outside services
|
19.9
|
|
|
7.3
|
%
|
|
18.8
|
|
|
7.7
|
%
|
|
1.1
|
|
|
(0.4
|
)%
|
|||
Advertising
|
10.0
|
|
|
3.7
|
%
|
|
8.6
|
|
|
3.5
|
%
|
|
1.4
|
|
|
0.2
|
%
|
|||
Rent
|
8.0
|
|
|
2.9
|
%
|
|
7.8
|
|
|
3.2
|
%
|
|
0.2
|
|
|
(0.3
|
)%
|
|||
Utilities
|
4.6
|
|
|
1.7
|
%
|
|
4.5
|
|
|
1.8
|
%
|
|
0.1
|
|
|
(0.1
|
)%
|
|||
Insurance
|
3.0
|
|
|
1.1
|
%
|
|
3.8
|
|
|
1.6
|
%
|
|
(0.8
|
)
|
|
(0.5
|
)%
|
|||
Other
|
24.5
|
|
|
8.9
|
%
|
|
22.5
|
|
|
9.1
|
%
|
|
2.0
|
|
|
(0.2
|
)%
|
|||
Selling, general and administrative expense
|
$
|
188.8
|
|
|
69.2
|
%
|
|
$
|
171.5
|
|
|
70.1
|
%
|
|
$
|
17.3
|
|
|
(0.9
|
)%
|
Gross profit
|
$
|
272.7
|
|
|
|
|
$
|
244.6
|
|
|
|
|
|
|
|
|
For the Three Months Ended September 30,
|
|
Increase
(Decrease) |
|
% of Gross
Profit (Decrease) Increase |
|||||||||||||||
|
2015
|
|
% of Gross
Profit |
|
2014
|
|
% of Gross
Profit |
|
||||||||||||
|
(Dollars in millions)
|
|||||||||||||||||||
Same Store (1):
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Personnel costs
|
$
|
80.8
|
|
|
31.8
|
%
|
|
$
|
75.4
|
|
|
31.4
|
%
|
|
$
|
5.4
|
|
|
0.4
|
%
|
Sales compensation
|
27.8
|
|
|
10.9
|
%
|
|
25.7
|
|
|
10.7
|
%
|
|
2.1
|
|
|
0.2
|
%
|
|||
Share-based compensation
|
2.4
|
|
|
0.9
|
%
|
|
2.4
|
|
|
1.0
|
%
|
|
—
|
|
|
(0.1
|
)%
|
|||
Outside services
|
18.8
|
|
|
7.4
|
%
|
|
18.5
|
|
|
7.7
|
%
|
|
0.3
|
|
|
(0.3
|
)%
|
|||
Advertising
|
9.0
|
|
|
3.5
|
%
|
|
8.4
|
|
|
3.5
|
%
|
|
0.6
|
|
|
—
|
%
|
|||
Rent
|
8.0
|
|
|
3.1
|
%
|
|
7.8
|
|
|
3.3
|
%
|
|
0.2
|
|
|
(0.2
|
)%
|
|||
Utilities
|
4.3
|
|
|
1.7
|
%
|
|
4.4
|
|
|
1.8
|
%
|
|
(0.1
|
)
|
|
(0.1
|
)%
|
|||
Insurance
|
2.7
|
|
|
1.1
|
%
|
|
3.7
|
|
|
1.5
|
%
|
|
(1.0
|
)
|
|
(0.4
|
)%
|
|||
Other
|
23.6
|
|
|
9.4
|
%
|
|
22.0
|
|
|
9.2
|
%
|
|
1.6
|
|
|
0.2
|
%
|
|||
Selling, general and administrative expense
|
$
|
177.4
|
|
|
69.8
|
%
|
|
$
|
168.3
|
|
|
70.1
|
%
|
|
$
|
9.1
|
|
|
(0.3
|
)%
|
Gross profit
|
$
|
254.1
|
|
|
|
|
$
|
240.0
|
|
|
|
|
|
|
|
(1)
|
Same store amounts consist of information from dealerships which we operated for all of the months in both comparative periods
|
|
For the Nine Months Ended September 30,
|
|
Increase
(Decrease)
|
|
%
Change
|
|||||||||
|
2015
|
|
2014
|
|
||||||||||
|
(Dollars in millions, except per share data)
|
|||||||||||||
REVENUE:
|
|
|
|
|
|
|
|
|||||||
New vehicle
|
$
|
2,720.7
|
|
|
$
|
2,378.8
|
|
|
$
|
341.9
|
|
|
14
|
%
|
Used vehicle
|
1,474.0
|
|
|
1,319.2
|
|
|
154.8
|
|
|
12
|
%
|
|||
Parts and service
|
555.5
|
|
|
495.9
|
|
|
59.6
|
|
|
12
|
%
|
|||
Finance and insurance, net
|
197.6
|
|
|
170.8
|
|
|
26.8
|
|
|
16
|
%
|
|||
TOTAL REVENUE
|
4,947.8
|
|
|
4,364.7
|
|
|
583.1
|
|
|
13
|
%
|
|||
GROSS PROFIT:
|
|
|
|
|
|
|
|
|||||||
New vehicle
|
152.5
|
|
|
146.4
|
|
|
6.1
|
|
|
4
|
%
|
|||
Used vehicle
|
102.4
|
|
|
98.6
|
|
|
3.8
|
|
|
4
|
%
|
|||
Parts and service
|
347.9
|
|
|
306.8
|
|
|
41.1
|
|
|
13
|
%
|
|||
Finance and insurance, net
|
197.6
|
|
|
170.8
|
|
|
26.8
|
|
|
16
|
%
|
|||
TOTAL GROSS PROFIT
|
800.4
|
|
|
722.6
|
|
|
77.8
|
|
|
11
|
%
|
|||
OPERATING EXPENSES:
|
|
|
|
|
|
|
|
|||||||
Selling, general and administrative
|
546.4
|
|
|
500.5
|
|
|
45.9
|
|
|
9
|
%
|
|||
Depreciation and amortization
|
22.0
|
|
|
19.4
|
|
|
2.6
|
|
|
13
|
%
|
|||
Other operating expense, net
|
0.1
|
|
|
0.2
|
|
|
(0.1
|
)
|
|
NM
|
|
|||
INCOME FROM OPERATIONS
|
231.9
|
|
|
202.5
|
|
|
29.4
|
|
|
15
|
%
|
|||
OTHER (INCOME) EXPENSES:
|
|
|
|
|
|
|
|
|||||||
Floor plan interest expense
|
12.0
|
|
|
9.3
|
|
|
2.7
|
|
|
29
|
%
|
|||
Other interest expense, net
|
31.5
|
|
|
28.2
|
|
|
3.3
|
|
|
12
|
%
|
|||
Swap interest expense
|
2.0
|
|
|
1.5
|
|
|
0.5
|
|
|
33
|
%
|
|||
Gain on divestitures
|
(21.4
|
)
|
|
—
|
|
|
(21.4
|
)
|
|
NM
|
|
|||
Total other (income) expenses, net
|
24.1
|
|
|
39.0
|
|
|
(14.9
|
)
|
|
(38
|
)%
|
|||
INCOME FROM CONTINUING OPERATIONS BEFORE INCOME TAXES
|
207.8
|
|
|
163.5
|
|
|
44.3
|
|
|
27
|
%
|
|||
Income tax expense
|
79.6
|
|
|
63.4
|
|
|
16.2
|
|
|
26
|
%
|
|||
INCOME FROM CONTINUING OPERATIONS
|
128.2
|
|
|
100.1
|
|
|
28.1
|
|
|
28
|
%
|
|||
Discontinued operations, net of tax
|
(0.1
|
)
|
|
(0.3
|
)
|
|
0.2
|
|
|
(67
|
)%
|
|||
NET INCOME
|
$
|
128.1
|
|
|
$
|
99.8
|
|
|
$
|
28.3
|
|
|
28
|
%
|
Income from continuing operations per common share—Diluted
|
$
|
4.77
|
|
|
$
|
3.29
|
|
|
$
|
1.48
|
|
|
45
|
%
|
Net income per common share—Diluted
|
$
|
4.76
|
|
|
$
|
3.28
|
|
|
$
|
1.48
|
|
|
45
|
%
|
|
For the Nine Months Ended September 30,
|
||||
|
2015
|
|
2014
|
||
REVENUE MIX PERCENTAGES:
|
|
|
|
||
New vehicles
|
55.0
|
%
|
|
54.5
|
%
|
Used retail vehicles
|
26.5
|
%
|
|
26.6
|
%
|
Used vehicle wholesale
|
3.3
|
%
|
|
3.6
|
%
|
Parts and service
|
11.2
|
%
|
|
11.4
|
%
|
Finance and insurance, net
|
4.0
|
%
|
|
3.9
|
%
|
Total revenue
|
100.0
|
%
|
|
100.0
|
%
|
GROSS PROFIT MIX PERCENTAGES:
|
|
|
|
||
New vehicles
|
19.1
|
%
|
|
20.3
|
%
|
Used retail vehicles
|
13.1
|
%
|
|
13.7
|
%
|
Used vehicle wholesale
|
(0.4
|
)%
|
|
(0.1
|
)%
|
Parts and service
|
43.5
|
%
|
|
42.5
|
%
|
Finance and insurance, net
|
24.7
|
%
|
|
23.6
|
%
|
Total gross profit
|
100.0
|
%
|
|
100.0
|
%
|
GROSS PROFIT MARGIN
|
16.2
|
%
|
|
16.6
|
%
|
SG&A EXPENSES AS A PERCENTAGE OF GROSS PROFIT
|
68.3
|
%
|
|
69.3
|
%
|
|
For the Nine Months Ended September 30,
|
|
Increase
(Decrease)
|
|
%
Change
|
|||||||||
|
2015
|
|
2014
|
|
||||||||||
|
(Dollars in millions, except for per vehicle data)
|
|||||||||||||
As Reported:
|
|
|
|
|
|
|
|
|||||||
Revenue:
|
|
|
|
|
|
|
|
|||||||
Luxury
|
$
|
948.7
|
|
|
$
|
880.4
|
|
|
$
|
68.3
|
|
|
8
|
%
|
Mid-line import
|
1,265.5
|
|
|
1,161.2
|
|
|
104.3
|
|
|
9
|
%
|
|||
Mid-line domestic
|
506.5
|
|
|
337.2
|
|
|
169.3
|
|
|
50
|
%
|
|||
Total new vehicle revenue
|
$
|
2,720.7
|
|
|
$
|
2,378.8
|
|
|
$
|
341.9
|
|
|
14
|
%
|
Gross profit:
|
|
|
|
|
|
|
|
|||||||
Luxury
|
$
|
63.6
|
|
|
$
|
64.0
|
|
|
$
|
(0.4
|
)
|
|
(1
|
)%
|
Mid-line import
|
59.4
|
|
|
61.5
|
|
|
(2.1
|
)
|
|
(3
|
)%
|
|||
Mid-line domestic
|
29.5
|
|
|
20.9
|
|
|
8.6
|
|
|
41
|
%
|
|||
Total new vehicle gross profit
|
$
|
152.5
|
|
|
$
|
146.4
|
|
|
$
|
6.1
|
|
|
4
|
%
|
New vehicle units:
|
|
|
|
|
|
|
|
|||||||
Luxury
|
18,632
|
|
|
17,291
|
|
|
1,341
|
|
|
8
|
%
|
|||
Mid-line import
|
47,052
|
|
|
43,941
|
|
|
3,111
|
|
|
7
|
%
|
|||
Mid-line domestic
|
14,137
|
|
|
10,115
|
|
|
4,022
|
|
|
40
|
%
|
|||
Total new vehicle units
|
79,821
|
|
|
71,347
|
|
|
8,474
|
|
|
12
|
%
|
|||
|
|
|
|
|
|
|
|
|||||||
Same Store (1):
|
|
|
|
|
|
|
|
|||||||
Revenue:
|
|
|
|
|
|
|
|
|||||||
Luxury
|
$
|
928.1
|
|
|
$
|
847.7
|
|
|
$
|
80.4
|
|
|
9
|
%
|
Mid-line import
|
1,225.7
|
|
|
1,151.0
|
|
|
74.7
|
|
|
6
|
%
|
|||
Mid-line domestic
|
373.6
|
|
|
337.2
|
|
|
36.4
|
|
|
11
|
%
|
|||
Total new vehicle revenue
|
$
|
2,527.4
|
|
|
$
|
2,335.9
|
|
|
$
|
191.5
|
|
|
8
|
%
|
Gross profit:
|
|
|
|
|
|
|
|
|||||||
Luxury
|
$
|
62.5
|
|
|
$
|
61.8
|
|
|
$
|
0.7
|
|
|
1
|
%
|
Mid-line import
|
57.1
|
|
|
60.9
|
|
|
(3.8
|
)
|
|
(6
|
)%
|
|||
Mid-line domestic
|
22.0
|
|
|
20.9
|
|
|
1.1
|
|
|
5
|
%
|
|||
Total new vehicle gross profit
|
$
|
141.6
|
|
|
$
|
143.6
|
|
|
$
|
(2.0
|
)
|
|
(1
|
)%
|
New vehicle units:
|
|
|
|
|
|
|
|
|||||||
Luxury
|
18,254
|
|
|
16,667
|
|
|
1,587
|
|
|
10
|
%
|
|||
Mid-line import
|
45,604
|
|
|
43,575
|
|
|
2,029
|
|
|
5
|
%
|
|||
Mid-line domestic
|
10,500
|
|
|
10,115
|
|
|
385
|
|
|
4
|
%
|
|||
Total new vehicle units
|
74,358
|
|
|
70,357
|
|
|
4,001
|
|
|
6
|
%
|
(1)
|
Same store amounts consist of information from dealerships which we operated for all of the months in both comparative periods
|
|
For the Nine Months Ended September 30,
|
|
Increase (Decrease)
|
|
%
Change
|
|||||||||
|
2015
|
|
2014
|
|
||||||||||
As Reported:
|
|
|
|
|
|
|
|
|||||||
Revenue per new vehicle sold
|
$
|
34,085
|
|
|
$
|
33,341
|
|
|
$
|
744
|
|
|
2
|
%
|
Gross profit per new vehicle sold
|
$
|
1,911
|
|
|
$
|
2,052
|
|
|
$
|
(141
|
)
|
|
(7
|
)%
|
New vehicle gross margin
|
5.6
|
%
|
|
6.2
|
%
|
|
(0.6
|
)%
|
|
|
|
|||
|
|
|
|
|
|
|
|
|||||||
Same Store (1):
|
|
|
|
|
|
|
|
|||||||
Revenue per new vehicle sold
|
$
|
33,990
|
|
|
$
|
33,201
|
|
|
$
|
789
|
|
|
2
|
%
|
Gross profit per new vehicle sold
|
$
|
1,904
|
|
|
$
|
2,041
|
|
|
$
|
(137
|
)
|
|
(7
|
)%
|
New vehicle gross margin
|
5.6
|
%
|
|
6.1
|
%
|
|
(0.5
|
)%
|
|
|
|
(1)
|
Same store amounts consist of information from dealerships which we operated for all of the months in both comparative periods
|
|
For the Nine Months Ended September 30,
|
|
Increase (Decrease)
|
|
%
Change
|
|||||||||
|
2015
|
|
2014
|
|
||||||||||
|
(Dollars in millions, except for per vehicle data)
|
|||||||||||||
As Reported:
|
|
|
|
|
|
|
|
|||||||
Revenue:
|
|
|
|
|
|
|
|
|||||||
Used vehicle retail revenues
|
$
|
1,309.8
|
|
|
$
|
1,159.9
|
|
|
$
|
149.9
|
|
|
13
|
%
|
Used vehicle wholesale revenues
|
164.2
|
|
|
159.3
|
|
|
4.9
|
|
|
3
|
%
|
|||
Used vehicle revenue
|
$
|
1,474.0
|
|
|
$
|
1,319.2
|
|
|
$
|
154.8
|
|
|
12
|
%
|
Gross profit:
|
|
|
|
|
|
|
|
|||||||
Used vehicle retail gross profit
|
$
|
105.6
|
|
|
$
|
99.5
|
|
|
$
|
6.1
|
|
|
6
|
%
|
Used vehicle wholesale gross profit
|
(3.2
|
)
|
|
(0.9
|
)
|
|
(2.3
|
)
|
|
(256
|
)%
|
|||
Used vehicle gross profit
|
$
|
102.4
|
|
|
$
|
98.6
|
|
|
$
|
3.8
|
|
|
4
|
%
|
Used vehicle retail units:
|
|
|
|
|
|
|
|
|||||||
Used vehicle retail units
|
63,164
|
|
|
56,968
|
|
|
6,196
|
|
|
11
|
%
|
|||
|
|
|
|
|
|
|
|
|||||||
Same Store (1):
|
|
|
|
|
|
|
|
|||||||
Revenue:
|
|
|
|
|
|
|
|
|||||||
Used vehicle retail revenues
|
$
|
1,204.0
|
|
|
$
|
1,138.1
|
|
|
$
|
65.9
|
|
|
6
|
%
|
Used vehicle wholesale revenues
|
151.4
|
|
|
156.4
|
|
|
(5.0
|
)
|
|
(3
|
)%
|
|||
Used vehicle revenue
|
$
|
1,355.4
|
|
|
$
|
1,294.5
|
|
|
$
|
60.9
|
|
|
5
|
%
|
Gross profit:
|
|
|
|
|
|
|
|
|||||||
Used vehicle retail gross profit
|
$
|
98.1
|
|
|
$
|
98.0
|
|
|
$
|
0.1
|
|
|
—
|
%
|
Used vehicle wholesale gross profit
|
(2.8
|
)
|
|
(0.9
|
)
|
|
(1.9
|
)
|
|
211
|
%
|
|||
Used vehicle gross profit
|
$
|
95.3
|
|
|
$
|
97.1
|
|
|
$
|
(1.8
|
)
|
|
(2
|
)%
|
Used vehicle retail units:
|
|
|
|
|
|
|
|
|||||||
Used vehicle retail units
|
57,977
|
|
|
56,053
|
|
|
1,924
|
|
|
3
|
%
|
|
For the Nine Months Ended September 30,
|
|
Increase (Decrease)
|
|
%
Change
|
|||||||||
|
2015
|
|
2014
|
|
||||||||||
As Reported:
|
|
|
|
|
|
|
|
|||||||
Revenue per used vehicle retailed
|
$
|
20,736
|
|
|
$
|
20,361
|
|
|
$
|
375
|
|
|
2
|
%
|
Gross profit per used vehicle retailed
|
$
|
1,672
|
|
|
$
|
1,747
|
|
|
$
|
(75
|
)
|
|
(4
|
)%
|
Used vehicle retail gross margin
|
8.1
|
%
|
|
8.6
|
%
|
|
(0.5
|
)%
|
|
|
|
|||
|
|
|
|
|
|
|
|
|||||||
Same Store (1):
|
|
|
|
|
|
|
|
|||||||
Revenue per used vehicle retailed
|
$
|
20,767
|
|
|
$
|
20,304
|
|
|
$
|
463
|
|
|
2
|
%
|
Gross profit per used vehicle retailed
|
$
|
1,692
|
|
|
$
|
1,748
|
|
|
$
|
(56
|
)
|
|
(3
|
)%
|
Used vehicle retail gross margin
|
8.1
|
%
|
|
8.6
|
%
|
|
(0.5
|
)%
|
|
|
|
(1)
|
Same store amounts consist of information from dealerships which we operated for all of the months in both comparative periods
|
|
For the Nine Months Ended September 30,
|
|
Increase
|
|
%
Change
|
|||||||||
|
2015
|
|
2014
|
|
||||||||||
|
(Dollars in millions)
|
|||||||||||||
As Reported:
|
|
|
|
|
|
|
|
|||||||
Parts and service revenue
|
$
|
555.5
|
|
|
$
|
495.9
|
|
|
$
|
59.6
|
|
|
12
|
%
|
Parts and service gross profit:
|
|
|
|
|
|
|
|
|||||||
Customer pay
|
$
|
173.7
|
|
|
$
|
161.4
|
|
|
$
|
12.3
|
|
|
8
|
%
|
Reconditioning and preparation
|
76.5
|
|
|
63.9
|
|
|
12.6
|
|
|
20
|
%
|
|||
Warranty
|
41.1
|
|
|
34.9
|
|
|
6.2
|
|
|
18
|
%
|
|||
Wholesale parts
|
56.6
|
|
|
46.6
|
|
|
10.0
|
|
|
21
|
%
|
|||
Total parts and service gross profit
|
$
|
347.9
|
|
|
$
|
306.8
|
|
|
$
|
41.1
|
|
|
13
|
%
|
Parts and service gross margin
|
62.6
|
%
|
|
61.9
|
%
|
|
0.7
|
%
|
|
|
|
|||
|
|
|
|
|
|
|
|
|||||||
Same Store (1):
|
|
|
|
|
|
|
|
|||||||
Parts and service revenue
|
$
|
525.9
|
|
|
$
|
482.7
|
|
|
$
|
43.2
|
|
|
9
|
%
|
Parts and service gross profit:
|
|
|
|
|
|
|
|
|||||||
Customer pay
|
$
|
179.3
|
|
|
$
|
170.6
|
|
|
$
|
8.7
|
|
|
5
|
%
|
Reconditioning and preparation
|
85.5
|
|
|
75.5
|
|
|
10.0
|
|
|
13
|
%
|
|||
Warranty
|
49.4
|
|
|
38.6
|
|
|
10.8
|
|
|
28
|
%
|
|||
Wholesale parts
|
15.2
|
|
|
15.0
|
|
|
0.2
|
|
|
1
|
%
|
|||
Total parts and service gross profit
|
$
|
329.4
|
|
|
$
|
299.7
|
|
|
$
|
29.7
|
|
|
10
|
%
|
Parts and service gross margin
|
62.6
|
%
|
|
62.1
|
%
|
|
0.5
|
%
|
|
|
|
(1)
|
Same store amounts consist of information from dealerships which we operated for all of the months in both comparative periods
|
|
For the Nine Months Ended September 30,
|
|
Increase
|
|
%
Change
|
|||||||||
|
2015
|
|
2014
|
|
||||||||||
|
(Dollars in millions, except for per vehicle data)
|
|||||||||||||
As Reported:
|
|
|
|
|
|
|
|
|||||||
Finance and insurance, net
|
$
|
197.6
|
|
|
$
|
170.8
|
|
|
$
|
26.8
|
|
|
16
|
%
|
Finance and insurance, net per vehicle sold
|
$
|
1,382
|
|
|
$
|
1,331
|
|
|
$
|
51
|
|
|
4
|
%
|
|
|
|
|
|
|
|
|
|||||||
Same Store (1):
|
|
|
|
|
|
|
|
|||||||
Finance and insurance, net
|
$
|
181.3
|
|
|
$
|
168.5
|
|
|
$
|
12.8
|
|
|
8
|
%
|
Finance and insurance, net per vehicle sold
|
$
|
1,370
|
|
|
$
|
1,333
|
|
|
$
|
37
|
|
|
3
|
%
|
(1)
|
Same store amounts consist of information from dealerships which we operated for all of the months in both comparative periods
|
|
For the Nine Months Ended September 30,
|
|
Increase
|
|
% of Gross
Profit (Decrease) Increase
|
|||||||||||||||
|
2015
|
|
% of Gross
Profit
|
|
2014
|
|
% of Gross
Profit
|
|
||||||||||||
|
(Dollars in millions)
|
|||||||||||||||||||
As Reported:
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Personnel costs
|
$
|
251.6
|
|
|
31.4
|
%
|
|
$
|
231.5
|
|
|
32.0
|
%
|
|
$
|
20.1
|
|
|
(0.6
|
)%
|
Sales compensation
|
86.9
|
|
|
10.9
|
%
|
|
75.6
|
|
|
10.5
|
%
|
|
11.3
|
|
|
0.4
|
%
|
|||
Share-based compensation
|
7.7
|
|
|
1.0
|
%
|
|
6.7
|
|
|
0.9
|
%
|
|
1.0
|
|
|
0.1
|
%
|
|||
Outside services
|
56.9
|
|
|
7.1
|
%
|
|
53.2
|
|
|
7.4
|
%
|
|
3.7
|
|
|
(0.3
|
)%
|
|||
Advertising
|
29.0
|
|
|
3.6
|
%
|
|
25.1
|
|
|
3.5
|
%
|
|
3.9
|
|
|
0.1
|
%
|
|||
Rent
|
23.5
|
|
|
2.9
|
%
|
|
23.2
|
|
|
3.2
|
%
|
|
0.3
|
|
|
(0.3
|
)%
|
|||
Utilities
|
12.9
|
|
|
1.6
|
%
|
|
12.0
|
|
|
1.7
|
%
|
|
0.9
|
|
|
(0.1
|
)%
|
|||
Insurance
|
9.1
|
|
|
1.1
|
%
|
|
8.8
|
|
|
1.2
|
%
|
|
0.3
|
|
|
(0.1
|
)%
|
|||
Other
|
68.8
|
|
|
8.7
|
%
|
|
64.4
|
|
|
8.9
|
%
|
|
4.4
|
|
|
(0.2
|
)%
|
|||
Selling, general and administrative expense
|
$
|
546.4
|
|
|
68.3
|
%
|
|
$
|
500.5
|
|
|
69.3
|
%
|
|
$
|
45.9
|
|
|
(1.0
|
)%
|
Gross profit
|
$
|
800.4
|
|
|
|
|
$
|
722.6
|
|
|
|
|
|
|
|
|
For the Nine Months Ended September 30,
|
|
Increase
(Decrease) |
|
% of Gross
Profit (Decrease) Increase |
|||||||||||||||
|
2015
|
|
% of Gross
Profit |
|
2014
|
|
% of Gross
Profit |
|
|
|||||||||||
|
(Dollars in millions)
|
|||||||||||||||||||
Same Store (1):
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Personnel costs
|
$
|
235.8
|
|
|
31.5
|
%
|
|
$
|
226.7
|
|
|
32.0
|
%
|
|
$
|
9.1
|
|
|
(0.5
|
)%
|
Sales compensation
|
80.0
|
|
|
10.7
|
%
|
|
74.2
|
|
|
10.5
|
%
|
|
5.8
|
|
|
0.2
|
%
|
|||
Share-based compensation
|
7.7
|
|
|
1.0
|
%
|
|
6.7
|
|
|
0.9
|
%
|
|
1.0
|
|
|
0.1
|
%
|
|||
Outside services
|
53.7
|
|
|
7.2
|
%
|
|
52.4
|
|
|
7.4
|
%
|
|
1.3
|
|
|
(0.2
|
)%
|
|||
Advertising
|
25.9
|
|
|
3.5
|
%
|
|
24.6
|
|
|
3.5
|
%
|
|
1.3
|
|
|
—
|
%
|
|||
Rent
|
23.4
|
|
|
3.1
|
%
|
|
23.2
|
|
|
3.3
|
%
|
|
0.2
|
|
|
(0.2
|
)%
|
|||
Utilities
|
12.0
|
|
|
1.6
|
%
|
|
11.7
|
|
|
1.7
|
%
|
|
0.3
|
|
|
(0.1
|
)%
|
|||
Insurance
|
8.2
|
|
|
1.1
|
%
|
|
8.6
|
|
|
1.2
|
%
|
|
(0.4
|
)
|
|
(0.1
|
)%
|
|||
Other
|
65.9
|
|
|
8.9
|
%
|
|
62.8
|
|
|
8.7
|
%
|
|
3.1
|
|
|
0.2
|
%
|
|||
Selling, general and administrative expense
|
$
|
512.6
|
|
|
68.6
|
%
|
|
$
|
490.9
|
|
|
69.2
|
%
|
|
$
|
21.7
|
|
|
(0.6
|
)%
|
Gross profit
|
$
|
747.6
|
|
|
|
|
$
|
708.9
|
|
|
|
|
|
|
|
(1)
|
Same store amounts consist of information from dealerships which we operated for all of the months in both comparative periods
|
•
|
Revolving credit facility
—
a $175.0 million senior secured revolving credit facility for, among other things, acquisitions, working capital and capital expenditures, including a $50.0 million sublimit for letters of credit. Our borrowing capacity under the revolving credit facility is limited by a borrowing base calculation and any outstanding letters of credit. As of
September 30, 2015
, we had
$10.3 million
in outstanding letters of credit, resulting in
$164.7 million
of borrowing availability under our revolving credit facility. There were no amounts drawn under our revolving credit facility as of
September 30, 2015
.
|
•
|
New inventory floor plan facilities
—
an $825.0 million senior secured new vehicle revolving floor plan facility. In connection with the new vehicle floor plan facility, we established an account with Bank of America, N.A. (“Bank of America”) that allows us to transfer cash to an account as an offset to floor plan notes payable (a “floor plan offset account”). These transfers reduce the amount of outstanding new vehicle floor plan notes payable that would otherwise accrue interest, while retaining the ability to transfer amounts from the offset account into our operating cash accounts within one to two days. As a result of the use of our floor plan offset account, we experience a reduction in floor plan interest expense on our Condensed Consolidated Statements of Income. As of
September 30, 2015
, we had
$13.0 million
in this floor plan offset account. We also have a floor plan facility with Ford to purchase new Ford and Lincoln vehicle inventory, as well as facilities with certain other manufacturers for loaner vehicles. Neither our floor plan facility with Ford nor our facilities for loaner vehicles have stated borrowing limitations. As of
September 30, 2015
, we had $688.2 million, net, outstanding under our senior secured new vehicle revolving floor plan facility (including $23.9 million classified as Liabilities associated with assets held for sale) and
$108.6 million
outstanding under our floor plan facility with Ford.
|
•
|
Used vehicle floor plan facility
—
a $100.0 million senior secured used vehicle revolving floor plan facility to finance the acquisition of used vehicle inventory and for, among other things, working capital and capital expenditures, as well as to refinance used vehicles. Our borrowing capacity under the used vehicle floor plan facility is limited by a borrowing base calculation. We began the year with $2.0 million drawn on our used vehicle revolving floor plan facility and during the
nine
months ended
September 30, 2015
, we had borrowings of $254.0 million and made repayments of $191.0 million. As of
September 30, 2015
, we had $65.0 million outstanding and
$35.0 million
of remaining borrowing availability under our used vehicle revolving floor plan facility.
|
•
|
Real estate credit agreement
—
a real estate term loan credit agreement with an initial principal value of $75.0 million collateralized by first priority liens, subject to certain permitted exceptions, on all of the real property financed thereunder. As of
September 30, 2015
, the outstanding balance under the real estate credit agreement was
$64.9 million
.
|
•
|
Master Loan Facility
—
provides for term loans to certain of the Company’s subsidiaries in an aggregate amount not to exceed $100.0 million. Borrowings under the Master Loan Facility are guaranteed by the Company and are
|
•
|
Mortgage notes
—
as of
September 30, 2015
, we had
$196.0 million
of mortgage note obligations (excluding amounts outstanding under our real estate credit agreement and Master Loan Facility). These obligations are collateralized by the related real estate at our applicable owned dealership locations.
|
•
|
6.0% Senior Subordinated Notes due 2024 (“6.0% Notes”)
—
as of
September 30, 2015
we had $400.0 million in aggregate principal amount of our 6.0% Notes outstanding. We are required to pay interest on the 6.0% Notes on June 15 and December 15 of each year until their maturity on December 15, 2024.
|
|
For the Nine Months Ended September 30,
|
||||||
|
2015
|
|
2014
|
||||
|
(In millions)
|
||||||
Reconciliation of Cash provided by operating activities to Cash provided by operating activities, as adjusted
|
|
|
|
||||
Cash provided by operating activities, as reported
|
$
|
145.0
|
|
|
$
|
158.6
|
|
New and used vehicle floor plan borrowings
—
non-trade, net
|
114.5
|
|
|
(55.5
|
)
|
||
Cash provided by operating activities, as adjusted
|
$
|
259.5
|
|
|
$
|
103.1
|
|
•
|
$162.2 million related to a decrease in inventory, net of floor plan notes payable, primarily as a result of a $90.6 million net decrease in our floor plan offset account and a $63.0 million net increase in our used vehicle floor plan line borrowings;
|
•
|
$11.3 million increase in net income adjusted for non-cash items;
|
•
|
$16.6 million related to an increase in accounts payable and accrued expenses; and
|
•
|
$3.4 million related to a net increase in other long-term liabilities and assets.
|
•
|
$28.1 million related to a net increase in other current assets, primarily related to an increase in our loaner vehicle inventory and the turnover of that inventory; and
|
•
|
$9.0 million related to sales volume and the timing of collection of accounts receivable and contracts-in-transit.
|
Period
|
|
Total Number of Shares Purchased
|
|
Average 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 Plans or Program (in millions)
|
||||||
07/01/2015 - 07/31/2015
|
|
210,057
|
|
|
$
|
85.66
|
|
|
210,057
|
|
|
$
|
180.4
|
|
08/01/2015 - 08/31/2015
|
|
720,000
|
|
|
$
|
83.18
|
|
|
720,000
|
|
|
$
|
120.5
|
|
09/01/2015 - 09/30/2015
|
|
322,400
|
|
|
$
|
81.88
|
|
|
322,400
|
|
|
$
|
94.1
|
|
|
Asbury Automotive Group, Inc.
|
||
|
|
|
|
Date: October 22, 2015
|
By:
|
|
/s/ Craig T. Monaghan
|
|
Name:
|
|
Craig T. Monaghan
|
|
Title:
|
|
Chief Executive Officer and President
|
|
Asbury Automotive Group, Inc.
|
||
|
|
|
|
Date: October 22, 2015
|
By:
|
|
/s/ Keith R. Style
|
|
Name:
|
|
Keith R. Style
|
|
Title:
|
|
Senior Vice President and Chief Financial Officer
|
1.
|
I have reviewed this quarterly report on Form 10-Q of Asbury Automotive Group, 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 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 we 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;
|
5.
|
The registrant's other certifying officer 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/ Craig T. Monaghan
|
|
Craig T. Monaghan
Chief Executive Officer
October 22, 2015
|
|
1.
|
I have reviewed this quarterly report on Form 10-Q of Asbury Automotive Group, 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 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 we 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;
|
5.
|
The registrant's other certifying officer 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
|
(a)
|
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/ Keith R. Style
|
|
Keith R. Style
Chief Financial Officer October 22, 2015 |
|
(1)
|
The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; 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/ Craig T. Monaghan
|
|
Craig T. Monaghan
Chief Executive Officer
October 22, 2015
|
|
(1)
|
The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; 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/ Keith R. Style
|
|
Keith R. Style
Chief Financial Officer
October 22, 2015
|
|