|
|
|
☒
|
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
☐
|
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)
|
|
|
|
|
Trading
|
|
|
Title of each class
|
|
Symbol(s)
|
|
Name of each exchange on which registered
|
Common stock, $0.01 par value per share
|
|
ABG
|
|
New York Stock Exchange
|
Large Accelerated Filer
|
☒
|
|
Accelerated Filer
|
☐
|
|
|
|
|
|
Non-Accelerated Filer
|
☐
|
|
Smaller Reporting Company
|
☐
|
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|
Emerging Growth Company
|
☐
|
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Page
|
PART I—Financial Information
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
|
|
|
PART II—Other Information
|
|
|
|
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|
||
|
||
|
|
September 30, 2019
|
|
December 31, 2018
|
||||
ASSETS
|
|
|
|
||||
CURRENT ASSETS:
|
|
|
|
||||
Cash and cash equivalents
|
$
|
1.8
|
|
|
$
|
8.3
|
|
Contracts-in-transit
|
148.6
|
|
|
198.3
|
|
||
Accounts receivable, net
|
112.5
|
|
|
130.3
|
|
||
Inventories
|
1,030.1
|
|
|
1,067.6
|
|
||
Assets held for sale
|
26.1
|
|
|
26.3
|
|
||
Other current assets
|
128.9
|
|
|
122.2
|
|
||
Total current assets
|
1,448.0
|
|
|
1,553.0
|
|
||
PROPERTY AND EQUIPMENT, net
|
943.4
|
|
|
886.1
|
|
||
OPERATING LEASE RIGHT-OF-USE ASSETS
|
77.1
|
|
|
—
|
|
||
GOODWILL
|
272.1
|
|
|
181.2
|
|
||
INTANGIBLE FRANCHISE RIGHTS
|
65.8
|
|
|
65.8
|
|
||
OTHER LONG-TERM ASSETS
|
10.1
|
|
|
9.3
|
|
||
Total assets
|
$
|
2,816.5
|
|
|
$
|
2,695.4
|
|
LIABILITIES AND SHAREHOLDERS' EQUITY
|
|
|
|
||||
CURRENT LIABILITIES:
|
|
|
|
||||
Floor plan notes payable—trade, net
|
$
|
122.1
|
|
|
$
|
114.0
|
|
Floor plan notes payable—non-trade, net
|
738.9
|
|
|
852.1
|
|
||
Current maturities of long-term debt
|
38.1
|
|
|
38.8
|
|
||
Current maturities of operating leases
|
21.0
|
|
|
—
|
|
||
Accounts payable and accrued liabilities
|
315.0
|
|
|
298.4
|
|
||
Total current liabilities
|
1,235.1
|
|
|
1,303.3
|
|
||
LONG-TERM DEBT
|
867.8
|
|
|
866.5
|
|
||
OPERATING LEASE LIABILITIES
|
60.3
|
|
|
—
|
|
||
DEFERRED INCOME TAXES
|
20.4
|
|
|
21.7
|
|
||
OTHER LONG-TERM LIABILITIES
|
32.9
|
|
|
30.7
|
|
||
COMMITMENTS AND CONTINGENCIES (Note 12)
|
|
|
|
||||
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; 41,096,408 and 41,065,069 shares issued, including shares held in treasury, respectively
|
0.4
|
|
|
0.4
|
|
||
Additional paid-in capital
|
580.8
|
|
|
572.9
|
|
||
Retained earnings
|
1,050.9
|
|
|
922.7
|
|
||
Treasury stock, at cost; 21,791,707 and 21,719,339 shares, respectively
|
(1,028.6
|
)
|
|
(1,023.4
|
)
|
||
Accumulated other comprehensive (loss) income
|
(3.5
|
)
|
|
0.6
|
|
||
Total shareholders' equity
|
600.0
|
|
|
473.2
|
|
||
Total liabilities and shareholders' equity
|
$
|
2,816.5
|
|
|
$
|
2,695.4
|
|
|
For the Three Months Ended September 30,
|
|
For the Nine Months Ended September 30,
|
||||||||||||
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
REVENUE:
|
|
|
|
|
|
|
|
||||||||
New vehicle
|
$
|
986.9
|
|
|
$
|
980.5
|
|
|
$
|
2,823.9
|
|
|
$
|
2,766.3
|
|
Used vehicle
|
546.9
|
|
|
497.5
|
|
|
1,590.4
|
|
|
1,499.0
|
|
||||
Parts and service
|
227.6
|
|
|
206.1
|
|
|
669.7
|
|
|
609.9
|
|
||||
Finance and insurance, net
|
80.6
|
|
|
73.3
|
|
|
232.3
|
|
|
215.0
|
|
||||
TOTAL REVENUE
|
1,842.0
|
|
|
1,757.4
|
|
|
5,316.3
|
|
|
5,090.2
|
|
||||
COST OF SALES:
|
|
|
|
|
|
|
|
||||||||
New vehicle
|
948.3
|
|
|
938.4
|
|
|
2,709.1
|
|
|
2,645.0
|
|
||||
Used vehicle
|
514.5
|
|
|
464.7
|
|
|
1,487.6
|
|
|
1,398.6
|
|
||||
Parts and service
|
86.1
|
|
|
76.3
|
|
|
252.3
|
|
|
225.4
|
|
||||
TOTAL COST OF SALES
|
1,548.9
|
|
|
1,479.4
|
|
|
4,449.0
|
|
|
4,269.0
|
|
||||
GROSS PROFIT
|
293.1
|
|
|
278.0
|
|
|
867.3
|
|
|
821.2
|
|
||||
OPERATING EXPENSES:
|
|
|
|
|
|
|
|
||||||||
Selling, general, and administrative
|
202.0
|
|
|
188.8
|
|
|
593.7
|
|
|
563.6
|
|
||||
Depreciation and amortization
|
9.1
|
|
|
8.5
|
|
|
26.7
|
|
|
25.2
|
|
||||
Other operating (income) expense, net
|
(0.2
|
)
|
|
(0.1
|
)
|
|
1.0
|
|
|
(1.2
|
)
|
||||
INCOME FROM OPERATIONS
|
82.2
|
|
|
80.8
|
|
|
245.9
|
|
|
233.6
|
|
||||
OTHER EXPENSES (INCOME):
|
|
|
|
|
|
|
|
||||||||
Floor plan interest expense
|
9.0
|
|
|
8.4
|
|
|
29.7
|
|
|
23.0
|
|
||||
Other interest expense, net
|
13.7
|
|
|
13.2
|
|
|
41.2
|
|
|
39.4
|
|
||||
Swap interest expense
|
—
|
|
|
0.1
|
|
|
—
|
|
|
0.5
|
|
||||
Gain on divestiture
|
—
|
|
|
—
|
|
|
(11.7
|
)
|
|
—
|
|
||||
Total other expenses, net
|
22.7
|
|
|
21.7
|
|
|
59.2
|
|
|
62.9
|
|
||||
INCOME BEFORE INCOME TAXES
|
59.5
|
|
|
59.1
|
|
|
186.7
|
|
|
170.7
|
|
||||
Income tax expense
|
14.5
|
|
|
14.8
|
|
|
45.9
|
|
|
43.1
|
|
||||
NET INCOME
|
$
|
45.0
|
|
|
$
|
44.3
|
|
|
$
|
140.8
|
|
|
$
|
127.6
|
|
EARNINGS PER SHARE:
|
|
|
|
|
|
|
|
||||||||
Basic—
|
|
|
|
|
|
|
|
||||||||
Net income
|
$
|
2.36
|
|
|
$
|
2.22
|
|
|
$
|
7.37
|
|
|
$
|
6.29
|
|
Diluted—
|
|
|
|
|
|
|
|
||||||||
Net income
|
$
|
2.33
|
|
|
$
|
2.18
|
|
|
$
|
7.30
|
|
|
$
|
6.22
|
|
WEIGHTED AVERAGE SHARES OUTSTANDING:
|
|
|
|
|
|
|
|
||||||||
Basic
|
19.1
|
|
|
20.0
|
|
|
19.1
|
|
|
20.3
|
|
||||
Restricted stock
|
0.1
|
|
|
0.1
|
|
|
0.1
|
|
|
0.1
|
|
||||
Performance share units
|
0.1
|
|
|
0.2
|
|
|
0.1
|
|
|
0.1
|
|
||||
Diluted
|
19.3
|
|
|
20.3
|
|
|
19.3
|
|
|
20.5
|
|
|
For the Three Months Ended September 30,
|
|
For the Nine Months Ended September 30,
|
||||||||||||
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
Net income
|
$
|
45.0
|
|
|
$
|
44.3
|
|
|
$
|
140.8
|
|
|
$
|
127.6
|
|
Other comprehensive (loss) income:
|
|
|
|
|
|
|
|
||||||||
Change in fair value of cash flow swaps
|
(1.0
|
)
|
|
0.9
|
|
|
(5.3
|
)
|
|
4.9
|
|
||||
Income tax expense (benefit) associated with cash flow swaps
|
0.3
|
|
|
(0.2
|
)
|
|
1.4
|
|
|
(1.3
|
)
|
||||
Comprehensive income
|
$
|
44.3
|
|
|
$
|
45.0
|
|
|
$
|
136.9
|
|
|
$
|
131.2
|
|
|
Common Stock
|
|
Additional
Paid-in
Capital
|
|
Retained
Earnings
|
|
Treasury Stock
|
|
Accumulated
Other
Comprehensive
Income (Loss)
|
|
Total
|
||||||||||||||||||||||
|
Shares
|
|
Amount
|
|
|
|
Shares
|
|
Amount
|
|
|
||||||||||||||||||||||
Balances, December 31, 2018
|
41,065,069
|
|
|
$
|
0.4
|
|
|
$
|
572.9
|
|
|
$
|
922.7
|
|
|
21,719,339
|
|
|
$
|
(1,023.4
|
)
|
|
$
|
0.6
|
|
|
$
|
473.2
|
|
||||
Net income
|
—
|
|
|
—
|
|
|
—
|
|
|
40.9
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
40.9
|
|
||||||||||
Other comprehensive loss
|
—
|
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
|
(1.3
|
)
|
|
(1.3
|
)
|
||||||
Cumulative effect of change in accounting principle - ASU 2018-02
|
—
|
|
|
—
|
|
|
—
|
|
|
0.2
|
|
|
—
|
|
|
—
|
|
|
(0.2
|
)
|
|
—
|
|
||||||||||
Share-based compensation
|
—
|
|
|
—
|
|
|
3.9
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
3.9
|
|
||||||||||
Issuance of common stock, net of forfeitures in connection with share-based payment arrangements
|
238,078
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||||
Repurchase of common stock associated with net share settlement of employee share-based awards
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
66,912
|
|
|
(4.7
|
)
|
|
—
|
|
|
(4.7
|
)
|
||||||||||
Share repurchases
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
108,978
|
|
|
(7.4
|
)
|
|
—
|
|
|
(7.4
|
)
|
||||||||||
Retirement of previously repurchased common stock
|
(108,978
|
)
|
|
—
|
|
|
(1.3
|
)
|
|
(6.1
|
)
|
|
(108,978
|
)
|
|
7.4
|
|
|
—
|
|
|
—
|
|
||||||||||
Balances, March 31, 2019
|
41,194,169
|
|
|
$
|
0.4
|
|
|
$
|
575.5
|
|
|
$
|
957.7
|
|
|
21,786,251
|
|
|
$
|
(1,028.1
|
)
|
|
$
|
(0.9
|
)
|
|
$
|
504.6
|
|
||||
Net income
|
—
|
|
|
—
|
|
|
—
|
|
|
54.9
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
54.9
|
|
||||||||||
Other comprehensive loss
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1.9
|
)
|
|
(1.9
|
)
|
||||||||||
Share-based compensation
|
—
|
|
|
—
|
|
|
2.9
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2.9
|
|
||||||||||
Issuance of common stock, net of forfeitures in connection with share-based payment arrangements
|
(3,656
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||||
Repurchase of common stock associated with net share settlement of employee share-based awards
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
3,328
|
|
|
(0.3
|
)
|
|
—
|
|
|
(0.3
|
)
|
||||||||||
Share repurchases
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
50,436
|
|
|
(3.9
|
)
|
|
—
|
|
|
(3.9
|
)
|
||||||||||
Retirement of previously repurchased common stock
|
(50,436
|
)
|
|
—
|
|
|
(0.6
|
)
|
|
(3.3
|
)
|
|
(50,436
|
)
|
|
3.9
|
|
|
—
|
|
|
—
|
|
||||||||||
Balances, June 30, 2019
|
41,140,077
|
|
|
$
|
0.4
|
|
|
$
|
577.8
|
|
|
$
|
1,009.3
|
|
|
21,789,579
|
|
|
$
|
(1,028.4
|
)
|
|
$
|
(2.8
|
)
|
|
$
|
556.3
|
|
||||
Net income
|
—
|
|
|
—
|
|
|
—
|
|
|
45.0
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
45.0
|
|
||||||||||
Other comprehensive loss
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(0.7
|
)
|
|
(0.7
|
)
|
||||||||||
Share-based compensation
|
—
|
|
|
—
|
|
|
3.6
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
3.6
|
|
||||||||||
Issuance of common stock, net of forfeitures in connection with share-based payment arrangements
|
(704
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
|
|
|
—
|
|
|
—
|
|
||||||||||||
Repurchase of common stock associated with net share settlement of employee share-based awards
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2,128
|
|
|
(0.2
|
)
|
|
—
|
|
|
(0.2
|
)
|
||||||||||
Share repurchases
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
42,965
|
|
|
(4.0
|
)
|
|
—
|
|
|
(4.0
|
)
|
||||||||||
Retirement of previously repurchased common stock
|
(42,965
|
)
|
|
—
|
|
|
(0.6
|
)
|
|
(3.4
|
)
|
|
(42,965
|
)
|
|
4.0
|
|
|
—
|
|
|
—
|
|
||||||||||
Balances, September 30, 2019
|
41,096,408
|
|
|
$
|
0.4
|
|
|
$
|
580.8
|
|
|
$
|
1,050.9
|
|
|
21,791,707
|
|
|
$
|
(1,028.6
|
)
|
|
$
|
(3.5
|
)
|
|
$
|
600.0
|
|
|
Common Stock
|
|
Additional
Paid-in Capital |
|
Retained
Earnings |
|
Treasury Stock
|
|
Accumulated
Other Comprehensive Income (Loss) |
|
Total
|
||||||||||||||||||
|
Shares
|
|
Amount
|
|
|
|
Shares
|
|
Amount
|
|
|
||||||||||||||||||
Balances, December 31, 2017
|
40,969,987
|
|
|
$
|
0.4
|
|
|
$
|
563.5
|
|
|
$
|
750.3
|
|
|
20,156,962
|
|
|
$
|
(919.1
|
)
|
|
$
|
(0.9
|
)
|
|
$
|
394.2
|
|
Net income
|
—
|
|
|
—
|
|
|
—
|
|
|
40.1
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
40.1
|
|
||||||
Other comprehensive income
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2.1
|
|
|
2.1
|
|
||||||
Cumulative effect of change in accounting principle - ASU 2014-09
|
—
|
|
|
—
|
|
|
—
|
|
|
9.2
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
9.2
|
|
||||||
Share-based compensation
|
—
|
|
|
—
|
|
|
3.2
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
3.2
|
|
||||||
Issuance of common stock, net of forfeitures in connection with share-based payment arrangements
|
181,720
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Repurchase of common stock associated with net share settlements of employee share-based awards
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
65,412
|
|
|
(4.4
|
)
|
|
—
|
|
|
(4.4
|
)
|
||||||
Share repurchases
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
296,822
|
|
|
(20.0
|
)
|
|
—
|
|
|
(20.0
|
)
|
||||||
Balances, March 31, 2018
|
41,151,707
|
|
|
$
|
0.4
|
|
|
$
|
566.7
|
|
|
$
|
799.6
|
|
|
20,519,196
|
|
|
$
|
(943.5
|
)
|
|
$
|
1.2
|
|
|
$
|
424.4
|
|
Net income
|
—
|
|
|
|
|
—
|
|
|
43.2
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
43.2
|
|
|||||||
Other comprehensive income
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
0.8
|
|
|
0.8
|
|
||||||
Share-based compensation
|
—
|
|
|
—
|
|
|
2.5
|
|
|
|
|
|
|
—
|
|
|
—
|
|
|
2.5
|
|
||||||||
Issuance of common stock, net of forfeitures in connection with share-based payment arrangements
|
12,877
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Repurchase of common stock associated with net share settlements of employee share-based awards
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
3,519
|
|
|
(0.2
|
)
|
|
—
|
|
|
(0.2
|
)
|
||||||
Share repurchases
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
287,468
|
|
|
(20.2
|
)
|
|
—
|
|
|
(20.2
|
)
|
||||||
Balances, June 30, 2018
|
41,164,584
|
|
|
$
|
0.4
|
|
|
$
|
569.2
|
|
|
$
|
842.8
|
|
|
20,810,183
|
|
|
$
|
(963.9
|
)
|
|
$
|
2.0
|
|
|
$
|
450.5
|
|
Net income
|
—
|
|
|
|
|
—
|
|
|
44.3
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
44.3
|
|
|||||||
Other comprehensive income
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
0.7
|
|
|
0.7
|
|
||||||
Share-based compensation
|
—
|
|
|
—
|
|
|
2.5
|
|
|
|
|
|
|
—
|
|
|
—
|
|
|
2.5
|
|
||||||||
Issuance of common stock, net of forfeitures in connection with share-based payment arrangements
|
(5,265
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Repurchase of common stock associated with net share settlements of employee share-based awards
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2,087
|
|
|
(0.1
|
)
|
|
—
|
|
|
(0.1
|
)
|
||||||
Share repurchases
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
239,769
|
|
|
(16.9
|
)
|
|
—
|
|
|
(16.9
|
)
|
||||||
Balances, September 30, 2018
|
41,159,319
|
|
|
$
|
0.4
|
|
|
$
|
571.7
|
|
|
$
|
887.1
|
|
|
21,052,039
|
|
|
$
|
(980.9
|
)
|
|
$
|
2.7
|
|
|
$
|
481.0
|
|
|
For the Nine Months Ended September 30,
|
||||||
|
2019
|
|
2018
|
||||
CASH FLOW FROM OPERATING ACTIVITIES:
|
|
|
|
||||
Net income
|
$
|
140.8
|
|
|
$
|
127.6
|
|
Adjustments to reconcile net income to net cash provided by operating activities—
|
|
|
|
||||
Depreciation and amortization
|
26.7
|
|
|
25.2
|
|
||
Share-based compensation
|
10.4
|
|
|
8.2
|
|
||
Deferred income taxes
|
—
|
|
|
0.6
|
|
||
Loaner vehicle amortization
|
17.6
|
|
|
16.7
|
|
||
Gain on divestiture
|
(11.7
|
)
|
|
—
|
|
||
Change in right-of-use asset
|
14.3
|
|
|
—
|
|
||
Other adjustments, net
|
4.0
|
|
|
1.9
|
|
||
Changes in operating assets and liabilities, net of acquisitions and divestitures—
|
|
|
|
||||
Contracts-in-transit
|
49.7
|
|
|
55.3
|
|
||
Accounts receivable
|
17.6
|
|
|
14.8
|
|
||
Inventories
|
201.0
|
|
|
26.4
|
|
||
Other current assets
|
(131.1
|
)
|
|
(144.5
|
)
|
||
Floor plan notes payable—trade, net
|
8.1
|
|
|
(2.0
|
)
|
||
Accounts payable and other current liabilities
|
11.8
|
|
|
(25.6
|
)
|
||
Operating lease liabilities
|
(14.5
|
)
|
|
—
|
|
||
Other long-term assets and liabilities, net
|
3.0
|
|
|
1.8
|
|
||
Net cash provided by operating activities
|
347.7
|
|
|
106.4
|
|
||
CASH FLOW FROM INVESTING ACTIVITIES:
|
|
|
|
||||
Capital expenditures—excluding real estate
|
(28.7
|
)
|
|
(21.5
|
)
|
||
Capital expenditures—real estate
|
(9.2
|
)
|
|
(17.6
|
)
|
||
Purchases of previously leased real estate
|
(4.9
|
)
|
|
(4.4
|
)
|
||
Acquisitions
|
(210.0
|
)
|
|
(91.3
|
)
|
||
Divestiture
|
39.1
|
|
|
—
|
|
||
Proceeds from the sale of assets
|
7.5
|
|
|
2.0
|
|
||
Net cash used in investing activities
|
(206.2
|
)
|
|
(132.8
|
)
|
||
CASH FLOW FROM FINANCING ACTIVITIES:
|
|
|
|
||||
Floor plan borrowings—non-trade
|
3,118.7
|
|
|
3,309.7
|
|
||
Floor plan borrowings—acquisitions
|
55.3
|
|
|
22.7
|
|
||
Floor plan repayments—non-trade
|
(3,273.1
|
)
|
|
(3,231.4
|
)
|
||
Floor plan repayments—divestiture
|
(14.1
|
)
|
|
—
|
|
||
Repayments of borrowings
|
(12.0
|
)
|
|
(10.7
|
)
|
||
Payment of debt issuance costs
|
(2.3
|
)
|
|
—
|
|
||
Repurchases of common stock, including shares associated with net share settlement of employee share-based awards
|
(20.5
|
)
|
|
(61.8
|
)
|
||
Net cash (used in) provided by financing activities
|
(148.0
|
)
|
|
28.5
|
|
||
Net (decrease) increase in cash and cash equivalents
|
(6.5
|
)
|
|
2.1
|
|
||
CASH AND CASH EQUIVALENTS, beginning of period
|
8.3
|
|
|
4.7
|
|
||
CASH AND CASH EQUIVALENTS, end of period
|
$
|
1.8
|
|
|
$
|
6.8
|
|
•
|
Coggin dealerships operating primarily in Jacksonville, Fort Pierce and Orlando, Florida;
|
•
|
Courtesy dealerships operating in Tampa, Florida;
|
•
|
Crown dealerships operating in North Carolina, South Carolina and Virginia;
|
•
|
Greenville Automotive dealerships operating in Greenville, South Carolina;
|
•
|
Gray-Daniels dealerships operating in the Jackson, Mississippi area;
|
•
|
Hare and Estes dealerships operating in the Indianapolis, Indiana area;
|
•
|
McDavid dealerships operating in metropolitan Austin and Dallas, Texas;
|
•
|
Nalley dealerships operating in metropolitan Atlanta, Georgia;
|
•
|
Plaza dealerships operating in metropolitan St. Louis, Missouri; and
|
•
|
Mike Shaw dealership in the Denver, Colorado area.
|
|
For the Three Months Ended September 30,
|
||||||
|
2019
|
|
2018
|
||||
|
(In millions)
|
||||||
Revenue:
|
|
|
|
||||
New vehicle
|
$
|
986.9
|
|
|
$
|
980.5
|
|
Used vehicle retail
|
505.0
|
|
|
448.7
|
|
||
Used vehicle wholesale
|
41.9
|
|
|
48.8
|
|
||
New and used vehicle
|
1,533.8
|
|
|
1,478.0
|
|
||
Sale of vehicle parts and accessories
|
36.7
|
|
|
34.3
|
|
||
Vehicle repair and maintenance services
|
190.9
|
|
|
171.8
|
|
||
Parts and services
|
227.6
|
|
|
206.1
|
|
||
Finance and insurance, net
|
80.6
|
|
|
73.3
|
|
||
Total revenue
|
1,842.0
|
|
|
$
|
1,757.4
|
|
|
For the Nine Months Ended September 30,
|
||||||
|
2019
|
|
2018
|
||||
|
(In millions)
|
||||||
Revenue:
|
|
|
|
||||
New vehicle
|
$
|
2,823.9
|
|
|
$
|
2,766.3
|
|
Used vehicle retail
|
1,449.8
|
|
|
1,355.4
|
|
||
Used vehicle wholesale
|
140.6
|
|
|
143.6
|
|
||
New and used vehicle
|
4,414.3
|
|
|
4,265.3
|
|
||
Sale of vehicle parts and accessories
|
109.7
|
|
|
102.4
|
|
||
Vehicle repair and maintenance services
|
560.0
|
|
|
507.5
|
|
||
Parts and services
|
669.7
|
|
|
609.9
|
|
||
Finance and insurance, net
|
232.3
|
|
|
215.0
|
|
||
Total revenue
|
$
|
5,316.3
|
|
|
$
|
5,090.2
|
|
|
Vehicle Repair and Maintenance Services
|
|
Finance and Insurance, net
|
|
Total
|
||||||
|
(In millions)
|
||||||||||
Contract Assets (Current), January 1, 2019
|
$
|
4.1
|
|
|
$
|
10.6
|
|
|
$
|
14.7
|
|
Transferred to receivables from contract assets recognized at the beginning of the period
|
(4.1
|
)
|
|
(3.3
|
)
|
|
(7.4
|
)
|
|||
Increases related to revenue recognized, inclusive of adjustments to constraint, during the period
|
4.4
|
|
|
3.3
|
|
|
7.7
|
|
|||
Contract Assets (Current), March 31, 2019
|
$
|
4.4
|
|
|
$
|
10.6
|
|
|
$
|
15.0
|
|
Transferred to receivables from contract assets recognized at the beginning of the period
|
(4.4
|
)
|
|
(3.2
|
)
|
|
(7.6
|
)
|
|||
Increases related to revenue recognized, inclusive of adjustments to constraint, during the period
|
4.8
|
|
|
4.6
|
|
|
9.4
|
|
|||
Contract Assets (Current), June 30, 2019
|
4.8
|
|
|
12.0
|
|
|
16.8
|
|
|||
Transferred to receivables from contract assets recognized at the beginning of the period
|
(4.8
|
)
|
|
(2.6
|
)
|
|
(7.4
|
)
|
|||
Increases related to revenue recognized, inclusive of adjustments to constraint, during the period
|
4.9
|
|
|
2.1
|
|
|
7.0
|
|
|||
Contract Assets (Current), September 30, 2019
|
$
|
4.9
|
|
|
$
|
11.5
|
|
|
$
|
16.4
|
|
|
As of
|
||
|
September 30, 2019
|
||
|
(In millions)
|
||
Inventory
|
$
|
70.9
|
|
Real estate
|
43.1
|
|
|
Property and equipment
|
4.7
|
|
|
Goodwill and manufacturer franchise rights
|
91.0
|
|
|
Loaner vehicles
|
1.5
|
|
|
Liabilities assumed
|
(0.8
|
)
|
|
Total purchase price
|
$
|
210.4
|
|
|
As of
|
||||||
|
September 30, 2019
|
|
December 31, 2018
|
||||
|
(In millions)
|
||||||
Vehicle receivables
|
$
|
35.1
|
|
|
$
|
45.7
|
|
Manufacturer receivables
|
45.0
|
|
|
51.2
|
|
||
Other receivables
|
33.9
|
|
|
34.7
|
|
||
Total accounts receivable
|
114.0
|
|
|
131.6
|
|
||
Less—Allowance for doubtful accounts
|
(1.5
|
)
|
|
(1.3
|
)
|
||
Accounts receivable, net
|
$
|
112.5
|
|
|
$
|
130.3
|
|
|
As of
|
||||||
|
September 30, 2019
|
|
December 31, 2018
|
||||
|
(In millions)
|
||||||
New vehicles
|
$
|
810.3
|
|
|
$
|
867.2
|
|
Used vehicles
|
176.3
|
|
|
158.9
|
|
||
Parts and accessories
|
43.5
|
|
|
41.5
|
|
||
Total inventories
|
$
|
1,030.1
|
|
|
$
|
1,067.6
|
|
|
As of
|
||||||
|
September 30, 2019
|
|
December 31, 2018
|
||||
|
(In millions)
|
||||||
Floor plan notes payable—trade
|
$
|
135.3
|
|
|
$
|
125.3
|
|
Floor plan notes payable offset account
|
(13.2
|
)
|
|
(11.3
|
)
|
||
Floor plan notes payable—trade, net
|
$
|
122.1
|
|
|
$
|
114.0
|
|
|
|
|
|
||||
Floor plan notes payable—new non-trade
|
$
|
765.6
|
|
|
$
|
843.0
|
|
Floor plan notes payable—used non-trade
|
25.0
|
|
|
30.0
|
|
||
Floor plan notes payable offset account
|
(51.7
|
)
|
|
(20.9
|
)
|
||
Floor plan notes payable—non-trade, net
|
$
|
738.9
|
|
|
$
|
852.1
|
|
•
|
a $250.0 million revolving credit facility (the "Revolving Credit Facility"), including a $50.0 million sub-limit for letters of credit;
|
•
|
a $1.04 billion new vehicle revolving floor plan facility (the "New Vehicle Floor Plan Facility"); and
|
•
|
a $160.0 million used vehicle revolving floor plan facility (the "Used Vehicle Floor Plan Facility").
|
|
As of
|
||||||
September 30, 2019
|
|
December 31, 2018
|
|||||
(In millions)
|
|||||||
6.0% Senior Subordinated Notes due 2024
|
$
|
600.0
|
|
|
$
|
600.0
|
|
Mortgage notes payable bearing interest at fixed rates
|
127.3
|
|
|
132.2
|
|
||
2018 Bank of America Facility
|
24.8
|
|
|
25.7
|
|
||
2018 Wells Fargo Master Loan Facility
|
25.0
|
|
|
25.0
|
|
||
Prior real estate credit agreement
|
36.1
|
|
|
40.8
|
|
||
Restated master loan agreement
|
79.5
|
|
|
83.3
|
|
||
Finance lease liability
|
17.3
|
|
|
3.1
|
|
||
Total debt outstanding
|
910.0
|
|
|
910.1
|
|
||
Add—unamortized premium on 6.0% Senior Subordinated Notes due 2024
|
5.4
|
|
|
6.0
|
|
||
Less—debt issuance costs
|
(9.5
|
)
|
|
(10.8
|
)
|
||
Long-term debt, including current portion
|
905.9
|
|
|
905.3
|
|
||
Less—current portion, net of current portion of debt issuance costs
|
(38.1
|
)
|
|
(38.8
|
)
|
||
Long-term debt
|
$
|
867.8
|
|
|
$
|
866.5
|
|
|
|
|
|
As of
|
||
Leases
|
|
Classification
|
|
September 30, 2019
|
||
|
|
|
|
(In millions)
|
||
Assets:
|
|
|
|
|
||
Operating
|
|
Operating lease right-of-use assets
|
|
$
|
77.1
|
|
Finance
|
|
Property and equipment, net
|
|
14.6
|
|
|
Total right-of-use assets
|
|
|
|
$
|
91.7
|
|
Liabilities:
|
|
|
|
|
||
Current
|
|
|
|
|
||
Operating
|
|
Current maturities of operating leases
|
|
$
|
21.0
|
|
Finance
|
|
Current maturities of long-term debt
|
|
0.6
|
|
|
Non-Current
|
|
|
|
|
||
Operating
|
|
Operating lease liabilities
|
|
60.3
|
|
|
Finance
|
|
Long-term debt
|
|
16.7
|
|
|
Total lease liabilities
|
|
|
|
$
|
98.6
|
|
|
As of
|
|
|
September 30, 2019
|
|
Weighted Average Lease Term - Operating Leases
|
5.8 years
|
|
Weighted Average Lease Term - Finance Lease
|
1.4 years
|
|
Weighted Average Discount Rate - Operating Leases
|
4.7
|
%
|
Weighted Average Discount Rate - Finance Lease
|
4.1
|
%
|
|
For the Three Months Ended September 30, 2019
|
|
For the Nine Months Ended September 30, 2019
|
||||
|
(In millions)
|
||||||
Finance lease cost
|
|
|
|
||||
Interest
|
$
|
0.2
|
|
|
$
|
0.5
|
|
Operating lease cost
|
5.9
|
|
|
17.3
|
|
||
Short-term lease cost
|
0.5
|
|
|
2.2
|
|
||
Variable lease cost
|
0.3
|
|
|
0.7
|
|
||
|
$
|
6.9
|
|
|
$
|
20.7
|
|
|
For the Three Months Ended September 30, 2019
|
|
For the Nine Months Ended September 30, 2019
|
||||
|
(In millions)
|
||||||
Supplemental Cash Flow:
|
|
|
|
||||
Cash paid for amounts included in the measurements of lease liabilities
|
|
|
|
||||
Operating cash flows from finance lease
|
$
|
0.2
|
|
|
$
|
0.5
|
|
Operating cash flows from operating leases
|
6.0
|
|
|
17.6
|
|
||
Financing cash flows from finance lease
|
0.1
|
|
|
0.3
|
|
||
Right-of-use assets obtained in exchange for new finance lease liabilities
|
—
|
|
|
17.7
|
|
||
Right-of-use assets obtained in exchange for new operating lease liabilities
|
3.2
|
|
|
13.9
|
|
||
Changes to finance lease right-of-use asset resulting from lease reassessment event
|
—
|
|
|
(3.1
|
)
|
|
Finance
|
|
Operating
|
||||
|
(In millions)
|
||||||
2019 (remaining three months)
|
$
|
0.3
|
|
|
$
|
6.1
|
|
2020
|
1.3
|
|
|
24.0
|
|
||
2021
|
16.7
|
|
|
20.9
|
|
||
2022
|
—
|
|
|
15.5
|
|
||
2023
|
—
|
|
|
7.5
|
|
||
Thereafter
|
—
|
|
|
21.2
|
|
||
Total minimum lease payments
|
18.3
|
|
|
95.2
|
|
||
Less: amount of lease payments representing interest
|
(1.0
|
)
|
|
(13.9
|
)
|
||
Present value of future minimum lease payments
|
17.3
|
|
|
81.3
|
|
||
Less: current obligations under leases
|
(0.6
|
)
|
|
(21.0
|
)
|
||
Long-term lease obligation
|
$
|
16.7
|
|
|
$
|
60.3
|
|
|
Capital
|
|
Operating
|
||||
|
(In millions)
|
||||||
2019
|
$
|
0.4
|
|
|
$
|
22.5
|
|
2020
|
0.4
|
|
|
22.2
|
|
||
2021
|
0.4
|
|
|
19.2
|
|
||
2022
|
0.4
|
|
|
14.0
|
|
||
2023
|
0.4
|
|
|
6.0
|
|
||
Thereafter
|
2.8
|
|
|
25.5
|
|
||
Total minimum lease payments
|
4.8
|
|
|
109.4
|
|
||
Less: Amounts representing interest
|
(1.7
|
)
|
|
N/A
|
|
||
Total minimum lease payments excluding interest
|
$
|
3.1
|
|
|
$
|
109.4
|
|
|
As of
|
||||||
|
September 30, 2019
|
|
December 31, 2018
|
||||
|
(In millions)
|
||||||
Carrying Value:
|
|
|
|
||||
6.0% Senior Subordinated Notes due 2024
|
$
|
605.4
|
|
|
$
|
606.0
|
|
Mortgage notes payable
|
292.7
|
|
|
307.0
|
|
||
Total carrying value
|
$
|
898.1
|
|
|
$
|
913.0
|
|
|
|
|
|
||||
Fair Value:
|
|
|
|
||||
6.0% Senior Subordinated Notes due 2024
|
$
|
619.5
|
|
|
$
|
570.0
|
|
Mortgage notes payable
|
302.6
|
|
|
306.7
|
|
||
Total fair value
|
$
|
922.1
|
|
|
$
|
876.7
|
|
|
As of
|
||||||
|
September 30, 2019
|
|
December 31, 2018
|
||||
|
(In millions)
|
||||||
Other current liabilities/(assets)
|
$
|
0.8
|
|
|
$
|
(0.2
|
)
|
Other long-term liabilities/(assets)
|
3.9
|
|
|
(0.4
|
)
|
||
Total fair value
|
$
|
4.7
|
|
|
$
|
(0.6
|
)
|
For the Three Months Ended September 30,
|
|
Results Recognized in Accumulated Other Comprehensive Income/(Loss)
|
|
Location of Amount Reclassified from Accumulated Other Comprehensive Income/(Loss) to Earnings
|
|
Amount Reclassified from Accumulated Other Comprehensive Income/(Loss)
to Earnings
|
||||
2019
|
|
$
|
(1.0
|
)
|
|
Other interest expense, net
|
|
$
|
(0.1
|
)
|
2018
|
|
$
|
0.8
|
|
|
Swap interest expense
|
|
$
|
(0.1
|
)
|
For the Nine Months Ended September 30,
|
|
Results Recognized in Accumulated Other Comprehensive Income/(Loss)
|
|
Location of Amount Reclassified from Accumulated Other Comprehensive Income/(Loss) to Earnings
|
|
Amount Reclassified from Accumulated Other Comprehensive Income/(Loss)
to Earnings
|
||||
2019
|
|
$
|
(5.3
|
)
|
|
Other interest expense, net
|
|
$
|
—
|
|
2018
|
|
$
|
4.4
|
|
|
Swap interest expense
|
|
$
|
(0.5
|
)
|
•
|
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;
|
•
|
general economic conditions and its impact on our revenues and expenses;
|
•
|
our parts and service revenue due to, among other things, improvements in vehicle technology;
|
•
|
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 as it relates to acquisitions and divestitures, stock repurchases, dividends and capital expenditures;
|
•
|
the continued availability of financing, including floor plan financing for inventory;
|
•
|
the ability of consumers to secure vehicle financing at favorable rates;
|
•
|
the growth of the brands that comprise our portfolio 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.
|
•
|
changes in general economic and business conditions, including changes in employment levels, consumer demand, preferences and confidence levels, the availability and cost of credit, fuel prices, levels of discretionary personal income and interest rates;
|
•
|
our ability to execute our balanced automotive retailing and service business strategy;
|
•
|
our ability to attract and retain skilled employees;
|
•
|
adverse conditions affecting the vehicle manufacturers whose brands we sell, and their ability to design, manufacture, deliver, and market their vehicles successfully;
|
•
|
changes in the mix, and total number, of vehicles we are able to sell;
|
•
|
our outstanding indebtedness and our continued ability to comply with applicable covenants in our various financing and lease agreements, or to obtain waivers of these covenants as necessary;
|
•
|
high levels of competition in our industry, which may create pricing and margin pressures on our products and services;
|
•
|
our relationships with manufacturers of the vehicles we sell and our ability to renew, and enter into new framework and dealer agreements with vehicle manufacturers whose brands we sell, on terms acceptable to us;
|
•
|
the availability of manufacturer incentive programs and our ability to earn these incentives;
|
•
|
failure of our management information systems or any security breaches;
|
•
|
changes in laws and regulations governing the operation of automobile franchises, including consumer protections, accounting standards, taxation requirements, and environmental laws;
|
•
|
changes in, or the imposition of, new tariffs or trade restrictions on imported vehicles or parts;
|
•
|
adverse results from litigation or other similar proceedings involving us;
|
•
|
our ability to generate sufficient cash flows, maintain our liquidity and obtain any necessary additional funds for working capital, capital expenditures, acquisitions, stock repurchases and/or dividends, debt maturity payments, and other corporate purposes;
|
•
|
any disruptions in the financial markets, which may impact our ability to access capital;
|
•
|
our relationships with, and the financial stability of, our lenders and lessors;
|
•
|
significant disruptions in the production and delivery of vehicles and parts for any reason, including natural disasters, product recalls, work stoppages, significant property loss or other occurrences that are outside of our control;
|
•
|
our ability to execute our initiatives and other strategies; and
|
•
|
our ability to leverage gains from our dealership portfolio.
|
•
|
Coggin dealerships operating primarily in Jacksonville, Fort Pierce and Orlando, Florida;
|
•
|
Courtesy dealerships operating in Tampa, Florida;
|
•
|
Crown dealerships operating in North Carolina, South Carolina and Virginia;
|
•
|
Greenville Automotive dealerships operating in Greenville, South Carolina;
|
•
|
Gray-Daniels dealerships operating in the Jackson, Mississippi area;
|
•
|
Hare and Estes dealerships operating in the Indianapolis, Indiana area;
|
•
|
McDavid dealerships operating in metropolitan Austin and Dallas, Texas;
|
•
|
Nalley dealerships operating in metropolitan Atlanta, Georgia;
|
•
|
Plaza dealerships operating in metropolitan St. Louis, Missouri; and
|
•
|
Mike Shaw dealership operating in the Denver, Colorado area.
|
|
For the Three Months Ended September 30,
|
|
Increase
(Decrease)
|
|
%
Change
|
|||||||||
|
2019
|
|
2018
|
|
||||||||||
|
(Dollars in millions, except per share data)
|
|||||||||||||
REVENUE:
|
|
|
|
|
|
|
|
|||||||
New vehicle
|
$
|
986.9
|
|
|
$
|
980.5
|
|
|
$
|
6.4
|
|
|
1
|
%
|
Used vehicle
|
546.9
|
|
|
497.5
|
|
|
49.4
|
|
|
10
|
%
|
|||
Parts and service
|
227.6
|
|
|
206.1
|
|
|
21.5
|
|
|
10
|
%
|
|||
Finance and insurance, net
|
80.6
|
|
|
73.3
|
|
|
7.3
|
|
|
10
|
%
|
|||
TOTAL REVENUE
|
1,842.0
|
|
|
1,757.4
|
|
|
84.6
|
|
|
5
|
%
|
|||
GROSS PROFIT:
|
|
|
|
|
|
|
|
|||||||
New vehicle
|
38.6
|
|
|
42.1
|
|
|
(3.5
|
)
|
|
(8
|
)%
|
|||
Used vehicle
|
32.4
|
|
|
32.8
|
|
|
(0.4
|
)
|
|
(1
|
)%
|
|||
Parts and service
|
141.5
|
|
|
129.8
|
|
|
11.7
|
|
|
9
|
%
|
|||
Finance and insurance, net
|
80.6
|
|
|
73.3
|
|
|
7.3
|
|
|
10
|
%
|
|||
TOTAL GROSS PROFIT
|
293.1
|
|
|
278.0
|
|
|
15.1
|
|
|
5
|
%
|
|||
OPERATING EXPENSES:
|
|
|
|
|
|
|
|
|||||||
Selling, general, and administrative
|
202.0
|
|
|
188.8
|
|
|
13.2
|
|
|
7
|
%
|
|||
Depreciation and amortization
|
9.1
|
|
|
8.5
|
|
|
0.6
|
|
|
7
|
%
|
|||
Other operating (income) expenses, net
|
(0.2
|
)
|
|
(0.1
|
)
|
|
(0.1
|
)
|
|
(100
|
)%
|
|||
INCOME FROM OPERATIONS
|
82.2
|
|
|
80.8
|
|
|
1.4
|
|
|
2
|
%
|
|||
OTHER EXPENSES (INCOME):
|
|
|
|
|
|
|
|
|||||||
Floor plan interest expense
|
9.0
|
|
|
8.4
|
|
|
0.6
|
|
|
7
|
%
|
|||
Other interest expense, net
|
13.7
|
|
|
13.2
|
|
|
0.5
|
|
|
4
|
%
|
|||
Swap interest expense
|
—
|
|
|
0.1
|
|
|
(0.1
|
)
|
|
—
|
%
|
|||
Total other expenses, net
|
22.7
|
|
|
21.7
|
|
|
1.0
|
|
|
5
|
%
|
|||
INCOME BEFORE INCOME TAXES
|
59.5
|
|
|
59.1
|
|
|
0.4
|
|
|
1
|
%
|
|||
Income tax expense
|
14.5
|
|
|
14.8
|
|
|
(0.3
|
)
|
|
(2
|
)%
|
|||
NET INCOME
|
$
|
45.0
|
|
|
$
|
44.3
|
|
|
$
|
0.7
|
|
|
2
|
%
|
Net income per common share—Diluted
|
$
|
2.33
|
|
|
$
|
2.18
|
|
|
$
|
0.15
|
|
|
7
|
%
|
|
For the Three Months Ended September 30,
|
||||
|
2019
|
|
2018
|
||
REVENUE MIX PERCENTAGES:
|
|
|
|
||
New vehicle
|
53.6
|
%
|
|
55.8
|
%
|
Used vehicle retail
|
27.3
|
%
|
|
25.5
|
%
|
Used vehicle wholesale
|
2.3
|
%
|
|
2.8
|
%
|
Parts and service
|
12.4
|
%
|
|
11.7
|
%
|
Finance and insurance, net
|
4.4
|
%
|
|
4.2
|
%
|
Total revenue
|
100.0
|
%
|
|
100.0
|
%
|
GROSS PROFIT MIX PERCENTAGES:
|
|
|
|
||
New vehicle
|
13.2
|
%
|
|
15.1
|
%
|
Used vehicle retail
|
11.5
|
%
|
|
11.8
|
%
|
Used vehicle wholesale
|
(0.5
|
)%
|
|
—
|
%
|
Parts and service
|
48.3
|
%
|
|
46.7
|
%
|
Finance and insurance, net
|
27.5
|
%
|
|
26.4
|
%
|
Total gross profit
|
100.0
|
%
|
|
100.0
|
%
|
GROSS PROFIT MARGIN
|
15.9
|
%
|
|
15.8
|
%
|
SG&A EXPENSES AS A PERCENTAGE OF GROSS PROFIT
|
68.9
|
%
|
|
67.9
|
%
|
|
For the Three Months Ended September 30,
|
|
Increase (Decrease)
|
|
%
Change
|
|||||||||
|
2019
|
|
2018
|
|
||||||||||
|
(Dollars in millions, except for per vehicle data)
|
|||||||||||||
As Reported:
|
|
|
|
|
|
|
|
|||||||
Revenue:
|
|
|
|
|
|
|
|
|||||||
Luxury
|
$
|
324.5
|
|
|
$
|
297.8
|
|
|
$
|
26.7
|
|
|
9
|
%
|
Import
|
456.3
|
|
|
485.2
|
|
|
(28.9
|
)
|
|
(6
|
)%
|
|||
Domestic
|
206.1
|
|
|
197.5
|
|
|
8.6
|
|
|
4
|
%
|
|||
Total new vehicle revenue
|
$
|
986.9
|
|
|
$
|
980.5
|
|
|
$
|
6.4
|
|
|
1
|
%
|
Gross profit:
|
|
|
|
|
|
|
|
|||||||
Luxury
|
$
|
19.7
|
|
|
$
|
18.6
|
|
|
$
|
1.1
|
|
|
6
|
%
|
Import
|
10.2
|
|
|
15.4
|
|
|
(5.2
|
)
|
|
(34
|
)%
|
|||
Domestic
|
8.7
|
|
|
8.1
|
|
|
0.6
|
|
|
7
|
%
|
|||
Total new vehicle gross profit
|
$
|
38.6
|
|
|
$
|
42.1
|
|
|
$
|
(3.5
|
)
|
|
(8
|
)%
|
New vehicle units:
|
|
|
|
|
|
|
|
|||||||
Luxury
|
6,025
|
|
|
5,685
|
|
|
340
|
|
|
6
|
%
|
|||
Import
|
15,998
|
|
|
17,046
|
|
|
(1,048
|
)
|
|
(6
|
)%
|
|||
Domestic
|
5,055
|
|
|
5,019
|
|
|
36
|
|
|
1
|
%
|
|||
Total new vehicle units
|
27,078
|
|
|
27,750
|
|
|
(672
|
)
|
|
(2
|
)%
|
|||
|
|
|
|
|
|
|
|
|||||||
Same Store:
|
|
|
|
|
|
|
|
|||||||
Revenue:
|
|
|
|
|
|
|
|
|||||||
Luxury
|
$
|
323.1
|
|
|
$
|
297.8
|
|
|
$
|
25.3
|
|
|
8
|
%
|
Import
|
450.8
|
|
|
474.0
|
|
|
(23.2
|
)
|
|
(5
|
)%
|
|||
Domestic
|
169.2
|
|
|
197.5
|
|
|
(28.3
|
)
|
|
(14
|
)%
|
|||
Total new vehicle revenue
|
$
|
943.1
|
|
|
$
|
969.3
|
|
|
$
|
(26.2
|
)
|
|
(3
|
)%
|
Gross profit:
|
|
|
|
|
|
|
|
|||||||
Luxury
|
$
|
19.7
|
|
|
$
|
18.7
|
|
|
$
|
1.0
|
|
|
5
|
%
|
Import
|
10.1
|
|
|
14.8
|
|
|
(4.7
|
)
|
|
(32
|
)%
|
|||
Domestic
|
6.9
|
|
|
8.1
|
|
|
(1.2
|
)
|
|
(15
|
)%
|
|||
Total new vehicle gross profit
|
$
|
36.7
|
|
|
$
|
41.6
|
|
|
$
|
(4.9
|
)
|
|
(12
|
)%
|
New vehicle units
|
|
|
|
|
|
|
|
|||||||
Luxury
|
5,993
|
|
|
5,685
|
|
|
308
|
|
|
5
|
%
|
|||
Import
|
15,828
|
|
|
16,619
|
|
|
(791
|
)
|
|
(5
|
)%
|
|||
Domestic
|
4,165
|
|
|
5,019
|
|
|
(854
|
)
|
|
(17
|
)%
|
|||
Total new vehicle units
|
25,986
|
|
|
27,323
|
|
|
(1,337
|
)
|
|
(5
|
)%
|
|
For the Three Months Ended September 30,
|
|
Increase (Decrease)
|
|
%
Change
|
|||||||||
|
2019
|
|
2018
|
|
||||||||||
As Reported:
|
|
|
|
|
|
|
|
|||||||
Revenue per new vehicle sold
|
$
|
36,447
|
|
|
$
|
35,333
|
|
|
$
|
1,114
|
|
|
3
|
%
|
Gross profit per new vehicle sold
|
$
|
1,426
|
|
|
$
|
1,517
|
|
|
$
|
(91
|
)
|
|
(6
|
)%
|
New vehicle gross margin
|
3.9
|
%
|
|
4.3
|
%
|
|
(0.4
|
)%
|
|
|
|
|||
|
|
|
|
|
|
|
|
|||||||
Luxury:
|
|
|
|
|
|
|
|
|||||||
Gross profit per new vehicle sold
|
$
|
3,270
|
|
|
$
|
3,272
|
|
|
$
|
(2
|
)
|
|
—
|
%
|
New vehicle gross margin
|
6.1
|
%
|
|
6.2
|
%
|
|
(0.1
|
)%
|
|
|
||||
Import:
|
|
|
|
|
|
|
|
|||||||
Gross profit per new vehicle sold
|
$
|
638
|
|
|
$
|
903
|
|
|
$
|
(265
|
)
|
|
(29
|
)%
|
New vehicle gross margin
|
2.2
|
%
|
|
3.2
|
%
|
|
(1.0
|
)%
|
|
|
||||
Domestic:
|
|
|
|
|
|
|
|
|||||||
Gross profit per new vehicle sold
|
$
|
1,721
|
|
|
$
|
1,614
|
|
|
$
|
107
|
|
|
7
|
%
|
New vehicle gross margin
|
4.2
|
%
|
|
4.1
|
%
|
|
0.1
|
%
|
|
|
||||
|
|
|
|
|
|
|
|
|||||||
Same Store:
|
|
|
|
|
|
|
|
|||||||
Revenue per new vehicle sold
|
$
|
36,293
|
|
|
$
|
35,476
|
|
|
$
|
817
|
|
|
2
|
%
|
Gross profit per new vehicle sold
|
$
|
1,412
|
|
|
$
|
1,523
|
|
|
$
|
(111
|
)
|
|
(7
|
)%
|
New vehicle gross margin
|
3.9
|
%
|
|
4.3
|
%
|
|
(0.4
|
)%
|
|
|
|
|||
|
|
|
|
|
|
|
|
|||||||
Luxury:
|
|
|
|
|
|
|
|
|||||||
Gross profit per new vehicle sold
|
$
|
3,287
|
|
|
$
|
3,289
|
|
|
$
|
(2
|
)
|
|
—
|
%
|
New vehicle gross margin
|
6.1
|
%
|
|
6.3
|
%
|
|
(0.2
|
)%
|
|
|
||||
Import:
|
|
|
|
|
|
|
|
|||||||
Gross profit per new vehicle sold
|
$
|
638
|
|
|
$
|
891
|
|
|
$
|
(253
|
)
|
|
(28
|
)%
|
New vehicle gross margin
|
2.2
|
%
|
|
3.1
|
%
|
|
(0.9
|
)%
|
|
|
||||
Domestic:
|
|
|
|
|
|
|
|
|||||||
Gross profit per new vehicle sold
|
$
|
1,657
|
|
|
$
|
1,614
|
|
|
$
|
43
|
|
|
3
|
%
|
New vehicle gross margin
|
4.1
|
%
|
|
4.1
|
%
|
|
—
|
%
|
|
|
|
For the Three Months Ended September 30,
|
|
Increase (Decrease)
|
|
%
Change
|
|||||||||
|
2019
|
|
2018
|
|
||||||||||
|
(Dollars in millions, except for per vehicle data)
|
|||||||||||||
As Reported:
|
|
|
|
|
|
|
|
|||||||
Revenue:
|
|
|
|
|
|
|
|
|||||||
Used vehicle retail revenue
|
$
|
505.0
|
|
|
$
|
448.7
|
|
|
$
|
56.3
|
|
|
13
|
%
|
Used vehicle wholesale revenue
|
41.9
|
|
|
48.8
|
|
|
(6.9
|
)
|
|
(14
|
)%
|
|||
Used vehicle revenue
|
$
|
546.9
|
|
|
$
|
497.5
|
|
|
$
|
49.4
|
|
|
10
|
%
|
Gross profit:
|
|
|
|
|
|
|
|
|||||||
Used vehicle retail gross profit
|
$
|
33.9
|
|
|
$
|
32.7
|
|
|
$
|
1.2
|
|
|
4
|
%
|
Used vehicle wholesale gross profit
|
(1.5
|
)
|
|
0.1
|
|
|
(1.6
|
)
|
|
NM
|
|
|||
Used vehicle gross profit
|
$
|
32.4
|
|
|
$
|
32.8
|
|
|
$
|
(0.4
|
)
|
|
(1
|
)%
|
Used vehicle retail units:
|
|
|
|
|
|
|
|
|||||||
Used vehicle retail units
|
22,988
|
|
|
20,824
|
|
|
2,164
|
|
|
10
|
%
|
|||
|
|
|
|
|
|
|
|
|||||||
Same Store:
|
|
|
|
|
|
|
|
|||||||
Revenue:
|
|
|
|
|
|
|
|
|||||||
Used vehicle retail revenue
|
$
|
481.7
|
|
|
$
|
442.4
|
|
|
$
|
39.3
|
|
|
9
|
%
|
Used vehicle wholesale revenue
|
40.5
|
|
|
47.5
|
|
|
(7.0
|
)
|
|
(15
|
)%
|
|||
Used vehicle revenue
|
$
|
522.2
|
|
|
$
|
489.9
|
|
|
$
|
32.3
|
|
|
7
|
%
|
Gross profit:
|
|
|
|
|
|
|
|
|||||||
Used vehicle retail gross profit
|
$
|
32.0
|
|
|
$
|
32.4
|
|
|
$
|
(0.4
|
)
|
|
(1
|
)%
|
Used vehicle wholesale gross profit
|
(1.5
|
)
|
|
0.2
|
|
|
(1.7
|
)
|
|
NM
|
|
|||
Used vehicle gross profit
|
$
|
30.5
|
|
|
$
|
32.6
|
|
|
$
|
(2.1
|
)
|
|
(6
|
)%
|
Used vehicle retail units:
|
|
|
|
|
|
|
|
|||||||
Used vehicle retail units
|
21,810
|
|
|
20,511
|
|
|
1,299
|
|
|
6
|
%
|
|
For the Three Months Ended September 30,
|
|
Increase (Decrease)
|
|
%
Change
|
|||||||||
|
2019
|
|
2018
|
|
||||||||||
As Reported:
|
|
|
|
|
|
|
|
|||||||
Revenue per used vehicle retailed
|
$
|
21,968
|
|
|
$
|
21,547
|
|
|
$
|
421
|
|
|
2
|
%
|
Gross profit per used vehicle retailed
|
$
|
1,475
|
|
|
$
|
1,570
|
|
|
$
|
(95
|
)
|
|
(6
|
)%
|
Used vehicle retail gross margin
|
6.7
|
%
|
|
7.3
|
%
|
|
(0.6
|
)%
|
|
|
|
|||
|
|
|
|
|
|
|
|
|||||||
Same Store:
|
|
|
|
|
|
|
|
|||||||
Revenue per used vehicle retailed
|
$
|
22,086
|
|
|
$
|
21,569
|
|
|
$
|
517
|
|
|
2
|
%
|
Gross profit per used vehicle retailed
|
$
|
1,467
|
|
|
$
|
1,580
|
|
|
$
|
(113
|
)
|
|
(7
|
)%
|
Used vehicle retail gross margin
|
6.6
|
%
|
|
7.3
|
%
|
|
(0.7
|
)%
|
|
|
|
|
For the Three Months Ended September 30,
|
|
Increase
(Decrease)
|
|
%
Change
|
|||||||||
|
2019
|
|
2018
|
|
||||||||||
|
(Dollars in millions)
|
|||||||||||||
As Reported:
|
|
|
|
|
|
|
|
|||||||
Parts and service revenue
|
$
|
227.6
|
|
|
$
|
206.1
|
|
|
$
|
21.5
|
|
|
10
|
%
|
Parts and service gross profit:
|
|
|
|
|
|
|
|
|||||||
Customer pay
|
79.8
|
|
|
73.0
|
|
|
6.8
|
|
|
9
|
%
|
|||
Warranty
|
22.1
|
|
|
19.2
|
|
|
2.9
|
|
|
15
|
%
|
|||
Wholesale parts
|
5.8
|
|
|
5.6
|
|
|
0.2
|
|
|
4
|
%
|
|||
Parts and service gross profit, excluding reconditioning and preparation
|
$
|
107.7
|
|
|
$
|
97.8
|
|
|
$
|
9.9
|
|
|
10
|
%
|
Parts and service gross margin, excluding reconditioning and preparation
|
47.3
|
%
|
|
47.5
|
%
|
|
(0.2
|
)%
|
|
|
||||
Reconditioning and preparation *
|
$
|
33.8
|
|
|
$
|
32.0
|
|
|
$
|
1.8
|
|
|
6
|
%
|
Total parts and service gross profit
|
$
|
141.5
|
|
|
$
|
129.8
|
|
|
$
|
11.7
|
|
|
9
|
%
|
|
|
|
|
|
|
|
|
|||||||
Same Store:
|
|
|
|
|
|
|
|
|||||||
Parts and service revenue
|
$
|
220.8
|
|
|
$
|
203.8
|
|
|
$
|
17.0
|
|
|
8
|
%
|
Parts and service gross profit:
|
|
|
|
|
|
|
|
|||||||
Customer pay
|
77.0
|
|
|
72.2
|
|
|
4.8
|
|
|
7
|
%
|
|||
Warranty
|
21.6
|
|
|
19.1
|
|
|
2.5
|
|
|
13
|
%
|
|||
Wholesale parts
|
5.8
|
|
|
5.5
|
|
|
0.3
|
|
|
5
|
%
|
|||
Parts and service gross profit, excluding reconditioning and preparation
|
$
|
104.4
|
|
|
$
|
96.8
|
|
|
$
|
7.6
|
|
|
8
|
%
|
Parts and service gross margin, excluding reconditioning and preparation
|
47.3
|
%
|
|
47.5
|
%
|
|
(0.2
|
)%
|
|
|
||||
Reconditioning and preparation *
|
$
|
32.6
|
|
|
$
|
31.5
|
|
|
$
|
1.1
|
|
|
3
|
%
|
Total parts and service gross profit
|
$
|
137.0
|
|
|
$
|
128.3
|
|
|
$
|
8.7
|
|
|
7
|
%
|
|
For the Three Months Ended September 30,
|
|
Increase
(Decrease)
|
|
%
Change
|
|||||||||
|
2019
|
|
2018
|
|
||||||||||
|
(Dollars in millions, except for per vehicle data)
|
|||||||||||||
As Reported:
|
|
|
|
|
|
|
|
|||||||
Finance and insurance, net
|
$
|
80.6
|
|
|
$
|
73.3
|
|
|
$
|
7.3
|
|
|
10
|
%
|
Finance and insurance, net per vehicle sold
|
$
|
1,610
|
|
|
$
|
1,509
|
|
|
$
|
101
|
|
|
7
|
%
|
|
|
|
|
|
|
|
|
|||||||
Same Store:
|
|
|
|
|
|
|
|
|||||||
Finance and insurance, net
|
$
|
77.8
|
|
|
$
|
72.2
|
|
|
$
|
5.6
|
|
|
8
|
%
|
Finance and insurance, net per vehicle sold
|
$
|
1,628
|
|
|
$
|
1,509
|
|
|
$
|
119
|
|
|
8
|
%
|
|
For the Three Months Ended September 30,
|
|
Increase
(Decrease)
|
|
% of Gross
Profit Increase (Decrease)
|
|||||||||||||||
|
2019
|
|
% of Gross
Profit
|
|
2018
|
|
% of Gross
Profit
|
|
||||||||||||
|
(Dollars in millions)
|
|||||||||||||||||||
As Reported:
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Personnel costs
|
$
|
95.1
|
|
|
32.4
|
%
|
|
$
|
90.8
|
|
|
32.7
|
%
|
|
$
|
4.3
|
|
|
(0.3
|
)%
|
Sales compensation
|
31.5
|
|
|
10.7
|
%
|
|
29.4
|
|
|
10.6
|
%
|
|
2.1
|
|
|
0.1
|
%
|
|||
Share-based compensation
|
3.6
|
|
|
1.2
|
%
|
|
2.5
|
|
|
0.9
|
%
|
|
1.1
|
|
|
0.3
|
%
|
|||
Outside services
|
21.0
|
|
|
7.2
|
%
|
|
21.1
|
|
|
7.6
|
%
|
|
(0.1
|
)
|
|
(0.4
|
)%
|
|||
Advertising
|
9.9
|
|
|
3.4
|
%
|
|
7.5
|
|
|
2.7
|
%
|
|
2.4
|
|
|
0.7
|
%
|
|||
Rent
|
6.7
|
|
|
2.3
|
%
|
|
6.4
|
|
|
2.3
|
%
|
|
0.3
|
|
|
—
|
%
|
|||
Utilities
|
4.5
|
|
|
1.5
|
%
|
|
4.4
|
|
|
1.6
|
%
|
|
0.1
|
|
|
(0.1
|
)%
|
|||
Insurance
|
2.9
|
|
|
1.0
|
%
|
|
2.4
|
|
|
0.9
|
%
|
|
0.5
|
|
|
0.1
|
%
|
|||
Other
|
26.8
|
|
|
9.2
|
%
|
|
24.3
|
|
|
8.6
|
%
|
|
2.5
|
|
|
0.6
|
%
|
|||
Selling, general, and administrative expense
|
$
|
202.0
|
|
|
68.9
|
%
|
|
$
|
188.8
|
|
|
67.9
|
%
|
|
$
|
13.2
|
|
|
1.0
|
%
|
Gross profit
|
$
|
293.1
|
|
|
|
|
$
|
278.0
|
|
|
|
|
|
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Same Store:
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Personnel costs
|
$
|
91.6
|
|
|
32.5
|
%
|
|
$
|
89.7
|
|
|
32.7
|
%
|
|
$
|
1.9
|
|
|
(0.2
|
)%
|
Sales compensation
|
30.1
|
|
|
10.7
|
%
|
|
28.9
|
|
|
10.5
|
%
|
|
1.2
|
|
|
0.2
|
%
|
|||
Share-based compensation
|
3.6
|
|
|
1.3
|
%
|
|
2.5
|
|
|
0.9
|
%
|
|
1.1
|
|
|
0.4
|
%
|
|||
Outside services
|
20.2
|
|
|
7.2
|
%
|
|
20.8
|
|
|
7.6
|
%
|
|
(0.6
|
)
|
|
(0.4
|
)%
|
|||
Advertising
|
9.0
|
|
|
3.2
|
%
|
|
7.3
|
|
|
2.7
|
%
|
|
1.7
|
|
|
0.5
|
%
|
|||
Rent
|
6.7
|
|
|
2.4
|
%
|
|
6.4
|
|
|
2.3
|
%
|
|
0.3
|
|
|
0.1
|
%
|
|||
Utilities
|
4.3
|
|
|
1.5
|
%
|
|
4.3
|
|
|
1.6
|
%
|
|
—
|
|
|
(0.1
|
)%
|
|||
Insurance
|
2.7
|
|
|
1.0
|
%
|
|
2.3
|
|
|
0.8
|
%
|
|
0.4
|
|
|
0.2
|
%
|
|||
Other
|
26.4
|
|
|
9.2
|
%
|
|
24.0
|
|
|
8.7
|
%
|
|
2.4
|
|
|
0.5
|
%
|
|||
Selling, general, and administrative expense
|
$
|
194.6
|
|
|
69.0
|
%
|
|
$
|
186.2
|
|
|
67.8
|
%
|
|
$
|
8.4
|
|
|
1.2
|
%
|
Gross profit
|
$
|
282.0
|
|
|
|
|
$
|
274.7
|
|
|
|
|
|
|
|
|
For the Nine Months Ended September 30,
|
|
Increase
(Decrease)
|
|
%
Change
|
|||||||||
|
2019
|
|
2018
|
|
||||||||||
|
(Dollars in millions, except per share data)
|
|||||||||||||
REVENUE:
|
|
|
|
|
|
|
|
|||||||
New vehicle
|
$
|
2,823.9
|
|
|
$
|
2,766.3
|
|
|
$
|
57.6
|
|
|
2
|
%
|
Used vehicle
|
1,590.4
|
|
|
1,499.0
|
|
|
91.4
|
|
|
6
|
%
|
|||
Parts and service
|
669.7
|
|
|
609.9
|
|
|
59.8
|
|
|
10
|
%
|
|||
Finance and insurance, net
|
232.3
|
|
|
215.0
|
|
|
17.3
|
|
|
8
|
%
|
|||
TOTAL REVENUE
|
5,316.3
|
|
|
5,090.2
|
|
|
226.1
|
|
|
4
|
%
|
|||
GROSS PROFIT:
|
|
|
|
|
|
|
|
|||||||
New vehicle
|
114.8
|
|
|
121.3
|
|
|
(6.5
|
)
|
|
(5
|
)%
|
|||
Used vehicle
|
102.8
|
|
|
100.4
|
|
|
2.4
|
|
|
2
|
%
|
|||
Parts and service
|
417.4
|
|
|
384.5
|
|
|
32.9
|
|
|
9
|
%
|
|||
Finance and insurance, net
|
232.3
|
|
|
215.0
|
|
|
17.3
|
|
|
8
|
%
|
|||
TOTAL GROSS PROFIT
|
867.3
|
|
|
821.2
|
|
|
46.1
|
|
|
6
|
%
|
|||
OPERATING EXPENSES:
|
|
|
|
|
|
|
|
|||||||
Selling, general, and administrative
|
593.7
|
|
|
563.6
|
|
|
30.1
|
|
|
5
|
%
|
|||
Depreciation and amortization
|
26.7
|
|
|
25.2
|
|
|
1.5
|
|
|
6
|
%
|
|||
Other operating expense (income), net
|
1.0
|
|
|
(1.2
|
)
|
|
2.2
|
|
|
NM
|
|
|||
INCOME FROM OPERATIONS
|
245.9
|
|
|
233.6
|
|
|
12.3
|
|
|
5
|
%
|
|||
OTHER EXPENSES (INCOME):
|
|
|
|
|
|
|
|
|||||||
Floor plan interest expense
|
29.7
|
|
|
23.0
|
|
|
6.7
|
|
|
29
|
%
|
|||
Other interest expense, net
|
41.2
|
|
|
39.4
|
|
|
1.8
|
|
|
5
|
%
|
|||
Swap interest expense
|
—
|
|
|
0.5
|
|
|
(0.5
|
)
|
|
(100
|
)%
|
|||
Gain on divestiture
|
(11.7
|
)
|
|
—
|
|
|
(11.7
|
)
|
|
—
|
%
|
|||
Total other expenses, net
|
59.2
|
|
|
62.9
|
|
|
(3.7
|
)
|
|
(6
|
)%
|
|||
INCOME BEFORE INCOME TAXES
|
186.7
|
|
|
170.7
|
|
|
16.0
|
|
|
9
|
%
|
|||
Income tax expense
|
45.9
|
|
|
43.1
|
|
|
2.8
|
|
|
6
|
%
|
|||
NET INCOME
|
$
|
140.8
|
|
|
$
|
127.6
|
|
|
$
|
13.2
|
|
|
10
|
%
|
Net income per share—Diluted
|
$
|
7.30
|
|
|
$
|
6.22
|
|
|
$
|
1.1
|
|
|
17
|
%
|
|
For the Nine Months Ended September 30,
|
||||
|
2019
|
|
2018
|
||
REVENUE MIX PERCENTAGES:
|
|
|
|
||
New vehicle
|
53.1
|
%
|
|
54.3
|
%
|
Used vehicle retail
|
27.3
|
%
|
|
26.7
|
%
|
Used vehicle wholesale
|
2.6
|
%
|
|
2.8
|
%
|
Parts and service
|
12.6
|
%
|
|
12.0
|
%
|
Finance and insurance, net
|
4.4
|
%
|
|
4.2
|
%
|
Total revenue
|
100.0
|
%
|
|
100.0
|
%
|
GROSS PROFIT MIX PERCENTAGES:
|
|
|
|
||
New vehicle
|
13.2
|
%
|
|
14.8
|
%
|
Used vehicle retail
|
11.8
|
%
|
|
12.0
|
%
|
Used vehicle wholesale
|
0.1
|
%
|
|
0.2
|
%
|
Parts and service
|
48.1
|
%
|
|
46.8
|
%
|
Finance and insurance, net
|
26.8
|
%
|
|
26.2
|
%
|
Total gross profit
|
100.0
|
%
|
|
100.0
|
%
|
GROSS PROFIT MARGIN
|
16.3
|
%
|
|
16.1
|
%
|
SG&A EXPENSES AS A PERCENTAGE OF GROSS PROFIT
|
68.5
|
%
|
|
68.6
|
%
|
|
For the Nine Months Ended September 30,
|
|
Increase
(Decrease)
|
|
%
Change
|
|||||||||
|
2019
|
|
2018
|
|
||||||||||
|
(Dollars in millions, except for per vehicle data)
|
|||||||||||||
As Reported:
|
|
|
|
|
|
|
|
|||||||
Revenue:
|
|
|
|
|
|
|
|
|||||||
Luxury
|
$
|
929.8
|
|
|
$
|
883.8
|
|
|
$
|
46.0
|
|
|
5
|
%
|
Import
|
1,290.4
|
|
|
1,319.3
|
|
|
(28.9
|
)
|
|
(2
|
)%
|
|||
Domestic
|
603.7
|
|
|
563.2
|
|
|
40.5
|
|
|
7
|
%
|
|||
Total new vehicle revenue
|
$
|
2,823.9
|
|
|
$
|
2,766.3
|
|
|
$
|
57.6
|
|
|
2
|
%
|
Gross profit:
|
|
|
|
|
|
|
|
|||||||
Luxury
|
$
|
58.0
|
|
|
$
|
57.5
|
|
|
$
|
0.5
|
|
|
1
|
%
|
Import
|
31.5
|
|
|
39.1
|
|
|
(7.6
|
)
|
|
(19
|
)%
|
|||
Domestic
|
25.3
|
|
|
24.7
|
|
|
0.6
|
|
|
2
|
%
|
|||
Total new vehicle gross profit
|
$
|
114.8
|
|
|
$
|
121.3
|
|
|
$
|
(6.5
|
)
|
|
(5
|
)%
|
New vehicle units:
|
|
|
|
|
|
|
|
|||||||
Luxury
|
16,933
|
|
|
16,527
|
|
|
406
|
|
|
2
|
%
|
|||
Import
|
45,697
|
|
|
46,545
|
|
|
(848
|
)
|
|
(2
|
)%
|
|||
Domestic
|
15,006
|
|
|
14,406
|
|
|
600
|
|
|
4
|
%
|
|||
Total new vehicle units
|
77,636
|
|
|
77,478
|
|
|
158
|
|
|
—
|
%
|
|||
|
|
|
|
|
|
|
|
|||||||
Same Store:
|
|
|
|
|
|
|
|
|||||||
Revenue:
|
|
|
|
|
|
|
|
|||||||
Luxury
|
$
|
926.7
|
|
|
$
|
883.8
|
|
|
$
|
42.9
|
|
|
5
|
%
|
Import
|
1,260.1
|
|
|
1,284.0
|
|
|
(23.9
|
)
|
|
(2
|
)%
|
|||
Domestic
|
512.1
|
|
|
563.2
|
|
|
(51.1
|
)
|
|
(9
|
)%
|
|||
Total new vehicle revenue
|
$
|
2,698.9
|
|
|
$
|
2,731.0
|
|
|
$
|
(32.1
|
)
|
|
(1
|
)%
|
Gross profit:
|
|
|
|
|
|
|
|
|||||||
Luxury
|
$
|
58.1
|
|
|
$
|
57.5
|
|
|
$
|
0.6
|
|
|
1
|
%
|
Import
|
30.6
|
|
|
37.8
|
|
|
(7.2
|
)
|
|
(19
|
)%
|
|||
Domestic
|
20.6
|
|
|
24.7
|
|
|
(4.1
|
)
|
|
(17
|
)%
|
|||
Total new vehicle gross profit
|
$
|
109.3
|
|
|
$
|
120.0
|
|
|
$
|
(10.7
|
)
|
|
(9
|
)%
|
New vehicle units:
|
|
|
|
|
|
|
|
|||||||
Luxury
|
16,862
|
|
|
16,527
|
|
|
335
|
|
|
2
|
%
|
|||
Import
|
44,617
|
|
|
45,258
|
|
|
(641
|
)
|
|
(1
|
)%
|
|||
Domestic
|
12,708
|
|
|
14,406
|
|
|
(1,698
|
)
|
|
(12
|
)%
|
|||
Total new vehicle units
|
74,187
|
|
|
76,191
|
|
|
(2,004
|
)
|
|
(3
|
)%
|
|
For the Nine Months Ended September 30,
|
|
Increase (Decrease)
|
|
%
Change
|
|||||||||
|
2019
|
|
2018
|
|
||||||||||
As Reported:
|
|
|
|
|
|
|
|
|||||||
Revenue per new vehicle sold
|
$
|
36,374
|
|
|
$
|
35,704
|
|
|
$
|
670
|
|
|
2
|
%
|
Gross profit per new vehicle sold
|
$
|
1,479
|
|
|
$
|
1,566
|
|
|
$
|
(87
|
)
|
|
(6
|
)%
|
New vehicle gross margin
|
4.1
|
%
|
|
4.4
|
%
|
|
(0.3
|
)%
|
|
|
|
|||
|
|
|
|
|
|
|
|
|||||||
Luxury:
|
|
|
|
|
|
|
|
|||||||
Gross profit per new vehicle sold
|
$
|
3,425
|
|
|
$
|
3,479
|
|
|
$
|
(54
|
)
|
|
(2
|
)%
|
New vehicle gross margin
|
6.2
|
%
|
|
6.5
|
%
|
|
(0.3
|
)%
|
|
|
||||
Import:
|
|
|
|
|
|
|
|
|||||||
Gross profit per new vehicle sold
|
$
|
689
|
|
|
$
|
840
|
|
|
$
|
(151
|
)
|
|
(18
|
)%
|
New vehicle gross margin
|
2.4
|
%
|
|
3.0
|
%
|
|
(0.6
|
)%
|
|
|
||||
Domestic:
|
|
|
|
|
|
|
|
|||||||
Gross profit per new vehicle sold
|
$
|
1,686
|
|
|
$
|
1,715
|
|
|
$
|
(29
|
)
|
|
(2
|
)%
|
New vehicle gross margin
|
4.2
|
%
|
|
4.4
|
%
|
|
(0.2
|
)%
|
|
|
||||
|
|
|
|
|
|
|
|
|||||||
Same Store:
|
|
|
|
|
|
|
|
|||||||
Revenue per new vehicle sold
|
$
|
36,380
|
|
|
$
|
35,844
|
|
|
$
|
536
|
|
|
1
|
%
|
Gross profit per new vehicle sold
|
$
|
1,473
|
|
|
$
|
1,575
|
|
|
$
|
(102
|
)
|
|
(6
|
)%
|
New vehicle gross margin
|
4.0
|
%
|
|
4.4
|
%
|
|
(0.4
|
)%
|
|
|
|
|||
|
|
|
|
|
|
|
|
|||||||
Luxury:
|
|
|
|
|
|
|
|
|||||||
Gross profit per new vehicle sold
|
$
|
3,446
|
|
|
$
|
3,479
|
|
|
$
|
(33
|
)
|
|
(1
|
)%
|
New vehicle gross margin
|
6.3
|
%
|
|
6.5
|
%
|
|
(0.2
|
)%
|
|
|
||||
Import:
|
|
|
|
|
|
|
|
|||||||
Gross profit per new vehicle sold
|
$
|
686
|
|
|
$
|
835
|
|
|
$
|
(149
|
)
|
|
(18
|
)%
|
New vehicle gross margin
|
2.4
|
%
|
|
2.9
|
%
|
|
(0.5
|
)%
|
|
|
||||
Domestic:
|
|
|
|
|
|
|
|
|||||||
Gross profit per new vehicle sold
|
$
|
1,621
|
|
|
$
|
1,715
|
|
|
$
|
(94
|
)
|
|
(5
|
)%
|
New vehicle gross margin
|
4.0
|
%
|
|
4.4
|
%
|
|
(0.4
|
)%
|
|
|
|
For the Nine Months Ended September 30,
|
|
Increase (Decrease)
|
|
%
Change
|
|||||||||
|
2019
|
|
2018
|
|
||||||||||
|
(Dollars in millions, except for per vehicle data)
|
|||||||||||||
As Reported:
|
|
|
|
|
|
|
|
|||||||
Revenue:
|
|
|
|
|
|
|
|
|||||||
Used vehicle retail revenue
|
$
|
1,449.8
|
|
|
$
|
1,355.4
|
|
|
$
|
94.4
|
|
|
7
|
%
|
Used vehicle wholesale revenue
|
140.6
|
|
|
143.6
|
|
|
(3.0
|
)
|
|
(2
|
)%
|
|||
Used vehicle revenue
|
$
|
1,590.4
|
|
|
$
|
1,499.0
|
|
|
$
|
91.4
|
|
|
6
|
%
|
Gross profit:
|
|
|
|
|
|
|
|
|||||||
Used vehicle retail gross profit
|
$
|
102.2
|
|
|
$
|
98.5
|
|
|
$
|
3.7
|
|
|
4
|
%
|
Used vehicle wholesale gross profit
|
0.6
|
|
|
1.9
|
|
|
(1.3
|
)
|
|
(68
|
)%
|
|||
Used vehicle gross profit
|
$
|
102.8
|
|
|
$
|
100.4
|
|
|
$
|
2.4
|
|
|
2
|
%
|
Used vehicle retail units:
|
|
|
|
|
|
|
|
|||||||
Used vehicle retail units
|
66,330
|
|
|
63,079
|
|
|
3,251
|
|
|
5
|
%
|
|||
|
|
|
|
|
|
|
|
|||||||
Same Store:
|
|
|
|
|
|
|
|
|||||||
Revenue:
|
|
|
|
|
|
|
|
|||||||
Used vehicle retail revenue
|
$
|
1,383.4
|
|
|
$
|
1,333.1
|
|
|
$
|
50.3
|
|
|
4
|
%
|
Used vehicle wholesale revenue
|
135.9
|
|
|
140.7
|
|
|
(4.8
|
)
|
|
(3
|
)%
|
|||
Used vehicle revenue
|
$
|
1,519.3
|
|
|
$
|
1,473.8
|
|
|
$
|
45.5
|
|
|
3
|
%
|
Gross profit:
|
|
|
|
|
|
|
|
|||||||
Used vehicle retail gross profit
|
$
|
96.6
|
|
|
$
|
97.2
|
|
|
$
|
(0.6
|
)
|
|
(1
|
)%
|
Used vehicle wholesale gross profit
|
0.6
|
|
|
2.0
|
|
|
(1.4
|
)
|
|
(70
|
)%
|
|||
Used vehicle gross profit
|
$
|
97.2
|
|
|
$
|
99.2
|
|
|
$
|
(2.0
|
)
|
|
(2
|
)%
|
Used vehicle retail units:
|
|
|
|
|
|
|
|
|||||||
Used vehicle retail units
|
62,917
|
|
|
61,913
|
|
|
1,004
|
|
|
2
|
%
|
|
For the Nine Months Ended September 30,
|
|
Increase (Decrease)
|
|
%
Change
|
|||||||||
|
2019
|
|
2018
|
|
||||||||||
As Reported:
|
|
|
|
|
|
|
|
|||||||
Revenue per used vehicle retailed
|
$
|
21,857
|
|
|
$
|
21,487
|
|
|
$
|
370
|
|
|
2
|
%
|
Gross profit per used vehicle retailed
|
$
|
1,541
|
|
|
$
|
1,562
|
|
|
$
|
(21
|
)
|
|
(1
|
)%
|
Used vehicle retail gross margin
|
7.0
|
%
|
|
7.3
|
%
|
|
(0.3
|
)%
|
|
|
|
|||
|
|
|
|
|
|
|
|
|||||||
Same Store:
|
|
|
|
|
|
|
|
|||||||
Revenue per used vehicle retailed
|
$
|
21,988
|
|
|
$
|
21,532
|
|
|
$
|
456
|
|
|
2
|
%
|
Gross profit per used vehicle retailed
|
$
|
1,535
|
|
|
$
|
1,570
|
|
|
$
|
(35
|
)
|
|
(2
|
)%
|
Used vehicle retail gross margin
|
7.0
|
%
|
|
7.3
|
%
|
|
(0.3
|
)%
|
|
|
|
|
For the Nine Months Ended September 30,
|
|
Increase
(Decrease)
|
|
%
Change
|
|||||||||
|
2019
|
|
2018
|
|
||||||||||
|
(Dollars in millions)
|
|||||||||||||
As Reported:
|
|
|
|
|
|
|
|
|||||||
Parts and service revenue
|
$
|
669.7
|
|
|
$
|
609.9
|
|
|
$
|
59.8
|
|
|
10
|
%
|
Parts and service gross profit:
|
|
|
|
|
|
|
|
|||||||
Customer pay
|
236.9
|
|
|
217.8
|
|
|
19.1
|
|
|
9
|
%
|
|||
Warranty
|
66.1
|
|
|
56.5
|
|
|
9.6
|
|
|
17
|
%
|
|||
Wholesale parts
|
17.6
|
|
|
16.8
|
|
|
0.8
|
|
|
5
|
%
|
|||
Parts and service gross profit, excluding reconditioning and preparation
|
$
|
320.6
|
|
|
$
|
291.1
|
|
|
$
|
29.5
|
|
|
10
|
%
|
Parts and service gross margin, excluding reconditioning and preparation
|
47.9
|
%
|
|
47.7
|
%
|
|
0.2
|
%
|
|
|
|
|||
Reconditioning and preparation *
|
$
|
96.8
|
|
|
$
|
93.4
|
|
|
$
|
3.4
|
|
|
4
|
%
|
Total parts and service gross profit
|
$
|
417.4
|
|
|
$
|
384.5
|
|
|
$
|
32.9
|
|
|
9
|
%
|
|
|
|
|
|
|
|
|
|||||||
Same Store:
|
|
|
|
|
|
|
|
|||||||
Parts and service revenue
|
$
|
648.6
|
|
|
$
|
602.1
|
|
|
$
|
46.5
|
|
|
8
|
%
|
Parts and service gross profit:
|
|
|
|
|
|
|
|
|||||||
Customer pay
|
229.0
|
|
|
215.2
|
|
|
13.8
|
|
|
6
|
%
|
|||
Warranty
|
64.2
|
|
|
56.0
|
|
|
8.2
|
|
|
15
|
%
|
|||
Wholesale parts
|
17.3
|
|
|
16.6
|
|
|
0.7
|
|
|
4
|
%
|
|||
Parts and service gross profit, excluding reconditioning and preparation
|
$
|
310.5
|
|
|
$
|
287.8
|
|
|
$
|
22.7
|
|
|
8
|
%
|
Parts and service gross margin, excluding reconditioning and preparation
|
47.9
|
%
|
|
47.8
|
%
|
|
0.1
|
%
|
|
|
|
|||
Reconditioning and preparation *
|
$
|
93.1
|
|
|
$
|
91.6
|
|
|
$
|
1.5
|
|
|
2
|
%
|
Total parts and service gross profit
|
$
|
403.6
|
|
|
$
|
379.4
|
|
|
$
|
24.2
|
|
|
6
|
%
|
|
For the Nine Months Ended September 30,
|
|
Increase
(Decrease)
|
|
%
Change
|
|||||||||
|
2019
|
|
2018
|
|
||||||||||
|
(Dollars in millions, except for per vehicle data)
|
|||||||||||||
As Reported:
|
|
|
|
|
|
|
|
|||||||
Finance and insurance, net
|
$
|
232.3
|
|
|
$
|
215.0
|
|
|
$
|
17.3
|
|
|
8
|
%
|
Finance and insurance, net per vehicle sold
|
$
|
1,614
|
|
|
$
|
1,530
|
|
|
$
|
84
|
|
|
5
|
%
|
|
|
|
|
|
|
|
|
|||||||
Same Store:
|
|
|
|
|
|
|
|
|||||||
Finance and insurance, net
|
$
|
222.8
|
|
|
$
|
210.7
|
|
|
$
|
12.1
|
|
|
6
|
%
|
Finance and insurance, net per vehicle sold
|
$
|
1,625
|
|
|
$
|
1,526
|
|
|
$
|
99
|
|
|
6
|
%
|
|
For the Nine Months Ended September 30,
|
|
Increase
(Decrease)
|
|
% of Gross
Profit Increase (Decrease)
|
|||||||||||||||
|
2019
|
|
% of Gross
Profit
|
|
2018
|
|
% of Gross
Profit
|
|
||||||||||||
|
(Dollars in millions)
|
|||||||||||||||||||
As Reported:
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Personnel costs
|
$
|
282.2
|
|
|
32.5
|
%
|
|
$
|
270.1
|
|
|
32.9
|
%
|
|
$
|
12.1
|
|
|
(0.4
|
)%
|
Sales compensation
|
90.7
|
|
|
10.5
|
%
|
|
86.3
|
|
|
10.5
|
%
|
|
4.4
|
|
|
—
|
%
|
|||
Share-based compensation
|
10.4
|
|
|
1.2
|
%
|
|
8.2
|
|
|
1.0
|
%
|
|
2.2
|
|
|
0.2
|
%
|
|||
Outside services
|
61.4
|
|
|
7.1
|
%
|
|
61.4
|
|
|
7.5
|
%
|
|
—
|
|
|
(0.4
|
)%
|
|||
Advertising
|
27.7
|
|
|
3.2
|
%
|
|
23.5
|
|
|
2.9
|
%
|
|
4.2
|
|
|
0.3
|
%
|
|||
Rent
|
20.3
|
|
|
2.3
|
%
|
|
19.0
|
|
|
2.3
|
%
|
|
1.3
|
|
|
—
|
%
|
|||
Utilities
|
12.5
|
|
|
1.4
|
%
|
|
12.3
|
|
|
1.5
|
%
|
|
0.2
|
|
|
(0.1
|
)%
|
|||
Insurance
|
10.5
|
|
|
1.2
|
%
|
|
10.6
|
|
|
1.3
|
%
|
|
(0.1
|
)
|
|
(0.1
|
)%
|
|||
Other
|
78.0
|
|
|
9.1
|
%
|
|
72.2
|
|
|
8.7
|
%
|
|
5.8
|
|
|
0.4
|
%
|
|||
Selling, general, and administrative expense
|
$
|
593.7
|
|
|
68.5
|
%
|
|
$
|
563.6
|
|
|
68.6
|
%
|
|
$
|
30.1
|
|
|
(0.1
|
)%
|
Gross profit
|
$
|
867.3
|
|
|
|
|
$
|
821.2
|
|
|
|
|
|
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Same Store:
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Personnel costs
|
$
|
271.3
|
|
|
32.6
|
%
|
|
$
|
266.2
|
|
|
32.9
|
%
|
|
$
|
5.1
|
|
|
(0.3
|
)%
|
Sales compensation
|
86.6
|
|
|
10.4
|
%
|
|
84.5
|
|
|
10.4
|
%
|
|
2.1
|
|
|
—
|
%
|
|||
Share-based compensation
|
10.4
|
|
|
1.2
|
%
|
|
8.2
|
|
|
1.0
|
%
|
|
2.2
|
|
|
0.2
|
%
|
|||
Outside services
|
58.6
|
|
|
7.0
|
%
|
|
60.3
|
|
|
7.5
|
%
|
|
(1.7
|
)
|
|
(0.5
|
)%
|
|||
Advertising
|
25.1
|
|
|
3.0
|
%
|
|
22.9
|
|
|
2.8
|
%
|
|
2.2
|
|
|
0.2
|
%
|
|||
Rent
|
20.1
|
|
|
2.4
|
%
|
|
19.0
|
|
|
2.3
|
%
|
|
1.1
|
|
|
0.1
|
%
|
|||
Utilities
|
12.0
|
|
|
1.4
|
%
|
|
12.2
|
|
|
1.5
|
%
|
|
(0.2
|
)
|
|
(0.1
|
)%
|
|||
Insurance
|
9.6
|
|
|
1.2
|
%
|
|
10.3
|
|
|
1.3
|
%
|
|
(0.7
|
)
|
|
(0.1
|
)%
|
|||
Other
|
$
|
75.7
|
|
|
9.2
|
%
|
|
$
|
70.8
|
|
|
8.8
|
%
|
|
4.9
|
|
|
0.4
|
%
|
|
Selling, general, and administrative expense
|
$
|
569.4
|
|
|
68.4
|
%
|
|
$
|
554.4
|
|
|
68.5
|
%
|
|
$
|
15.0
|
|
|
(0.1
|
)%
|
Gross profit
|
$
|
832.9
|
|
|
|
|
$
|
809.3
|
|
|
|
|
|
|
|
•
|
2019 Senior Credit Facility — On September 25, 2019, the Company and certain of its subsidiaries entered into the 2019 Senior Credit Facility, which amended and restated the Company’s pre-existing second amended and restated credit agreement, dated as of July 25, 2016, among the Company and certain of its subsidiaries and Bank of America, as administrative agent, and the other lenders party thereto. The 2019 Senior Credit Agreement provides for the following:
|
•
|
Manufacturer affiliated new vehicle floor plan and other financing facilities — we have a floor plan facility with the Ford Motor Credit Company ("Ford Credit") to purchase new Ford and Lincoln vehicle inventory, which matures on December 5, 2019. We also have established a floor plan offset account with Ford Credit, which operates in a similar manner to our floor plan offset account with Bank of America. As of September 30, 2019, we had $122.1
|
•
|
6.0% Senior Subordinated Notes due 2024 — as of September 30, 2019 we had $600.0 million in aggregate principal amount outstanding related to our 6.0% Notes. We are required to pay interest on the 6.0% Notes on June 15 and December 15 of each year until maturity on December 15, 2024.
|
•
|
Mortgage notes — as of September 30, 2019, we had $127.3 million of mortgage note obligations. These obligations are collateralized by the associated real estate at our dealership locations.
|
•
|
Restated Master Loan Agreement — provides for term loans to certain of our subsidiaries (the "Restated Master Loan Agreement"). Borrowings under the Restated Master Loan Agreement are guaranteed by us and are collateralized by the real property financed under the Restated Master Loan Agreement. As of September 30, 2019, the outstanding balance under the Restated Master Loan Agreement was $79.5 million. There is no further borrowing availability under this agreement.
|
•
|
Prior Real Estate Credit Agreement — a real estate term loan credit agreement with borrowings collateralized by first priority liens, subject to certain permitted exceptions, on all of the real property financed thereunder (the "Prior Real Estate Credit Agreement"). As of September 30, 2019, we had $36.1 million of mortgage note obligations outstanding under the Prior Real Estate Credit Agreement. There is no further borrowing availability under this agreement.
|
•
|
2018 Bank of America Facility —On November 13, 2018, the Company and certain of its subsidiaries entered into a real estate term loan credit agreement (the “Bank of America Credit Agreement") with Bank of America N.A., which provides for term loans in an aggregate amount not to exceed $128.1 million (the "Bank of America Facility"). On November 13, 2018, we borrowed an aggregate amount of $24.8 million under the Bank of America Credit Agreement, a portion of which was used to refinance certain of the Company’s other outstanding mortgage indebtedness. All of the real property financed by an operating dealership subsidiary of the Company under the Bank of America Facility is collateralized by first priority liens, subject to certain permitted exceptions. As of September 30, 2019, we had $24.8 million of outstanding borrowings under the 2018 Bank of America Facility.
|
•
|
2018 Wells Fargo Master Loan Facility—On November 16, 2018, certain subsidiaries of the Company entered into a master loan agreement (the “Wells Fargo Master Loan Agreement”) with Wells Fargo Bank, National Association, as lender which provides for term loans to certain of the Company’s subsidiaries that are borrowers under the Wells Fargo Master Loan Agreement in an aggregate amount not to exceed $100.0 million (the "Wells Fargo Master Loan Facility"). On November 16, 2018, we borrowed an aggregate amount of $25.0 million under the Wells Fargo Master Loan Facility, the proceeds of which were used for general corporate purposes. Borrowings under the Wells Fargo Master Loan Facility are guaranteed by the Company pursuant to an unconditional guaranty, and all of the real property financed by any operating dealership subsidiary of the Company under the Wells Fargo Master Loan Facility is collateralized by first priority liens, subject to certain permitted exceptions. As of September 30, 2019, we had $25.0 million outstanding borrowings under the Wells Fargo Master Loan Facility.
|
|
For the Nine Months Ended September 30,
|
||||||
|
2019
|
|
2018
|
||||
|
(In millions)
|
||||||
Reconciliation of Cash provided by operating activities to Cash provided by operating activities, as adjusted
|
|
|
|
||||
Cash provided by operating activities, as reported
|
$
|
347.7
|
|
|
$
|
106.4
|
|
New vehicle floor plan borrowings —non-trade, net
|
(179.4
|
)
|
|
78.3
|
|
||
Cash provided by operating activities, as adjusted
|
$
|
168.3
|
|
|
$
|
184.7
|
|
•
|
$37.4 million increase related to the change in accounts payable and other current liabilities;
|
•
|
$21.9 million increase related to non-cash adjustments to net income; and
|
•
|
$0.1 million increase related to the change in other current assets and other long-term assets and liabilities, net.
|
Period
|
|
Total Number of Shares Purchased(1)
|
|
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)(1)
|
||||||
07/01/2019 - 07/31/2019
|
|
1,527
|
|
|
$
|
84.31
|
|
|
—
|
|
|
$
|
70.2
|
|
08/01/2019 - 08/31/2019
|
|
43,149
|
|
|
$
|
92.80
|
|
|
42,965
|
|
|
$
|
66.3
|
|
09/01/2019 - 09/30/2019
|
|
417
|
|
|
$
|
101.63
|
|
|
—
|
|
|
$
|
66.3
|
|
Total
|
|
45,093
|
|
|
|
|
42,965
|
|
|
|
|
|
Asbury Automotive Group, Inc.
|
||
|
|
|
|
|
Date:
|
October 30, 2019
|
By:
|
|
/s/ David W. Hult
|
|
|
Name:
|
|
David W. Hult
|
|
|
Title:
|
|
Chief Executive Officer and President
|
|
|
Asbury Automotive Group, Inc.
|
||
|
|
|
|
|
Date:
|
October 30, 2019
|
By:
|
|
/s/ Sean D. Goodman
|
|
|
Name:
|
|
Sean D. Goodman
|
|
|
Title:
|
|
Senior Vice President and Chief Financial Officer
|
By:
|
/s/ George A. Villasana
|
Title:
|
Senior Vice President, General Counsel & Secretary
|
By:
|
/s/ Matthew Pettoni
|
Title:
|
Treasurer
|
By:
|
/s/ David Ferrell
|
“Vesting Date” for RSUS
|
Percentage of RSUs Vested
|
First anniversary of the Date of Grant
|
33.33%
|
Second anniversary of the Date of Grant
|
33.33%
|
Third anniversary of the Date of Grant
|
33.34%
|
If to the Company:
|
Asbury Automotive Group, Inc.
2905 Premiere Parkway NW, Suite 300 Duluth, GA 30097 Attention: General Counsel Fax : (678) 542-2680 |
If to the Grantee:
|
At the then-current address shown on the
payroll of the Company. |
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/ David W. Hult
|
|
David W. Hult
Chief Executive Officer
October 30, 2019
|
|
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/ Sean D. Goodman
|
|
Sean D. Goodman
Chief Financial Officer October 30, 2019 |
|
(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/ David W. Hult
|
|
David W. Hult
Chief Executive Officer
October 30, 2019
|
|
(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/ Sean D. Goodman
|
|
Sean D. Goodman
Chief Financial Officer
October 30, 2019
|
|