Pinewood.AI to Acquire Lithia's 51% Stake; New Contract Secures Deployment Across Lithia's Dealerships in US and Canada by 2028LONDON and MEDFORD, Ore., June 6, 2025 /PRNewswire/ -- Pinewood Technologies Group plc (Pinewood.AI), a leading cloud-based software provider for the automotive retail industry, and Lithia UK Holdings Limited, a wholly-owned subsidiary of Lithia & Driveway (NYSE: LAD), today announced an agreement in which Pinewood.AI will acquire Lithia's 51% interest in their North American joint ...

Core Insights - Lithia & Driveway has risen to 124 on the 2025 Fortune 500 list, improving 16 positions from 140 in 2024, and maintains its status as the largest automotive retailer globally for the second consecutive year [1][2][3] Company Performance - Lithia & Driveway first appeared on the Fortune 500 list in 2015 at 482 with a revenue of $7.9 billion, and has shown consistent growth, achieving $36.2 billion in revenue in 2024 [2][3] - The company's growth is attributed to a combination of organic growth, strategic acquisitions, digital innovation, and an expanding network of dealerships [3] Business Strategy - The advancement in ranking and leadership in automotive retail highlights the effectiveness of the company's long-term growth strategy and disciplined business model execution [3] - Lithia & Driveway aims to drive operational excellence, accelerate growth, and enhance customer experiences through a comprehensive network of physical locations and e-commerce platforms [4]

Core Insights - Lithia & Driveway's CFO Tina Miller and Chief Customer Officer Dianna du Preez have been recognized as part of the 100 Leading Women in the North American Auto Industry by Automotive News, highlighting their significant influence and leadership in the automotive sector [1][2][3] Company Overview - Lithia & Driveway (NYSE: LAD) is the largest global automotive retailer, offering a wide range of products and services throughout the vehicle ownership lifecycle, including physical locations, e-commerce platforms, and captive finance solutions [7] Leadership Recognition - The recognition of Tina Miller and Dianna du Preez reflects their leadership qualities and contributions to the company, emphasizing the mission of "Growth Powered by People" [3][4] - Tina Miller has been with Lithia & Driveway since 2005, serving in various roles before becoming CFO in 2019, and this marks her second time being named among the 100 Leading Women [4] - Dianna du Preez, with over 30 years of experience in the automotive industry, leads the online retail vertical and focuses on improving service retention and sales effectiveness [5][6]

Core Viewpoint - Lithia Motors (LAD) shares have increased by approximately 5.3% since the last earnings report, but this performance is below that of the S&P 500 [1] Group 1: Earnings and Estimates - Recent estimates for Lithia Motors have trended downward, with a consensus estimate shift of -5.47% [2] - The most recent earnings report is crucial for understanding the catalysts affecting the stock [1] Group 2: VGM Scores - Lithia Motors has a strong Growth Score of A, but a low Momentum Score of F, while also receiving an A for value, placing it in the top quintile for this investment strategy [3] - The overall aggregate VGM Score for Lithia Motors is A, which is significant for investors not focused on a single strategy [3] Group 3: Outlook - The downward trend in estimates indicates a broader negative sentiment, with Lithia Motors holding a Zacks Rank of 3 (Hold) [4] - An in-line return is expected from the stock in the upcoming months [4]

Core Insights - Lithia Motors (LAD) reported first-quarter 2025 adjusted earnings per share of $7.66, an increase from $6.11 in the prior-year quarter, but below the Zacks Consensus Estimate of $7.77 [1] - The company's revenues reached $9.18 billion, reflecting a year-over-year increase of 7.3%, yet falling short of the Zacks Consensus Estimate of $9.33 billion [1] Segmental Performance - New vehicle retail revenues rose 9.1% year over year to $4.38 billion, aligning with estimates, while new vehicle units sold increased 7.4% to 91,990 units, missing the estimate of 93,776 units [2] - The average selling price (ASP) of new vehicles increased to $47,616 from $46,848, with a gross margin contraction of 110 basis points to 6.3% due to a 10.3% rise in cost of sales to $4.1 billion [2] - Used vehicle retail revenues grew 4.2% year over year to $2.92 billion, surpassing the estimate of $2.76 billion, with units sold rising 4.8% to 107,326 units, exceeding the expectation of 102,615 units [3] - The ASP for used vehicles was $27,198, down 0.5% year over year, while the gross margin remained flat at 6.5% [3] - Revenues from used vehicle wholesale decreased 2% to $331 million, missing the estimate of $531.9 million, while finance and insurance revenues increased 7% to $364.3 million, exceeding the estimate of $348 million [4] - Aftersales revenues were $979.1 million, up 7.3% year over year, surpassing the estimate of $978.7 million, and fleet and others revenues jumped 31.3% to $204.6 million, beating the expectation of $180.9 million [4] Financial Overview - Same-store new vehicle revenues increased 5.7% year over year, while same-store used vehicle retail sales fell 0.9% [5] - Cost of sales rose 7.5% year over year, with SG&A expenses at $952.7 million, and adjusted SG&A as a percentage of gross profit decreased to 68.2% from 69.4% in the prior year [5] - The company increased its quarterly dividend by 4% to 55 cents, with a share repurchase of nearly 403,000 shares at an average price of $326 [6] - As of March 31, 2025, Lithia had cash and equivalents of $430.3 million, up from $402.2 million at the end of 2024, and long-term debt decreased to $5.9 billion from $6.1 billion [7] Market Position - Lithia currently holds a Zacks Rank 3 (Hold), with better-ranked stocks in the auto sector including Standard Motor Products, Inc. (SMP) with a Zacks Rank 1 (Strong Buy), and Advance Auto Parts, Inc. (AAP) and Carvana Co. (CVNA) both at Zacks Rank 2 (Buy) [8]

Revenue and Profitability - Total revenues for 2025 reached $9,178.3 million, a 7.2% increase compared to $8,561.8 million in 2024[106] - New vehicle retail revenues were $4,380.2 million, up 9.1% from $4,014.1 million in 2024[106] - Total gross profit increased to $1,410.4 million, reflecting a 5.6% growth from $1,335.2 million in 2024[106] - Net income grew in 2025 primarily due to increased total gross profit while maintaining SG&A costs under control[105] - Aftersales gross profit increased by 11.9% to $561.5 million, up from $502.0 million in 2024[106] - Total revenues for Q1 2025 reached $8,543.2 million, a 2.5% increase from $8,332.5 million in Q1 2024[1] - Total gross profit for Q1 2025 was $1,333.7 million, reflecting a 1.8% increase from $1,310.0 million in Q1 2024[1] - The company reported net income attributable to Lithia Motors, Inc. of $209.5 million for the three months ended March 31, 2025, compared to $162.6 million in 2024[156] Vehicle Sales - The company sold 91,990 new vehicles, representing a 7.4% increase from 85,683 units sold in 2024[106] - New vehicle retail revenue for Q1 2025 increased by 9.1% to $4,166.6 million compared to Q1 2024, driven by same store growth and acquisition activity[115] - Used vehicle retail revenue for Q1 2025 increased by 4.2% to $2,658.4 million, although same store sales decreased by 0.9% due to lower average selling prices[118] Expenses and Costs - Adjusted SG&A for the three months ended March 31, 2025 was $961.5 million, an increase of $34.9 million or 3.8% compared to $926.6 million in 2024[134] - Operating margin for the three months ended March 31, 2025 was 4.4%, up from 4.0% in 2024, reflecting a 40 basis points increase due to a 5.6% rise in gross profit[144] - Depreciation and amortization increased to $63.9 million in the three months ended March 31, 2025, a 10.6% increase from $57.8 million in 2024, driven by acquisition activity[142] - Floor plan interest expense decreased by $3.6 million to $57.1 million in the three months ended March 31, 2025, a decline of 5.9% compared to $60.7 million in 2024[140] - Total other interest expense increased by $1.9 million to $65.5 million in the three months ended March 31, 2025, a 3.0% rise compared to $63.6 million in 2024[146] Cash Flow and Liquidity - As of March 31, 2025, available liquidity was approximately $1.4 billion, including $234.4 million in unrestricted cash[102] - Net cash provided by operating activities for Q1 2025 was $322.1 million, a $29.7 million increase compared to $292.4 million in Q1 2024[161] - Net cash used in investing activities decreased significantly to $117.1 million in Q1 2025 from $1,265.9 million in Q1 2024, reflecting a change of $1,148.8 million[163] - Cash paid for acquisitions, net of cash acquired, was $84.5 million in Q1 2025, down from $1,074.4 million in Q1 2024, a decrease of $989.9 million[164] - Total current available funds increased to $1,394.6 million as of March 31, 2025, a 3.0% increase from $1,353.8 million at December 31, 2024[160] Capital Expenditures and Shareholder Returns - Capital expenditures for the first three months of 2025 amounted to $68.7 million, with $143.4 million allocated for share repurchases[102] - The company plans to allocate 35% to 45% of free cash flow to acquisitions, 25% to capital expenditures, and 30% to shareholder returns through dividends and share repurchases[157] - The company repurchased 439,798 shares of common stock at an average price of $329.03, with $687.3 million remaining available for repurchases as of March 31, 2025[175] - Dividends paid in March 2025 amounted to $13.9 million, with a dividend per share of $0.53[176] Financing and Interest Rates - Financing operations recorded income of $12.5 million in Q1 2025, a significant improvement from a loss of $1.7 million in Q1 2024[129] - The total average managed finance receivables increased to $4,062.1 million in Q1 2025 from $3,436.6 million in Q1 2024[127] - The weighted average contract rate on loans decreased to 9.1% in Q1 2025 from 10.2% in Q1 2024, reflecting competitive adjustments following Federal Reserve rate cuts[130] Legal Proceedings - The company is involved in numerous legal proceedings as part of its normal business operations, but does not expect these to materially affect its financial condition or cash flows[188] Acquisitions - The company achieved an average return of over 25% on acquisitions by the third year of ownership, exceeding the target of 15%[99] - The company acquired 2 locations in Q1 2025, compared to 139 locations in Q1 2024[173]

Group 1 - Lithia Motors Inc. reported first-quarter FY25 sales growth of 7.2% year-on-year to $9.18 billion, missing the analyst consensus estimate of $9.26 billion [1] - New vehicle, same-store units grew by 3.6%, with new vehicle retail revenues increasing by 9.1% year-on-year and used vehicle retail revenues climbing by 4.2% [1] - Adjusted EPS of $7.66 missed the consensus estimate of $7.69 [1] Group 2 - President and CEO Bryan DeBoer stated that the company achieved profitable growth year over year in each month of the quarter, growing market share and driving operating efficiencies [2] - Following the earnings announcement, Lithia Motors shares gained 4.7% to trade at $291.30 [2] - Analysts made changes to their price targets, with Wells Fargo lowering the target from $308 to $305 and Goldman Sachs lowering it from $385 to $328 [2]

Investor Presentation Updated 04/23/2025 APRIL 2025 Disclosure Forward-Looking Statements Certain statements in this presentation, and at times made by our officers and representatives, constitute forward- looking statements within the meaning of the "Safe Harbor" provisions of the Private Securities Litigation Reform Act of 1995. Generally, you can identify forward-looking statements by terms such as "project", "outlook", "target", "may", "will", "would", "should", "seek", "expect", "plan", "intend", "fore ...

Financial Data and Key Metrics Changes - The company reported diluted earnings per share of $7.94, a 34.8% increase year-over-year, and adjusted diluted earnings of $7.66, a 25.4% increase, marking the first quarterly year-over-year adjusted earnings increase since Q4 2022 [7][10]. - Total revenues grew to a record $9.2 billion, a 7% increase from Q1 of the previous year [10]. - Adjusted SG&A as a percentage of gross profit was 68.2%, a 120 basis point decline from the prior year [42]. Business Line Data and Key Metrics Changes - New vehicle units increased by 3.6% year-over-year, while total unit sales increased by 1.5% [33]. - After-sales gross profit increased by 7.5%, with warranty work showing a 19.7% year-over-year increase [37][38]. - Financing operations delivered income of $12.5 million compared to a loss of $1.7 million in the same period last year [44]. Market Data and Key Metrics Changes - The company operates within one of the largest and least consolidated industries, with a current market share of just over 1% and a target of reaching 5% [24][17]. - The diversified omnichannel ecosystem spans retail, digital, and fleet channels across North America and the UK, with offerings ranging from new vehicles to twenty-year-old value autos [13]. Company Strategy and Development Direction - The focus for 2025 is on executing the strategy to build customer loyalty and expand market share, with a commitment to achieving $2 in EPS for every $1 billion in revenue [10][20]. - The company aims to maintain a balanced capital allocation strategy, targeting a minimum after-tax return of 15% on acquisitions [21][23]. - The strategy includes optimizing the network by acquiring larger automotive retail stores in profitable regions and leveraging digital channels [24][26]. Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's ability to deliver sustainable performance and capture market share despite potential tariff impacts [10][12]. - The management noted that the operational success is driven by store leaders' autonomy to adapt quickly to local demand [11][12]. - The company remains focused on disciplined cost management and enhancing efficiencies across the business [41][43]. Other Important Information - The company repurchased $146 million, or nearly 2% of its outstanding shares, at attractive valuations during the first quarter [23]. - The company ended the quarter with a net leverage of 2.5 times, in line with its long-term target [51]. Q&A Session Summary Question: Current tariff environment and its impact - Management noted that over 45% of inventory is not impacted by current tariffs, positioning the company favorably compared to peers [59]. - Inventory levels have decreased significantly, with a drop of almost ten days supply quarter-over-quarter [60]. Question: Communication with factory partners and M&A environment - There has been clear communication from manufacturers regarding pricing stability through the 2025 model year, with no major changes in the M&A environment noted [74]. Question: Expectations for front-end gross profit and market share - Management indicated that the design of the ecosystem allows for a potential upward price inflection rather than downward, with expectations for used vehicle gross profit to grow over time [80][82]. Question: Impact of tariffs on after-sales business - Management believes that most customers will need to repair their cars regardless of tariffs, minimizing the impact on the after-sales business [110][112]. Question: Capital allocation and acquisition targets - The company is targeting $2 billion in acquired revenues for the year, with ongoing evaluations of share repurchases and acquisitions [114].

Financial Data and Key Metrics Changes - The company reported diluted earnings per share of $7.94, a 34.8% year-over-year increase, and adjusted diluted earnings of $7.66, reflecting a 25.4% increase [6][9] - Revenues reached a record $9.2 billion, representing a 7% increase from Q1 of the previous year [9][10] - Adjusted EBITDA for the first quarter was $402.1 million, a 17.1% year-over-year increase [31] Business Line Data and Key Metrics Changes - Total unit sales increased by 1.5% year-over-year, with new vehicle units up 3.6% and used vehicles down slightly by 0.4% [22][23] - Aftersales revenue increased by 2.4%, with gross profit from aftersales up 7.5% [24] - Financing operations reported income of $12.5 million compared to a loss of $1.7 million in the same period last year [29] Market Data and Key Metrics Changes - The company noted a significant improvement in value auto sales, which increased by 38.8% year-over-year [23] - The inventory balance decreased by $163 million, with new vehicle days sales outstanding (DSO) decreasing from 59 days to 43 days [25] Company Strategy and Development Direction - The focus for 2025 is on executing the strategy to build customer loyalty and growth, with an emphasis on operational performance and market share expansion [7][14] - The company aims to achieve $2 in EPS for every $1 billion in revenue, with a disciplined approach to acquisitions and capital allocation [16][18] - The omnichannel strategy is designed to enhance customer engagement and streamline operations across retail, digital, and fleet channels [10][13] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the ability to adapt to tariff impacts and emphasized the importance of maintaining affordability in their product mix [10][42] - The company is optimistic about the growth potential in the aftersales segment, which is expected to benefit from ongoing demand for repairs and maintenance [70][71] - Management highlighted the importance of disciplined cost management and operational execution to drive profitability [27][28] Other Important Information - The company repurchased $146 million of its outstanding shares in the first quarter, representing nearly 2% of its float [15][31] - The transition of Adam Chamberlain from COO to CEO of Mercedes Benz USA was acknowledged, reflecting the strength of partnerships within the industry [19] Q&A Session Summary Question: Current tariff environment and its impact on demand and GPU - Management noted that over 45% of inventory is not impacted by current tariffs, positioning the company favorably compared to peers [37][38] Question: Communication from factory partners regarding tariffs - Clear communication has been received from manufacturers, with guarantees on holding prices through May for most OEMs [50] Question: Balancing front-end gross profit with market share - The company aims to create transparent experiences for consumers, which may lead to an upward price inflection rather than downward [53] Question: Impact of tariffs on aftersales business margins - Management believes that the need for repairs will sustain demand, minimizing the impact of tariffs on aftersales margins [70][71] Question: Capital allocation and acquisition targets - The company expects to focus on $2 billion in acquired revenue for the year, with ongoing share buybacks [72][73]