Lithia Motors(LAD) - 2025 Q1 - Quarterly Report

Revenue and Profitability - Total revenues for 2025 reached $9,178.3 million, a 7.2$8,561.8 million in 2024[106] - New vehicle retail revenues were $4,380.2 million, up 9.1$4,014.1 million in 2024[106] - Total gross profit increased to $1,410.4 million, reflecting a 5.6$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$8,332.5 million in Q1 2024[1] - Total gross profit for Q1 2025 was $1,333.7 million, reflecting a 1.8$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$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$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$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$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]