Group 1 Automotive(GPI) - 2025 Q1 - Quarterly Report

Financial Performance - Total revenues for Q1 2025 increased to $5,505.3 million, up 23.1% from $4,470.5 million in Q1 2024[22] - Gross profit for Q1 2025 was $891.9 million, representing a 20.1% increase compared to $742.6 million in Q1 2024[22] - Net income for Q1 2025 decreased to $128.1 million, down 13.4% from $147.9 million in Q1 2024[23] - Basic earnings per share for continuing operations in Q1 2025 was $9.66, a decrease of 10.6% from $10.81 in Q1 2024[22] - Comprehensive income for Q1 2025 was $141.9 million, slightly down from $150.0 million in Q1 2024[23] - Total revenues for the three months ended March 31, 2025, were $5,505.3 million, an increase from $4,470.5 million in the same period of 2024, representing a growth of approximately 23.2%[34] - Income before income taxes for the three months ended March 31, 2025, was $167.5 million, compared to $193.3 million for the same period in 2024, indicating a decrease of 13.3%[53] - Basic earnings per common share for the three months ended March 31, 2025, were $9.69, down from $10.84 in the same period of 2024, reflecting a decline of 10.6%[56] - Total revenues reached $5,505.3 million, reflecting a 23.1% increase from $4,470.5 million[99] Cash Flow and Investments - Cash flows from operating activities in Q1 2025 were $158.7 million, down from $253.9 million in Q1 2024[27] - The company reported a net cash used in investing activities of $41.0 million in Q1 2025, compared to $618.2 million in Q1 2024[27] - Total capital expenditures for the three months ended March 31, 2025, were $52.2 million, compared to $63.2 million in the same period of 2024, a decrease of 17.7%[53] - Net cash provided by operating activities decreased by $95.2 million compared to the Prior Year Quarter, with adjusted net cash provided decreasing by $33.3 million[150] - Net cash used in investing activities decreased by $577.2 million, primarily due to a $624.4 million decrease in acquisition activity[151] Acquisitions and Restructuring - The acquisition of Inchcape Retail was completed on August 1, 2024, for approximately $517.0 million, which included 54 dealership locations and three collision centers in the U.K.[36] - The Company recorded $11.1 million in restructuring charges during the three months ended March 31, 2025, as part of the U.K.-wide restructuring plan initiated in late 2024[50] - Goodwill associated with the Inchcape Acquisition totaled $121.7 million, while total identifiable net assets amounted to $395.3 million[38] - The Company expects to incur an additional $2.6 million in restructuring charges throughout 2025 as part of the integration activities of Inchcape Retail[49] - As of March 31, 2025, the Company had incurred $27.8 million in restructuring charges related to the ongoing Restructuring Plan since its commencement[51] Sales Performance - New vehicle retail sales in the U.S. reached $1,968.7 million for the three months ended March 31, 2025, compared to $1,799.8 million in 2024, reflecting an increase of 9.4%[34] - New vehicle retail sales increased to $2,680.0 million, a 22.8% increase compared to $2,182.6 million in the previous year[99] - Used vehicle retail sales grew by 23.9% to $1,755.4 million, up from $1,416.8 million[99] - Retail new vehicles sold increased by 26.6% to 56,099 units compared to 44,302 units last year[99] - Retail used vehicles sold in same stores increased by 2.0% to 49,180 units compared to 48,239 units[100] - Total revenues in the U.K. increased by $758.7 million, or 92.0%, compared to the prior year quarter, driven by store acquisitions, higher same store revenues, and foreign currency exchange rate changes[119] Expenses and Profitability - The total cost of sales for Q1 2025 was $4,613.3 million, an increase of 23.7% from $3,727.9 million in Q1 2024[22] - SG&A expenses rose to $617.3 million, a 29.6% increase from $476.1 million[99] - Floorplan interest expense increased by $6.4 million, or 31.0%, due to higher inventories from improved manufacturer production and acquisitions[139] - Other interest expense, net increased by $10.5 million, or 35.7%, primarily due to interest expense associated with the 6.375% Senior Notes issued in 2024[142] - The gross margin for total revenues improved to 13.7%, up from 12.5% in the prior year quarter[116] Debt and Financing - The total long-term debt decreased to $2,661.1 million as of March 31, 2025, down from $2,737.9 million as of December 31, 2024, reflecting a reduction of about 2.8%[70] - The Company had $2.5 billion in a revolving syndicated credit arrangement, with an option to increase availability to $3.0 billion[74] - The outstanding balance of the Acquisition Line was $51.8 million, with $40.0 million in USD borrowings and $11.8 million related to letters of credit[155] - The total adjusted leverage ratio was 2.70, well below the required maximum of 5.75, and the fixed charge coverage ratio was 3.43, exceeding the required minimum of 1.20[157] Corporate Governance and Compliance - Group 1 Automotive, Inc. reported significant updates in their corporate governance with the Third Amended and Restated Certificate of Incorporation effective May 18, 2023[3.1] - The company has made amendments to its bylaws, with the Fourth Amended and Restated Bylaws effective February 15, 2023[3.2] - The certifications of the Chief Executive Officer and Chief Financial Officer pursuant to the Sarbanes-Oxley Act of 2002 were filed, ensuring compliance and accountability[31.1][31.2] - The company remains in compliance with all financial covenants under its debt agreements as of March 31, 2025[157] - The company has no legal proceedings that are expected to materially affect its financial condition or results of operations[167]