Asbury Automotive Group(ABG) - 2025 Q1 - Quarterly Results

Financial Performance - First quarter 2025 net income was $132 million ($6.71 per diluted share), a decrease of 10% from $147 million ($7.21 per diluted share) in Q1 2024[2] - Revenue for Q1 2025 was $4.1 billion, a decrease of 1% compared to the same period in 2024[10] - Adjusted net income for Q1 2025 was $134 million ($6.82 per diluted share), down 9% from $147 million ($7.21 per diluted share) in Q1 2024[2] - Gross profit for Q1 2025 was $724 million, a decrease of 3% from the previous year[10] - Total revenue for Q1 2025 was $4,148.5 million, a decrease of 1% compared to $4,201.2 million in Q1 2024[25] - Net income decreased by 10% to $132.1 million, with diluted earnings per share at $6.71, down 7% from $7.21[25] - Adjusted EBITDA for the twelve months ended March 31, 2025, was $963.4 million, down from $982.0 million for the previous year, indicating a decline of 1.7%[39] - The diluted EPS for the three months ended March 31, 2025, was $6.71, compared to $6.82 for the same period in 2024, reflecting a decrease of 1.6%[40] Revenue Breakdown - New vehicle revenue increased by 4% to $2,138.1 million, while total used vehicle revenue decreased by 9% to $1,235.8 million[25] - New vehicle unit volume increased by 2% in Q1 2025, while used vehicle retail unit volume decreased by 10%[10] - The average selling price of new vehicles rose by 2% to $51,525, while the average selling price of used vehicles increased by 1% to $30,465[33] - Total unit sales of new vehicles increased by 2% to 41,496 units compared to 40,677 units in the prior year[33] Expenses and Margins - Operating margin for Q1 2025 was 5.6%, with an adjusted operating margin of 5.8%[10] - Selling, general and administrative expenses decreased by 3% to $456.4 million from $468.6 million year-over-year[33] - The income from operations as a percentage of revenue decreased to 5.6% from 6.3% in the previous year[33] - The gross margin for total new vehicles decreased by 120 basis points to 6.7% from 7.9%[33] - Selling, general and administrative (SG&A) expenses for the three months ended March 31, 2025, were $456.4 million, with SG&A as a percentage of gross profit at 63.0%[40] Liquidity and Debt - As of March 31, 2025, the company had total liquidity of $964 million, including cash and availability under credit lines[9] - Cash and cash equivalents increased by 80% to $124.6 million compared to $69.4 million in Q1 2024[27] - Long-term debt decreased slightly to $3,128.5 million from $3,138.6 million in Q4 2024[27] - The adjusted long-term net debt as of March 31, 2025, was $2,650.7 million, compared to $2,796.9 million as of December 31, 2024, showing a reduction of 5.2%[39] - The transaction adjusted net leverage ratio as of March 31, 2025, was 2.75, slightly down from 2.85 as of December 31, 2024[39] Inventory and Supply Chain - Inventory decreased by 8% to $1,822.4 million from $1,978.8 million in Q1 2024[27] - Days supply of new vehicle inventory improved to 44 days from 49 days in Q4 2024, while used vehicle inventory days supply decreased to 31 days from 37 days[28] Acquisitions and Divestitures - The company completed two divestitures in Q1 2025, contributing estimated annualized revenue of $79 million[2] - The company announced a definitive agreement to acquire The Herb Chambers Automotive Group, which has approximately $3 billion in annual revenue[4] Other Financial Metrics - The company reported a 52% increase in finance and insurance costs, rising to $13.1 million from $8.6 million in Q1 2024[25] - Total non-core items for the twelve months ended March 31, 2025, amounted to $155.4 million, compared to $152.4 million in the previous year[39] - The impact of dealership acquisitions and divestitures on transaction adjusted EBITDA was a negative $1.1 million for the twelve months ended March 31, 2025[39] - Cash provided by operating activities for the three months ended March 31, 2025, was $225.0 million, an increase from $177.1 million in the same period of 2024, representing a growth of 27.0%[40] - Adjusted cash flow provided by operating activities for the three months ended March 31, 2025, was $187.4 million, compared to $208.7 million in the same period of 2024, indicating a decline of 10.6%[40]