Asbury Automotive Group Reports Fourth Quarter Financial Results

Core Insights - Asbury Automotive Group reported a significant decline in net income for Q4 2023, with net income of $56 million ($2.70 per diluted share), down 89% from $353 million ($15.95 per diluted share) in Q4 2022 [1] - The decrease in net income was attributed to non-cash asset impairments of $117.2 million or $4.29 per diluted share in Q4 2023, compared to gains on dealership divestitures of $203 million or $6.92 per diluted share in Q4 2022 [1][3] - Adjusted net income for Q4 2023 was $146 million ($7.12 per diluted share), a 28% decrease from $202 million ($9.12 per diluted share) in Q4 2022 [1] Financial Performance - Total revenue for Q4 2023 was $3.8 billion, an increase of 3% year-over-year, while gross profit decreased by 9% to $673 million [5] - The gross margin decreased by 226 basis points to 17.7% in Q4 2023 [5] - New vehicle unit volume increased by 8%, with new vehicle revenue rising by 11%, but new vehicle gross profit decreased by 14% [5] - Used vehicle retail unit volume and revenue both decreased by 11%, with used vehicle retail gross profit down by 21% [5] - Finance and insurance (F&I) per vehicle retailed decreased by 11% to $2,304 [5] Operational Highlights - The company completed 16 divestitures in 2022, contributing $683 million in revenue for the year [1] - The integration of acquired businesses and the rollout of technology initiatives were emphasized as key strategies for future growth [2][3] - The company reported a total adjusted EBITDA of $1.1 billion for the full year 2023, a decrease of 15% from the prior year [8] Shareholder Returns - Asbury repurchased approximately 246,000 shares for $47 million during Q4 2023, totaling 1.3 million shares for $258 million for the full year [10] - As of December 31, 2023, the company had $203 million remaining on its share repurchase authorization [10] Liquidity and Leverage - As of December 31, 2023, the company had total liquidity of $460 million, including cash and availability under the revolver [9] - The adjusted net leverage ratio was reported at 2.5x at the end of the quarter [9]