ST. LOUIS--(BUSINESS WIRE)--The Presidio Group LLC ("Presidio†), an independent merchant banking firm focused on mergers and acquisitions, capital raising and investments in the automotive retail and consumer mobility sectors, advised Asbury Automotive Group, Inc. ("Asbury†) on the sale of six Plaza Motors dealerships and a collision center in the St. Louis market to MileOne Autogroup ("MileOne†). "This transaction highlights how leading groups are actively realigning their footprints to further their ...

Core Viewpoint - Lithia & Driveway is the largest global automotive retailer, focusing on new and used vehicle sales and aftersales services, while pursuing strategic growth and acquisitions to maintain its leadership position [1] Financial Performance - The company reported record full-year revenues of $37.63 billion, representing a 4% increase from the previous year [2][6] - In the fourth quarter, revenues reached $9.20 billion, with a 6.1% growth in used vehicle revenue and a 4.7% increase in used retail units on a same-store basis [3] - Aftersales revenue increased by 10.9%, contributing to a 9.8% rise in gross profit on a same-store basis [3] Earnings and Shareholder Returns - The fourth quarter diluted earnings per share were reported at $5.72, with adjusted diluted earnings per share at $6.74 [4] - In 2025, the company repurchased $947 million worth of shares, accounting for 11.4% of outstanding shares, including 3.8% in the fourth quarter [5] Strategic Initiatives - Lithia & Driveway made strategic acquisitions totaling $2.4 billion in annual revenue, emphasizing strong growth in used vehicles and aftersales despite challenges in new vehicle sales [5][6] - The financing operations achieved a record quarterly income of $23 million, a significant increase of $19 million from the previous year, with a penetration rate of 15% and an average FICO score of 751 [4]

Financial Data and Key Metrics Changes - In 2025, the company achieved record revenues of $5.6 billion in Q4 and over $3.6 billion in gross profit for the full year, including nearly $1.6 billion from parts and service [6][11] - Adjusted net income for Q4 was $105 million, with adjusted diluted EPS of $8.49 from continuing operations [11] - Gross profit margin in the U.S. saw a slight decline in new vehicle sales, while used vehicle revenues increased approximately 4% [12][14] Business Line Data and Key Metrics Changes - Parts and service gross profit reached record levels, contributing significantly to overall profitability [4][6] - F&I (Finance and Insurance) performance improved, with PRU (Per Retail Unit) increasing by 13% in the U.K. [9][15] - Used vehicle operations held volumes flat year-over-year, but GPUs (Gross Profit per Unit) declined approximately 8% on a same-store basis due to higher acquisition costs [12][14] Market Data and Key Metrics Changes - In the U.K., new vehicle same-store volumes declined by 8.2%, while used vehicle same-store revenues increased over 9% [14][15] - The U.K. market faced challenges from weak economic growth, inflation, and increased competition from new entrants, particularly Chinese OEMs [7][31] - Chinese OEMs' market share leveled off at around 12%, impacting competitive dynamics in the U.K. [31] Company Strategy and Development Direction - The company is focused on operational excellence and capital deployment towards high-growth opportunities, including acquisitions of brands like Lexus and Acura [6][7] - Restructuring initiatives in the U.K. aim to improve efficiency and profitability, with ongoing adjustments to the operational model [7][16] - The company emphasizes the importance of aftersales and F&I as stabilizers in the U.K. operations while leveraging U.S. best practices [8][15] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about navigating near-term challenges while building a resilient platform for long-term growth [10][69] - The macroeconomic environment remains dynamic, with a focus on controlling costs and improving operational efficiency [9][10] - There is a belief in the potential for organic growth in both the U.S. and U.K. markets, particularly in aftersales and used vehicle segments [50][51] Other Important Information - The company disposed of 13 dealerships, generating approximately $775 million in annualized revenue, while also repurchasing over 10% of outstanding shares [7][18] - Liquidity as of December 31 was $883 million, with cash flow generation yielding $699 million of adjusted operating cash flow [17][18] Q&A Session Summary Question: What were the impairments tied to this quarter? - Impairments were primarily related to the U.S. business, particularly within the Audi brand and the Maryland/D.C. market [21][22] Question: Are there specific productivity actions in the U.S.? - The company is deploying AI and productivity tools across various operations, leading to improved technician productivity and lower costs [24][25] Question: What is the status of the U.K. restructuring plan? - The restructuring is in the early stages, with ongoing adjustments to meet acceptable profit levels [29][30] Question: How do Chinese OEMs impact the market? - Chinese OEMs have leveled off at around 12% market share, but the company feels well-positioned due to its focus on luxury brands [31][32] Question: What are the expectations for used GPUs and SG&A post-restructuring? - Used GPUs are expected to improve with better discipline in the U.K., while SG&A is targeted to be around 80% on a long-term basis [39][40] Question: What is the outlook for lease returns and their impact? - An increase in lease returns is expected to provide a controlled source of premium used cars, positively impacting the used car business [52][53] Question: What are the expectations for the used vehicle market in the U.S.? - The company is optimistic about the used car opportunity, focusing on disciplined acquisition and leveraging AI for smarter purchasing decisions [60][61]

Financial Data and Key Metrics Changes - In 2025, Group 1 Automotive achieved record revenues of $5.6 billion in Q4 and over $3.6 billion in gross profit for the full year, including nearly $1.6 billion from parts and service [6][11][12] - Adjusted net income for Q4 was $105 million, with adjusted diluted EPS of $8.49 from continuing operations [11] - Gross profit from customer pay and warranty increased approximately 5% and 11% respectively, with overall U.S. business demonstrating strong performance [13][14] Business Line Data and Key Metrics Changes - Parts and service gross profit reached record levels, contributing significantly to overall profitability [4][6] - New vehicle sales in the U.S. declined slightly, while used vehicle operations held volumes flat but increased revenues by approximately 4% [11][12] - F&I gross profits grew nearly 3% in Q4, reflecting improved product penetration across categories [12][15] Market Data and Key Metrics Changes - In the U.K., new vehicle same-store volumes declined 8.2%, while used vehicle same-store revenues increased over 9% [14][15] - The U.K. market faced challenges including weak economic growth and increased competition from new entrants, particularly Chinese OEMs, which held a market share of around 12% [7][31] - The macroeconomic environment in the U.K. remains difficult, with inflation and margin pressure impacting operations [7][14] Company Strategy and Development Direction - Group 1 is focused on operational excellence and capital deployment towards high-value acquisitions, including brands like Lexus and Acura [6][7] - The company is executing restructuring initiatives in the U.K. to improve efficiency and profitability, including reducing headcount and consolidating operations [7][16] - There is an emphasis on leveraging U.S. operational practices in the U.K. to enhance aftersales performance and customer service [8][15] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about navigating near-term challenges while building a resilient platform for long-term growth [10][69] - The focus remains on controlling costs, managing inventory, and enhancing operational efficiency in response to evolving macroeconomic conditions [9][10] - There is a belief in the potential for organic growth in both the U.S. and U.K. markets, particularly in aftersales and F&I [50][51] Other Important Information - The company disposed of 13 dealerships generating approximately $775 million in annualized revenue while acquiring new dealerships expected to generate $640 million [6][7] - As of December 31, liquidity stood at $883 million, with a rent-adjusted leverage of 3.1 times [16][17] - The company repurchased over 10% of its outstanding shares in 2025, with ongoing buyback plans [17][18] Q&A Session Summary Question: What were the impairments tied to this quarter? - Impairments were primarily related to the U.S. business, particularly within the Audi brand and the Maryland/D.C. market [21][22] Question: Are there specific productivity actions in the U.S. that could impact SG&A? - AI tools are being deployed across various business areas to enhance productivity, with tangible results in technician retention and operational efficiency [24][25][26] Question: What is the status of the U.K. restructuring plan? - The restructuring is ongoing, with more work to be done, and costs will be adjusted throughout 2026 [29][30] Question: How do Chinese OEMs impact the market? - Chinese OEMs have leveled off at around 12% market share, and while they are not slowing down, Group 1 feels well-positioned due to its focus on luxury brands [31][32] Question: What are the expectations for used GPUs and SG&A in the future? - Used GPUs in the U.S. are currently higher than pre-COVID levels, with expectations for improvement in the U.K. as operational discipline is instilled [39][40] Question: How does the company view lease returns impacting the used car market? - An increase in lease returns is expected to provide a controlled source of premium used cars, which is beneficial for the business [52][53]

Financial Data and Key Metrics Changes - Group 1 Automotive reported record quarterly revenues of $5.8 billion, gross profit of $920 million, adjusted net income of $135 million, and adjusted diluted EPS of $10.45 from continuing operations [13][14] - Adjusted SG&A as a percentage of gross profit increased 160 basis points sequentially to 65.8% [16] - Cash flow generation yielded $500 million of adjusted operating cash flow and $352 million of free cash flow after accounting for $148 million of CapEx [19][20] Business Line Data and Key Metrics Changes - U.S. operations saw record quarterly revenues in used vehicles, parts and service, and F&I, with new vehicle unit sales rising mid-single digits [14][16] - Used vehicle operations achieved record quarterly revenue, with GPUs holding steady, reflecting disciplined sourcing and pricing [15] - F&I GPUs grew over 5%, with same-store PRU up $155 or greater than 16% year over year [6][15] Market Data and Key Metrics Changes - The UK market remains challenging with inflation and cost pressures, leading to a 4% decline in new vehicle same-store volumes [17] - Used vehicle same-store revenues in the UK were up over 5%, but same-store GPUs declined by over 24% [17] - The overall U.S. environment remains dynamic with steady consumer interest and balanced inventory levels [10][11] Company Strategy and Development Direction - The company is focusing on optimizing its portfolio, controlling costs, and enhancing operational efficiency, particularly in the UK [9][19] - Group 1 plans to exit the Jaguar Land Rover brand in the UK within 24 months, reallocating resources to more profitable areas [8][9] - The company continues to pursue acquisitions and share repurchases, having repurchased nearly one-third of its outstanding common shares since early 2022 [12][21] Management's Comments on Operating Environment and Future Outlook - Management expressed a cautious but confident stance regarding the U.S. market, maintaining operational discipline amid ongoing policy and trade uncertainties [11] - The UK environment is expected to stabilize as OEMs rationalize their networks to meet current market conditions [55][57] - Management believes that the after-sales business remains a key area for growth and stability [10][17] Other Important Information - The company took a $123.9 million asset impairment charge due to the decision to exit the JLR brand [8][18] - The UK operations experienced a £3 million impact from a cyber attack affecting profitability [9][18] Q&A Session Summary Question: Insights on U.S. luxury demand trends - Management noted that while there are some challenges, it is not yet material enough to call it a trend, with a focus on the upcoming fourth quarter for clarity [23][24] Question: Details on the JLR exit and property reallocation - The company is reviewing how to best utilize the real estate, with potential opportunities for other brands [25] Question: Clarification on impairment charges - The impairment includes $18 million related to JLR, with a broader goodwill impairment affecting the entire UK entity [26][28] Question: UK market dynamics and potential partnerships with Chinese brands - Management is considering partnerships with Chinese OEMs but remains focused on luxury brands for the time being [29] Question: Changes in consumer behavior and auto credit - No significant changes in consumer behavior were noted, with continued robust demand for loans [52]

Core Insights - AutoNation, Inc. reported a third quarter 2025 revenue of $7.0 billion, marking a 7% increase year-over-year, with diluted EPS rising to $5.65, up 23% from the previous year [1][7][8] - The company experienced strong performance across various segments, particularly in After-Sales and Customer Financial Services, contributing to robust cash flow and capital deployment for share repurchases and acquisitions [2][4] Financial Performance - Revenue for Q3 2025 was $7,037.4 million, compared to $6,586.1 million in Q3 2024, reflecting a 7% increase [3] - Gross profit increased by 5% to $1,238.4 million from $1,182.8 million year-over-year [3] - Operating income rose by 6% to $372.4 million, while net income increased by 16% to $215.1 million [3] - Adjusted diluted EPS for Q3 2025 was $5.01, a 25% increase from $4.02 in Q3 2024 [3] Segment Performance - Same-store revenue reached $6.9 billion, up 6% year-over-year, driven by increased new vehicle unit sales and higher average selling prices [8] - New vehicle revenue was $3.4 billion, a 7% increase, while used vehicle revenue rose to $2.0 billion, up 5% [8] - Customer Financial Services revenue increased by 11% to $368 million, and After-Sales revenue grew by 6% to $1.2 billion [8] Capital Allocation and Liquidity - AutoNation utilized $39 million in cash for operating activities in the first nine months of 2025, with adjusted free cash flow at $786 million, representing 134% of adjusted net income [4][6] - The company repurchased 0.8 million shares for $181 million in Q3 2025, with a total of 2.8 million shares repurchased year-to-date for $523 million [5] - As of September 30, 2025, AutoNation had $1.8 billion in liquidity, including $98 million in cash and $1.7 billion available under its revolving credit facility [6] Operational Highlights - AutoNation Finance's portfolio grew to over $2 billion, enhancing profitability despite higher non-cash credit provisioning [2][8] - The company made strategic acquisitions, including an Audi and a Mercedes-Benz store in Chicago, contributing to over $500 million in annual revenues [4]

Core Insights - Penske Automotive Group reported strong Q2 2025 earnings with GAAP EPS of $3.78, exceeding analyst estimates of $3.57, while net income rose to $250.0 million [1][2] - Revenue remained stable at $7,662.3 million, slightly below the consensus estimate of $7,881.12 million, reflecting challenges in vehicle volumes and the freight market [1][5] Financial Performance - GAAP EPS increased by 4.7% year-over-year from $3.61 in Q2 2024 [2] - Revenue was flat compared to the previous year, with retail automotive revenue declining by 1.5% [2][7] - Operating income rose to $348.2 million, a 3.0% increase from $338.0 million in Q2 2024 [2][6] - Gross profit reached a record $1.3 billion, driven by service and parts, which accounted for over 12.5% of retail automotive revenue [2][6] Business Overview - Penske Automotive Group operates in automotive and commercial truck dealerships, retail commercial vehicle distribution, and has a stake in Penske Transportation Solutions [3] - The company focuses on expanding its premium and luxury brand presence and growing service and parts revenue [4] Operational Highlights - The company experienced a decline in new unit deliveries by 6% and used unit sales by 16.1%, while commercial truck operations saw a revenue increase of 5.7% [7] - The premium brand mix accounted for 72% of retail automotive dealership revenue in 2024, helping to mitigate margin pressures from electric vehicles [7] Strategic Initiatives - Penske Automotive Group increased its quarterly dividend by 4.8% to $1.32 per share, marking the nineteenth consecutive increase [9] - The company repurchased 630,000 shares, with $295.7 million remaining under its buyback authorization [9] - Liquidity stood strong at $2.3 billion with low leverage at 1.2 times total capitalization [9] Future Outlook - Management did not provide formal guidance for EPS or revenue for the remainder of FY2025 but expressed cautious optimism regarding cost discipline and margin management [10] - Ongoing trends to monitor include changes in vehicle demand, impacts from tariffs, and the effects of electric vehicle adoption on margins [11]

Financial Data and Key Metrics Changes - Total revenue for Q2 2025 was $7 billion, an increase of 8% year-over-year on both total and same-store basis [14] - Adjusted net income rose to $209 million, up 29% from $163 million a year ago [18] - Adjusted EPS was $5.46 for the quarter, an increase of $1.47 or 37% from the previous year [18] Business Line Data and Key Metrics Changes - New vehicle sales increased by 8% year-over-year, with domestic segment sales up 19% [5][19] - Used vehicle gross profit increased by 13% year-over-year, with unit sales up 6% [6][23] - Customer financial services gross profit also rose by 13%, with finance penetration stable at around 75% [8][24] Market Data and Key Metrics Changes - New vehicle unit volumes increased by 7% year-over-year, with hybrid sales up over 40% [19] - Used vehicle retail unit sales improved by 6% year-over-year, driven by growth in both lower and higher-priced vehicles [21] - Average FICO scores on originations improved to 698 from 675 year-over-year, with delinquency rates down to 2.4% [27] Company Strategy and Development Direction - The company is focused on maintaining market share while optimizing tariff efficiency and pricing structures [12] - There is a commitment to explore M&A opportunities to add scale and density in existing markets [35] - The company aims to enhance its mobile service business while ensuring efficient use of technician resources [38][39] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the second half of 2025, expecting stable margins despite potential fluctuations [56][58] - The company is encouraged by recent legislative provisions that could stimulate vehicle purchases [13] - There is a focus on balancing vehicle pricing and affordability to avoid stifling demand [90] Other Important Information - The company completed its inaugural asset-backed securitization, which was oversubscribed, allowing for increased debt funding levels [28][29] - Adjusted free cash flow for the first half totaled $394 million, representing 100% of adjusted net income [32] - The company received $10 million in insurance recoveries related to the previous year's CDK outage [34] Q&A Session Summary Question: Discussion on M&A opportunities and market flexibility - Management indicated a cautious approach post-tariff announcement but noted an improvement in the M&A pipeline and a commitment to both share repurchases and M&A [46][48] Question: Insights on July sales performance and consumer landscape - Management noted a strong first half and expressed optimism for the second half, despite some fluctuations in sales patterns [54][60] Question: Update on AutoNation USA strategy - Management confirmed that additional openings are planned, focusing on markets with existing density to enhance performance [82][86] Question: Aftersales business performance and pricing - Management highlighted a balance between volume and pricing, with a focus on maintaining competitive pricing while managing costs [75][78] Question: Update on AutoNation Finance and its coexistence with legacy business - Management discussed the growth of AutoNation Finance and its impact on profitability, emphasizing the importance of managing the portfolio effectively [104]

Financial Performance - Total company revenues for 2Q25 reached $5704 million, a 21% increase year-over-year[6, 10] - Same store revenues increased by 7% in the U S and 6% in the U K[10] - Total same store parts & service gross profit increased 14% year-over-year[10] - Diluted EPS from continuing operations was $1077, a 6% increase year-over-year, and adjusted diluted EPS was $1152, an 18% increase year-over-year[10] - Adjusted free cash flow was $267 million year-to-date[20] Strategic Initiatives - The company largely completed the U K restructuring plan, with additional cost-saving activities continuing in 2025[10, 11, 12] - During 2025, the company repurchased 04 million shares at an average price of $41662 for $167 million[10, 21] - Acquired revenues since the beginning of 2021 totaled $88 billion[20] Portfolio Optimization - Acquisitions in 2025 YTD amounted to $04 billion involving 9 franchises[21, 22] - Dispositions in 2025 YTD totaled $470 million[21] - Three luxury dealerships were acquired with expected annual revenues of $330 million[22]

Financial Data and Key Metrics Changes - GAAP EPS was $2.04 per share, and adjusted EPS was $1.48 per share, a 9% increase year over year [5] - First quarter consolidated total revenues were a record $3.1 billion, up 8% year over year, while consolidated gross profit grew 6% and adjusted EBITDA increased 7% [6][11] Business Segment Data and Key Metrics Changes - Franchised dealership segment revenues reached $3.1 billion, up 9% year over year, driven by an 11% increase in new retail volume and a 6% increase in fixed operations revenues [6] - EchoPark segment income was a record $10.3 million, with adjusted EBITDA at $15.8 million, up 116% year over year [8] - EchoPark revenues were $560 million, flat year over year, but gross profit increased 21% to $64 million [9] - Power Sports segment generated record revenues of $34.4 million, with a gross profit of $8.5 million, and an adjusted EBITDA loss of $700,000 [10] Market Data and Key Metrics Changes - Same store new vehicle gross profit per unit (GPU) was $3,089, down sequentially from the fourth quarter [7] - Same store used vehicle volume decreased 2% year over year, while same store used GPU increased sequentially to $15.55 per unit [7] - Parts and service gross profit increased by 7% in the first quarter [8] Company Strategy and Development Direction - The company is focused on maintaining strong relationships with teammates, manufacturers, and customers as key to future success [5] - A data-driven centralized inventory management strategy for EchoPark is seen as a key differentiator to minimize market volatility disruptions [10] - The company plans to adapt to ongoing changes in the automotive retail environment while making strategic decisions to maximize long-term returns [12] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in navigating tariff impacts and believes that the automotive industry can handle price adjustments without significant concerns [17][20] - The company is focused on executing its operational playbooks and processes, expecting solid results in the upcoming quarters [18][19] - Management acknowledged the need to balance warranty and customer pay work in service operations to improve revenue mix [50][51] Other Important Information - The company ended the quarter with $947 million in available liquidity, including $430 million in cash and floor plan deposits [11] - A quarterly cash dividend of $0.35 per share was approved, payable on July 15, 2025 [11] Q&A Session Summary Question: Commentary on tariffs and their impact - Management indicated that manufacturers are uncertain about the tariff impacts, but they expect things to stabilize in the next 90 days [17] - The company is not concerned about significant price increases and believes they can navigate through the situation [19] Question: Update on fixed operations hiring - Management reported hiring 345 additional technicians, which has positively impacted fixed operations [23][24] - There is ongoing focus on increasing technician headcount to meet service demand [26] Question: Used vehicle GPU trajectory - Management stated that GPU margins should hold steady if market conditions remain stable, with EchoPark's margins improving due to increased street purchases [38][39] Question: Warranty work versus customer pay - Warranty work grew by 40% in the first quarter, while customer pay grew by only 2-3%, indicating a need to adjust the revenue mix [47][50] Question: EchoPark's full-year guidance - Management explained that guidance was conservative due to potential tariff impacts, but they are prepared to adjust as conditions evolve [77][78] Question: SG&A expenses - Management noted that first-quarter SG&A expenses were influenced by one-time compensation costs, but overall expenses are in line with expectations [82][84]