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Tue Jul 25 2017

Asbury Automotive Group Announces Second Quarter 2017 Financial Results

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Second quarter EPS from continuing operations of $1.52 per diluted share
Second quarter adjusted EPS from continuing operations of $1.58 per diluted share (a non-GAAP measure), down 4% from the prior year quarter

DULUTH, Ga., July 25, 2017 /PRNewswire/ -- Asbury Automotive Group, Inc. (NYSE: ABG), one of the largest automotive retail and service companies in the U.S., today reported net income for the second quarter 2017 of $31.9 million, or $1.52 per diluted share, compared to $36.7 million, or $1.65 per diluted share in the prior year quarter. It also reported adjusted income from continuing operations (a non-GAAP measure) for the second quarter 2017 of $33.2 million, or $1.58 per diluted share, compared to $36.6 million, or $1.65 per diluted share, in the prior year quarter, a 4% decrease in adjusted earnings per share.

Income from continuing operations for the second quarter 2017 was adjusted for $2.9 million of pre-tax real estate related charges, or $0.08 per diluted share and $0.8 million of pre-tax investment income, or $0.02 per diluted share.  There were no adjustments for the second quarter 2016. See attached reconciliation for reported adjustments related to both of these periods.

Total revenue for the second quarter remained flat at $1.6 billion compared to the prior year period; total revenue on a same-store basis (a non-GAAP measure) was up 2% from the prior year period.

Second Quarter 2017 Operational Summary

Same store:

  • Total revenues increased 2%; gross profit increased 2%
  • New vehicle revenue remained flat; gross profit decreased 14%
  • Used vehicle retail revenue increased 5%; gross profit decreased 6%
  • Finance and insurance revenue increased 8%
  • Parts and service revenue increased 6%; gross profit increased 6%

All store:

  • SG&A as a percentage of gross profit increased 140 basis points to 69.5%
  • Total company adjusted income from operations (a non-GAAP measure) as a percentage of revenue was 4.5%, down 30 bps from the prior year
  • Adjusted EPS from continuing operations decreased 4%

"In a softening automotive retail environment, we are pleased to have increased our same store revenue and gross profit by 2% this quarter compared to the prior year," said Craig Monaghan, Asbury's President and Chief Executive Officer. "Despite market pressures, we believe we can deliver low to mid-single digit EPS growth in the back half of the year."

"Even though we experienced margin pressure, our ability to drive incremental Used Sales, enhance F&I PVR, and grow Parts and Service enabled us to deliver industry leading operating margins," said Asbury's Executive Vice President and Chief Operating Officer, David Hult. "Our investments in digital technologies and lead management initiatives are yielding solid results and we will continue to invest in this area in the future."

For the six-month period ended June 30, 2017, the Company reported total revenue of $3.2 billion, flat with the prior year period. Total revenue on a same-store basis was up 2%.

For the six-month period ended June 30, 2017, the Company reported net income from continuing operations of $65.9 million, or $3.12 per diluted share, compared to net income from continuing operations of $67.7 million, or $2.91 per diluted share in the prior year period.  For the six-month period ended June 30, 2017, the Company reported adjusted net income from continuing operations (a non-GAAP measure) of $66.6 million, or $3.16 per diluted share, compared to adjusted net income from continuing operations of $69.8 million, or $3.00 per diluted share in the prior year period.

Management will host a conference call at 10:00 a.m. Eastern Time today. The conference call will be simulcast live on the internet and can be accessed by logging onto www.asburyauto.com or www.ccbn.com.

A replay will be available at these sites for 30 days. In addition, a live audio of the call will be accessible to the public by calling (888) 481-2864 (domestic), or (719) 325-2367 (international); passcode - 9324358.  Callers should dial in approximately 5 to 10 minutes before the call begins.

A conference call replay will be available two hours following the call for seven days, and can be accessed by calling (888) 203-1112 (domestic), or (719) 457-0820 (international); passcode - 9324358.

About Asbury Automotive Group, Inc.

Asbury Automotive Group, Inc. ("Asbury"), a Fortune 500 company headquartered in Duluth, GA, is one of the largest automotive retailers in the U.S.  Asbury currently operates 80 dealerships, consisting of 96 franchises, representing 29 domestic and foreign brands of vehicles.  Asbury also operates 24 collision repair centers. Asbury offers customers an extensive range of automotive products and services, including new and used vehicle sales and related financing and insurance, vehicle maintenance and repair services, replacement parts and service contracts.

Forward-Looking Statements

This press release contains "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995.  Forward-looking statements are statements other than historical fact, and may include statements relating to goals, plans, market conditions and projections regarding Asbury's financial position, liquidity, results of operations, market position and dealership portfolio, and other initiatives and future business strategy.  These statements are based on management's current expectations and beliefs and involve significant risks and uncertainties that may cause results to differ materially from those set forth in the statements.  These risks and uncertainties include, among other things, market factors, Asbury's relationships with, and the financial and operational stability of, vehicle manufacturers and other suppliers, acts of God or other incidents which may adversely impact supply from vehicle manufacturers and/or present retail sales challenges, risks associated with Asbury's indebtedness (including available borrowing capacity, compliance with its financial covenants and ability to refinance or repay such indebtedness, on favorable terms), Asbury's relationships with, and the financial stability of, its lenders and lessors, risks related to competition in the automotive retail and service industries, general economic conditions both nationally and locally, governmental regulations, legislation, adverse results in litigation and other proceedings, and Asbury's ability to execute its IT initiatives and other operational strategies, Asbury's ability to leverage gains from its dealership portfolio, Asbury's ability to capitalize on opportunities to repurchase its debt and equity securities or purchase properties that it currently leases, and Asbury's ability to stay within its targeted range for capital expenditures.  There can be no guarantees that Asbury's plans for future operations will be successfully implemented or that they will prove to be commercially successful.

These and other risk factors that could cause actual results to differ materially from those expressed or implied in our forward-looking statements are and will be discussed in Asbury's filings with the U.S. Securities and Exchange Commission from time to time, including its most recent annual report on Form 10-K and any subsequently filed quarterly reports on Form 10-Q.  We undertake no obligation to publicly update any forward-looking statement, whether as a result of new information, future events or otherwise.

 


ASBURY AUTOMOTIVE GROUP, INC.

CONSOLIDATED STATEMENTS OF INCOME (In millions, except per share data)

(Unaudited)



For the Three Months
Ended June 30,


Increase
(Decrease)


%
Change


2017


2016



REVENUE:








New vehicle

$

882.9



$

897.0



$

(14.1)



(2)

%

Used vehicle:








Retail

430.2



418.3



11.9



3

%

Wholesale

49.0



51.9



(2.9)



(6)

%

     Total used vehicle

479.2



470.2



9.0



2

%

Parts and service

200.8



195.3



5.5



3

%

Finance and insurance, net

68.9



64.9



4.0



6

%

TOTAL REVENUE

1,631.8



1,627.4



4.4



%

GROSS PROFIT:








New vehicle

41.0



47.5



(6.5)



(14)

%

Used vehicle:








Retail

32.5



34.8



(2.3)



(7)

%

Wholesale

0.2



(0.6)



0.8



133

%

     Total used vehicle

32.7



34.2



(1.5)



(4)

%

Parts and service

124.5



121.0



3.5



3

%

Finance and insurance, net

68.9



64.9



4.0



6

%

TOTAL GROSS PROFIT

267.1



267.6



(0.5)



%

OPERATING EXPENSES (INCOME):








Selling, general and administrative

185.6



182.3



3.3



2

%

Depreciation and amortization

8.0



7.7



0.3



4

%

Other operating expenses (income), net

1.9



(0.5)



2.4



NM


INCOME FROM OPERATIONS

71.6



78.1



(6.5)



(8)

%

OTHER EXPENSES:








Floor plan interest expense

6.1



5.0



1.1



22

%

Other interest expense, net

13.4



13.4





%

Swap interest expense

0.6



0.8



(0.2)



(25)

%

Total other expenses, net

20.1



19.2



0.9



5

%

INCOME FROM CONTINUING OPERATIONS BEFORE INCOME TAXES

51.5



58.9



(7.4)



(13)

%

Income tax expense

19.6



22.3



(2.7)



(12)

%

INCOME FROM CONTINUING OPERATIONS

31.9



36.6



(4.7)



(13)

%

Discontinued operations, net of tax



0.1



(0.1)



(100)

%

NET INCOME

$

31.9



$

36.7



$

(4.8)



(13)

%

EARNINGS PER COMMON SHARE:








Basic—








Continuing operations

$

1.53



$

1.66



$

(0.13)



(8)

%

Discontinued operations







%

Net income

$

1.53



$

1.66



$

(0.13)



(8)

%

Diluted—








Continuing operations

$

1.52



$

1.65



$

(0.13)



(8)

%

Discontinued operations







%

Net income

$

1.52



$

1.65



$

(0.13)



(8)

%

WEIGHTED AVERAGE COMMON SHARES OUTSTANDING:








Basic

20.8



22.1



(1.3)



(6)

%

Stock options

0.1





0.1



%

Restricted stock

0.1



0.1





%

Performance share units

21.0



22.2



(1.2)



(5)

%

Diluted









______________________________

NMNot Meaningful

 

 


ASBURY AUTOMOTIVE GROUP, INC.

KEY OPERATING HIGHLIGHTS (In millions, except per unit data)

(Unaudited)



For the Three Months
Ended June 30,


Increase
(Decrease)


%
Change


2017


2016



Unit sales








New vehicle:








Luxury

5,504



5,782



(278)



(5)

%

Import

14,833



14,808



25



%

Domestic

4,794



5,175



(381)



(7)

%

     Total new vehicle

25,131



25,765



(634)



(2)

%

Used vehicle retail

20,263



19,612



651



3

%

Used to new ratio

80.6

%


76.1

%


450

bps



Average selling price








New vehicle

$

35,132



$

34,815



$

317



1

%

Used vehicle retail

21,231



21,329



(98)



%

Average gross profit per unit








New vehicle:








Luxury

$

3,307



$

3,615



$

(308)



(9)

%

Import

944



1,189



(245)



(21)

%

Domestic

1,836



1,739



97



6

%

Total new vehicle

1,631



1,844



(213)



(12)

%

Used vehicle

1,604



1,774



(170)



(10)

%

Finance and insurance, net

1,518



1,430



88



6

%

Front end yield (1)

3,137



3,244



(107)



(3)

%

Gross margin








New vehicle:








Luxury

6.3

%


6.9

%


(60)

bps



Import

3.4

%


4.3

%


(90)

bps



Domestic

4.9

%


4.8

%


10

bps



Total new vehicle

4.6

%


5.3

%


(70)

bps



Used vehicle retail

7.6

%


8.3

%


(70)

bps



Parts and service

62.0

%


62.0

%


bps



Total gross profit margin

16.4

%


16.4

%


bps



SG&A metrics








Rent expense

$

6.8



$

7.6



$

(0.8)



(11)

%

Total SG&A as a percentage of gross profit

69.5

%


68.1

%


140

bps



SG&A, excluding rent expense as a percentage of gross profit

66.9

%


65.3

%


160

bps



Operating metrics








Income from operations as a percentage of revenue

4.4

%


4.8

%


(40)

bps



Income from operations as a percentage of gross profit

26.8

%


29.2

%


(240)

bps



Adjusted income from operations as a percentage of revenue

4.5

%


4.8

%


(30)

bps



Adjusted income from operations as a percentage of gross profit

27.6

%


29.2

%


(160)

bps



Revenue mix








New vehicle

54.1

%


55.1

%





Used vehicle retail

26.4

%


25.7

%





Used vehicle wholesale

3.0

%


3.2

%





Parts and service

12.3

%


12.0

%





Finance and insurance

4.2

%


4.0

%





     Total revenue

100.0

%


100.0

%





Gross profit mix








New vehicle

15.4

%


17.8

%





Used vehicle retail

12.1

%


12.9

%





Used vehicle wholesale

0.1

%


(0.2)

%





Parts and service

46.6

%


45.2

%





Finance and insurance

25.8

%


24.3

%





     Total gross profit

100.0

%


100.0

%






_____________________________

(1)

Front end yield is calculated as gross profit from new vehicles, used retail vehicles and finance and insurance (net), divided by combined new and used retail unit sales.


 

 

ASBURY AUTOMOTIVE GROUP, INC.

SAME STORE OPERATING HIGHLIGHTS (In millions)

(Unaudited)



For the Three Months
Ended June 30,


Increase
(Decrease)


%
Change


2017


2016



Revenue








New vehicle:








Luxury

$

291.1



$

294.9



$

(3.8)



(1)

%

Import

402.7



388.2



14.5



4

%

Domestic

163.2



175.5



(12.3)



(7)

%

     Total new vehicle

857.0



858.6



(1.6)



%

Used Vehicle:








Retail

416.4



396.4



20.0



5

%

Wholesale

47.4



49.7



(2.3)



(5)

%

     Total used vehicle

463.8



446.1



17.7



4

%

Parts and service

197.1



185.6



11.5



6

%

Finance and insurance

66.8



61.9



4.9



8

%

Total revenue

$

1,584.7



$

1,552.2



$

32.5



2

%









Gross profit








New vehicle:








Luxury

$

18.2



$

20.4



$

(2.2)



(11)

%

Import

13.8



17.0



(3.2)



(19)

%

Domestic

7.6



8.4



(0.8)



(10)

%

     Total new vehicle

39.6



45.8



(6.2)



(14)

%

Used Vehicle:








Retail

31.1



33.1



(2.0)



(6)

%

Wholesale

0.2



(0.8)



1.0



125

%

     Total used vehicle

31.3



32.3



(1.0)



(3)

%

Parts and service:








Customer pay

67.9



65.1



2.8



4

%

Warranty

20.4



16.6



3.8



23

%

Wholesale parts

5.2



4.8



0.4



8

%

     Parts and service, excluding reconditioning and preparation

93.5



86.5



7.0



8

%

Reconditioning and preparation

28.5



29.0



(0.5)



(2)

%

  Total parts and service

122.0



115.5



6.5



6

%

Finance and insurance

66.8



61.9



4.9



8

%

Total gross profit

$

259.7



$

255.5



$

4.2



2

%









SG&A expense

$

180.4



$

174.0



$

6.4



4

%

SG&A expense as a percentage of gross profit

69.5

%


68.1

%


140

bps




_____________________________

Same store amounts consist of information from dealerships for identical months in each comparative period, commencing with the first month we owned the dealership. Additionally, amounts related to divested dealerships are excluded from each comparative period.

 

 


ASBURY AUTOMOTIVE GROUP, INC.

SAME STORE OPERATING HIGHLIGHTS (Continued)

(Unaudited)



For the Three Months
Ended June 30,


Increase
(Decrease)


%
Change


2017


2016



Unit sales








New vehicle:








Luxury

5,504



5,672



(168)



(3)

%

Import

14,572



14,166



406



3

%

Domestic

4,293



4,770



(477)



(10)

%

     Total new vehicle

24,369



24,608



(239)



(1)

%

Used vehicle retail

19,531



18,465



1,066



6

%

Used to new ratio

80.1

%


75.0

%


510

bps











Average selling price








New vehicle

$

35,168



$

34,891



$

277



1

%

Used vehicle retail

21,320



21,468



(148)



(1)

%









Average gross profit per unit








New vehicle:








Luxury

$

3,307



$

3,597



$

(290)



(8)

%

Import

947



1,200



(253)



(21)

%

Domestic

1,770



1,761



9



1

%

Total new vehicle

1,625



1,861



(236)



(13)

%

Used vehicle retail

1,592



1,793



(201)



(11)

%

Finance and insurance, net

1,522



1,437



85



6

%

Front end yield (1)

3,132



3,269



(137)



(4)

%









Gross margin








New vehicle:








Luxury

6.3

%


6.9

%


(60)

bps



Import

3.4

%


4.4

%


(100)

bps



Domestic

4.7

%


4.8

%


(10)

bps



Total new vehicle

4.6

%


5.3

%


(70)

bps



Used vehicle retail

7.5

%


8.4

%


(90)

bps



Parts and service:








Parts and service, excluding reconditioning and preparation

47.4

%


46.6

%


80

bps



Parts and service, including reconditioning and preparation

61.9

%


62.2

%


(30)

bps



Total gross profit margin

16.4

%


16.5

%


(10)

bps




_____________________________

Same store amounts consist of information from dealerships for identical months in each comparative period, commencing with the first month we owned the dealership. Additionally, amounts related to divested dealerships are excluded from each comparative period.



(1)

Front end yield is calculated as gross profit from new vehicles, used retail vehicles and finance and insurance (net), divided by combined new and used retail unit sales.


 

 

ASBURY AUTOMOTIVE GROUP, INC.

CONSOLIDATED STATEMENTS OF INCOME (In millions, except per share data)

(Unaudited)



For the Six Months 
Ended June 30,


Increase
(Decrease)


%
Change


2017


2016



REVENUE:








New vehicle

$

1,715.4



$

1,735.4



$

(20.0)



(1)

%

Used vehicle:








Retail

845.6



831.4



14.2



2

%

Wholesale

95.4



99.7



(4.3)



(4)

%

     Total used vehicle

941.0



931.1



9.9



1

%

Parts and service

392.3



384.5



7.8



2

%

Finance and insurance, net

134.8



127.2



7.6



6

%

TOTAL REVENUE

3,183.5



3,178.2



5.3



%

GROSS PROFIT:








New vehicle

81.4



92.2



(10.8)



(12)

%

Used vehicle:








Retail

65.5



69.5



(4.0)



(6)

%

Wholesale

1.1



0.5



0.6



120

%

     Total used vehicle

66.6



70.0



(3.4)



(5)

%

Parts and service

244.4



239.0



5.4



2

%

Finance and insurance, net

134.8



127.2



7.6



6

%

TOTAL GROSS PROFIT

527.2



528.4



(1.2)



%

OPERATING EXPENSES (INCOME):








Selling, general and administrative

366.7



363.5



3.2



1

%

Depreciation and amortization

15.9



15.2



0.7



5

%

Other operating expenses (income), net

0.7



2.7



(2.0)



(74)

%

INCOME FROM OPERATIONS

143.9



147.0



(3.1)



(2)

%

OTHER EXPENSES:








Floor plan interest expense

11.3



9.4



1.9



20

%

Other interest expense, net

26.8



26.8





%

Swap interest expense

1.2



1.6



(0.4)



(25)

%

Total other expenses, net

39.3



37.8



1.5



4

%

INCOME FROM CONTINUING OPERATIONS BEFORE INCOME TAXES

104.6



109.2



(4.6)



(4)

%

Income tax expense

38.7



41.5



(2.8)



(7)

%

INCOME FROM CONTINUING OPERATIONS

65.9



67.7



(1.8)



(3)

%

Discontinued operations, net of tax







%

NET INCOME

$

65.9



$

67.7



$

(1.8)



(3)

%

EARNINGS PER COMMON SHARE:








Basic—








Continuing operations

$

3.15



$

2.92



$

0.23



8

%

Discontinued operations







%

Net income

$

3.15



$

2.92



$

0.23



8

%

Diluted—








Continuing operations

$

3.12



$

2.91



$

0.21



7

%

Discontinued operations







%

Net income

$

3.12



$

2.91



$

0.21



7

%

WEIGHTED AVERAGE COMMON SHARES OUTSTANDING:








Basic

20.9



23.2



(2.3)



(10)

%

Restricted stock

0.1





0.1



%

Performance share units

0.1



0.1





%

Diluted

21.1



23.3



(2.2)



(9)

%

 

 

 


ASBURY AUTOMOTIVE GROUP, INC.

KEY OPERATING HIGHLIGHTS (In millions, except per unit data)

(Unaudited)



For the Six Months 
Ended June 30,


Increase
(Decrease)


%
Change


2017


2016



Unit sales








New vehicle:








Luxury

10,618



11,408



(790)



(7)

%

Import

28,507



28,292



215



1

%

Domestic

9,472



10,094



(622)



(6)

%

     Total new vehicle

48,597



49,794



(1,197)



(2)

%

Used vehicle retail

40,330



39,348



982



2

%

Used to new ratio

83.0

%


79.0

%


400

bps



Average selling price








New vehicle

$

35,298



$

34,852



$

446



1

%

Used vehicle retail

20,967



21,129



(162)



(1)

%

Average gross profit per unit








New vehicle:








Luxury

$

3,419



$

3,559



$

(140)



(4)

%

Import

993



1,223



(230)



(19)

%

Domestic

1,774



1,684



90



5

%

Total new vehicle

1,675



1,852



(177)



(10)

%

Used vehicle

1,624



1,766



(142)



(8)

%

Finance and insurance, net

1,516



1,427



89



6

%

Front end yield (1)

3,168



3,241



(73)



(2)

%

Gross margin








New vehicle:








Luxury

6.4

%


6.9

%


(50)

bps



Import

3.6

%


4.4

%


(80)

bps



Domestic

4.7

%


4.7

%


bps



Total new vehicle

4.7

%


5.3

%


(60)

bps



Used vehicle retail

7.7

%


8.4

%


(70)

bps



Parts and service

62.3

%


62.2

%


10

bps



Total gross profit margin

16.6

%


16.6

%


bps



SG&A metrics








Rent expense

$

13.7



$

15.4



$

(1.7)



(11)

%

Total SG&A as a percentage of gross profit

69.6

%


68.8

%


80

bps



SG&A, excluding rent expense as a percentage of gross profit

67.0

%


65.9

%


110

bps



Operating metrics








Income from operations as a percentage of revenue

4.5

%


4.6

%


(10)

bps



Income from operations as a percentage of gross profit

27.3

%


27.8

%


(50)

bps



Adjusted income from operations as a percentage of revenue

4.6

%


4.7

%


(10)

bps



Adjusted income from operations as a percentage of gross profit

27.5

%


28.5

%


(100)

bps



Revenue mix








New vehicle

53.9

%


54.6

%





Used vehicle retail

26.6

%


26.2

%





Used vehicle wholesale

3.0

%


3.1

%





Parts and service

12.3

%


12.1

%





Finance and insurance

4.2

%


4.0

%





     Total revenue

100.0

%


100.0

%





Gross profit mix








New vehicle

15.4

%


17.4

%





Used vehicle retail

12.4

%


13.2

%





Used vehicle wholesale

0.2

%


0.1

%





Parts and service

46.4

%


45.2

%





Finance and insurance

25.6

%


24.1

%





     Total gross profit

100.0

%


100.0

%






_____________________________

(1)

Front end yield is calculated as gross profit from new vehicles, used retail vehicles and finance and insurance (net), divided by combined new and used retail unit sales.


 

 

ASBURY AUTOMOTIVE GROUP, INC.

SAME STORE OPERATING HIGHLIGHTS (In millions)

(Unaudited)



For the Six Months 
Ended June 30,


Increase
(Decrease)


%
Change


2017


2016



Revenue








New vehicle:








Luxury

$

564.0



$

579.6



$

(15.6)



(3)

%

Import

780.1



743.9



36.2



5

%

Domestic

328.1



340.5



(12.4)



(4)

%

     Total new vehicle

1,672.2



1,664.0



8.2



%

Used Vehicle:








Retail

822.3



785.9



36.4



5

%

Wholesale

92.3



95.5



(3.2)



(3)

%

     Total used vehicle

914.6



881.4



33.2



4

%

Parts and service

386.1



364.8



21.3



6

%

Finance and insurance

131.4



121.1



10.3



9

%

Total revenue

$

3,104.3



$

3,031.3



$

73.0



2

%









Gross profit








New vehicle:








Luxury

$

36.3



$

39.7



$

(3.4)



(9)

%

Import

28.0



33.4



(5.4)



(16)

%

Domestic

14.7



15.9



(1.2)



(8)

%

     Total new vehicle

79.0



89.0



(10.0)



(11)

%

Used Vehicle:








Retail

63.0



65.6



(2.6)



(4)

%

Wholesale

1.1



0.5



0.6



120

%

     Total used vehicle

64.1



66.1



(2.0)



(3)

%

Parts and service:








Customer pay

133.2



128.2



5.0



4

%

Warranty

40.5



33.1



7.4



22

%

Wholesale parts

10.4



9.8



0.6



6

%

     Parts and service, excluding reconditioning and preparation

184.1



171.1



13.0



8

%

Reconditioning and preparation

56.1



56.8



(0.7)



(1)

%

  Total parts and service

240.2



227.9



12.3



5

%

Finance and insurance

131.4



121.1



10.3



9

%

Total gross profit

$

514.7



$

504.1



$

10.6



2

%









SG&A expense

$

357.7



$

346.2



$

11.5



3

%

SG&A expense as a percentage of gross profit

69.5

%


68.7

%


80

bps




_____________________________

Same store amounts consist of information from dealerships for identical months in each comparative period, commencing with the first month we owned the dealership. Additionally, amounts related to divested dealerships are excluded from each comparative period.

 

 

 


ASBURY AUTOMOTIVE GROUP, INC.

SAME STORE OPERATING HIGHLIGHTS (Continued)

(Unaudited)



For the Six Months 
Ended June 30,


Increase
(Decrease)


%
Change


2017


2016



Unit sales








New vehicle:








Luxury

10,618



11,189



(571)



(5)

%

Import

28,138



27,080



1,058



4

%

Domestic

8,574



9,357



(783)



(8)

%

     Total new vehicle

47,330



47,626



(296)



(1)

%

Used vehicle retail

39,086



36,912



2,174



6

%

Used to new ratio

82.6

%


77.5

%


510

bps











Average selling price








New vehicle

$

35,331



$

34,939



$

392



1

%

Used vehicle retail

21,038



21,291



(253)



(1)

%









Average gross profit per unit








New vehicle:








Luxury

$

3,419



$

3,548



$

(129)



(4)

%

Import

995



1,233



(238)



(19)

%

Domestic

1,714



1,699



15



1

%

Total new vehicle

1,669



1,869



(200)



(11)

%

Used vehicle retail

1,612



1,777



(165)



(9)

%

Finance and insurance, net

1,521



1,432



89



6

%

Front end yield (1)

3,164



3,261



(97)



(3)

%









Gross margin








New vehicle:








Luxury

6.4

%


6.8

%


(40)

bps



Import

3.6

%


4.5

%


(90)

bps



Domestic

4.5

%


4.7

%


(20)

bps



Total new vehicle

4.7

%


5.3

%


(60)

bps



Used vehicle retail

7.7

%


8.3

%


(60)

bps



Parts and service:








Parts and service, excluding reconditioning and preparation

47.7

%


46.9

%


80

bps



Parts and service, including reconditioning and preparation

62.2

%


62.5

%


(30)

bps



Total gross profit margin

16.6

%


16.6

%


bps




_____________________________

Same store amounts consist of information from dealerships for identical months in each comparative period, commencing with the first month we owned the dealership. Additionally, amounts related to divested dealerships are excluded from each comparative period.