Sonic Automotive, Inc., one of the nation’s largest automotive retailers, reported financial results for the first quarter of 2018.
- Record first quarter revenue and gross profit of $2.4 billion and $352.5 million, respectively
- All-time record quarterly pre-owned retail unit sales of 33,739 units
- All-time record quarterly F&I gross profit per retail unit of $1,490
- Record first quarter F&I gross of $93.7 million
- Record first quarter fixed operations gross profit of $169.6 million
- Pre-owned segment retailed over 5,500 units during the quarter
- First Quarter 2018 Results
Net loss from continuing operations for the first quarter of 2018 was $2.0 million, or $0.05 per diluted share. Comparatively, net loss from continuing operations for the first quarter of 2017 was $0.0 million, or $0.0 per diluted share.
Adjusted net income from continuing operations and related earnings per diluted share are non-GAAP financial measures. The schedules included in this press release reconcile these non-GAAP financial measures to the most directly comparable GAAP financial measures.
Adjusted net income from continuing operations for the first quarter of 2018 was $11.0 million, or $0.26 per diluted share. The adjustments in the 2018 quarterly period relate to a gain on the disposal of franchises offset by fixed asset impairments, compensation related charges, lease exit accruals and certain legal matters. Adjusted net income from continuing operations for the first quarter of 2017 was $10.3 million, or $0.23 per diluted share. The adjustments in the 2017 quarterly period relate to the redemption of Sonic’s 7.0% Senior Subordinated Notes due 2022 (the “7.0% Notes”), weather-related physical damage costs and fixed asset impairments, offset by net settlement gains related to legal matters.
Heath Byrd, the Company’s Chief Financial Officer, noted, “The first quarter met our internal earnings expectations and we remain confident with our full year earnings guidance. We shifted our strategy during the quarter related to the number of used vehicle inventory we are carrying. The decline in used gross per unit and the increase in wholesale loss resulted from us aggressively disposing of units to reduce our overall days’ supply of used vehicles. Additionally, we believe we found a good compromise between volume and gross for new vehicles and we were able to grow both fixed operations and F&I gross profit compared to the first quarter of 2017.”
“We remain committed to growing our franchise store operations and our EchoPark brand. In addition to our dividend of $0.06 per share distributed during the first quarter, we continue to honor our commitment to return capital to shareholders as we repurchased approximately 1.2 million shares of our common stock for approximately $23.4 million.”
Sonic’s Board of Directors approved a quarterly dividend of $0.06 per share payable in cash for our stockholders of record on June 15, 2018. The dividend will be payable on July 13, 2018.
First Quarter Earnings Conference Call
Senior management will host a conference call today at 11:00 A.M. (Eastern) to discuss the quarter’s results. To access the live broadcast of the call over the Internet go to: www.sonicautomotive.com, then click on “Our Company,” then “Investor Relations,” then “Earnings Conference Calls.”
Presentation materials for the conference call can be accessed on the Company’s website at www.sonicautomotive.com by clicking on the “Investor Relations” tab under “Our Company” and choosing “Webcasts & Presentations.”
The conference call will also be available live by dialing in 10 minutes prior to the start of the call at:
Domestic: (877) 450-3867
International: (706) 643-0958
Conference ID: 9399998
A conference call replay will be available one hour following the call for seven days and can be accessed by calling:
Domestic: (855) 859-2056
International: (404) 537-3406
Conference ID: 9399998
SOURCE Sonic Automotive
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