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Section 1: 8-K (8-K)

0001019849false00010198492019-10-292019-10-29

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of Earliest Event Reported):

October 29, 2019

Penske Automotive Group, Inc.

(Exact name of registrant as specified in its charter)

Delaware

    

1-12297

    

22-3086739

(State or other jurisdiction

(Commission

(I.R.S. Employer

of incorporation)

File Number)

Identification No.)

2555 Telegraph Road, Bloomfield Hills,
Michigan

48302

(Address of principal executive offices)

(Zip Code)

Registrant’s telephone number, including area code:

248-648-2500

Not Applicable

Former name or former address, if changed since last report

Securities registered pursuant to Section 12(b) of the Act:

Title of each class

Trading Symbol(s)

Name of each exchange on which registered

Voting Common Stock, par value $0.0001 per share

PAG

New York Stock Exchange

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

  Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

  Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

  Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

  Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.

Item 2.02 Results of Operations and Financial Condition.

On October 29, 2019, we issued a press release announcing our third quarter 2019 financial results and other information. A copy of the press release is furnished as Exhibit 99.1.

Item 7.01 Regulation FD Disclosure.

The following information is furnished pursuant to Item 7.01 “Regulation FD Disclosure.”

On October 29, 2019, we issued a press release announcing our third quarter 2019 financial results and other information. A copy of the press release is furnished as Exhibit 99.1.

Item 8.01 Other Events.

Investors and others should note that we announce material financial information using our company website (www.penskeautomotive.com), our investor relations website (investors.penskeautomotive.com), SEC filings, press releases, public conference calls and webcasts. Information about Penske Automotive, its business, and its results of operations may also be announced by posts on the following social media channels:

Penske Automotive’s Twitter feed (www.twitter.com/penskecarscorp)
Penske Automotive’s Facebook page (www.facebook.com/penskecars)
Penske Automotive’s Social website (www.penskesocial.com)

The information that we post on these social media channels could be deemed to be material information. As a result, we encourage investors, the media, and others interested in Penske Automotive to review the information that we post on these social media channels. These channels may be updated from time to time on Penske Automotive’s investor relations website.

Item 9.01 Financial Statements and Exhibits.

Exhibit 99.1     Press Release.

Exhibit Index

Exhibit No.

 

Description

99.1

 

Press Release.

104

Cover Page Interactive Data File (formatted as inline XBRL).

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

    

Penske Automotive Group, Inc.

October 29, 2019

By:

/s/ Shane M. Spradlin

Name: Shane M. Spradlin

Title: Executive Vice President

(Back To Top)

Section 2: EX-99.1 (EX-99.1)

Exhibit 99_1

 

 

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Penske Automotive Group, Inc.
2555 Telegraph Road
Bloomfield Hills, MI 48302-0954

 

 

FOR IMMEDIATE RELEASE

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PENSKE AUTOMOTIVE REPORTS THIRD QUARTER 2019 RESULTS

 

Record Third Quarter Revenues Increase 5.5%

 

SG&A to Gross Profit Improves 30 BPS

 

Income From Continuing Operations of $116.1 million and Related Earnings Per Share of $1.42

 

Repurchased 1.0 Million Shares in Third Quarter and 4.0 Million Shares Year-to-Date

 

 

BLOOMFIELD HILLS, MI, October 29, 2019 –  Penske Automotive Group, Inc. (NYSE:PAG), a diversified international transportation services company,  today announced third quarter and nine months 2019 results.  For the three months ended September 30, 2019,  the company reported income from continuing operations attributable to common shareholders of $116.1 million, or  $1.42 per share, compared to $130.1 million, or $1.53 per share in the prior year. For the three and nine months ended September 30, 2018, income and earnings per share from continuing operations attributable to common shareholders included a tax benefit of $11.6 million, or $0.14 per share, related to the final reconciliation of the income tax benefit of the 2017 U.S. Tax Cuts and Jobs Act. Excluding this benefit, adjusted income from continuing operations was $118.5 million, and related earnings per share was $1.40 in the third quarter last year. 

The shift in mix of the Company’s earnings to be more heavily weighted towards the U.S. increased the effective tax rate to 26.8% in the three months ended September 30, 2019 compared to 17.3% in the same period last year. Excluding the $11.6 million tax benefit noted above, the Company’s prior period comparable adjusted effective tax rate was 24.6%. Additionally, foreign exchange rates negatively impacted earnings per share attributable to common shareholders by $0.01. Weak market conditions in the U.K., largely as the result of Brexit, impacted third quarter 2019 results as the over-supply of vehicles in the market impacted new and used vehicle gross profit and margins. As a result, the company estimates its third quarter results were negatively impacted by approximately $0.26 per share.

 

 

 

 

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“Our business produced another quarter of record revenue,” said Penske Automotive Group Chair and CEO Roger Penske. “I am particularly pleased with the 30-basis points improvement in selling, general and administrative expense as a percentage of gross profit we achieved during the quarter, coupled with the strength in the performance of our U.S. retail automotive businesses, including finance and insurance gross profit, and the North American commercial truck dealership business. Despite the challenges from the U.K., I am very pleased with the performance of our business in the third quarter which demonstrates the positive impact from the Warner Truck Group acquisition and share repurchases.”

For the nine months ended September 30, 2019, the company reported income from continuing operations attributable to common shareholders of $333.9 million, or $4.02 per share, compared to $372.7 million, or $4.37 per share in the prior year. Foreign exchange rates negatively impacted earnings per share attributable to common shareholders by $0.08. Excluding the tax benefit of $11.6 million noted above, adjusted income from continuing operations was $361.1 million and related adjusted earnings per share were $4.23 for the nine months ended September 30, 2018.

Third Quarter Operating Highlights

 

 

 

 

Reported

Excluding F/X

Revenue

Gross Profit

Earnings Before Taxes

+5.5%

+2.0%

+0.8%

+7.7%

+4.1%

+1.9%

 

Retail Automotive Same-Store Retail Revenue

 

+0.5%

 

+2.9%

      New Vehicle Revenue

-0.2%

+1.8%

      Used Vehicle Revenue

Flat

+3.0%

      Finance & Insurance Revenue

+5.0%

+7.6%

      Service & Parts Revenue

+4.3%

+6.2%

 

   Total Retail Automotive Gross Profit Per Unit of $3,199, -$189/unit; excluding F/X -$116/unit

·

U.S. $3,581, +$ 147/unit

·

International $2,773, -$562/unit; excluding F/X -$407/unit

 

Used Vehicle Supercenter Operations

For the three months ended September 30, 2019, our used vehicle supercenters increased units retailed by 6.2% to 19,728 and generated $327.6 million in revenue. Total gross profit per unit retailed declined 14.0%, or $286, representing an increase of 4.2%, or $120 per unit in the U.S., offset by a decline of 21.1%, or $388 per unit in the U.K. The decline in used vehicle gross profit in the U.K was largely associated with an oversupply of vehicles in the market and a decline in used vehicle market values. For the nine months ended September 30, 2019, the used vehicle supercenters retailed 55,543 used

 

 

 

 

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units representing a decline of 0.9% and generated $954.0 million in revenue. Additionally, in the third quarter of 2019, we opened a new CarSense used vehicle supercenter in Glen Mills, Pennsylvania, increasing our used vehicle supercenter location total to fifteen (15).

Retail Commercial Truck Operations

During the third quarter of 2019, the company became the largest dealership group for Freightliner in North America with the acquisition of Warner Truck Centers, representing six dealership locations in Utah and Idaho, bringing our total commercial vehicle dealership count to twenty-five (25). For the three months ended September 30, 2019, total medium and heavy-duty units retailed increased 57.2%, and revenue increased 79.7% to $692.3 million. For the nine months ended September 30, 2019,  total medium and heavy-duty truck units retailed increased 32.8% and revenue increased 42.8% to $1.5 billion. Same-store revenue increased 4.0% and 14.1% for the three and nine months ended September 30, 2019, respectively. 

Penske Truck Leasing

Penske Truck Leasing Co., L.P. (“PTL”) is a leading provider of full-service truck leasing, truck rental, contract maintenance, and logistics services. Effective September 1, 2019, Penske Transportation Solutions (PTS) has become the new universal brand name for PTL’s various business lines, Penske Truck Leasing, Logistics, Vehicle Services, and Epes Transport Systems. The company accounts for its ownership interest in PTL using the equity method of accounting. For the three and nine months ended September 30, 2019, the company recorded $42.2 million and $106.0 million in earnings from this investment compared to $40.7 million and $91.7 million for the same periods last year, respectively.

Dividend and Share Repurchases

On October 16, 2019, the company announced that its Board of Directors increased the dividend to its common stock shareholders to $0.41 per share, the 34th consecutive increase in the quarterly dividend.

During the three months ended September 30, 2019, the company repurchased 1,021,622 shares for $43.6 million, or an average of $42.66 per share. For the nine months ended September 30, 2019, the company repurchased 3,986,836 shares for $174.1 million, or an average of $43.68 per share.  In September 2019, our Board of Directors increased the authority delegated to management to repurchase our outstanding securities to $200.0 million.

Conference Call

Penske Automotive Group will host a conference call discussing financial results relating to the third quarter of 2019 on Tuesday,  October 29, 2019, at 2:00 p.m. Eastern Daylight Time. To listen to the conference call, participants must dial (800) 230‑1074 – [International, please dial (612) 234‑9959]

 

 

 

 

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The call will also be simultaneously broadcast over the Internet through the Investor’s section of the Penske Automotive Group website. Additionally, an investor presentation relating to the third quarter 2019 financial results has been posted to the company’s website. To access the presentation or to listen to the company’s webcast, please refer to www.penskeautomotive.com.

About Penske Automotive

Penske Automotive Group, Inc.,  (NYSE:PAG) headquartered in Bloomfield Hills, Michigan, is an international transportation services company that operates automotive and commercial truck dealerships principally in the United States, Canada, and Western Europe, and distributes commercial vehicles, diesel engines, gas engines, power systems and related parts and services principally in Australia and New Zealand. PAG employs more than  27,000 people worldwide and is a member of the Fortune 500, Russell 1000, and Russell 3000 indexes, and is ranked among the World’s Most Admired Companies by Fortune Magazine. For additional information, visit the company’s website at www.penskeautomotive.com.

Non-GAAP Financial Measures

This release contains certain non-GAAP financial measures as defined under SEC rules, such as earnings before interest, taxes, depreciation and amortization (“EBITDA”). The company has reconciled these measures to the most directly comparable GAAP measures in the release. The company believes that these widely accepted measures of operating profitability improve the transparency of the company’s disclosures and provide a meaningful presentation of the company’s results from its core business operations excluding the impact of items not related to the company’s ongoing core business operations, and improve the period-to-period comparability of the company’s results from its core business operations. These non-GAAP financial measures are not substitutes for GAAP financial results, and should only be considered in conjunction with the company’s financial information that is presented in accordance with GAAP.

Caution Concerning Forward Looking Statements

Statements in this press release may involve forward-looking statements, including forward-looking statements regarding Penske Automotive Group, Inc.’s product availability, future sales and earnings potential. Actual results may vary materially because of risks and uncertainties that are difficult to predict. These risks and uncertainties include, among others: economic conditions generally, conditions in the credit markets, changes in interest rates and foreign currency exchange rates, changes in tariff rates, adverse impacts related to the outcome of the United Kingdom’s potential departure from the European Union, adverse conditions affecting a particular manufacturer, including the adverse impact to the vehicle

 

 

 

 

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and parts supply chain due to limited vehicle availability due to WLTP and RDE, natural disasters, recall or other disruptions that interrupt the supply of vehicles or parts to us, changes in consumer credit availability, the outcome of legal and administrative matters, and other factors over which management has limited control. These forward-looking statements should be evaluated together with additional information about Penske Automotive Group’s business, markets, conditions and other uncertainties, which could affect Penske Automotive Group’s future performance. These risks and uncertainties are addressed in Penske Automotive Group’s Form 10-K for the year ended December 31, 2018, and its other filings with the Securities and Exchange Commission (“SEC”). This press release speaks only as of its date, and Penske Automotive Group disclaims any duty to update the information herein.

 

Find a vehiclehttp://www.penskecars.com

Engage Penske Automotivehttp://www.penskesocial.com

Like Penske Automotive on Facebookhttps://facebook.com/penskecars

Follow Penske Automotive on Twitterhttps://twitter.com/penskecars

Visit Penske Automotive on YouTubehttp://www.youtube.com/penskecars

 

Inquiries should contact:

 

 

J.D. Carlson

Anthony R. Pordon

Executive Vice President and

Executive Vice President Investor Relations

Chief Financial Officer

and Corporate Development

Penske Automotive Group, Inc.

Penske Automotive Group, Inc.

248-648-2810

248-648-2540

[email protected]

[email protected]

 

# # #

 

 

 

 

 

 

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PENSKE AUTOMOTIVE GROUP, INC.

Consolidated Condensed Statements of Income

 (Amounts In Millions, Except Per Share Data)

(Unaudited)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended

 

 

Nine Months Ended

 

 

September 30,

 

 

September 30,

 

 

2019

 

2018

 

Change

 

 

2019

 

2018

 

Change

Revenue

 

$

5,967.6

 

$

5,658.6

 

5.5

%  

 

 

$

17,287.8

 

$

17,345.8

 

(0.3)

%  

Cost of Sales

 

 

5,097.9

 

 

4,806.0

 

6.1

%  

 

 

 

14,698.8

 

 

14,739.0

 

(0.3)

%  

Gross Profit

 

$

869.7

 

$

852.6

 

2.0

%  

 

 

$

2,589.0

 

$

2,606.8

 

(0.7)

%  

SG&A Expenses

 

 

672.8

 

 

662.8

 

1.5

%  

 

 

 

2,008.1

 

 

2,001.3

 

0.3

%  

Depreciation

 

 

27.5

 

 

25.9

 

6.2

%  

 

 

 

81.0

 

 

77.2

 

4.9

%  

Operating Income

 

$

169.4

 

$

163.9

 

3.4

%  

 

 

$

499.9

 

$

528.3

 

(5.4)

%  

Floor Plan Interest Expense

 

 

(21.4)

 

 

(20.2)

 

5.9

%  

 

 

 

(64.2)

 

 

(59.0)

 

8.8

%  

Other Interest Expense

 

 

(32.9)

 

 

(28.3)

 

16.3

%  

 

 

 

(93.2)

 

 

(86.7)

 

7.5

%  

Equity in Earnings of Affiliates

 

 

43.3

 

 

41.7

 

3.8

%  

 

 

 

109.6

 

 

95.0

 

15.4

%  

Income from Continuing Operations Before Income Taxes

 

$

158.4

 

$

157.1

 

0.8

%  

 

 

$

452.1

 

$

477.6

 

(5.3)

%  

Income Taxes

 

 

(42.4)

 

 

(27.1)

 

56.5

%  

 

 

 

(118.6)

 

 

(104.7)

 

13.3

%  

Income from Continuing Operations

 

$

116.0

 

$

130.0

 

(10.8)

%  

 

 

$

333.5

 

$

372.9

 

(10.6)

%  

Income from Discontinued Operations, net of tax

 

 

0.1

 

 

0.1

 

nm

 

 

 

 

0.3

 

 

0.2

 

nm

 

Net Income

 

$

116.1

 

$

130.1

 

(10.8)

%  

 

 

$

333.8

 

$

373.1

 

(10.5)

%  

Less: Income (Loss) Attributable to Non-Controlling Interests

 

 

(0.1)

 

 

(0.1)

 

nm

 

 

 

 

(0.4)

 

 

0.2

 

nm

 

Net Income Attributable to Common Shareholders

 

$

116.2

 

$

130.2

 

(10.8)

%  

 

 

$

334.2

 

$

372.9

 

(10.4)

%  

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Amounts Attributable to Common Shareholders:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Reported Income from Continuing Operations

 

$

116.0

 

$

130.0

 

(10.8)

%  

 

 

$

333.5

 

$

372.9

 

(10.6)

%  

Less: Income (Loss) Attributable to Non-Controlling Interests

 

 

(0.1)

 

 

(0.1)

 

nm

 

 

 

 

(0.4)

 

 

0.2

 

nm

 

Income from Continuing Operations, net of tax

 

$

116.1

 

$

130.1

 

(10.8)

%  

 

 

$

333.9

 

$

372.7

 

(10.4)

%  

Income from Discontinued Operations, net of tax

 

 

0.1

 

 

0.1

 

nm

 

 

 

 

0.3

 

 

0.2

 

nm

 

Net Income Attributable to Common Shareholders

 

$

116.2

 

$

130.2

 

(10.8)

%  

 

 

$

334.2

 

$

372.9

 

(10.4)

%  

Income from Continuing Operations Per Share

 

$

1.42

 

$

1.53

 

(7.2)

%  

 

 

$

4.02

 

$

4.37

 

(8.0)

%  

Income Per Share

 

$

1.42

 

$

1.53

 

(7.2)

%  

 

 

$

4.03

 

$

4.37

 

(7.8)

%  

Weighted Average Shares Outstanding

 

 

81.7

 

 

84.9

 

(3.8)

%  

 

 

 

83.0

 

 

85.3

 

(2.7)

%  

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

nm – not meaningful

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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PENSKE AUTOMOTIVE GROUP, INC.

Consolidated Condensed Balance Sheets

(Amounts In Millions)

(Unaudited)

 

 

 

 

 

 

 

 

    

September 30,

    

December 31,

 

 

2019

 

2018

Assets:

 

 

 

 

 

 

Cash and Cash Equivalents

 

$

77.5

 

$

39.4

Accounts Receivable, Net

 

 

967.3

 

 

929.1

Inventories

 

 

4,043.9

 

 

4,040.1

Other Current Assets

 

 

98.8

 

 

86.6

Total Current Assets

 

 

5,187.5

 

 

5,095.2

Property and Equipment, Net

 

 

2,309.3

 

 

2,250.0

Operating Lease Right-of-Use Assets

 

 

2,384.4

 

 

 —

Intangibles

 

 

2,423.9

 

 

2,238.2

Other Long-Term Assets

 

 

1,384.4

 

 

1,321.1

Total Assets

 

$

13,689.5

 

$

10,904.5

 

 

 

 

 

 

 

Liabilities and Equity:

 

 

 

 

 

 

Floor Plan Notes Payable

 

$

2,444.1

 

$

2,362.2

Floor Plan Notes Payable – Non-Trade

 

 

1,410.6

 

 

1,428.6

Accounts Payable

 

 

672.3

 

 

598.2

Accrued Expenses and Other Current Liabilities

 

 

722.2

 

 

566.6

Current Portion Long-Term Debt

 

 

96.8

 

 

92.0

Liabilities Held for Sale

 

 

0.5

 

 

0.7

Total Current Liabilities

 

 

5,346.5

 

 

5,048.3

Long-Term Debt

 

 

2,282.5

 

 

2,124.7

Long-Term Operating Lease Liabilities

 

 

2,334.7

 

 

 —

Other Long-Term Liabilities

 

 

1,066.7

 

 

1,096.8

Total Liabilities

 

 

11,030.4

 

 

8,269.8

Equity

 

 

2,659.1

 

 

2,634.7

Total Liabilities and Equity

 

$

13,689.5

 

$

10,904.5

 

 

 

 

 

 

 

Supplemental Balance Sheet Information

 

 

 

 

 

 

New vehicle days' supply

 

 

64

 

 

72

Used vehicle days' supply

 

 

43

 

 

57

 

 

 

 

 

7

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PENSKE AUTOMOTIVE GROUP, INC.

Consolidated Operations

Selected Data

(Unaudited)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended

 

Nine Months Ended

 

 

 

September 30,

 

September 30,

 

 

    

2019

    

2018

    

2019

    

2018

 

Geographic Revenue Mix:

 

 

 

 

 

 

 

 

 

 

 

 

 

North America

 

 

61.8

%  

 

57.9

%  

 

58.3

%  

 

55.4

%

U.K.

 

 

31.2

%  

 

34.4

%  

 

33.7

%  

 

36.0

%

Other International

 

 

7.0

%  

 

7.7

%  

 

8.0

%  

 

8.6

%

Total

 

 

100.0

%  

 

100.0

%  

 

100.0

%  

 

100.0

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Revenue: (Amounts in Millions)

 

 

 

 

 

 

 

 

 

 

 

 

 

Retail Automotive

 

$

5,155.4

 

$

5,148.5

 

$

15,442.9

 

$

15,900.0

 

Retail Commercial Trucks

 

 

692.3

 

 

385.3

 

 

1,451.4

 

 

1,016.5

 

Commercial Vehicles Australia/Power Systems and Other

 

 

119.9

 

 

124.8

 

 

393.5

 

 

429.3

 

Total

 

$

5,967.6

 

$

5,658.6

 

$

17,287.8

 

$

17,345.8

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Gross Profit: (Amounts in Millions)

 

 

 

 

 

 

 

 

 

 

 

 

 

Retail Automotive

 

$

747.5

 

$

762.2

 

$

2,283.9

 

$

2,338.5

 

Retail Commercial Trucks

 

 

86.6

 

 

57.8

 

 

199.5

 

 

156.8

 

Commercial Vehicles Australia/Power Systems and Other

 

 

35.6

 

 

32.6

 

 

105.6

 

 

111.5

 

Total

 

$

869.7

 

$

852.6

 

$

2,589.0

 

$

2,606.8

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Gross Margin:

 

 

 

 

 

 

 

 

 

 

 

 

 

Retail Automotive

 

 

14.5

%  

 

14.8

%  

 

14.8

%  

 

14.7

%

Retail Commercial Trucks

 

 

12.5

%  

 

15.0

%

 

13.7

%  

 

15.4

%

Commercial Vehicles Australia/Power Systems and Other

 

 

29.7

%  

 

26.1

%  

 

26.8

%  

 

26.0

%

Total

 

 

14.6

%  

 

15.1

%  

 

15.0

%  

 

15.0

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended

 

Nine Months Ended

 

 

September 30,

 

September 30,

 

    

 

    

 

    

 

 

    

 

    

 

 

2019

 

2018

 

 

2019

 

2018

 

Operating Items as a Percentage of Revenue:

 

 

 

 

 

 

 

 

 

 

Gross Profit

 

14.6

%  

15.1

%  

 

15.0

%  

15.0

%  

Selling, General and Administrative Expenses

 

11.3

%  

11.7

%  

 

11.6

%  

11.5

%  

Operating Income

 

2.8

%  

2.9

%  

 

2.9

%  

3.0

%  

Income from Continuing Operations Before Income Taxes

 

2.7

%  

2.8

%  

 

2.6

%  

2.8

%  

 

 

 

 

 

 

 

 

 

 

 

Operating Items as a Percentage of Total Gross Profit:

 

 

 

 

 

 

 

 

 

 

Selling, General and Administrative Expenses

 

77.4

%  

77.7

%  

 

77.6

%  

76.8

%  

Operating Income

 

19.5

%  

19.2

%  

 

19.3

%  

20.3

%  

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended

 

Nine Months Ended

 

 

September 30,

 

September 30,

 

    

 

 

    

 

 

    

 

 

 

    

 

 

    

(Amounts in Millions)

 

2019

 

2018

 

 

2019

 

2018

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

EBITDA*

 

$

218.8

 

$

211.3

 

 

$

626.3

 

$

641.5

 

Floorplan Credits

 

$

9.7

 

$

11.1

 

 

$

27.3

 

$

29.9

 

Rent Expense

 

$

58.3

 

$

58.4

 

 

$

173.4

 

$

175.3

 

Capital Expenditures

 

$

54.3

 

$

69.7

 

 

$

188.8

 

$

188.5

 

Stock Repurchases

 

$

43.6

 

$

 —

 

 

$

174.1

 

$

55.8

 


* See the following Non-GAAP reconciliation table.

 

 

 

 

 

8

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PENSKE AUTOMOTIVE GROUP, INC.

Retail Automotive Operations

Selected Data – Revenue and Gross Profit Mix

(Unaudited)

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended

 

Nine Months Ended

 

 

 

September 30,

 

September 30,

 

 

    

2019

    

2018

    

2019

    

2018

 

Retail Automotive Revenue Mix:

 

 

 

 

 

 

 

 

 

Premium:

 

 

 

 

 

 

 

 

 

BMW / MINI

 

24

%  

23

%  

23

%  

22

%

Audi

 

11

%  

12

%  

12

%  

13

%

Mercedes-Benz

 

10

%  

 9

%  

10

%  

 9

%

Land Rover / Jaguar

 

 8

%  

 9

%  

 9

%  

 9

%

Porsche

 

 6

%  

 5

%  

 6

%  

 6

%

Ferrari / Maserati

 

 2

%  

 3

%  

 3

%  

 3

%

Lexus

 

 3

%  

 3

%  

 3

%  

 3

%

Acura

 

 1

%  

 1

%  

 1

%  

 1

%

Bentley

 

 1

%  

 1

%  

 1

%  

 1

%

Others

 

 2

%  

 2

%  

 2

%  

 2

%

Total Premium

 

68

%  

68

%  

70

%  

69

%

Volume Non-U.S.:

 

 

 

 

 

 

 

 

 

Toyota

 

11

%  

11

%  

10

%  

10

%

Honda

 

 7

%  

 7

%  

 6

%  

 6

%

Volkswagen

 

 4

%  

 4

%  

 4

%  

 4

%

Nissan

 

 1

%  

 1

%  

 1

%  

 1

%

Others

 

 2

%  

 1

%  

 2

%  

 2

%

Total Volume Non-U.S.

 

25

%  

24

%  

23

%  

23

%

U.S.:

 

 

 

 

 

 

 

 

 

General Motors / Chrysler / Ford

 

 1

%  

 2

%  

 1

%  

 2

%

Stand-Alone Used

 

 6

%  

 6

%  

 6

%  

 6

%

Total

 

100

%  

100

%  

100

%  

100

%

 

 

 

 

 

 

 

 

 

 

Retail Automotive Geographic Revenue Mix:

 

 

 

 

 

 

 

 

 

U.S.

 

58

%  

56

%  

56

%  

54

%

U.K.

 

36

%  

38

%  

38

%  

39

%

Other International

 

 6

%  

 6

%  

 6

%  

 7

%

Total

 

100

%  

100

%  

100

%  

100

%

 

 

 

 

 

 

 

 

 

 

Retail Automotive Geographic Gross Profit Mix:

 

 

 

 

 

 

 

 

 

U.S.

 

63

%  

59

%  

61

%  

58

%

U.K.

 

32

%  

35

%  

34

%  

36

%

Other International

 

 5

%  

 6

%  

 5

%  

 6

%

Total

 

100

%  

100

%  

100

%  

100

%

 

 

 

 

 

 

9

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PENSKE AUTOMOTIVE GROUP, INC.

Retail Automotive Operations

(Unaudited)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended

 

 

Nine Months Ended

 

 

September 30,

 

 

September 30,

 

    

2019

    

2018

 

Change

    

    

2019

    

2018

 

Change

Retail Automotive Units:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

New Retail

 

 

57,214

 

 

58,933

 

(2.9)

%  

 

 

 

166,730

 

 

179,266

 

(7.0)

%  

Used Retail

 

 

74,096

 

 

72,000

 

2.9

%  

 

 

 

218,906

 

 

218,371

 

0.2

%  

Total

 

 

131,310

 

 

130,933

 

0.3

%  

 

 

 

385,636

 

 

397,637

 

(3.0)

%  

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Retail Automotive Revenue: (Amounts in Millions)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

New Vehicles

 

$

2,332.3

 

$

2,350.2

 

(0.8)

%  

 

 

$

6,873.9

 

$

7,325.6

 

(6.2)

%  

Used Vehicles

 

 

1,824.5

 

 

1,825.2

 

(0.0)

%  

 

 

 

5,529.2

 

 

5,588.9

 

(1.1)

%  

Finance and Insurance, Net

 

 

166.0

 

 

158.5

 

4.7

%  

 

 

 

491.5

 

 

482.2

 

1.9

%  

Service and Parts

 

 

543.5

 

 

523.8

 

3.8

%  

 

 

 

1,654.0

 

 

1,615.1

 

2.4

%  

Fleet and Wholesale

 

 

289.1

 

 

290.8

 

(0.6)

%  

 

 

 

894.3

 

 

888.2

 

0.7

%  

Total Revenue

 

$

5,155.4

 

$

5,148.5

 

0.1

%  

 

 

$

15,442.9

 

$

15,900.0

 

(2.9)

%  

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Retail Automotive Gross Profit: (Amounts in Millions)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

New Vehicles

 

$

164.3

 

$

179.8

 

(8.6)

%  

 

 

$

511.8

 

$

552.8

 

(7.4)

%  

Used Vehicles

 

 

89.7

 

 

105.3

 

(14.8)

%  

 

 

 

284.2

 

 

327.5

 

(13.2)

%  

Finance and Insurance, Net

 

 

166.0

 

 

158.5

 

4.7

%  

 

 

 

491.5

 

 

482.2

 

1.9

%  

Service and Parts

 

 

321.7

 

 

313.2

 

2.7

%  

 

 

 

981.4

 

 

959.5

 

2.3

%  

Fleet and Wholesale

 

 

5.8

 

 

5.4

 

7.4

%  

 

 

 

15.0

 

 

16.5

 

(9.1)

%  

Total Gross Profit

 

$

747.5

 

$

762.2

 

(1.9)

%  

 

 

$

2,283.9

 

$

2,338.5

 

(2.3)

%  

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Retail Automotive Revenue Per Vehicle Retailed:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

New Vehicles

 

$

40,764