Sonic Automotive, Inc. Posts 14% Increase in EPS

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Record Q1 Revenues and Profit

CHARLOTTE, N.C., April 23, 2013 /PRNewswire/ -- Sonic Automotive, Inc. (NYSE: SAH), one of the nation's largest automotive retailers, today reported record first quarter earnings from continuing operations in 2013 of $21.7 million for a 2.6% increase over the prior year results.  Continuing operations earnings per diluted share increased 13.9% to $0.41 compared to $0.36 in the prior year quarter. 

Q1 2013 Highlights- Record Q1 Continuing Operations Net Income and Revenues; Continuing Operations Diluted EPS up 14%; Record Q1 New and Used Retail VehicleVolumes

  • Record Q1 continuing operations net income of $21.7 million
  • Total Q1 revenues up 8.1% over prior year quarter
  • Record Q1 retail volumes – new vehicle retail of 30,590 units – used vehicle retail of 26,469 units
  • New vehicle retail revenue up 11.7% over prior year quarter
  • Record used vehicle sales volume in March retailing nearly 9,400 vehicles for the month
  • Parts and Service gross profit up 1.0% over prior year quarter (up 4.2% adjusted for two less selling days in 1Q2013)
  • Total gross profit up 3.1% over prior year quarter

B. Scott Smith, the Company's President, noted, "For 14 consecutive quarters, we have grown revenue when compared to the prior year without adding any dealerships, and are pleased with the quarter's operating and financial results.  Our operating performance continues to improve year-over-year, as we have focused on executing our playbooks and being Predictable, Repeatable and Sustainable.  This is our year to execute."

Jeff Dyke, Sonic's EVP of Operations, stated, "Our new and used vehicle growth in the first quarter grew at a record pace breaking an all-time sales record for used cars in the month of March.  Our new vehicle retail volume, which increased 7.4%, continues to show growth as we continue to focus on the customer experience, execution of our process and implementation of True Price.  We are excited about the possibilities of further improvement in the coming months."

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: 1.877.791.3416
International: 1.706.643.0958
Conference ID: 34425848

A conference call replay will be available one hour following the call for seven days and can be accessed by calling:

Domestic: 1.855.859.2056
International: 1.404.537.3406
Conference ID: 34425848

About Sonic Automotive

Sonic Automotive, Inc., a Fortune 500 company based in Charlotte, N.C., is one of the nation's largest automotive retailers.  Sonic can be reached on the web at www.sonicautomotive.com. 

Included herein are forward-looking statements, including statements with respect to anticipated growth in new vehicle sales, and anticipated future success and impacts from the implementation of our planned strategic initiatives.  There are many factors that affect management's views about future events and trends of the Company's business.  These factors involve risk and uncertainties that could cause actual results or trends to differ materially from management's view, including without limitation, economic conditions in the markets in which we operate, new and used vehicle industry sales volume, the success of our operational strategies, the rate and timing of overall economic recovery or decline, and the risk factors described in the Company's annual report on Form 10-K for the year ending December 31, 2012.  The Company does not undertake any obligation to update forward-looking information.

Sonic Automotive, Inc.
Results of Operations (Unaudited)
(Dollars and shares in thousands, except per share amounts)




First Quarter Ended

March 31, 

2013

2012

Revenues:


New retail vehicles

$   1,101,109

$      986,032

Fleet vehicles

41,947

45,358

Total new vehicles

1,143,056

1,031,390

Used vehicles

526,182

501,864

Wholesale vehicles

51,792

43,673

Total vehicles

1,721,030

1,576,927

Parts, service and collision repair

296,642

292,555

Finance, insurance and other

65,494

57,584

Total revenues

2,083,166

1,927,066

Gross profit

313,020

303,754

Selling, general and administrative expenses

(245,824)

(237,149)

Impairment charges

(15)

(1)

Depreciation and amortization

(12,134)

(10,895)

Operating income (loss)

55,047

55,709

Other income (expense):


Interest expense, floor plan

(5,213)

(4,263)

Interest expense, other, net

(14,359)

(16,409)

Other income (expense), net

95

20

Total other income (expense)

(19,477)

(20,652)

Income (loss) from continuing operations before taxes

35,570

35,057

Provision for income taxes - benefit (expense)

(13,873)

(13,912)

Income (loss) from continuing operations

21,697

21,145

Income (loss) from discontinued operations

(406)

(647)

Net income (loss)

$        21,291

$        20,498




Diluted earnings (loss) per common share:


Earnings (loss) per share from continuing operations

$            0.41

$            0.36

Earnings (loss) per share from discontinued operations

(0.01)

(0.01)

Earnings (loss) per common share

$            0.40

$            0.35

Weighted average common shares outstanding

52,931

64,420




Gross Margin Data (Continuing Operations):


New retail vehicles

5.9%

6.3%

Fleet vehicles

3.0%

3.4%

Total new vehicles

5.8%

6.2%

Used vehicles

7.2%

7.9%

Wholesale vehicles

(2.3%)

0.5%

Parts, service and collision repair

48.6%

48.8%

Finance, insurance and other

100.0%

100.0%

Overall gross margin

15.0%

15.8%




SG&A Expenses (Continuing Operations):


Compensation

$      148,580

$      142,184

Advertising

13,431

12,055

Rent and rent related

26,396

26,786

Other

57,417

56,124

Total SG&A expenses

$      245,824

$      237,149

SG&A expenses as % of gross profit

78.5%

78.1%




Operating Margin %

2.6%

2.9%




Unit Data (Continuing Operations):


New retail units

30,590

28,490

Fleet units

1,493

1,683

Total new units

32,083

30,173

Used units

26,469

25,478

Wholesale units

8,393

7,175








Sonic Automotive, Inc.
Results of Operations (Unaudited)
(In thousands, except per share amounts)


















First Quarter Ended March 31, 2013




Income (Loss)

Income (Loss)








From Continuing

From Discontinued








Operations

Operations

Net Income (Loss)


Weighted


Per


Per


Per


Average


Share


Share


Share


Shares

Amount

Amount

Amount

Amount

Amount

Amount
















Reported:














Earnings (loss) and shares


52,586

$ 21,697


$ (406)


$ 21,291


Effect of participating securities:














Non-vested restricted stock














and stock units




(170)


-


(170)


Basic earnings (loss) and shares


52,586

$ 21,527

$ 0.41

$ (406)

$ (0.01)

$ 21,121

$ 0.40

Effect of dilutive securities:














Stock compensation plans


345












Diluted earnings (loss) and shares


52,931

$ 21,527

$ 0.41

$ (406)

$ (0.01)

$ 21,121

$ 0.40


































First Quarter Ended March 31, 2012




Income (Loss)

Income (Loss)








From Continuing

From Discontinued








Operations

Operations

Net Income (Loss)


Weighted


Per


Per


Per


Average


Share


Share


Share


Shares

Amount

Amount

Amount

Amount

Amount

Amount
















Reported:














Earnings (loss) and shares


52,224

$ 21,145


$ (647)


$ 20,498


Effect of participating securities:














Non-vested restricted stock














and stock units




(329)


-


(329)


Basic earnings (loss) and shares


52,224

$ 20,816

$ 0.40

$ (647)

$ (0.01)

$ 20,169

$ 0.39

Effect of dilutive securities:














Contingently convertible














debt (5.0% Convertible Notes)


11,676

2,125


47


2,172


Stock compensation plans


520












Diluted earnings (loss) and shares


64,420

$ 22,941

$ 0.36

$ (600)

$ (0.01)

$ 22,341

$ 0.35
















SOURCE Sonic Automotive, Inc.

Released April 23, 2013