Exhibit 99.1

FOR IMMEDIATE RELEASE

Sonic Automotive, Inc. Posts All-Time Record Pre-Owned Unit Sales and Q1 Record Pre-Owned Gross Profits

CHARLOTTE, N.C. – April 22, 2014Sonic Automotive, Inc. (NYSE: SAH), one of the nation’s largest automotive retailers, today reported 2014 first quarter earnings from continuing operations of $20.0 million compared to $21.7 million in the prior year quarter. Continuing operations earnings per diluted share were $0.38 in the first quarter of 2014 compared to $0.41 in the prior year quarter. Sonic estimates that first quarter 2014 weather events in the southeast negatively affected continuing operations earnings per diluted share by approximately $0.02. Expenses attributable to Sonic’s stand-alone pre-owned store initiative also reduced continuing operations earnings per diluted share by an additional $0.02 in the first quarter of 2014.

Q1 2014 Highlights:

 

    All-time record pre-owned unit sales of 27,657 in Q1 2014

 

    Record Q1 pre-owned gross profit of $40.7 million in 2014

 

    Pre-owned unit sales per store per month reached 90 units in Q1 2014

 

    Q1 2014 fixed operations revenue up $22.1 million, or 7.5% over the prior year quarter

 

    Record Q1 fixed operations gross profit of $152.1 million, up $7.9 million over the prior year quarter

B. Scott Smith, the Company’s President, noted, “We have been very busy in the first quarter. I’m happy with the progress we have made in both pre-owned and in our customer experience initiatives. We are very excited about the opening of our pre-owned stores in Denver expected in the fourth quarter 2014. Our collection of highly skilled professionals, operational playbooks and state-of-the-art technology will provide us with a competitive advantage over others in this pre-owned space.”

“With our customer experience initiative (One-Sonic One-Experience), we intend on helping the retail automotive industry change toward the way current and future consumers want to shop for cars and trucks. Our goal is to provide options to customers that are enjoyable, transparent and consistent with their lifestyles. We plan on beginning the roll out this new shopping experience to our customers in the Charlotte, North Carolina market in the third quarter of 2014, and we will launch the customer experience initiative in other markets after the Charlotte roll out is complete.”

“We would also like to reiterate our targeted range of diluted earnings per share from continuing operations for full year 2014 of $1.95 to $2.05. This range includes an expected $0.14 per diluted share effect related to costs of our stand-alone pre-owned initiative. Excluding the anticipated effects of this initiative, our targeted range of diluted earnings per share from continuing operations for full year 2014 is $2.09 to $2.19.”


Jeff Dyke, Sonic’s EVP of Operations, stated, “We continue to demonstrate our ability to operate and grow in the pre-owned space at record levels. Compared to the prior year quarter, we were able to grow pre-owned unit sales by 4.5% and pre-owned gross profit by 7.0%. In addition, our fixed operations teams were able to achieve record results despite the weather issues that plagued many of our southeastern stores during the quarter. We achieved fixed operations revenue and gross profit growth over the prior year quarter of 7.5% and 5.5%, respectively. While new retail unit volumes were relatively flat compared to the prior year quarter, we were able to increase our gross profit per unit to $2,191, up $58 per unit versus Q1 2013. We continue to make progress on our One-Sonic One-Experience and stand-alone pre-owned store projects, which are all on track. While the weather caused a slowdown in January and February, we still beat our internal forecast for Q1 2014, and we remain on track to achieve our EPS target for the full year.”

“We continue testing our True Price® pricing methodology. This quarter we began to see two things happen – as the market grew stronger, our share stabilized, and we grew market share sequentially over the prior quarter and we were able to grow new car margin by $58 per retail unit. This marks the first time in over a year of adjusting our model that both share and margin grew together in the quarter. As we move toward our One-Sonic One-Experience launch, we expect to gain significant market share as customers benefit from the entire complement of our new shopping experience. Bottom line, when we fully implement One-Sonic One-Experience, we will offer the automobile buying community a shopping experience that no other competitor in our industry can offer, or will be able to offer, for several years to come.”

First Quarter Earnings Conference Call

Senior management will host a conference call today at 10:00 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: 1.877.450.3867

International: 1.706.643.0958

Conference ID: 76537421

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: 76537421

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 earnings per share from continuing operations, expected expense impacts of our company’s stand-alone pre-owned store initiative, anticipated growth in new vehicle sales, and anticipated future success and impacts from the implementation of our planned customer experience and stand-alone pre-owned store 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, 2013. The Company does not undertake any obligation to update forward-looking information.

###

 

Contact:    Heath Byrd, Chief Financial Officer (704) 566-2400
   C.G. Saffer, Vice President and Chief Accounting Officer (704) 566-2439


Sonic Automotive, Inc.

Results of Operations (Unaudited)

 

     First Quarter Ended
March 31, 2014
    First Quarter Ended
March 31, 2013
 
     (In thousands, except per share and unit
data)
 

Revenues:

    

New retail vehicles

   $ 1,112,291      $ 1,101,109   

Fleet vehicles

     34,329        41,947   
  

 

 

   

 

 

 

Total new vehicles

     1,146,620        1,143,056   

Used vehicles

     559,816        526,182   

Wholesale vehicles

     41,598        51,792   
  

 

 

   

 

 

 

Total vehicles

     1,748,034        1,721,030   

Parts, service and collision repair

     318,771        296,642   

Finance, insurance and other, net

     69,581        65,494   
  

 

 

   

 

 

 

Total revenues

     2,136,386        2,083,166   

Gross profit

     329,000        313,020   

Selling, general and administrative expenses

     (263,973     (245,824

Impairment charges

     (3     (15

Depreciation and amortization

     (14,381     (12,134
  

 

 

   

 

 

 

Operating income (loss)

     50,643        55,047   

Other income (expense):

    

Interest expense, floor plan

     (4,689     (5,213

Interest expense, other, net

     (13,818     (14,359

Other income (expense), net

     97        95   
  

 

 

   

 

 

 

Total other income (expense)

     (18,410     (19,477
  

 

 

   

 

 

 

Income (loss) from continuing operations before taxes

     32,233        35,570   

Provision for income taxes - benefit (expense)

     (12,249     (13,873
  

 

 

   

 

 

 

Income (loss) from continuing operations

     19,984        21,697   
  

 

 

   

 

 

 

Income (loss) from discontinued operations

     (598     (406
  

 

 

   

 

 

 

Net income (loss)

   $ 19,386      $ 21,291   
  

 

 

   

 

 

 

Diluted earnings (loss) per common share:

    

Earnings (loss) per share from continuing operations

   $ 0.38      $ 0.41   

Earnings (loss) per share from discontinued operations

     (0.02     (0.01
  

 

 

   

 

 

 

Earnings (loss) per common share

   $ 0.36      $ 0.40   
  

 

 

   

 

 

 

Weighted average common shares outstanding

     52,946        52,931   

Gross Margin Data (Continuing Operations):

    

New retail vehicles

     5.9     5.9

Fleet vehicles

     2.6     3.0

Total new vehicles

     5.8     5.8

Used vehicles

     7.3     7.2

Wholesale vehicles

     (0.2 %)      (2.3 %) 

Parts, service and collision repair

     47.7     48.6

Finance, insurance and other

     100.0     100.0

Overall gross margin

     15.4     15.0

SG&A Expenses (Continuing Operations):

    

Compensation

   $ 157,154      $ 148,580   

Advertising

     14,119        13,431   

Rent

     18,535        19,022   

Other

     74,165        64,791   
  

 

 

   

 

 

 

Total SG&A expenses

   $ 263,973      $ 245,824   

SG&A expenses as % of gross profit

     80.2     78.5

Operating Margin %

     2.4     2.6

Unit Data (Continuing Operations):

    

New retail units

     30,029        30,590   

Fleet units

     1,102        1,493   
  

 

 

   

 

 

 

Total new units

     31,131        32,083   

Used units

     27,657        26,469   

Wholesale units

     7,380        8,393   


Sonic Automotive, Inc.

Results of Operations (Unaudited)

Per Share Data

 

     First Quarter Ended March 31, 2014  
            Income (Loss)
From Continuing
Operations
     Income (Loss)
From Discontinued
Operations
    Net income (Loss)  
     Weighted
Average
Shares
     Amount     Per
Share
Amount
     Amount     Per
Share
Amount
    Amount     Per
Share
Amount
 
     (In thousands, except per share amounts)  

Reported:

                

Earnings (loss) and shares

     52,418       $ 19,984         $ (598     $ 19,386     

Effect of participating securities:

                

Non-vested restricted stock and stock units

        (63        —            (63  
  

 

 

    

 

 

   

 

 

    

 

 

   

 

 

   

 

 

   

 

 

 

Basic earnings (loss) and shares

     52,418       $ 19,921      $ 0.38       $ (598   $ (0.01   $ 19,323      $ 0.37   

Effect of dilutive securities:

                

Stock compensation plans

     528                 
  

 

 

    

 

 

   

 

 

    

 

 

   

 

 

   

 

 

   

 

 

 

Diluted earnings (loss) and shares

     52,946       $ 19,921      $ 0.38       $ (598   $ (0.02   $ 19,323      $ 0.36   
  

 

 

    

 

 

   

 

 

    

 

 

   

 

 

   

 

 

   

 

 

 
     First Quarter Ended March 31, 2013  
            Income (Loss)
From Continuing
Operations
     Income (Loss)
From Discontinued
Operations
    Net Income (Loss)  
     Weighted
Average
Shares
     Amount     Per
Share
Amount
     Amount     Per
Share
Amount
    Amount     Per
Share
Amount
 
     (In thousands, except per share amounts)  

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   
  

 

 

    

 

 

   

 

 

    

 

 

   

 

 

   

 

 

   

 

 

 


Sonic Automotive, Inc.

Results of Operations (Unaudited)

New Vehicles

 

     First Quarter Ended March 31,     Better / (Worse)  
     2014     2013     Change     % Change  
     (In thousands, except units and per unit data)  

Reported:

        

Revenue

   $ 1,146,620      $ 1,143,056      $ 3,564        0.3

Gross profit

   $ 66,673      $ 66,470      $ 203        0.3

Unit sales

     31,131        32,083        (952     (3.0 %) 

Revenue per unit

   $ 36,832      $ 35,628      $ 1,204        3.4

Gross profit per unit

   $ 2,142      $ 2,072      $ 70        3.4

Gross profit as a % of revenue

     5.8     5.8     0        bps   
     First Quarter Ended March 31,     Better / (Worse)  
     2014     2013     Change     % Change  
     (In thousands, except units and per unit data)  

Same Store:

        

Revenue

   $ 1,129,303      $ 1,143,056      $ (13,753     (1.2 %) 

Gross profit

   $ 65,372      $ 66,341      $ (969     (1.5 %) 

Unit sales

     30,818        32,083        (1,265     (3.9 %) 

Revenue per unit

   $ 36,644      $ 35,628      $ 1,016        2.9

Gross profit per unit

   $ 2,121      $ 2,068      $ 53        2.6

Gross profit as a % of revenue

     5.8     5.8     0        bps   


Sonic Automotive, Inc.

Results of Operations (Unaudited)

Used Vehicles

 

     First Quarter Ended March 31,     Better / (Worse)  
     2014     2013     Change      % Change  
     (In thousands, except units and per unit data)  
Reported:          

Revenue

   $ 559,816      $ 526,182      $ 33,634         6.4

Gross profit

   $ 40,693      $ 38,030      $ 2,663         7.0

Unit sales

     27,657        26,469        1,188         4.5

Revenue per unit

   $ 20,241      $ 19,879      $ 362         1.8

Gross profit per unit

   $ 1,471      $ 1,437      $ 34         2.4

Gross profit as a % of revenue

     7.3     7.2     10         bps   
     First Quarter Ended March 31,     Better / (Worse)  
     2014     2013     Change      % Change  
     (In thousands, except units and per unit data)  
Same Store:          

Revenue

   $ 546,937      $ 526,182      $ 20,755         3.9

Gross profit

   $ 39,870      $ 37,262      $ 2,608         7.0

Unit sales

     27,126        26,469        657         2.5

Revenue per unit

   $ 20,163      $ 19,879      $ 284         1.4

Gross profit per unit

   $ 1,470      $ 1,408      $ 62         4.4

Gross profit as a % of revenue

     7.3     7.1     20         bps   


Sonic Automotive, Inc.

Results of Operations (Unaudited)

Wholesale Vehicles

 

     First Quarter Ended March 31,     Better / (Worse)  
     2014     2013     Change     % Change  
     (In thousands, except units and per unit data)  
Reported:         

Revenue

   $ 41,598      $ 51,792      $ (10,194     (19.7 %) 

Gross profit (loss)

   $ (93   $ (1,203   $ 1,110        92.3

Unit sales

     7,380        8,393        (1,013     (12.1 %) 

Revenue per unit

   $ 5,637      $ 6,171      $ (534     (8.7 %) 

Gross profit (loss) per unit

   $ (13   $ (143   $ 130        90.9

Gross profit (loss) as a % of revenue

     (0.2 %)      (2.3 %)      210        bps   
     First Quarter Ended March 31,     Better / (Worse)  
     2014     2013     Change     % Change  
     (In thousands, except units and per unit data)  

Same Store:

        

Revenue

   $ 40,627      $ 51,792      $ (11,165     (21.6 %) 

Gross profit (loss)

   $ 28      $ (1,203   $ 1,231        102.3

Unit sales

     7,270        8,393        (1,123     (13.4 %) 

Revenue per unit

   $ 5,588      $ 6,171      $ (583     (9.4 %) 

Gross profit (loss) per unit

   $ 4      $ (143   $ 147        102.8

Gross profit (loss) as a % of revenue

     0.1     (2.3 %)      240        bps   


Sonic Automotive, Inc.

Results of Operations (Unaudited)

Parts, Service and Collision Repair (“Fixed Operations”)

 

     First Quarter Ended March 31,     Better / (Worse)  
     2014     2013     Change     % Change  
     (In thousands)  

Reported:

  

Revenue

        

Customer pay

   $ 141,121      $ 133,803      $ 7,318        5.5

Warranty

     46,591        44,813        1,778        4.0

Wholesale parts

     47,944        40,538        7,406        18.3

Internal, sublet and other

     83,115        77,488        5,627        7.3
  

 

 

   

 

 

   

 

 

   

 

 

 

Total

   $ 318,771      $ 296,642      $ 22,129        7.5
  

 

 

   

 

 

   

 

 

   

 

 

 

Gross profit

        

Customer pay

   $ 77,999      $ 74,116      $ 3,883        5.2

Warranty

     25,238        23,895        1,343        5.6

Wholesale parts

     8,161        7,619        542        7.1

Internal, sublet and other

     40,748        38,599        2,149        5.6
  

 

 

   

 

 

   

 

 

   

 

 

 

Total

   $ 152,146      $ 144,229      $ 7,917        5.5
  

 

 

   

 

 

   

 

 

   

 

 

 

Gross profit as a % of revenue

        

Customer pay

     55.3     55.4     (10     bps   

Warranty

     54.2     53.3     90        bps   

Wholesale parts

     17.0     18.8     (180     bps   

Internal, sublet and other

     49.0     49.8     (80     bps   
  

 

 

   

 

 

   

 

 

   

Total

     47.7     48.6     (90     bps   


Sonic Automotive, Inc.

Results of Operations (Unaudited)

Parts, Service and Collision Repair (“Fixed Operations”)

 

     First Quarter Ended March 31,     Better / (Worse)  
     2014     2013     Change     % Change  
     (In thousands)  

Same Store:

        

Revenue

        

Customer pay

   $ 136,121      $ 133,803      $ 2,318        1.7

Warranty

     45,237        44,813        424        0.9

Wholesale parts

     46,607        40,538        6,069        15.0

Internal, sublet and other

     81,538        77,489        4,049        5.2
  

 

 

   

 

 

   

 

 

   

 

 

 

Total

   $ 309,503      $ 296,643      $ 12,860        4.3
  

 

 

   

 

 

   

 

 

   

 

 

 

Gross profit

        

Customer pay

   $ 75,365      $ 74,116      $ 1,249        1.7

Warranty

     24,523        24,195        328        1.4

Wholesale parts

     7,820        7,619        201        2.6

Internal, sublet and other

     39,724        38,423        1,301        3.4
  

 

 

   

 

 

   

 

 

   

 

 

 

Total

   $ 147,432      $ 144,353      $ 3,079        2.1
  

 

 

   

 

 

   

 

 

   

 

 

 

Gross profit as a % of revenue

        

Customer pay

     55.4     55.4     0        bps   

Warranty

     54.2     54.0     20       bps   

Wholesale parts

     16.8     18.8     (200     bps   

Internal, sublet and other

     48.7     49.6     (90     bps   
  

 

 

   

 

 

   

 

 

   

Total

     47.6     48.7     (110     bps   


Sonic Automotive, Inc.

Results of Operations (Unaudited)

Finance, Insurance and Other, Net (“F&I”)

 

     First Quarter Ended March 31,      Better / (Worse)  
     2014      2013      Change      % Change  
     (In thousands, except per unit data)  

Reported:

           

Revenue

   $ 69,581       $ 65,494       $ 4,087         6.2

Gross profit per retail unit (excludes fleet)

   $ 1,206       $ 1,148       $ 58         5.1
     First Quarter Ended March 31,      Better / (Worse)  
     2014      2013      Change      % Change  
     (In thousands, except per unit data)  

Same Store:

           

Revenue

   $ 68,408       $ 65,507       $ 2,901         4.4

Gross profit per retail unit (excludes fleet)

   $ 1,203       $ 1,148       $ 55         4.8


Sonic Automotive, Inc.

Results of Operations (Unaudited)

Selling, General and Administrative (“SG&A”) Expenses

 

     First Quarter Ended March 31,     Better / (Worse)  
     2014     2013     Change     % Change  
     (In thousands)  

Compensation

   $ 157,154      $ 148,580      $ (8,574     (5.8 %) 

Advertising

     14,119        13,431        (688     (5.1 %) 

Rent

     18,535        19,022        487        2.6

Other

     74,165        64,791        (9,374     (14.5 %) 
  

 

 

   

 

 

   

 

 

   

 

 

 

Total

   $ 263,973      $ 245,824      $ (18,149     (7.4 %) 
  

 

 

   

 

 

   

 

 

   

 

 

 

SG&A expenses as a % of gross profit

        

Compensation

     47.8     47.5     (30     bps   

Advertising

     4.3     4.3     0        bps   

Rent

     5.6     6.1     50        bps   

Other

     22.5     20.6     (190     bps   
  

 

 

   

 

 

   

 

 

   

Total

     80.2     78.5     (170     bps