Group 1 Automotive Inc.
) witnessed a 21.4% rise in adjusted earnings per share to $1.25 in
the second quarter of 2012 compared to $1.03 in the corresponding
quarter last year and surpassed the Zacks Consensus Estimate of
Profits escalated 20.1% to $29.7 million from $24.8 million in
the year-ago quarter. Meanwhile, reported earnings were $28.6
million or $1.20 per share compared with $24.7 million or $1.03 in
the second quarter of 2011.
The company's revenues for the quarter came in at $1.9 billion, up
28.6% compared with $1.5 billion in the year-ago quarter and higher
than the Zacks Consensus Estimate of $1.7 billion. The growth in
revenues was driven by strong retail new vehicle and used vehicle
Revenues from new vehicle sales surged 33.4% to $1.1 billion on a
36.6% increase in unit sales to 32,924 vehicles. However, revenue
per vehicle fell 2.3% to $32,824 in the quarter.
Revenues from retailed used vehicles boosted 29.2% to $456.2
million. Used vehicle unit sales improved 27.9% to 22,004 vehicles,
reflecting a marginal 1% increase in revenue per vehicle to
$20,734. Revenues from wholesaled used vehicles went up 20.7% to
$73.1 million. Used vehicles wholesaled increased 32.4% to 11,244
Revenues from parts and service went up 7.9% to $220.3 million.
Meanwhile, the company's finance and insurance business witnessed a
40.7% growth in revenues to $65.4 million.
Gross profit increased 16.8% to $285.3 million from $244.2 million
in the year-ago quarter. The improvement was driven by higher gross
profit earned from the finance and insurance and new vehicle retail
sales. However, a loss in the used vehicle wholesale business had
an adverse effect on the overall gross profit.
Gross margin declined to 15.1% from 16.6% recorded in the year-ago
quarter. Adjusted SG&A expenses increased 16.2% to $212.7
million in the quarter.
Operating income swelled 15.9% to $63.1 million from $54.4 million
recorded in the second quarter of 2011. However, adjusted operating
margin went down marginally to 3.4% from 3.7% in the last year
During the quarter, Group 1 Automotive repurchased 241,991 shares
for an average price of $46.75. The company's Board of Directors
authorized a repurchase of $50 million shares during the quarter,
replacing the remaining $5.4 million shares as of June 30, 2012
under the prior authorization.
Group 1 Automotive had cash and cash equivalents of $9.5 million as
of June 30, 2012, declining from $14.9 million in the corresponding
period of the prior year. Total debt amounted to $224.5 million as
of June 30, 2012 compared with $198.9 million as of December 31,
2011. In the quarter, the company had cash flow from operating
activities of $42.9 million, declining from $53.8 million in the
AUTONATION INC (AN): Free Stock Analysis Report
GROUP 1 AUTO (GPI): Free Stock Analysis Report
PENSKE AUTO GRP (PAG): Free Stock Analysis
To read this article on Zacks.com click here.
Headquartered in Memorial City of Houston, Texas, Group 1
Automotive was founded in 1997. The company is one of the largest
automotive retailers in U.S., which provides 31 automotive brands.
It has 122 automotive dealerships, 159 franchises and 28 collision
centers in the U.S. and the U.K. The company offers new and
used cars, light trucks and is also engaged in sales financing
In addition, the company provides insurance contracts, maintenance
and repair services along with vehicle parts to its customers. It
Penske Automotive Group Inc.
). Currently, the company retains a Zacks #2 Rank, which translates
into a short-term (1 to 3 months) Buy rating.