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Major Dealer Groups Prepare to Top Records Set in 2012

February 27, 2013
4 min to read


Major dealer groups reported significant growth in the fourth quarter and on a full-year basis for 2012. Based on their reports, the dealer groups are aggressively moving into 2013 with the goal of topping last year’s record-breaking numbers.


Group1 Automotive, for one, reported a record year for revenues in 2012, with a net income of $24 million for the quarter and diluted earnings per share (EPS) of $0.99 for the period. The automotive retailer’s annual net income increased 25.8 percent to a record $108.2 million. F&I revenues for the Houston-based dealer group increased 32.8 percent on 24 percent more retail unit sales, while gross profit per retail unit reached an all-time high of $1,215. Additionally, parts and service revenues grew 8.1 percent for the year, while both new- and used-vehicle profit grew more than 17 percent.

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"Despite continuing the strong growth pace in the fourth quarter with 19 percent revenue growth, we missed some opportunities to maximize profits via complete leveraging of our cost structure,” Earl J. Hesterberg, Group 1’s president and CEO, said in a company release. “We began taking actions in this regard on Jan. 1, and I am confident that we can return to the type of cost leverage we generated in the first three quarters of the year.


“I believe 2013 will be another great year for the industry as a whole and Group 1 Automotive in particular," he added.


AutoNation’s fourth quarter earnings per share (EPS) reached an all-time record at $0.67, up 31 percent from the fourth quarter 2011 from continuing operations of $0.51. The dealer group’s total revenue reached $4.2 billion, up 13 percent compared to the year-ago period. AutoNation posted gains across all major business sectors, with operating income of $169 million, up 18 percent vs. the fourth quarter in 2011.


Lithia Motors also realized a record fourth quarter 2012, with adjusted net income from operations of $19.3 million — the highest in company history and up from $12.7 million in the fourth quarter 2011. The Medford, Ore.-based group also posted slight gains in the F&I office, with the average gross profit per retail unit coming in at $1,097 vs. $1,068 per vehicle in the final quarter of 2011. Total revenue for F&I was $29.2 million for the fourth quarter vs. $22.4 million in the same quarter last year.


For Penske Automotive, total revenue for the fourth quarter jumped 17.9 percent to $3.4 billion, while total annual revenue shot up 18.3 percent to $13.2 billion.

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Chairman Roger Penske said in a recent release: "2012 was a very solid year of growth and profitability for our company. We expanded our presence globally by completing acquisitions in Northern Ireland and Italy, and we entered the Madison, Wis., market in the U.S. In total, our business added $750 million in estimated annualized revenue through acquisitions during the year, and generated a 9.9 percent increase in same-store retail revenue, resulting in revenue growth of 18.3 percent, which contributed to a 23.4 percent increase in operating income and a 26.7 percent increase in adjusted earnings per share."


Penske’s F&I operations reported increases in key metrics as well, with same-store retail revenue up 13 percent in F&I and the average gross profit per retail unit coming in at $986.


Asbury Automotive announced a record 2012 fourth quarter and year-end results — with income for the fourth quarter coming in at $22.6 million vs. $17.5 million in the same period last year. F&I revenues were up 23 percent, Asbury reported, with $43.5 million in net income for the quarter, up from $35.5 million in 2011. Duluth, Ga.-based group' F&I operations also posted revenues of $166.6 million for the year, up from $137 million in 2011.


Asbury’s Executive Vice President and COO Michael Kearney said in a release: “Our new vehicle unit sales significantly out-performed the industry, increasing 21 percent due to the strength of our brand portfolio and excellent sales execution. We are also very encouraged with the traction we are seeing in our parts and service growth."


Sonic also realized record gains in 2012, particularly with its $28.8 million in net income from continuing operation for the fourth quarter, a 35.5 percent increase over the same period last year. Additionally, the Charlotte, NC.-based dealer group reported an increase in net income of 19.6 percent. Sonic’s F&I operation also posted revenues of $250.4 million for the year, with revenues totally $64.7 in the final quarter of 2012.


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