Sonic Automotive, Inc. Reports Third Quarter Results
EchoPark Revenue Up 226% with Volume Up 221%
CHARLOTTE, N.C. – October 25, 2018 – Sonic Automotive, Inc. (NYSE: SAH), one of the nation’s largest automotive retailers, today reported financial results for the third quarter of 2018.
• Third quarter revenue and gross profit of $2.5 billion and $360.5 million, respectively
• Record third quarter pre-owned retail unit sales of 34,952 units
• Record third quarter F&I gross profit per retail unit of $1,505
• Record third quarter F&I gross of $98.1 million
• EchoPark stores retailed 7,698 units during the quarter, up 221% from the third quarter of 2017
• GAAP continuing operations earnings per diluted share of $0.36 per diluted share in the third quarter of 2018
• Adjusted continuing operations earnings per diluted share of $0.43 per diluted share in the third quarter of 2018
Third Quarter 2018 Results
Net income from continuing operations for the third quarter of 2018 was $15.3 million, or $0.36 per diluted share. Comparatively, net income from continuing operations for the third quarter of 2017 was $19.7 million, or $0.45 per diluted share.
Adjusted net income from continuing operations and related earnings per diluted share are non-GAAP financial measures. The schedules included in this press release reconcile these non-GAAP financial measures to the most directly comparable GAAP financial measures.
Adjusted net income from continuing operations for the third quarter of 2018 was $18.3 million, or $0.43 per diluted share. The adjustments in the third quarter of 2018 relate to storm damage, executive transition costs and charges related to the disposal of franchises. Adjusted net income from continuing operations for the third quarter of 2017 was $17.4 million, or $0.40 per diluted share. The adjustments in the third quarter of 2017 relate to a gain from the disposal of a franchise and charges related to fixed asset impairments, storm damage and legal matters.
David Bruton Smith, the Company’s Chief Executive Officer, noted, “Our EchoPark strategy to grow our pre-owned business continued according to plan in the third quarter of 2018. Revenues grew by nearly $130 million, or 226%, compared to the prior year quarter and we anticipate this upward trajectory to continue into the fourth quarter of 2018 with the opening of two additional EchoPark locations. On October 8, 2018, we opened an EchoPark store in Charlotte, North Carolina, and we expect to open another EchoPark Store in Houston, Texas by the end of 2018. On the franchise side of the business, revenues declined 1.7% on a same store basis primarily due to the strong third quarter comparison in 2017 containing the rebound effects of Hurricane Harvey. Despite this headwind, the franchised dealerships increased total gross profit by 1.1% during the quarter with strong performances in used vehicles and fixed operations. We look forward to a robust selling environment in the fourth quarter.”
Jeff Dyke, the Company’s President, noted, “We continue to work with our manufacturer partners to improve our margins at the store level and to make facility investments that provide the appropriate return for all parties. I am pleased with the progress we are making but believe we have more opportunity for improvement with certain brands. As David mentioned, we are very excited about the performance of EchoPark and our expansion plans.”
The following information was filed by Sonic Automotive Inc (SAH) on Thursday, October 25, 2018 as an 8K 2.02 statement, which is an earnings press release pertaining to results of operations and financial condition. It may be helpful to assess the quality of management by comparing the information in the press release to the information in the accompanying 10-Q Quarterly Report statement of earnings and operation as management may choose to highlight particular information in the press release.