Standalone used stores boost Penske’s Q1 results

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BLOOMFIELD HILLS, Mich. - 

Penske Automotive Group posted a used-vehicle performance lift during the first quarter thanks in part to the addition of U.S.-based CarSense and U.K.-based CarShop, both of which are stand-alone specialty retailers of used vehicles.

During Q1, Penske reported these used-vehicle dealerships retailed 8,200 units, generating $143.1 million in revenue and $24.6 million in gross profit. The average transaction price was $14,372, generating a gross profit per unit of $1,382.  Finance and insurance gross profit per unit was $1,147.

All told, according to the financial statement Penske released on Wednesday, the dealer group retailed 62,284 used units during the first quarter. A year earlier, the figure came in at 52,741 units.

On a same-store basis, however, Penske sustained a slight softening in used-vehicle retail sales as that metric was 51,852 units.

Gross profit on used retail sales on a same-store basis also ticked a bit lower year-over-year as Penske reported the Q1 figure at $1,549, down from $1,601 a year earlier.

However, F&I gross profit per unit improved a bit year-over-year when looking at the same-store data, edging up to $1,123 from $1,066.

Overall, Penske reported that its first quarter included record revenue, income from continuing operations and earnings per share.

The dealer group said Q1 income from continuing operations attributable to common shareholders increased 4.9 percent to $83.2 million, and related earnings per share increased 7.8 percent to $0.97, when compared to the same period last year. 

Penske acknowledged foreign exchange negatively impacted income from continuing operations attributable to common shareholders by $7.5 million, and earnings per share attributable to common shareholders by $0.09.

Excluding the foreign exchange impact, the company explained income from continuing operations attributable to common shareholders would have increased 14.4 percent to $90.7 million and earnings per share would have increased 17.8 percent to $1.06. 

The company added total revenue increased 5.3 percent to $5.1 billion, but same-store retail revenue declined 2.2 percent. Foreign exchange rates negatively impacted revenues by approximately $287.6 million. 

Excluding the foreign exchange impact, total revenue would have increased 11.3 percent to $5.4 billion and same-store retail revenue would have increased 3.7 percent, according to the company.

Penske Automotive Group chairman Roger Penske said, “Our diversified transportation services business delivered another outstanding quarter of record results despite foreign currency headwinds.  I am pleased to see increases in average gross profit per transaction for new vehicles, used vehicles and finance and insurance when excluding the impact from foreign exchange, coupled with another strong quarter of record results by our U.K. business.

“As we look to the future our recent acquisitions combined with the continued performance of our existing business provide a solid foundation for growth and profitability,” he went on to say.

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