AutoNation: Used, New Sales Drive Double-Digit Revenue Growth
FORT LAUDERDALE, Fla. — Enjoying the second straight quarter of growth throughout all its regions — including Florida, its largest state — AutoNation's used- and new-vehicle revenue gains helped push close to a 19-percent increase in overall revenue in the first quarter, a period that saw the company's net income from continuing operations climb $5 million.
More specifically, AutoNation's net income from continuing operations was $58.4 million, up from $52.6 million in the year-ago period.
It was up even more from the adjusted net income from continuing operations of $39.6 million from the first quarter of 2009 (This was adjusted for gain of senior note repurchase, net gain on asset sales and dispositions, and property and other impairments).
Continuing on, AutoNation generated $2.85 billion of revenue in the quarter, up 18.6 percent from the first quarter of 2009.
Interestingly enough, AutoNation enjoyed particularly strong performance in Florida, the state where it has the most dealers. The Sunshine State was an early victim of the nation's recession, but AutoNation's business seems to picking up in Florida, as the company's first-quarter revenue there climbed 29 percent.
"We delivered strong double-digit growth in the first quarter, which was driven by both new- and used-vehicle unit sales and revenue. We have seen growth in all regions for two quarters led by our largest state Florida, which was one of the first states to experience the effects of the economic downturn," said Mike Jackson, chairman and chief executive officer. "First quarter revenue for Florida was up 29 percent. We see an improved sales environment going forward."
He added: "By lowering our structural costs, and efficiently managing our inventory, we were able to deliver substantial EPS growth in a steadily improving retail sales environment."
Discussing the company's performance in more detail, officials noted that used-vehicle revenue (including retail and wholesale) was $734.6 million, up from $590.5 million, while new-vehicle revenue totaled $1.47 billion, compared with $1.19 billion in the first quarter of 2009.
Overall, its retail sales were 83,211, up 15.3 percent from the year-ago period.
AutoNation reported used-retail sales of 37,773 units, an 11.5-percent year-over-year improvement, and new-vehicle retail sales climbed 18.7 percent to 45,438 units.
Moving on, as reported in Auto Remarketing last month, AutoNation recently made some debt refinancing moves, and it appears they are paying off, according to executives.
"These transactions extended our debt maturities, increased our available liquidity, and lowered our exposure to interest rate increases in the future," explained Michael Short, executive vice president and chief financial officer.
"We believe that these transactions will provide us with additional flexibility to manage our business and optimize capital allocation going forward," he added.