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Asbury Automotive Group Announces Record Second Quarter 2021 Financial Results

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Second quarter EPS of $7.80 per diluted share, up 204% over prior year EPS

Second quarter adjusted EPS of $7.78 per diluted share (a non-GAAP measure), up 209% over prior year adjusted EPS

Second quarter revenue increased 79% and gross profit increased 105% over prior year quarter

DULUTH, Ga., July 27, 2021--(BUSINESS WIRE)--Asbury Automotive Group, Inc. (NYSE: ABG), one of the largest automotive retail and service companies in the U.S., reported record net income for the second quarter 2021 of $152.1 million ($7.80 per diluted share). This compares to net income of $49.6 million ($2.57 per diluted share) in the prior year quarter.

The financial measures discussed below include both GAAP and adjusted (non-GAAP) financial measures. Please see reconciliations for our non-GAAP metrics included in the accompanying financial tables.

"This quarter, new inventory supply continued to be unpredictable, but our teams met the challenge and performed at record levels in revenue, volume, margins, net income, and EPS. In addition to this record performance, our online car buying platform, Clicklane, now fully active across all of our dealerships for the entire quarter, is exceeding our expectations, with its growth trajectory ahead of target," said David Hult, Asbury’s President and Chief Executive Officer. "We are tracking well to achieve our strategic five-year plan."

The Company reported adjusted net income (a non-GAAP measure) for the second quarter 2021 of $151.7 million ($7.78 per diluted share) compared to $48.7 million ($2.52 per diluted share) in the prior year quarter.

Net income for the second quarter 2021 was adjusted for real estate net gains of $0.5 million ($0.02 per diluted share).

Net income for the second quarter 2020 was adjusted for a $1.2 million ($0.05 per diluted share) legal settlement gain.

The Company reported total revenue for the second quarter of $2.6 billion, up 79% from the prior year period; total revenue on a same-store basis was up 50% from the prior year period.

Second Quarter 2021 Operational Summary

$ in millions, except EPS

Selected GAAP Financial

For the Three Months Ended June 30,

2021

2020

2019

YoY

2021 vs. 2019

Revenue

$

2,584.0

$

1,445.1

$

1,803.5

79

%

43

%

Gross Profit

$

497.2

$

242.8

$

295.0

105

%

69

%

Gross Margin

19.2

%

16.8

%

16.4

%

240 bps

280 bps

New Units

31,725

20,060

26,449

58

%

20

%

Used Retail Units

26,856

18,400

22,259

46

%

21

%

New Margin

9.1

%

5.1

%

4.0

%

400 bps

510 bps

Used Retail Margin

9.7

%

7.7

%

7.1

%

200 bps

260 bps

F&I Gross Profit

$

107.0

$

66.6

$

80.2

61

%

33

%

Parts & Service Gross Profit

$

182.6

$

100.5

$

140.6

82

%

30

%

SG&A % of Gross Profit

54.2

%

62.7

%

68.0

%

-850bps

-1,380 bps

Operating Income

$

218.4

$

82.2

$

85.9

166

%

154

%

Operating Margin

8.5

%

5.7

%

4.8

%

280 bps

370 bps

EPS

$

7.80

$

2.57

$

2.84

204

%

175

%

$ in millions, except EPS

Selected GAAP Financial

For the Three Months Ended June 30,

2021

2020

2019

YoY

2021 vs. 2019

Adjusted Operating Income

$

217.9

$

81.0

$

85.6

169

%

155

%

Adjusted Operating Margin

8.4

%

5.6

%

4.7

%

280 bps

370 bps

Adjusted EPS

$

7.78

$

2.52

$

2.38

209

%

227

%

Same store vs. 2nd Quarter 2020:

  • Revenue increased 50%

  • Gross profit increased 72%

  • Gross margin increased 250 bps to 19.3%

  • New vehicle unit volume increased 42%; used vehicle retail unit volume increased 29%

  • New vehicle revenue increased 52%; gross profit increased 162%

  • Used vehicle retail revenue increased 53%; gross profit increased 96%

  • Finance and insurance revenue and gross profit increased 48%

  • Parts and service revenue increased 41%; gross profit increased 48%; Customer pay gross profit increased 59%

Comparable store vs. 2nd Quarter 2019:

  • Revenue increased 23%

  • Gross profit increased 46%

  • Gross margin increased up 290 bps

  • New vehicle unit volume increased 11%; used vehicle retail unit volume increased 10%

  • New vehicle revenue increased 23%; gross profit increased 172%

  • Used vehicle retail revenue increased 34%; gross profit increased 88%

  • Finance and insurance revenue and gross profit increased 30%

  • Parts and service revenue and gross profit increased 7%; customer pay gross profit increased 9%

Liquidity and Leverage

As of June 30, 2021, the company had $576 million of liquidity (including cash of $102 million, floorplan offset accounts of $75 million, and availability under our used vehicle floorplan line and revolver of $399 million). The company’s adjusted net leverage ratio was 1.6x at quarter-end.

Additional commentary regarding the first quarter results will be provided during the earnings conference call on July 27, 2021, at 10:00 a.m. ET. The conference call will be simulcast live on the internet and can be accessed at www.asburyauto.com. A replay will be available at this site for 30 days.

In addition, live audio of the call will be accessible to the public by calling (800) 353-6461 (domestic), or (334) 323-0501 (international); passcode – 6678848. Callers should dial in approximately 5 to 10 minutes before the call begins.

A conference call replay will be available two hours following the call for seven days and can be accessed by calling (888) 203-1112 (domestic), or (719) 457-0820 (international); passcode – 6678848.

About Asbury Automotive Group, Inc.

Asbury Automotive Group, Inc. (NYSE: ABG), a Fortune 500 company headquartered in Duluth, GA, is one of the largest automotive retailers in the U.S. In late 2020, Asbury embarked on a 5-year plan to strategically increase revenue and profitability through organic and acquisitive growth as well as their innovative Clicklane digital car purchasing platform, with its guest-centric approach as Asbury’s constant North Star. Asbury currently operates 91 dealerships, consisting of 112 franchises, representing 31 domestic and foreign brands of vehicles. Asbury also operates 25 collision repair centers. Asbury offers an extensive range of automotive products and services, including new and used vehicles; parts and service, which includes vehicle repair and maintenance services, replacement parts and collision repair services; and finance and insurance products, including arranging vehicle financing through third parties and aftermarket products, such as extended service contracts, guaranteed asset protection debt cancellation, prepaid maintenance, and credit life and disability insurance. For additional information, visit www.asburyauto.com.

Forward-Looking Statements

This press release contains "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are statements other than historical fact, and may include statements relating to goals, plans, market conditions and projections regarding Asbury's financial position, liquidity, results of operations, market position and dealership portfolio, the expected benefits of Clicklane, and other initiatives and future business strategy. These statements are based on management's current expectations and beliefs and involve significant risks and uncertainties that may cause results to differ materially from those set forth in the statements. These risks and uncertainties include, among other things, the impact of the COVID-19 pandemic, market factors, Asbury's relationships with, and the financial and operational stability of, vehicle manufacturers and other suppliers, acts of God or other incidents and the shortage of semiconductor chips, which may adversely impact supply from vehicle manufacturers and/or present retail sales challenges, risks associated with Asbury's indebtedness (including available borrowing capacity, compliance with its financial covenants and ability to refinance or repay such indebtedness, on favorable terms), Asbury's relationships with, and the financial stability of, its lenders and lessors, risks related to competition in the automotive retail and service industries, general economic conditions both nationally and locally, governmental regulations, legislation, adverse results in litigation and other proceedings, and Asbury's ability to execute its five-year strategic plan, IT initiatives and other operational strategies, Asbury's ability to leverage gains from its dealership portfolio, Asbury's ability to capitalize on opportunities to repurchase its debt and equity securities or purchase properties that it currently leases, and Asbury's ability to stay within its targeted range for capital expenditures. There can be no guarantees that Asbury's plans for future operations will be successfully implemented or that they will prove to be commercially successful.

These and other risk factors that could cause actual results to differ materially from those expressed or implied in our forward-looking statements are and will be discussed in Asbury's filings with the U.S. Securities and Exchange Commission from time to time, including its most recent annual report on Form 10-K and any subsequently filed quarterly reports on Form 10-Q. We undertake no obligation to publicly update any forward-looking statement, whether as a result of new information, future events or otherwise.

ASBURY AUTOMOTIVE GROUP, INC.
CONSOLIDATED STATEMENTS OF INCOME (In millions, except per share data)
(Unaudited)

For the Three Months Ended June 30,

Increase

(Decrease)

%

Change

2021

2020

REVENUE:

New vehicle

$

1,368.4

$

761.8

$

606.6

80

%

Used vehicle:

Retail

759.4

412.6

346.8

84

%

Wholesale

56.8

34.9

21.9

63

%

Total used vehicle

816.2

447.5

368.7

82

%

Parts and service

292.4

169.2

123.2

73

%

Finance and insurance, net

107.0

66.6

40.4

61

%

TOTAL REVENUE

2,584.0

1,445.1

1,138.9

79

%

GROSS PROFIT:

New vehicle

124.1

38.6

85.5

222

%

Used vehicle:

Retail

73.5

31.6

41.9

133

%

Wholesale

10.0

5.5

4.5

82

%

Total used vehicle

83.5

37.1

46.4

125

%

Parts and service

182.6

100.5

82.1

82

%

Finance and insurance, net

107.0

66.6

40.4

61

%

TOTAL GROSS PROFIT

497.2

242.8

254.4

105

%

OPERATING EXPENSES:

Selling, general and administrative

269.7

152.2

117.5

77

%

Depreciation and amortization

10.1

9.7

0.4

4

%

Other operating (income), net

(1.0

)

(1.3

)

0.3

23

%

INCOME FROM OPERATIONS

218.4

82.2

136.2

166

%

OTHER EXPENSES:

Floor plan interest expense

2.1

4.1

(2.0

)

(49

)%

Other interest expense, net

14.4

11.8

2.6

22

%

Total other expenses, net

16.5

15.9

0.6

4

%

INCOME BEFORE INCOME TAXES

201.9

66.3

135.6

205

%

Income tax expense

49.8

16.7

33.1

198

%

NET INCOME

$

152.1

$

49.6

$

102.5

207

%

EARNINGS PER COMMON SHARE:

Basic—

Net income

$

7.88

$

2.58

$

5.30

205

%

Diluted—

Net income

$

7.80

$

2.57

$

5.23

204

%

WEIGHTED AVERAGE COMMON SHARES OUTSTANDING:

Basic

19.3

19.2

0.1

Restricted stock

0.1

0.1

Performance share units

0.1

0.1

Diluted

19.5

19.3

0.2

ASBURY AUTOMOTIVE GROUP, INC.
KEY OPERATING HIGHLIGHTS (In millions, except per unit data)
(Unaudited)

For the Three Months Ended June 30,

Increase

(Decrease)

%

Change

2021

2020

Unit sales

New vehicle:

Luxury

10,085

4,359

5,726

131

%

Import

17,257

11,610

5,647

49

%

Domestic

4,383

4,091

292

7

%

Total new vehicle

31,725

20,060

11,665

58

%

Used vehicle retail

26,856

18,400

8,456

46

%

Used to new ratio

84.7

%

91.7

%

(700) bps

Average selling price

New vehicle

$

43,133

$

37,976

$

5,157

14

%

Used vehicle retail

28,277

22,424

5,853

26

%

Average gross profit per unit

New vehicle:

Luxury

$

6,138

$

3,854

$

2,284

59

%

Import

2,550

1,077

1,473

137

%

Domestic

4,152

2,273

1,879

83

%

Total new vehicle

3,912

1,924

1,988

103

%

Used vehicle retail

2,737

1,717

1,020

59

%

Finance and insurance, net

1,827

1,732

95

5

%

Front end yield (1)

5,200

3,557

1,643

46

%

Gross margin

New vehicle:

Luxury

10.2

%

6.9

%

330 bps

Import

7.9

%

3.7

%

420 bps

Domestic

8.9

%

5.3

%

360 bps

Total new vehicle

9.1

%

5.1

%

400 bps

Used vehicle retail

9.7

%

7.7

%

200 bps

Parts and service

62.4

%

59.4

%

300 bps

Total gross profit margin

19.2

%

16.8

%

240 bps

SG&A metrics

Rent expense

$

9.1

$

5.9

$

3.2

54

%

SG&A as a percentage of gross profit

54.2

%

62.7

%

(850) bps

SG&A, excluding rent expense as a percentage of gross profit

52.4

%

60.3

%

(790) bps

Operating metrics

Income from operations as a percentage of revenue

8.5

%

5.7

%

280 bps

Income from operations as a percentage of gross profit

43.9

%

33.9

%

1,000 bps

Adjusted income from operations as a percentage of revenue

8.4

%

5.6

%

280 bps

Adjusted income from operations as a percentage of gross profit

43.8

%

33.4

%

1,040 bps

Revenue mix

New vehicle

53.0

%

52.7

%

Used vehicle retail

29.4

%

28.6

%

Used vehicle wholesale

2.2

%

2.4

%

Parts and service

11.3

%

11.7

%

Finance and insurance

4.1

%

4.6

%

Total revenue

100.0

%

100.0

Gross profit mix

New vehicle

25.0

%

15.9

%

Used vehicle retail

14.8

%

13.0

%

Used vehicle wholesale

2.0

%

2.3

%

Parts and service

36.7

%

41.4

%

Finance and insurance

21.5

%

27.4

%

Total gross profit

100.0

%

100.0

%

______________________________

(1)

Front end yield is calculated as gross profit from new vehicles, used retail vehicles and finance and insurance (net), divided by combined new and used retail unit sales.

ASBURY AUTOMOTIVE GROUP, INC.
SAME STORE OPERATING HIGHLIGHTS (In millions)
(Unaudited)

For the Three Months Ended June 30,

Increase

(Decrease)

%

Change

2021

2020

Revenue

New vehicle:

Luxury

$

381.0

$

236.2

$

144.8

61

%

Import

553.4

341.8

211.6

62

%

Domestic

204.1

168.8

35.3

21

%

Total new vehicle

1,138.5

746.8

391.7

52

%

Used Vehicle:

Retail

615.4

403.5

211.9

53

%

Wholesale

32.3

34.4

(2.1)

(6)

%

Total used vehicle

647.7

437.9

209.8

48

%

Parts and service

234.6

166.5

68.1

41

%

Finance and insurance

97.5

65.7

31.8

48

%

Total revenue

$

2,118.3

$

1,416.9

$

701.4

50

%

Gross profit

New vehicle:

Luxury

$

36.1

$

16.3

$

19.8

121

%

Import

43.9

12.4

31.5

254

%

Domestic

18.2

8.8

9.4

107

%

Total new vehicle

98.2

37.5

60.7

162

%

Used Vehicle:

Retail

61.3

31.2

30.1

96

%

Wholesale

6.4

5.5

0.9

16

%

Total used vehicle

67.7

36.7

31.0

84

%

Parts and service:

Customer pay

84.1

52.8

31.3

59

%

Warranty

20.2

17.6

2.6

15

%

Wholesale parts

6.6

4.8

1.8

38

%

Parts and service, excluding reconditioning and preparation

110.9

75.2

35.7

47

%

Reconditioning and preparation

35.2

23.6

11.6

49

%

Total parts and service

146.1

98.8

47.3

48

%

Finance and insurance

97.5

65.7

31.8

48

%

Total gross profit

$

409.5

$

238.7

$

170.8

72

%

SG&A expense

$

227.5

$

149.8

$

77.7

52

%

SG&A expense as a percentage of gross profit

55.6

%

62.8

%

(720) bps

______________________________

Same store amounts consist of information from dealerships for identical months in each comparative period, commencing with the first month we owned the dealership. Additionally, amounts related to divested dealerships are excluded from each comparative period.

ASBURY AUTOMOTIVE GROUP, INC.
SAME STORE OPERATING HIGHLIGHTS (Continued)
(Unaudited)

For the Three Months Ended June 30,

Increase

(Decrease)

%

Change

2021

2020

Unit sales

New vehicle:

Luxury

6,505

4,218

2,287

54

%

Import

17,205

11,610

5,595

48

%

Domestic

4,383

3,936

447

11

%

Total new vehicle

28,093

19,764

8,329

42

%

Used vehicle retail

23,267

18,033

5,234

29

%

Used to new ratio

82.8

%

91.2

%

(840) bps

Average selling price

New vehicle

$

40,526

$

37,786

$

2,740

7

%

Used vehicle retail

26,449

22,376

4,073

18

%

Average gross profit per unit

New vehicle:

Luxury

$

5,550

$

3,864

$

1,686

44

%

Import

2,552

1,068

1,484

139

%

Domestic

4,152

2,236

1,916

86

%

Total new vehicle

3,496

1,897

1,599

84

%

Used vehicle retail

2,635

1,730

905

52

%

Finance and insurance, net

1,898

1,738

160

9

%

Front end yield (1)

5,004

3,556

1,448

41

%

Gross margin

New vehicle:

Luxury

9.5

%

6.9

%

260 bps

Import

7.9

%

3.6

%

430 bps

Domestic

8.9

%

5.2

%

370 bps

Total new vehicle

8.6

%

5.0

%

360 bps

Used vehicle retail

10.0

%

7.7

%

230 bps

Parts and service:

Parts and service, excluding reconditioning and preparation

47.3

%

45.2

%

210 bps

Parts and service, including reconditioning and preparation

62.3

%

59.3

%

300 bps

Total gross profit margin

19.3

%

16.8

%

250 bps

______________________________

Same store amounts consist of information from dealerships for identical months in each comparative period, commencing with the first month we owned the dealership. Additionally, amounts related to divested dealerships are excluded from each comparative period.

(1)

Front end yield is calculated as gross profit from new vehicles, used retail vehicles and finance and insurance (net), divided by combined new and used retail unit sales.

ASBURY AUTOMOTIVE GROUP, INC.
CONSOLIDATED STATEMENTS OF INCOME (In millions, except per share data)
(Unaudited)

For the Six Months Ended June 30,

Increase

(Decrease)

%

Change

2021

2020

REVENUE:

New vehicle

$

2,520.1

$

1,583.9

$

936.2

59

%

Used vehicle:

Retail

1,366.9

858.6

508.3

59

%

Wholesale

140.2

82.1

58.1

71

%

Total used vehicle

1,507.1

940.7

566.4

60

%

Parts and service

554.4

390.8

163.6

42

%

Finance and insurance, net

195.3

137.0

58.3

43

%

TOTAL REVENUE

4,776.9

3,052.4

1,724.5

56

%

GROSS PROFIT:

New vehicle

199.6

75.0

124.6

166

%

Used vehicle:

Retail

121.0

62.8

58.2

93

%

Wholesale

18.3

5.0

13.3

266

%

Total used vehicle

139.3

67.8

71.5

105

%

Parts and service

345.7

235.4

110.3

47

%

Finance and insurance, net

195.3

137.0

58.3

43

%

TOTAL GROSS PROFIT

879.9

515.2

364.7

71

%

OPERATING EXPENSES:

Selling, general and administrative

509.5

346.9

162.6

47

%

Depreciation and amortization

19.9

19.2

0.7

4

%

Franchise rights impairment

23.0

(23.0

)

(100

)%

Other operating (income) expense, net

(4.2

)

8.9

(13.1

)

(147

)%

INCOME FROM OPERATIONS

354.7

117.2

237.5

203

%

OTHER EXPENSES (INCOME):

Floor plan interest expense

5.0

11.1

(6.1

)

(55

)%

Other interest expense, net

28.4

28.8

(0.4

)

(1

)%

Loss on extinguishment of long-term debt, net

20.6

(20.6

)

(100

)%

Gain on dealership divestitures, net

(33.7

)

33.7

100

%

Total other expenses, net

33.4

26.8

6.6

25

%

INCOME BEFORE INCOME TAXES

321.3

90.4

230.9

255

%

Income tax expense

76.4

21.3

55.1

259

%

NET INCOME

$

244.9

$

69.1

$

175.8

254

%

EARNINGS PER COMMON SHARE:

Basic—

Net income

$

12.69

$

3.60

$

9.09

253

%

Diluted—

Net income

$

12.56

$

3.58

$

8.98

251

%

WEIGHTED AVERAGE COMMON SHARES OUTSTANDING:

Basic

19.3

19.2

0.1

Restricted stock

0.1

0.1

Performance share units

0.1

0.1

Diluted

19.5

19.3

0.2

ASBURY AUTOMOTIVE GROUP, INC.
KEY OPERATING HIGHLIGHTS (In millions, except per unit data)
(Unaudited)

For the Six Months Ended June 30,

Increase

(Decrease)

%

Change

2021

2020

Unit sales

New vehicle:

Luxury

18,596

9,351

9,245

99

%

Import

31,634

24,068

7,566

31

%

Domestic

8,754

8,618

136

2

%

Total new vehicle

58,984

42,037

16,947

40

%

Used vehicle retail

50,375

38,687

11,688

30

%

Used to new ratio

85.4

%

92.0

%

(660) bps

Average selling price

New vehicle

$

42,725

$

37,679

$

5,046

13

%

Used vehicle retail

27,134

22,194

4,940

22

%

Average gross profit per unit

New vehicle:

Luxury

$

5,732

$

3,604

$

2,128

59

%

Import

1,963

964

999

104

%

Domestic

3,530

2,100

1,430

68

%

Total new vehicle

3,384

1,784

1,600

90

%

Used vehicle retail

2,402

1,623

779

48

%

Finance and insurance, net

1,786

1,697

89

5

%

Front end yield (1)

4,717

3,404

1,313

39

%

Gross margin

New vehicle:

Luxury

9.5

%

6.5

%

300 bps

Import

6.2

%

3.3

%

290 bps

Domestic

7.8

%

5.0

%

280 bps

Total new vehicle

7.9

%

4.7

%

320 bps

Used vehicle retail

8.9

%

7.3

%

160 bps

Parts and service

62.4

%

60.2

%

220 bps

Total gross profit margin

18.4

%

16.9

%

150 bps

SG&A metrics

Rent expense

$

20.3

$

12.7

$

7.6

60

%

SG&A as a percentage of gross profit

57.9

%

67.3

%

(940) bps

SG&A, excluding rent expense as a percentage of gross profit

55.6

%

64.9

%

(930) bps

Operating metrics

Income from operations as a percentage of revenue

7.4

%

3.8

%

360 bps

Income from operations as a percentage of gross profit

40.3

%

22.7

%

1,760 bps

Adjusted income from operations as a percentage of revenue

7.4

%

4.9

%

250 bps

Adjusted income from operations as a percentage of gross profit

39.9

%

29.0

%

1,090 bps

Revenue mix

New vehicle

52.8

%

51.9

%

Used vehicle retail

28.6

%

28.1

%

Used vehicle wholesale

2.9

%

2.7

%

Parts and service

11.6

%

12.8

%

Finance and insurance

4.1

%

4.5

%

Total revenue

100.0

%

100.0

%

Gross profit mix

New vehicle

22.7

%

14.6

%

Used vehicle retail

13.7

%

12.1

%

Used vehicle wholesale

2.1

%

1.0

%

Parts and service

39.3

%

45.7

%

Finance and insurance

22.2

%

26.6

%

Total gross profit

100.0

%

100.0

%

______________________________

(1)

Front end yield is calculated as gross profit from new vehicles, used retail vehicles and finance and insurance (net), divided by combined new and used retail unit sales.

ASBURY AUTOMOTIVE GROUP, INC.
SAME STORE OPERATING HIGHLIGHTS (In millions)
(Unaudited)

For the Six Months Ended June 30,

Increase

(Decrease)

%

Change

2021

2020

Revenue

New vehicle:

Luxury

$

703.2

$

503.5

$

199.7

40

%

Import

991.5

684.2

307.3

45

%

Domestic

393.6

340.2

53.4

16

%

Total new vehicle

2,088.3

1,527.9

560.4

37

%

Used Vehicle:

Retail

1,115.2

820.4

294.8

36

%

Wholesale

89.6

79.2

10.4

13

%

Total used vehicle

1,204.8

899.6

305.2

34

%

Parts and service

446.7

377.6

69.1

18

%

Finance and insurance, net

178.2

132.9

45.3

34

%

Total revenue

$

3,918.0

$

2,938.0

$

980.0

33

%

Gross profit

New vehicle:

Luxury

$

60.7

$

32.5

$

28.2

87

%

Import

62.0

22.8

39.2

172

%

Domestic

30.6

16.9

13.7

81

%

Total new vehicle

153.3

72.2

81.1

112

%

Used Vehicle:

Retail

101.3

60.8

40.5

67

%

Wholesale

12.8

5.1

7.7

151

%

Total used vehicle

114.1

65.9

48.2

73

%

Parts and service:

Customer pay

161.1

127.6

33.5

26

%

Warranty

38.5

38.7

(0.2

)

(1

)%

Wholesale parts

12.5

9.5

3.0

32

%

Parts and service, excluding reconditioning and preparation

212.1

175.8

36.3

21

%

Reconditioning and preparation

65.1

51.6

13.5

26

%

Total parts and service

277.2

227.4

49.8

22

%

Finance and insurance

178.2

132.9

45.3

34

%

Total gross profit

$

722.8

$

498.4

$

224.4

45

%

SG&A expense

$

427.1

$

334.9

$

92.2

28

%

SG&A expense as a percentage of gross profit

59.1

%

67.2

%

(810) bps

______________________________

Same store amounts consist of information from dealerships for identical months in each comparative period, commencing with the first month we owned the dealership. Additionally, amounts related to divested dealerships are excluded from each comparative period.

ASBURY AUTOMOTIVE GROUP, INC.
SAME STORE OPERATING HIGHLIGHTS (Continued)
(Unaudited)

For the Six Months Ended June 30,

Increase

(Decrease)

%

Change

2021

2020

Unit sales

New vehicle:

Luxury

12,031

9,038

2,993

33

%

Import

31,556

23,565

7,991

34

%

Domestic

8,653

8,094

559

7

%

Total new vehicle

52,240

40,697

11,543

28

%

Used vehicle retail

44,007

37,012

6,995

19

%

Used to new ratio

84.2

%

90.9

%

(670) bps

Average selling price

New vehicle

$

39,975

$

37,543

$

2,432

6

%

Used vehicle retail

25,341

22,166

3,175

14

%

Average gross profit per unit

New vehicle:

Luxury

$

5,045

$

3,596

$

1,449

40

%

Import

1,965

968

997

103

%

Domestic

3,536

2,088

1,448

69

%

Total new vehicle

2,935

1,774

1,161

65

%

Used vehicle retail

2,302

1,643

659

40

%

Finance and insurance, net

1,851

1,710

141

8

%

Front end yield (1)

4,497

3,422

1,075

31

%

Gross margin

New vehicle:

Luxury

8.6

%

6.5

%

210 bps

Import

6.3

%

3.3

%

300 bps

Domestic

7.8

%

5.0

%

280 bps

Total new vehicle

7.3

%

4.7

%

260 bps

Used vehicle retail

9.1

%

7.4

%

170 bps

Parts and service:

Parts and service, excluding reconditioning and preparation

47.5

%

46.6

%

90 bps

Parts and service, including reconditioning and preparation

62.1

%

60.2

%

190 bps

Total gross profit margin

18.4

%

17.0

%

140 bps

______________________________

Same store amounts consist of information from dealerships for identical months in each comparative period, commencing with the first month we owned the dealership. Additionally, amounts related to divested dealerships are excluded from each comparative period.

(1)

Front end yield is calculated as gross profit from new vehicles, used retail vehicles and finance and insurance (net), divided by combined new and used retail unit sales.

ASBURY AUTOMOTIVE GROUP, INC.
Additional Disclosures (In millions)
(Unaudited)

June 30,

2021

December 31,

2020

Increase

(Decrease)

% Change

SELECTED BALANCE SHEET DATA

Cash and cash equivalents

$

102.3

$

1.4

$

100.9

NM

New vehicle inventory (a)

224.2

640.0

(415.8

)

(65

)%

Used vehicle inventory (b)

284.4

188.5

95.9

51

%

Parts inventory (c)

51.6

46.7

4.9

10

%

Total current assets

1,132.5

1,405.7

(273.2

)

(19

)%

Floor plan notes payable (d)

241.5

702.2

(460.7

)

(66

)%

Total current liabilities

759.3

1,223.4

(464.1

)

(38

)%

CAPITALIZATION:

Long-term debt (including current portion) (e)

$

1,378.2

$

1,201.8

$

176.4

15

%

Shareholders' equity

1,148.3

905.5

242.8

27

%

Total

$

2,526.5

$

2,107.3

$

419.2

20

%

______________________________

NMNot Meaningful

(a)

Excluding $1.5 million of new vehicle inventory classified as Assets held for sale as of June 30, 2021

(b)

Excluding $1.1 million of used vehicle inventory classified as Assets held for sale as of June 30, 2021

(c)

Excluding $0.4 million of parts inventory classified as Assets held for sale as of June 30, 2021

(d)

Excluding $1.8 million of Floor plan notes payable classified as Liabilities associated with assets held for sale as of June 30, 2021

(e)

Excluding $2.3 million and $8.9 million of Long-term debt classified as Liabilities associated with assets held for sale as of June 30, 2021 and December 31, 2020, respectively

June 30, 2021

December 31, 2020

June 30, 2020

DAYS SUPPLY

New vehicle inventory

17

40

52

Used vehicle inventory

37

31

26

______________________________

Days supply of inventory is calculated based on new and used inventory levels at the end of each reporting period and a 30-day historical cost of sales.

Brand Mix - New Vehicle Revenue by Brand-

For the Six Months Ended June 30,

2021

2020

Luxury:

Mercedes-Benz

12

%

8

%

Lexus

12

%

6

%

BMW

5

%

6

%

Acura

4

%

4

%

Range Rover

3

%

2

%

Audi

2

%

2

%

Porsche

2

%

%

Other luxury

5

%

5

%

Total luxury

45

%

33

%

Imports:

Honda

16

%

18

%

Toyota

12

%

13

%

Nissan

5

%

6

%

Other imports

6

%

7

%

Total imports

39

%

44

%

Domestic:

Ford

6

%

10

%

Chevrolet

4

%

6

%

Dodge

3

%

4

%

Other domestics

3

%

3

%

Total domestic

16

%

23

%

Total New Vehicle Revenue

100

%

100

%

ASBURY AUTOMOTIVE GROUP INC.

Supplemental Disclosures

(Unaudited)

Non-GAAP Financial Disclosure and Reconciliation

In addition to evaluating the financial condition and results of our operations in accordance with GAAP, from time to time management evaluates and analyzes results and any impact on the Company of strategic decisions and actions relating to, among other things, cost reduction, growth, and profitability improvement initiatives, and other events outside of normal, or "core," business and operations, by considering certain alternative financial measures not prepared in accordance with GAAP. These measures include "Pro forma adjusted leverage ratio," "Adjusted income from operations," "Adjusted net income," " Adjusted operating margins," and "Adjusted diluted earnings per share ("EPS")." Further, management assesses the organic growth of our revenue and gross profit on a same store basis. We believe that our assessment on a same store basis represents an important indicator of comparative financial performance and provides relevant information to assess our performance at our existing locations. Same store amounts consist of information from dealerships for identical months in each comparative period, commencing with the first month we owned the dealership. Additionally, amounts related to divested dealerships are excluded from each comparative period. Non-GAAP measures do not have definitions under GAAP and may be defined differently by and not be comparable to similarly titled measures used by other companies. As a result, any non-GAAP financial measures considered and evaluated by management are reviewed in conjunction with a review of the most directly comparable measures calculated in accordance with GAAP. Management cautions investors not to place undue reliance on such non-GAAP measures, but also to consider them with the most directly comparable GAAP measures. In their evaluation of results from time to time, management excludes items that do not arise directly from core operations, or are otherwise of an unusual or non-recurring nature. Because these non-core, unusual or non-recurring charges and gains materially affect Asbury's financial condition or results in the specific period in which they are recognized, management also evaluates, and makes resource allocation and performance evaluation decisions based on, the related non-GAAP measures excluding such items. In addition to using such non-GAAP measures to evaluate results in a specific period, management believes that such measures may provide more complete and consistent comparisons of operational performance on a period-over-period historical basis and a better indication of expected future trends. Management discloses these non-GAAP measures, and the related reconciliations, because it believes investors use these metrics in evaluating longer-term period-over-period performance, and to allow investors to better understand and evaluate the information used by management to assess operating performance.

The following tables provide reconciliations for our non-GAAP metrics:

For the Twelve Months Ended

June 30, 2021

March 31, 2021

(Dollars in millions)

Adjusted leverage ratio:

Long-term debt (including current portion)

$

1,378.2

$

1,194.1

Debt included in Liabilities held for sale

2.3

2.3

Cash and floor plan offset

(177.3

)

(173.2

)

Availability under our used vehicle revolving floor plan facility

(160.0

)

(138.8

)

Adjusted long-term net debt

$

1,043.2

$

884.4

Calculation of earnings before interest, taxes, depreciation and amortization ("EBITDA"):

Net Income

$

430.1

$

327.6

Depreciation and amortization

39.2

38.8

Income tax expense

138.9

105.9

Swap and other interest expense

56.4

54.2

Earnings before interest, taxes, depreciation and amortization ("EBITDA")

$

664.6

$

526.5

Non-core items - expense (income):

Gain on dealership divestitures

$

(28.6

)

$

(28.6

)

Legal settlements

(3.5

)

(4.7

)

Gain on sale of real estate

(1.9

)

(1.1

)

Park Place related costs

1.3

1.3

Real estate-related charges

2.8

2.5

Total non-core items

(29.9

)

(30.6

)

Adjusted EBITDA

$

634.7

$

495.9

Adjusted net leverage ratio

1.6

1.8

For the Three Months Ended June 30,

2021

2020

2019

(In millions, except per share data)

Adjusted income from operations:

Income from operations

$

218.4

$

82.2

$

85.9

Legal settlements

(1.2

)

Gain on sale of real estate

(0.8

)

(0.3

)

Real estate-related charges

0.3

Adjusted income from operations

$

217.9

$

81.0

$

85.6

Adjusted operating margin:

Adjusted income from operations

$

217.9

$

81.0

$

85.6

Total revenue

2,584.0

1,445.1

1,803.5

Adjusted operating margin

8.4

%

5.6

%

4.7

%

Adjusted net income:

Net income

$

152.1

$

49.6

$

54.9

Non-core items - (income) expense:

Gain on dealership divestiture

(11.7

)

Legal settlements

(1.2

)

Gain on sale of real estate

(0.8

)

(0.3

)

Real estate-related charges

0.3

Income tax effect on non-core items above

0.1

0.3

3.0

Total non-core items

(0.4

)

(0.9

)

(9.0

)

Adjusted net income

$

151.7

$

48.7

$

45.9

Adjusted diluted earnings per share (EPS):

Diluted EPS

$

7.80

$

2.57

$

2.84

Total non-core items

(0.02

)

(0.05

)

(0.46

)

Adjusted diluted EPS

$

7.78

$

2.52

$

2.38

Weighted average common shares outstanding - diluted

19.5

19.3

19.3

For the Six Months Ended June 30,

2021

2020

(In millions, except per share data)

Adjusted income from operations:

Income from operations

$

354.7

$

117.2

Legal settlements

(3.5

)

(2.1

)

Gain on sale of real estate

(1.9

)

(0.3

)

Real estate related charges

2.1

Park Place related costs

11.6

Franchise rights impairment

23.0

Adjusted income from operations

$

351.4

$

149.4

Adjusted net income:

Net income

$

244.9

$

69.1

Non-core items - (income) expense:

Legal settlements

(3.5

)

(2.1

)

Gain on sale of real estate

(1.9

)

(0.3

)

Real estate related charges

2.1

Gain on dealership divestitures

(33.7

)

Loss on extinguishment of debt

20.7

Franchise rights impairment

23.0

Park Place deal termination costs

11.6

Income tax effect on non-core items above

0.8

(4.9

)

Total non-core items

(2.5

)

14.3

Adjusted net income

$

242.4

$

83.4

Adjusted diluted earnings per share (EPS):

Diluted EPS

$

12.56

$

3.58

Total non-core items

(0.13

)

0.74

Adjusted diluted EPS

$

12.43

$

4.32

Weighted average common shares outstanding - diluted

19.5

19.3

View source version on businesswire.com: https://www.businesswire.com/news/home/20210727005283/en/

Contacts

Investors & Reporters May Contact:
Karen Reid
VP & Treasurer
(770) 418-8211
ir@asburyauto.com