AutoNation Inc (AN) Reports Q3 2023 Earnings
AutoNation Inc (NYSE:AN) reported Q3 2023 revenue of $6.9 billion, a 3% increase from $6.7 billion a year ago.
After-Sales gross profit reached a record $546 million, a 14% increase compared to the prior year.
EPS for Q3 2023 was $5.54, compared to $6.31 in Q3 2022.
The company repurchased 1.3 million shares of common stock for an aggregate purchase price of $200 million.
AutoNation Inc (NYSE:AN) released its Q3 2023 earnings on October 27, 2023. The company reported a revenue of $6.9 billion, up from $6.7 billion in the same period last year. This increase was primarily driven by growth in New Vehicle and After-Sales sectors.
Financial Highlights
AutoNation's After-Sales gross profit reached a record $546 million, marking a 14% increase compared to the prior year. However, the company's Earnings Per Share (EPS) for Q3 2023 was $5.54, a decrease from the EPS of $6.31 in Q3 2022. During the quarter, AutoNation repurchased 1.3 million shares of common stock for an aggregate purchase price of $200 million.
During the quarter, we saw double digit year-over-year growth in new vehicle sales and strong sequential growth in used vehicle volume. This resulted in the first year-over-year growth in total unit sales in eight quarters. We also continue to see the significant benefits of the focus in our After-Sales business, which delivered record revenue and gross profit. Overall, AutoNation delivered a solid performance in this evolving operating environment. Additionally, we continued our investments in growth initiatives and deployed capital to create value for our shareholders, said Mike Manley, AutoNations CEO.
Operational Summary
The company's New Vehicle Revenue was $3.2 billion, marking an increase of $324 million or 11%. Used Vehicle Revenue, however, decreased by $230 million or 10% to $2.2 billion. After-Sales Revenue saw an increase of $125 million or 12%, reaching $1.2 billion.
AutoNation's gross profit totaled $1.29 billion, down $18 million from $1.31 billion a year ago. The company's SG&A as a percentage of gross profit was 63.3%, significantly lower than pre-pandemic levels.
Capital Allocation, Liquidity, and Leverage
During the quarter, cash from operating activities totaled $256 million, capital expenditures were $87 million, and AutoNation repurchased 1.3 million shares of common stock for an aggregate purchase price of $200 million. As of October 25, 2023, AutoNation has approximately $439 million remaining under its current Board authorization for share repurchase.
As of September 30, 2023, AutoNation had $1.6 billion of liquidity, including $64 million in cash and approximately $1.55 billion of availability under its revolving credit facility. The company's covenant leverage ratio was 2.0x at quarter end.
For more detailed financial information, please refer to the full earnings report on the AutoNation Inc (NYSE:AN) website.
Explore the complete 8-K earnings release (here) from AutoNation Inc for further details.
This article first appeared on GuruFocus.
