MEDFORD, Ore.--(BUSINESS WIRE)--Oct. 25, 2007--Lithia Motors, Inc. (NYSE:LAD) today announced that third quarter 2007 sales increased 3% to $859.7 million as compared to $834.4 million in the same period last year. New vehicle sales increased 1.4%, used vehicle sales increased 2.4%, finance/insurance sales increased 0.2%, and parts/service sales increased 14.7%.
Third quarter 2007 income from continuing operations was $11.3 million as compared to $10.7 million in the third quarter of 2006. Diluted earnings per share from continuing operations were $0.53 as compared to $0.51 in the third quarter of 2006.
Sid DeBoer, Lithia's Chairman and CEO, commented, "In spite of the current headwinds we face in today's retail environment, Lithia has been successful in adapting to these conditions while still pursuing our new business initiatives. We continue to redesign operations to not only weather the current economic situation, but prevail in the sector as an innovator."
"Third quarter sales were steadied by strong parts and service sales and revenues from acquisitions made in the past 12 months. Third quarter total same-store sales declined 5.6%. We believe that we are still seeing a challenging retail environment for automotive sales in our markets that will continue for the rest of this year and well into 2008. This is related to the ripple effects from the struggling housing market, high gas prices and consumer debt pressures. In response to these challenges, we are successfully reducing employee headcount in the stores. Our advertising expenses are down by almost 12% on a same-store basis. Our vehicle inventory levels are being carefully managed, and we have held our new and used vehicle margins steady," concluded Sid DeBoer.
For the nine month period ending September 30, 2007, total sales increased 7.6% to $2.5 billion as compared to $2.3 billion in the same period last year. New vehicle sales increased 6.4%, used vehicle sales increased 6.6%, finance/insurance sales increased 5.5%, and parts/service sales increased 18%.
For the first nine months, Lithia's net income from continuing operations was $29.2 million as compared to $33.6 million in 2006. Diluted earnings per share from continuing operations were $1.38 as compared to $1.58 in the first nine months of 2006.
Jeff DeBoer, Senior Vice President and CFO, added, "We have provided fourth quarter EPS guidance and have narrowed the range on our full year 2007 guidance as shown below. For the full year and first quarter of 2008, we have projected the guidance which is also shown below. These projections call for a continuation of difficult economic conditions through 2008, but we expect that our efficiency initiatives and our Assured Selling Program will successfully grow our EPS."
"Our guidance is based on income from continuing operations and assumes a steady pace of acquisitions, dispositions, and fifteen to twenty cents of development costs associated with L2," concluded Jeff DeBoer.
Earnings per Share
From Continuing Operations:
Guidance Guidance Guidance Guidance
Q4 2007 FY 2007 Q1 2008 FY 2008
----------------------------------------------------------------------
$0.26 - $0.31 $1.65 - $1.70 $0.25 - $0.30 $1.75 - $1.95
Conference Call Information
Lithia Motors will be providing more detailed information on the results for the third quarter 2007 in its conference call scheduled for today at 2 p.m. PDT and 5 p.m. EDT. The call can be accessed live by calling 973-582-2717; Conference ID #: 9348443. To listen LIVE on our website or for REPLAY: Log-on to www.Lithia.com - Go to Investor Relations - and click on the Conference Call Icon.
About Lithia
Lithia Motors, Inc. is a Fortune 700 and Russell 2000 Company. Lithia sells 30 brands of new and all brands of used vehicles at 109 stores which are located in 46 markets within 15 states. Internet sales are centralized at www.Lithia.com, or through the recently launched www.L2.com. Lithia also sells used vehicles; arranges finance, warranty, and credit insurance contracts; and provides vehicle parts, maintenance, and repair services at all of its locations. Lithia retailed 109,648 new and used vehicles and had $3.17 billion in total revenue in 2006.
Forward-Looking Statements
This press release includes forward-looking statements within the meaning of the "Safe-Harbor" provisions of the Private Securities Litigation Reform Act of 1995, which management believes are a benefit to shareholders. These statements are necessarily subject to risk and uncertainty and actual results could differ materially due to certain risk factors including, without limitation, economic conditions, acquisition risk factors and others set forth from time to time in the company's filings with the SEC. Specific risks in this press release include the accuracy of the company's comments and predictions related to the retail sales environment and its ability to successfully adjust to those conditions and achieve the earnings per share projected.
Additional Information
For additional information on Lithia Motors, contact the Investor Relations Department: 541-618-5770 or log on to: www.lithia.com - go to Investor Relations.
LITHIA MOTORS, INC.
(In Thousands except per share data)
Three Months Ended %
September 30, Increase Increase
-------------------
2007 2006 (Decrease) (Decrease)
--------- --------- ---------- ----------
New vehicle sales $494,882 $488,113 $ 6,769 1.4 %
Used vehicle sales 231,868 226,468 5,400 2.4
Finance and insurance 32,701 32,644 57 0.2
Service, body and parts 97,913 85,360 12,553 14.7
Fleet and other revenues 2,343 1,832 511 27.9
--------- --------- ---------- ---------
Total revenues 859,707 834,417 25,290 3.0
--------- --------- ---------- ---------
Cost of sales 715,016 695,657 19,359 2.8
--------- --------- ---------- ---------
Gross Profit 144,691 138,760 5,931 4.3
SG&A expense 107,387 102,225 5,162 5.0
Depreciation and
amortization 5,289 4,204 1,085 25.8
--------- --------- ---------- ---------
Income from operations 32,015 32,331 (316) (1.0)
Floorplan interest expense (8,236) (12,358) (4,122) (33.4)
Other interest expense (4,900) (3,482) 1,418 40.7
Other income, net 144 128 16 12.5
--------- --------- ---------- ---------
Income from continuing
operations before income
taxes 19,023 16,619 2,404 14.5
Income tax expense 7,713 5,933 1,780 30.0
Income Tax Rate 40.5% 35.7%
--------- --------- ---------- ---------
Income from continuing
operations 11,310 10,686 624 5.8 %
Discontinued Operations:
Loss from operations (336) (170) 166 97.6
Gain (Loss) from sale 263 - 263
--------- --------- ---------- ---------
Net income $ 11,237 $ 10,516 721 6.9 %
========= ========= ========== =========
Diluted net income per
share:
Continuing Operations $ 0.53 $ 0.51 $ 0.02 3.9
Discontinued Operations:
Loss from operations, net
of income tax (0.01) (0.01)
Gain from sale, net of
income tax 0.01 -
--------- --------- ---------- ---------
Net income per share $ 0.53 $ 0.50 $ 0.03 6.0
========= ========= ========== =========
Diluted shares outstanding 22,058 22,128 (70) (0.3)%
========= ========= ========== =========
LITHIA MOTORS, INC.
(Continuing Operations)
Three Months Ended %
September 30, Increase Increase
------------------
2007 2006 (Decrease) (Decrease)
---------- ------- ---------- ----------
Unit Sales:
-----------------------------
New Vehicle 16,884 17,860 (976) (5.5)%
Used - Retail Vehicle 10,928 11,395 (467) (4.1)
Used - Wholesale 7,364 7,218 146 2.0
Total Units Sold 35,176 36,473 (1,297) (3.6)
Average Selling Price:
-----------------------------
New Vehicle $29,311 $27,330 $ 1,981 7.2 %
Used - Retail Vehicle 16,867 16,110 $ 757 4.7
Used - Wholesale 6,457 5,943 $ 514 8.6
Key Financial Data:
-----------------------------
Gross Profit Margin 16.8% 16.6% 20 bps
SG&A as a % of Gross Profit 74.2% 73.7% 50 bps
Operating Margin 3.7% 3.9% -20 bps
Pre-Tax Margin 2.2% 2.0% 20 bps
Gross Margin/Profit Data
-----------------------------
New Vehicle Retail 7.6% 7.6% 0 bps
Used Vehicle Retail 14.9% 14.4% 50 bps
Used Vehicle Wholesale 0.5% 1.1% -60 bps
Service, Body & Parts 47.3% 48.6% -130 bps
Finance & Insurance 100.0% 100.0% 0 bps
New Retail Gross Profit/Unit $ 2,237 $ 2,088 $ 149
Used Retail Gross Profit/Unit $ 2,505 $ 2,325 $ 180
Used Wholesale Gross
Profit/Unit $ 33 $ 66 -$33
Finance & Insurance/Retail
Unit $ 1,176 $ 1,116 $ 60
Revenue Mix:
-----------------------------
New Vehicles 57.6% 58.5%
Used Retail Vehicles 21.4% 22.0%
Used Wholesale Vehicles 5.5% 5.2%
Finance and Insurance, Net 3.8% 3.9%
Service and Parts 11.4% 10.2%
Fleet and other 0.3% 0.2%
New Vehicle Unit Sales Brand
Mix:
-----------------------------
Chrysler Brands 40.0% 40.3%
General Motors & Saturn 16.9% 17.6%
Toyota 13.1% 12.9%
Honda 6.8% 5.3%
Ford 5.5% 7.8%
Hyundai 4.1% 4.3%
Nissan 3.5% 3.2%
BMW 3.4% 1.6%
Subaru 2.1% 3.2%
Volkswagen, Audi 2.0% 1.8%
Mercedes 1.0% 0.5%
Other 1.6% 1.5%
LITHIA MOTORS, INC.
(Selected Same Store Data)
Three Months Ended %
September 30, Increase Increase
------------------
2007 2006 (Decrease) (Decrease)
--------- -------- ---------- ----------
Same Store Unit Sales:
-----------------------------
New Vehicle 15,801 17,882 (2,081) (11.6)%
Used - Retail Vehicle 10,093 11,410 (1,317) (11.5)
Used - Wholesale 6,822 7,226 (404) (5.6)
Total Units Sold 32,716 36,518 (3,802) (10.4)
Same Store Average Selling
Price:
-----------------------------
New Vehicle $28,899 $27,330 $ 1,569 5.7 %
Used - Retail Vehicle 16,637 16,110 527 3.3
Used - Wholesale 6,396 5,943 453 7.6
Same Store Revenue:
-----------------------------
New Vehicle Retail Sales (6.6)% (4.8)%
Used Vehicle Retail Sales (8.6)% (2.4)%
Used Wholesale Sales 1.6 % 12.3 %
Total Vehicle Sales
(excluding Fleet) (6.6)% (3.3)%
Finance & Insurance Sales (5.9)% (2.0)%
Service, Body and Parts Sales 3.3 % 4.3 %
Total Sales (excluding Fleet) (5.6)% (2.6)%
Total Gross Profit (excluding
Fleet) (4.4)% (3.0)%
Same Store Average Gross
Profit Data:
-----------------------------
New Retail Gross Profit/Unit $ 2,198 $ 2,087 $ 111
Used Retail Gross Profit/Unit $ 2,475 $ 2,286 $ 189
Used Wholesale Gross
Profit/Unit $ 37 $ 66 $ (29)
Same Store Total Sales
Geographic Mix:
-----------------------------
Texas 23.2 % 18.9 %
Oregon 15.2 % 17.1 %
California 11.9 % 13.8 %
Washington 11.1 % 11.2 %
Montana 7.2 % 6.0 %
Alaska 7.1 % 7.6 %
Colorado 6.7 % 6.9 %
Idaho 6.4 % 7.1 %
Nevada 3.9 % 5.0 %
Nebraska 2.7 % 2.5 %
South Dakota 2.4 % 1.9 %
New Mexico 1.3 % 1.2 %
Wisconsin 0.6 % 0.5 %
LITHIA MOTORS, INC.
(In Thousands except per share data)
Nine Months Ended %
September 30, Increase Increase
-----------------------
2007 2006 (Decrease) (Decrease)
----------- ----------- ---------- ----------
New vehicle sales $1,447,623 $1,360,912 $ 86,711 6.4 %
Used vehicle sales 683,838 641,737 42,101 6.6
Finance and insurance 95,488 90,549 4,939 5.5
Service, body and parts 288,020 244,045 43,975 18.0
Fleet and other revenues 4,339 3,781 558 14.8
----------- ----------- ---------- ---------
Total revenues 2,519,308 2,341,024 178,284 7.6
----------- ----------- ---------- ---------
Cost of sales 2,090,893 1,943,164 147,729 7.6
----------- ----------- ---------- ---------
Gross Profit 428,415 397,860 30,555 7.7
SG&A expense 326,500 296,241 30,259 10.2
Depreciation and
amortization 15,149 12,052 3,097 25.7
----------- ----------- ---------- ---------
Income from operations 86,766 89,567 (2,801) (3.1)
Floorplan interest
expense (24,070) (25,219) (1,149) (4.6)
Other interest expense (14,567) (9,817) 4,750 48.4
Other income, net 469 765 (296) (38.7)
----------- ----------- ---------- ---------
Income from continuing
operations before
income taxes 48,598 55,296 (6,698) (12.1)
Income tax expense 19,411 21,670 (2,259) (10.4)
Income Tax Rate 39.9% 39.2%
----------- ----------- ---------- ---------
Income from continuing
operations 29,187 33,626 (4,439) (13.2)%
Discontinued Operations:
Loss from operations,
net of income tax (714) (1,851) (1,137) (61.4)
Loss from sale, net of
income tax (2,218) - 2,218
----------- ----------- ---------- ---------
Net income $ 26,255 $ 31,775 (5,520) (17.4)%
=========== =========== ========== =========
Diluted net income per
share:
Continuing Operations $ 1.38 $ 1.58 $ (0.20) (12.7)%
Discontinued Operations:
Loss from operations (0.03) (0.08)
Gain (Loss) from sale (0.10) -
----------- ----------- ---------- ---------
Net income per share $ 1.25 $ 1.50 $ (0.25) (16.7)
=========== =========== ========== =========
Diluted shares
outstanding 22,102 22,120 (18) (0.1)%
=========== =========== ========== =========
LITHIA MOTORS, INC.
(Continuing Operations)
Nine Months Ended %
September 30, Increase Increase
------------------
2007 2006 (Decrease) (Decrease)
-------- -------- ---------- ----------
Unit Sales:
----------------------------
New Vehicle 50,049 49,658 391 0.8%
Used - Retail Vehicle 33,375 32,939 436 1.3
Used - Wholesale 20,051 18,392 1,659 9.0
Total Units Sold 103,475 100,989 2,486 2.5
Average Selling Price:
----------------------------
New Vehicle $ 28,924 $ 27,406 $1,518 5.5%
Used - Retail Vehicle 16,591 16,102 $ 489 3.0
Used - Wholesale 6,490 6,054 $ 436 7.2
Key Financial Data:
----------------------------
Gross Profit Margin 17.0% 17.0% 0 bps
SG&A as a % of Gross Profit 76.2% 74.5% 170 bps
Operating Margin 3.4% 3.8% -40 bps
Pre-Tax Margin 1.9% 2.4% -50 bps
Gross Margin/Profit Data
----------------------------
New Vehicle Retail 7.5% 7.6% -10 bps
Used Vehicle Retail 15.0% 15.2% -20 bps
Used Vehicle Wholesale 2.3% 2.9% -60 bps
Service, Body & Parts 47.6% 48.6% -100 bps
Finance & Insurance 100.0% 100.0% 0 bps
New Retail Gross Profit/Unit $ 2,174 $ 2,087 $ 87
Used Retail Gross
Profit/Unit $ 2,481 $ 2,451 $ 30
Used Wholesale Gross
Profit/Unit $ 151 $ 174 -$23
Finance & Insurance/Retail
Unit $ 1,145 $ 1,096 $ 49
Revenue Mix:
----------------------------
New Vehicles 57.5% 58.1%
Used Retail Vehicles 22.0% 22.7%
Used Wholesale Vehicles 5.1% 4.7%
Finance and Insurance, Net 3.8% 3.9%
Service and Parts 11.4% 10.4%
Fleet and other 0.2% 0.2%
New Vehicle Unit Sales Brand
Mix:
----------------------------
Chrysler Brands 40.0% 40.8%
General Motors & Saturn 16.4% 16.8%
Toyota 13.4% 12.6%
Honda 6.5% 5.4%
Ford 5.9% 7.6%
Hyundai 3.8% 4.4%
BMW 3.7% 2.1%
Nissan 3.5% 3.5%
Subaru 2.1% 3.0%
Volkswagen, Audi 2.0% 1.7%
Mercedes 1.1% 0.6%
Other 1.5% 1.5%
LITHIA MOTORS, INC.
(Selected Same Store Data)
Nine Months Ended %
September 30, Increase Increase
-------------------
2007 2006 (Decrease) (Decrease)
-------- --------- ----------- ------------
Same Store Unit Sales:
------------------------
New Vehicle 45,631 49,558 (3,927) (7.9) %
Used - Retail Vehicle 30,476 32,923 (2,447) (7.4)
Used - Wholesale 18,310 18,399 (89) (0.5)
Total Units Sold 94,417 100,880 (6,463) (6.4)
Same Store Average
Selling Price:
------------------------
New Vehicle $28,477 $ 27,403 $ 1,074 3.9 %
Used - Retail Vehicle 16,377 16,102 275 1.7
Used - Wholesale 6,479 6,052 427 7.0
Same Store Revenue:
------------------------
New Vehicle Retail Sales (4.3)% 4.4 %
Used Vehicle Retail
Sales (5.8)% 3.3 %
Used Wholesale Sales 6.5 % 8.3 %
Total Vehicle Sales
(excluding Fleet) (4.1)% 4.3 %
Finance & Insurance
Sales (1.7)% 5.9 %
Service, Body and Parts
Sales 4.5 % 5.8 %
Total Sales (excluding
Fleet) (3.1)% 4.5 %
Total Gross Profit
(excluding Fleet) (2.9)% 3.1 %
Same Store Average Gross
Profit Data:
------------------------
New Retail Gross
Profit/Unit $ 2,140 $ 2,087 $ 53
Used Retail Gross
Profit/Unit $ 2,439 $ 2,417 $ 22
Used Wholesale Gross
Profit/Unit $ 147 $ 181 $ (34)
Same Store Total Sales
Geographic Mix:
------------------------
Texas 21.8 % 18.4 %
Oregon 16.1 % 17.7 %
California 12.0 % 13.6 %
Washington 11.6 % 11.4 %
Montana 6.9 % 6.1 %
Alaska 7.2 % 7.4 %
Colorado 7.0 % 7.3 %
Idaho 6.2 % 6.6 %
Nevada 4.4 % 5.1 %
Nebraska 2.9 % 3.0 %
South Dakota 2.4 % 2.1 %
New Mexico 1.3 % 1.1 %
Wisconsin 0.2 % 0.2 %
Balance Sheet Highlights (Dollars in Thousands)
September 31, 2007 December 31, 2006
------------------ -----------------
Cash & Cash Equivalents $ 15,749 $ 26,600
Trade Receivables(a) 112,508 118,528
Inventory 559,267 603,306
Assets held for sale 23,825 15,485
Other Current Assets 16,644 15,721
------------------ -----------------
Total Current Assets 727,993 779,640
Real Estate, net 348,413 327,890
Equipment & Leases, net 96,709 89,213
Goodwill, net 311,467 307,424
Other Assets 76,946 75,190
------------------ -----------------
Total Assets $1,561,528 $1,579,357
================== =================
Flooring Notes Payable $ 437,607 $ 499,679
Liabilities held for sale 18,373 11,610
Other Current Liabilities 115,391 118,650
------------------ -----------------
Total Current Liabilities 571,371 629,939
Used Vehicle Flooring 109,160 95,614
Real Estate Debt 171,789 155,890
Other Long-Term Debt 120,022 140,879
Other Liabilities 74,177 63,642
------------------ -----------------
Total Liabilities $1,046,519 $1,085,964
================== =================
Shareholders' Equity 515,009 493,393
------------------ -----------------
Total Liabilities & Shareholders'
Equity $1,561,528 $1,579,357
================== =================
(a) Note: Includes contracts-in-transit of $48,593 and $56,211 for
2007 and 2006
Other Balance Sheet Data (Dollars in Thousands)
Current Ratio 1.3x 1.2x
LT Debt/Total Cap.
(Excludes Real Estate) 31% 32%
Working Capital $ 156,622 $ 149,701
Book Value per Basic Share 26.40 25.32
CONTACT: Lithia Motors, Inc.
Investor Relations, 541-618-5770
www.lithia.com
SOURCE: Lithia Motors, Inc.
|