Sonic Automotive, Inc. Reports Quarterly Adjusted Continuing Operations Earnings per Share of $0.46

All-Time Record Gross Profit and Achieved 100 Pre-Owned Retail Unit Sales per Store per Month

News provided by

Sonic Automotive, Inc.

Jul 20, 2015, 07:30 ET

CHARLOTTE, N.C., July 20, 2015 /PRNewswire/ --

Second Quarter 2015 Results

  • Record Q2 total gross profit of $355.6  million, up 2.5% over the prior year quarter
  • Achieved milestone of retailing 100 pre-owned units per store per month for the quarter on a same store basis
  • All-time record quarterly pre-owned retail sales of 30,301 units, up 6.3% over the prior year quarter
  • All-time record quarterly fixed operations gross profit of $170.2 million, up 6.5% over the prior year quarter
  • Echo Park® stores retail 881 units, up 221 units, or 33.5%, from the prior quarter

Sonic Automotive, Inc. (NYSE: SAH), one of the nation's largest automotive retailers, today reported adjusted net income from continuing operations for the second quarter of 2015 of $23.4 million, or $0.46 per diluted share.  Included in these adjusted amounts are pre-tax expenses of $4.1 million, or $0.05 per diluted share, related to EchoPark® operations.

Adjusted net income from continuing operations for the second quarter of 2014 was $23.5 million, or $0.44 per diluted share. Included in these adjusted amounts are pre-tax expenses of $3.2 million, or $0.04 per diluted share, related to EchoPark® operations.

On a GAAP basis, net income from continuing operations and related diluted earnings per share for the second quarter of 2015 were $15.1 million and $0.30 per share, respectively, and net income from continuing operations and related diluted earnings per share for the second quarter of 2014 were $27.1 million and $0.51 per share, respectively.  See the accompanying tables for a reconciliation of the adjusted balances to GAAP basis amounts and further details of the quarterly adjustments.

B. Scott Smith, Sonic's President, noted, "I'm proud of our operations team for achieving the lofty goal of retailing 100 pre-owned vehicles per store per month.  We have had quarters in the past when we approached achieving this metric and several months where we surpassed this metric, but it had never been achieved on a quarterly basis.  Generating this type of retail activity fuels our fixed operations and F&I areas where we are most profitable."

"We also worked to build our fixed operations business in the quarter.  In addition to the benefits we experienced through the reconditioning work performed to achieve the sale of 100 pre-owned vehicles per store per month, we were able to grow overall same store fixed operations gross profit $13.1 million, or 8.5%, compared to the prior year quarter.  Fixed operations growth was achieved in our customer pay, warranty and internal categories.  This type of internal growth strategy is central to our One Sonic-One Experience (OSOE) initiative which is intended to grow the top-line revenue categories, generate retail activity, and realize benefits over multiple gross profit streams."

Jeff Dyke, Sonic's EVP of Operations, stated, "We had another very busy quarter at Sonic Automotive.  From a franchise store perspective, we executed our playbook and delivered another solid operating performance allowing our team to leverage this performance while we build on our OSOE strategy and our EchoPark® business model.  I am very excited about our pre-owned volume and the continued focus and execution from our team as they achieved 100 units per store per month for the quarter.  Our focus on our fixed operations business, and in particular our customer pay business, is beginning to pay off and the result showed in the quarter.  Warranty business was also robust."

"Our OSOE strategy continues to make progress.  The associated technology's performance is working very well and as a result, we have decided to move ahead with the rollout of several of its technology applications that will benefit our guests and associates.  Our proprietary CRM, desking and appraisal tools will be added to our stores over the next year and a half in the first wave of three planned waves that will ultimately result in the complete rollout of OSOE.  We will roll out our F&I and pricing tools as part of the OSOE strategy once we are comfortable with our performance in the Charlotte test market."

"EchoPark® made great strides again this quarter as we ramped up and executed our business plan.  We are meeting our goals and have started the acquisition of properties for our next market. We plan to begin construction in this next market before the end of this year.  We also plan on adding an additional five locations to our Denver market over the next twelve months.  Our associates have created a culture in the stores which allows them to offer our customers an easy, transparent shopping experience and, as a result, our guest feedback is overwhelmingly positive. We expect our initial neighborhood locations in Denver will become cash flow positive prior to the end of this year and we have developed a next generation neighborhood store that further improves our guest experience and operational efficiency."

Second Quarter 2015 Earnings Conference Call

Senior management will host a conference call today at 10:00 A.M. (Eastern) to discuss the quarter's results. To access the live broadcast of the call over the Internet go to: www.sonicautomotive.com, then click on "Our Company," then "Investor Relations," then "Webcasts & Presentations."

Presentation materials for the conference call can be accessed on the Company's website at www.sonicautomotive.com by clicking on the "Investor Relations" tab under "Our Company" and choosing "Webcasts & Presentations."

The conference call will also be available live by dialing in 10 minutes prior to the start of the call at:

Domestic: 1.877.450.3867
International: 1.706.643.0958
Conference ID: 76953618

A conference call replay will be available one hour following the call for seven days and can be accessed by calling:

Domestic: 1.855.859.2056
International: 1.404.537.3406
Conference ID: 76953618

About Sonic Automotive

Sonic Automotive, Inc., a Fortune 500 company based in Charlotte, N.C., is one of the nation's largest automotive retailers. Sonic can be reached on the web at www.sonicautomotive.com.

Included herein are forward-looking statements, including statements with respect to anticipated future success and impacts from the implementation of our planned customer experience and stand-alone pre-owned store initiatives. There are many factors that affect management's views about future events and trends of the Company's business. These factors involve risk and uncertainties that could cause actual results or trends to differ materially from management's view, including without limitation, economic conditions in the markets in which we operate, new and used vehicle industry sales volume, the success of our operational strategies, the rate and timing of overall economic recovery or decline, and the risk factors described in the Company's annual report on Form 10-K for the year ending December 31, 2014. The Company does not undertake any obligation to update forward-looking information.

Sonic Automotive, Inc.

Results of Operations (Unaudited)

This release contains certain non-GAAP financial measures as defined under SEC rules, such as, but not limited to, adjusted income from continuing operations and related earnings per share data.  The Company has reconciled these measures to the most directly comparable GAAP measures in the release.  The Company believes that these non-GAAP financial measures improve the transparency of the Company's disclosure by providing period-to-period comparability of the Company's results from operations.














Three Months Ended June 30,

Six Months Ended June 30,



2015

2014

2015

2014



(In thousands, except per share and unit data)

Revenues:









New retail vehicles

$               1,285,632

$               1,283,231

$          2,475,847

$          2,395,521

Fleet vehicles

9,656

15,546

21,763

49,876

  Total new vehicles

1,295,288

1,298,777

2,497,610

2,445,397

Used vehicles

658,794

603,868

1,252,536

1,163,684

Wholesale vehicles

41,131

44,765

82,789

86,363

  Total vehicles

1,995,213

1,947,410

3,832,935

3,695,444

Parts, service and collision repair

346,164

329,134

669,358

647,905

Finance, insurance and other, net

82,363

76,736

156,963

146,317

  Total revenues

2,423,740

2,353,280

4,659,256

4,489,666

Gross profit

355,554

346,947

690,513

675,947

Selling, general and administrative expenses

(284,661)

(268,914)

(555,523)

(532,887)

Impairment charges

(10,469)

(4)

(16,661)

(7)

Depreciation and amortization

(17,294)

(14,431)

(33,703)

(28,812)

Operating income (loss)

43,130

63,598

84,626

114,241

Other income (expense):








Interest expense, floor plan

(5,345)

(4,846)

(10,123)

(9,535)

Interest expense, other, net

(13,054)

(13,865)

(26,274)

(27,683)

Other income (expense), net

10

3

100

100

  Total other income (expense)

(18,389)

(18,708)

(36,297)

(37,118)

Income (loss) from continuing operations before taxes

24,741

44,890

48,329

77,123

Provision for income taxes for continuing operations- benefit (expense)

(9,649)

(17,829)

(18,848)

(30,078)

Income (loss) from continuing operations

15,092

27,061

29,481

47,045

Income (loss) from discontinued operations

(311)

(68)

(732)

(666)

Net income (loss)

$                    14,781

$                    26,993

$               28,749

$               46,379











Diluted earnings (loss) per common share:








Earnings (loss) per share from continuing operations

$                        0.30

$                        0.51

$                   0.57

$                   0.89

Earnings (loss) per share from discontinued operations

(0.01)

-

(0.01)

(0.02)

Earnings (loss) per common share

$                        0.29

$                        0.51

$                   0.56

$                   0.87

Weighted average common shares outstanding

51,093

52,930

51,247

52,938











Gross Margin Data (Continuing Operations):








New retail vehicles


5.1%

5.8%

5.2%

5.8%

Fleet vehicles

(0.1%)

2.3%

(0.3%)

2.5%

  Total new vehicles


5.0%

5.7%

5.1%

5.8%

Used vehicles


6.2%

6.2%

6.5%

6.7%

Wholesale vehicles

(6.5%)

(2.9%)

(3.5%)

(1.6%)

Parts, service and collision repair


49.2%

48.6%

48.8%

48.2%

Finance, insurance and other 


100.0%

100.0%

100.0%

100.0%

  Overall gross margin 


14.7%

14.7%

14.8%

15.1%











SG&A Expenses (Continuing Operations):








Compensation


$                  167,811

$                  163,109

$             329,669

$             320,263

Advertising


15,358

13,864

30,689

27,982

Rent 


18,246

18,643

36,500

37,178

Other


83,246

73,298

158,665

147,464

  Total SG&A expenses


$                  284,661

$                  268,914

$             555,523

$             532,887

SG&A expenses as % of gross profit


80.1%

77.5%

80.5%

78.8%











Operating Margin % 


1.8%

2.7%

1.8%

2.5%











Unit Data (Continuing Operations):








New retail units 


34,676

34,847

66,010

64,876

Fleet units


287

558

642

1,660

  Total new units 


34,963

35,405

66,652

66,536

Used units 


30,301

28,514

58,436

56,171

Wholesale units 


8,010

7,738

15,787

15,118











Sonic Automotive, Inc.

Results of Operations (Unaudited)

















Per Share Data
































Three Months Ended June 30, 2015



Income (Loss)

Income (Loss)








From Continuing

From Discontinued








Operations

Average

Net Income (Loss)

Weighted


Per


Per


Per

Average


Share


Share


Share

Shares

Amount

Amount

Amount

Amount

Amount

Amount

(In thousands, except per share amounts)

Reported:














Earnings (loss) and shares

50,784

$     15,092


$       (311)


$     14,781


Effect of participating securities:














  Non-vested restricted stock














 and stock units


(7)


-


(7)


Basic earnings (loss) and shares

50,784

$     15,085

$       0.30

$       (311)

$      (0.01)

$     14,774

$       0.29

Effect of dilutive securities:














  Stock compensation plans

309












Diluted earnings (loss) and shares

51,093

$     15,085

$       0.30

$       (311)

$      (0.01)

$     14,774

$       0.29















Adjustments (net of tax):














Gain on disposal


$         (645)

$      (0.01)

$             -

$           -

$         (645)

$      (0.01)

Impairment charges


6,386

0.12

-

-

6,386

0.12

Storm damage and other


2,555

0.05

-

-

2,555

0.05

  Total adjustments


$       8,296

$       0.16

$             -

$           -

$       8,296

$       0.16















Adjusted:














Earnings (loss) and 














  Diluted earnings (loss) per share (1)


$     23,388

$       0.46

$       (311)

$      (0.01)

$     23,077

$       0.45















(1) Expenses attributable to EchoPark® operations were $0.05 per fully diluted share in the three months ended June 30, 2015. 



































Three Months Ended June 30, 2014



Income (Loss)

Income (Loss)








From Continuing

From Discontinued








Operations

Operations

Net Income (Loss)

Weighted


Per


Per


Per

Average


Share


Share


Share

Shares

Amount

Amount

Amount

Amount

Amount

Amount

(In thousands, except per share amounts)

Reported:














Earnings (loss) and shares

52,514

$     27,061


$         (68)


$     26,993


Effect of participating securities:














  Non-vested restricted stock














 and stock units


(87)


-


(87)


Basic earnings (loss) and shares


52,514

$     26,974

$       0.51

$         (68)

$           -

$     26,906

$       0.51

Effect of dilutive securities:














  Stock compensation plans


416












Diluted earnings (loss) and shares

52,930

$     26,974

$       0.51

$         (68)

$           -

$     26,906

$       0.51















Adjustments (net of tax):














Gain on disposal


$      (4,446)

$      (0.08)

$             -

$           -

$      (4,446)

$      (0.08)

Storm damage and other


840

0.01

-

-

840

0.01

  Total adjustments


$      (3,606)

$      (0.07)

$             -

$           -

$      (3,606)

$      (0.07)















Adjusted:














Earnings (loss) and 














  Diluted earnings (loss) per share (2)


$     23,455

$       0.44

$         (68)

$           -

$     23,387

$       0.44















(2) Expenses attributable to EchoPark® operations were $0.04 per fully diluted share in the three months ended June 30, 2014. 


















































Sonic Automotive, Inc.

Results of Operations (Unaudited)















Per Share Data
































Six Months Ended June 30, 2015



Income (Loss)

Income (Loss)








From Continuing

From Discontinued








Operations

Operations

Net Income (Loss)

Weighted


Per


Per


Per

Average


Share


Share


Share

Shares

Amount

Amount

Amount

Amount

Amount

Amount

(In thousands, except per share amounts)

Reported:














Earnings (loss) and shares


50,819

$     29,481


$       (732)


$     28,749


Effect of participating securities:














  Non-vested restricted stock














 and stock units




(14)


-


(14)


Basic earnings (loss) and shares

50,819

$     29,467

$       0.58

$       (732)

$      (0.01)

$     28,735

$       0.57

Effect of dilutive securities:














  Stock compensation plans


428












Diluted earnings (loss) and shares

51,247

$     29,467

$       0.57

$       (732)

$      (0.01)

$     28,735

$       0.56















Adjustments (net of tax):














Gain on disposal


$         (583)

$      (0.01)

$             -

$           -

$         (583)

$      (0.01)

Impairment charges


10,166

0.20

-

-

10,166

0.20

Storm damage and other


3,132

0.06

-

-

3,132

0.06

  Total adjustments


$     12,715

$       0.25

$             -

$           -

$     12,715

$       0.25















Adjusted:














Earnings (loss) and 














  Diluted earnings (loss) per share (3)


$     42,196

$       0.82

$       (732)

$      (0.01)

$     41,464

$       0.81















(3) Expenses attributable to EchoPark® operations were $0.11 per fully diluted share in the six months ended June 30, 2015. 



































Six Months Ended June 30, 2014



Income (Loss)

Income (Loss)








From Continuing

From Discontinued








Operations

Operations

Net Income (Loss)

Weighted


Per


Per


Per

Average


Share


Share


Share

Shares

Amount

Amount

Amount

Amount

Amount

Amount

(In thousands, except per share amounts)

Reported:














Earnings (loss) and shares


52,466

$     47,045


$       (666)


$     46,379


Effect of participating securities:














  Non-vested restricted stock














 and stock units




(151)


-


(151)


Basic earnings (loss) and shares

52,466

$     46,894

$       0.89

$       (666)

$      (0.01)

$     46,228

$       0.88

Effect of dilutive securities:














  Stock compensation plans

472












Diluted earnings (loss) and shares

52,938

$     46,894

$       0.89

$       (666)

$      (0.02)

$     46,228

$       0.87















Adjustments (net of tax):














Gain on disposal


$      (4,446)

$      (0.08)

$             -

$           -

$      (4,446)

$      (0.08)

Storm damage and other


840

0.01

-

-

840

0.01

Effect of two-class method & rounding


-

-

-

0.01

-

0.01

  Total adjustments


$      (3,606)

$      (0.07)

$             -

$       0.01

$      (3,606)

$      (0.06)















Adjusted:














Earnings (loss) and 














  Diluted earnings (loss) per share (4)


$     43,439

$       0.82

$       (666)

$      (0.01)

$     42,773

$       0.81















(4) Expenses attributable to EchoPark® operations were $0.06 per fully diluted share in the six months ended June 30, 2014. 

















Sonic Automotive, Inc.
 Results of Operations (Unaudited)
 














New Vehicles
























Three Months Ended June 30,

Better / (Worse)




2015

2014

Change

% Change




(In thousands, except units and per unit data)


Reported:









Revenue

$          1,295,288

$          1,298,777

$               (3,489)

(0.3%)


Gross profit


$               64,936

$               74,193

$               (9,257)

(12.5%)


Unit sales


34,963

35,405

(442)

(1.2%)


Revenue per unit


$               37,047

$               36,683

$                  364

1.0%


Gross profit per unit

$                 1,857

$                 2,096

$                 (239)

(11.4%)


Gross profit as a % of revenue


5.0%

5.7%

(70)

bps















Six Months Ended June 30,

Better / (Worse)




2015

2014

Change

% Change




(In thousands, except units and per unit data)


Reported:









Revenue

$          2,497,610

$          2,445,397

$              52,213

2.1%


Gross profit


$             128,285

$             140,866

$             (12,581)

(8.9%)


Unit sales


66,652

66,536

116

0.2%


Revenue per unit


$               37,472

$               36,753

$                  719

2.0%


Gross profit per unit


$                 1,925

$                 2,117

$                 (192)

(9.1%)


Gross profit as a % of revenue

5.1%

5.8%

(70)

bps















Three Months Ended June 30,

Better / (Worse)




2015

2014

Change

% Change




(In thousands, except units and per unit data)


Same Store:









Revenue


$          1,282,668

$          1,252,870

$             29,798

2.4%


Gross profit


$               64,789

$               71,765

$              (6,976)

(9.7%)


Unit sales


34,575

34,125

450

1.3%


Revenue per unit


$               37,098

$               36,714

$                  384

1.0%


Gross profit per unit


$                 1,874

$                 2,103

$                 (229)

(10.9%)


Gross profit as a % of revenue

5.1%

5.7%

(60)

bps















Six Months Ended June 30,

Better / (Worse)




2015

2014

Change

% Change




(In thousands, except units and per unit data)


Same Store:









Revenue

$          2,472,920

$          2,362,936

$           109,984

4.7%


Gross profit


$             127,227

$             136,397

$              (9,170)

(6.7%)


Unit sales


65,911

64,207

1,704

2.7%


Revenue per unit


$               37,519

$               36,802

$                  717

1.9%


Gross profit per unit


$                 1,930

$                 2,124

$                 (194)

(9.1%)


Gross profit as a % of revenue


5.1%

5.8%

(70)

bps













Sonic Automotive, Inc.
 Results of Operations (Unaudited)









Used Vehicles




















Three Months Ended June 30,

Better / (Worse)

2015

2014

Change

% Change

(In thousands, except units and per unit data)

Reported:







Revenue


$             658,794

$             603,868

$               54,926

9.1%

Gross profit

$               40,696

$               37,473

$                 3,223

8.6%

Unit sales


30,301

28,514

1,787

6.3%

Revenue per unit


$               21,742

$               21,178

$                    564

2.7%

Gross profit per unit


$                 1,343

$                 1,314

$                      29

2.2%

Gross profit as a % of revenue


6.2%

6.2%

0

bps










Six Months Ended June 30,

Better / (Worse)

2015

2014

 Change

% Change

(In thousands, except units and per unit data)

Reported:







Revenue


$          1,252,536

$          1,163,684

$               88,852

7.6%

Gross profit

$               81,540

$               78,167

$                 3,373

4.3%

Unit sales


58,436

56,171

2,265

4.0%

Revenue per unit

$               21,434

$               20,717

$                    717

3.5%

Gross profit per unit


$                 1,395

$                 1,392

$                        3

0.2%

Gross profit as a % of revenue


6.5%

6.7%

(20)

bps










Three Months Ended June 30,

Better / (Worse)

2015

2014

 Change

% Change

(In thousands, except units and per unit data)

Same Store:







Revenue


$             632,838

$             581,024

$               51,814

8.9%

Gross profit


$               38,884

$               36,647

$                 2,237

6.1%

Unit sales


28,973

27,397

1,576

5.8%

Revenue per unit


$               21,842

$               21,208

$                    634

3.0%

Gross profit per unit

$                 1,342

$                 1,338

$                        4

0.3%

Gross profit as a % of revenue


6.1%

6.3%

(20)

bps










Six Months Ended June 30,

Better / (Worse)

2015

2014

 Change

% Change

(In thousands, except units and per unit data)

Same Store:







Revenue

$          1,205,597

$          1,118,663

$               86,934

7.8%

Gross profit


$               78,897

$               75,933

$                 2,964

3.9%

Unit sales


56,052

53,998

2,054

3.8%

Revenue per unit


$               21,509

$               20,717

$                    792

3.8%

Gross profit per unit


$                 1,408

$                 1,406

$                        2

0.1%

Gross profit as a % of revenue


6.5%

6.8%

(30)

bps








Sonic Automotive, Inc.
 Results of Operations (Unaudited)









Wholesale Vehicles




















Three Months Ended June 30,

Better / (Worse)

2015

2014

Change

% Change

(In thousands, except units and per unit data)

Reported:








Revenue

$             41,131

$              44,765

$               (3,634)

(8.1%)

Gross profit (loss)


$             (2,676)

$              (1,314)

$               (1,362)

(103.7%)

Unit sales


8,010

7,738

272

3.5%

Revenue per unit


$              5,135

$                5,785

$                  (650)

(11.2%)

Gross profit (loss) per unit


$               (334)

$                 (170)

$                  (164)

(96.5%)

Gross profit (loss) as a % of revenue

(6.5%)

(2.9%)

(360)

bps











Six Months Ended June 30,

Better / (Worse)

2015

2014

Change

% Change

(In thousands, except units and per unit data)

Reported:








Revenue


$              82,789

$              86,363

$               (3,574)

(4.1%)

Gross profit (loss)


$              (2,884)

$              (1,409)

$               (1,475)

(104.7%)

Unit sales


15,787

15,118

669

4.4%

Revenue per unit

$                5,244

$                5,713

$                  (469)

(8.2%)

Gross profit (loss) per unit


$                 (183)

$                   (93)

$                    (90)

(96.8%)

Gross profit (loss) as a % of revenue


(3.5%)

(1.6%)

(190)

bps











Three Months Ended June 30,

Better / (Worse)

2015

2014

Change

% Change

(In thousands, except units and per unit data)

Same Store:








Revenue

$              39,497

$              43,326

$               (3,829)

(8.8%)

Gross profit (loss)


$              (2,344)

$               (1,307)

$               (1,037)

(79.3%)

Unit sales

7,637

7,476

161

2.2%

Revenue per unit


$                5,172

$                5,795

$                  (623)

(10.8%)

Gross profit (loss) per unit


$                 (307)

$                  (175)

$                  (132)

(75.4%)

Gross profit (loss) as a % of revenue

(5.9%)

(3.0%)

(290)

bps











Six Months Ended June 30,

Better / (Worse)

2015

2014

Change

% Change

(In thousands, except units and per unit data)

Same Store:








Revenue


$              80,270

$              83,573

$               (3,303)

(4.0%)

Gross profit (loss)


$              (2,530)

$              (1,331)

$               (1,199)

(90.1%)

Unit sales


15,160

14,621

539

3.7%

Revenue per unit

$                5,295

$                5,716

$                  (421)

(7.4%)

Gross profit (loss) per unit


$                 (167)

$                   (91)

$                    (76)

(83.5%)

Gross profit (loss) as a % of revenue


(3.2%)

(1.6%)

(160)

bps

Sonic Automotive, Inc.
 Results of Operations (Unaudited)











Parts, Service and Collision Repair ("Fixed Operations") 
















Three Months Ended June 30,

Better / (Worse)

2015

2014

 Change

% Change

Reported:

(In thousands)

Revenue








  Customer pay

$             146,548

$             145,040

$                 1,508

1.0%

  Warranty

57,150

47,050

10,100

21.5%

  Wholesale parts


45,850

47,145

(1,295)

(2.7%)

  Internal, sublet and other


96,616

89,899

6,717

7.5%

 Total

$             346,164

$             329,134

$               17,030

5.2%

Gross profit








  Customer pay

$               80,286

$               79,606

$                    680

0.9%

  Warranty

32,679

25,671

7,008

27.3%

  Wholesale parts

8,148

8,308

(160)

(1.9%)

  Internal, sublet and other

49,122

46,274

2,848

6.2%

 Total

$             170,235

$             159,859

$               10,376

6.5%

Gross profit as a % of revenue








  Customer pay

54.8%

54.9%

(10)

bps

  Warranty

57.2%

54.6%

260

bps

  Wholesale parts


17.8%

17.6%

20

bps

  Internal, sublet and other 

50.8%

51.5%

(70)

bps

 Total

49.2%

48.6%

60

bps











Six Months Ended June 30,

Better / (Worse)

2015

2014

 Change

% Change

Reported:

(In thousands)

Revenue








  Customer pay

$             284,171

$             286,162

$               (1,991)

(0.7%)

  Warranty


110,648

93,641

17,007

18.2%

  Wholesale parts


90,862

95,089

(4,227)

(4.4%)

  Internal, sublet and other

183,677

173,013

10,664

6.2%

 Total

$             669,358

$             647,905

$               21,453

3.3%

Gross profit








  Customer pay

$             155,963

$             157,605

$               (1,642)

(1.0%)

  Warranty


62,440

50,909

11,531

22.7%

  Wholesale parts

16,287

16,469

(182)

(1.1%)

  Internal, sublet and other


91,919

87,023

4,896

5.6%

 Total

$             326,609

$             312,006

$               14,603

4.7%

Gross profit as a % of revenue








  Customer pay


54.9%

55.1%

(20)

bps

  Warranty

56.4%

54.4%

200

bps

  Wholesale parts


17.9%

17.3%

60

bps

  Internal, sublet and other

50.0%

50.3%

(30)

bps

 Total

48.8%

48.2%

60

bps

Sonic Automotive, Inc.
 Results of Operations (Unaudited)









Parts, Service and Collision Repair ("Fixed Operations") 

















Three Months Ended June 30,

Better / (Worse)

2015

2014

 Change

% Change

Same Store:

(In thousands)

Revenue








  Customer pay

$             145,235

$             140,701

$                 4,534

3.2%

  Warranty

56,672

45,065

11,607

25.8%

  Wholesale parts


45,502

45,855

(353)

(0.8%)

  Internal, sublet and other

93,761

87,105

6,656

7.6%

 Total

$             341,170

$             318,726

$               22,444

7.0%

Gross profit








  Customer pay


$               79,537

$               77,320

$                 2,217

2.9%

  Warranty


32,435

24,631

7,804

31.7%

  Wholesale parts

8,082

8,064

18

0.2%

  Internal, sublet and other

47,764

44,676

3,088

6.9%

 Total

$             167,818

$             154,691

$               13,127

8.5%

Gross profit as a % of revenue








  Customer pay

54.8%

55.0%

(20)

bps

  Warranty

57.2%

54.7%

250

bps

  Wholesale parts

17.8%

17.6%

20

bps

  Internal, sublet and other


50.9%

51.3%

(40)

bps

 Total

49.2%

48.5%

70

bps











Six Months Ended June 30,

Better / (Worse)

2015

2014

 Change

% Change

Same Store:

(In thousands)

Revenue








  Customer pay


$             281,002

$             277,187

$                 3,815

1.4%

  Warranty

109,644

89,838

19,806

22.0%

  Wholesale parts

90,082

92,522

(2,440)

(2.6%)

  Internal, sublet and other


178,717

167,665

11,052

6.6%

 Total


$             659,445

$             627,212

$               32,233

5.1%

Gross profit








  Customer pay


$             154,225

$             152,877

$                 1,348

0.9%

  Warranty

61,892

48,901

12,991

26.6%

  Wholesale parts


16,135

15,971

164

1.0%

  Internal, sublet and other


89,573

83,821

5,752

6.9%

 Total


$             321,825

$             301,570

$               20,255

6.7%

Gross profit as a % of revenue








  Customer pay

54.9%

55.2%

(30)

bps

  Warranty

56.4%

54.4%

200

bps

  Wholesale parts

17.9%

17.3%

60

bps

  Internal, sublet and other

50.1%

50.0%

10

bps

 Total

48.8%

48.1%

70

bps









Sonic Automotive, Inc.
 Results of Operations (Unaudited)









Finance, Insurance and Other, Net ("F&I")

















Three Months Ended June 30,

Better / (Worse)

2015

2014

Change

% Change

(In thousands, except per unit data)

Reported:








Revenue


$               82,363

$               76,736

$                 5,627

7.3%

Gross profit per retail unit (excludes fleet)

$                 1,268

$                 1,211

$                      57

4.7%





















Six Months Ended June 30,

Better / (Worse)

2015

2014

Change

% Change

(In thousands, except per unit data)

Reported:








Revenue

$             156,963

$             146,317

$               10,646

7.3%

Gross profit per retail unit (excludes fleet)

$                 1,261

$                 1,209

$                      52

4.3%











Three Months Ended June 30,

Better / (Worse)

2015

2014

Change

% Change

(In thousands, except per unit data)

Same Store:








Revenue


$               80,573

$               74,237

$                 6,336

8.5%

Gross profit per retail unit (excludes fleet)

$                 1,274

$                 1,218

$                      56

4.6%





















Six Months Ended June 30,

Better / (Worse)

2015

2014

Change

% Change

(In thousands, except per unit data)

Same Store:








Revenue

$             153,702

$             141,419

$               12,283

8.7%

Gross profit per retail unit (excludes fleet)


$                 1,267

$                 1,213

$                      54

4.5%

Sonic Automotive, Inc.
 Results of Operations (Unaudited)









Selling, General and Administrative ("SG&A") Expenses

















Three Months Ended June 30,

Better / (Worse)

2015

2014

 Change

% Change

(In thousands)

Reported:








Compensation

$             167,811

$             163,109

$               (4,702)

(2.9%)

Advertising


15,358

13,864

(1,494)

(10.8%)

Rent


18,246

18,643

397

2.1%

Other


83,246

73,298

(9,948)

(13.6%)

Total

$             284,661

$             268,914

$             (15,747)

(5.9%)

SG&A expenses as a % of gross profit







Compensation


47.2%

47.0%

(20)

bps

Advertising


4.3%

4.0%

(30)

bps

Rent

5.1%

5.4%

30

bps

Other

23.5%

21.1%

(240)

bps

Total

80.1%

77.5%

(260)

bps










Six Months Ended June 30,

Better / (Worse)

2015

2014

 Change

% Change

(In thousands)

Reported:







Compensation


$             329,669

$             320,263

$               (9,406)

(2.9%)

Advertising

30,689

27,982

(2,707)

(9.7%)

Rent

36,500

37,178

678

1.8%

Other


158,665

147,464

(11,201)

(7.6%)

Total


$             555,523

$             532,887

$             (22,636)

(4.2%)

SG&A expenses as a % of gross profit







Compensation


47.7%

47.4%

(30)

bps

Advertising


4.4%

4.1%

(30)

bps

Rent

5.3%

5.5%

20

bps

Other


23.1%

21.8%

(130)

bps

Total

80.5%

78.8%

(170)

bps







SOURCE Sonic Automotive, Inc.