NEW YORK — Asbury Automotive Group Inc. has reported financial results for the first quarter ended March 31, 2007.

Income from continuing operations for the first quarter was $2.4 million, or $0.07 per diluted share. These results include an after-tax charge of $11.1 million, or $0.33 per diluted share, related to a debt refinancing and after-tax charges of $1.8 million, or $0.05 per diluted share, related to the planned retirement next month of current CEO, Kenneth B. Gilman. Adjusting for these items, income from continuing operations for the first quarter increased 12 percent to $15.3 million, or $0.45 per diluted share, from $13.7 million, or $0.41 per diluted share, in last year's first quarter.

Summary financial information for the first quarter of 2007, as compared to last year's first quarter, included:

Total revenue for the quarter increased 4 percent to $1.4 billion. Total gross profit was $224.1 million, up 7 percent. Same-store retail revenue and gross profit (excluding fleet and wholesale businesses) increased 4 percent and 7 percent, respectively. New vehicle retail revenue and gross profit increased 2 percent and 4 percent, respectively. New retail unit sales were up 1 percent. Total new unit sales (including fleet) were up 2 percent. Used vehicle retail revenue and gross profit both increased 11 percent. Used retail unit sales were up 9 percent. Parts, service and collision repair revenue increased 3 percent, and gross profit rose 6 percent. Net finance and insurance (F&I) revenue increased 10 percent and dealership- generated F&I per vehicle retailed rose 9 percent. Selling, general and administrative (SG&A) expenses as a percentage of gross profit were 78.7 percent for the quarter. Adjusted for the charge related to the retirement of the current CEO, SG&A expenses were 77.4 percent of gross profit for the quarter, an 80 basis-point improvement compared to 78.2 percent a year ago.

Charles R. Oglesby, who will succeed Mr. Gilman as President and CEO on May 4, said, "The results for the first quarter again demonstrate the strength of Asbury's well-balanced business model. As the numbers reveal, it's the depth and breadth of the performance that's most impressive. All four business lines had record first quarter gross profit results, with two of them, fixed operations and used vehicles, having all-time record quarters. Overall, our gross profit margin improved to 15.8 percent, the highest in the Company's history. And, equally as important, our strong performance was not confined to any one geographic region, as each of our four regions delivered record first quarter results."

J. Gordon Smith, Senior Vice President and CFO, said, "This quarter was Asbury's tenth in a row of adjusted SG&A expense leverage improvement. That ratio improved another 80 basis points in the first quarter versus the prior year quarter, and we still see additional opportunity to continue to leverage our expense structure."

Mr. Smith continued, "Other highlights of the quarter surrounded the refinancing of our 9 percent senior subordinated notes. We completed the tender offer for these notes in March, accepting $238.1 million of tendered notes, and refinanced them with a successful private placement of $150 million in 7.625 percent senior subordinated notes and $115 million in 3 percent convertible notes. The combination of these transactions is expected to reduce our annual debt service by $6.5 million. In addition, concurrently with the convertible notes offering, we repurchased 1.3 million shares of common stock, fully utilizing the capacity under our stock repurchase program which was designed to off-set dilution related to stock-based compensation."

In light of its strong first quarter results and the positive impact of the debt refinancing and share repurchase on the remaining nine months of the year, the Company raised its full-year 2007 EPS guidance range to between $2.20 to $2.28 per diluted share from continuing operations, which excludes charges incurred in the first quarter associated with the debt refinancing ($0.33 per diluted share) and the charges related to the retirement benefits of Mr. Gilman ($0.05 per diluted share).