AutoNation, Inc. on May 2 reported that for the three months ended March 31, 2001, the company had net income of $59.9 million, or $0.17 per share, versus $62.3 million, or $0.17 per share, in the same period last year. Last year's reported first- quarter net income included a loss from discontinued operations of one cent per share.

During the quarter, total revenue declined 6.6 percent to $4.89 billion compared with $5.23 billion for the same period last year, and operating income declined 6.2 percent to $152.9 million versus $163 million last year.

The company said revenue in the quarter reflected a slower pace of vehicle sales compared to last year, partially offset by revenue improvement of 2.3 percent in its parts and service business and 4.4% in its finance and insurance operation. This positive shift in the first-quarter revenue mix to higher margin businesses resulted in a 70-basis-point improvement in gross margin (15.1 percent versus 14.4 percent a year ago) and a 10-basis-point improvement in store performance margin (4.7 percent versus 4.6 percent a year ago).

Also during the three months ended March 31, 2001, AutoNation:

- Improved the sale of finance and insurance products by 16 percent on a per-vehicle-retailed basis to $641 versus $553 a year ago.

- Generated EBITDA of $188.4 million.

- Improved gross margins on parts and service to 42.9%, a 90-basis-point improvement from a year ago.

- Reduced vehicle floorplan debt and non-vehicle debt by a total of $184.4 million.

- Reduced new-vehicle days supply by 24 percent to 63 days versus 83 days as of Dec. 31, 2000.

- Reduced used-vehicle days supply by 19 percent to 35 days versus 43 days supply as of Dec. 31, 2000.

- Reduced corporate SG&A by 14.4 percent, or $6.7 million, driven primarily by the continued disposal of excess properties.

- Repurchased 12.1 million shares of its stock at a cost of $98.2 million, leaving a board-authorized amount of $168.8 million for future repurchases.

"AutoNation's first-quarter performance reflects our disciplined approach to the automotive retail business," said Michael J. Jackson, CEO of AutoNation. "Despite a challenging new-vehicle market, we expanded margins, reduced inventories, paid down debt and repurchased shares. AutoNation is well positioned to meet the challenges of an uncertain retail environment.

"AutoNation remains cautious about the full-year outlook for the industry and is therefore maintaining its estimate of 2001 earnings in the range of $0.85 to $0.90 per share," Jackson said. "Our earnings estimate for the 2001 second quarter is a range of 21 cents to 23 cents per share."

About AutoNation, Inc.

AutoNation, Inc., headquartered in Fort Lauderdale, Fla., is America's largest automotive retailer, on and off the Web.

A Fortune 100 company, AutoNation employs about 31,000 people and owns and operates 375 automotive retail franchises in 17 states.

For more information, visit www.autonation.com.