Penske’s Quarterly Income Hits Historic High
Despite its Northeast and Central Midwest dealerships losing approximately 280 selling days due to harsh weather, Penske Automotive reported last week that it achieved a 15.4% increase in income from continuing operations.
BLOOMFIELD HILLS, Mich. — Penske Automotive Group announced a record first quarter performance during its quarterly investor call last Thursday, including the highest quarterly income from continuing operations in the history of the company.
Although the group’s Northeast and Central Midwest dealerships lost approximately 280 days of operations due to harsh weather during the quarter, the company’s income from continuing operations increased 15.4% to $66.1 million. Related earnings per share increased 15.9% to $0.73 per share.
“… I'm very pleased with our performance in the first quarter and believe our results continue to demonstrate the benefit and strength of our brand mix and our geographic diversification,” said Chairman and CEO Roger Penske. “With a strong balance sheet and a positive outlook across our automotive dealership, car rental, commercial vehicle businesses, we are poised for continued growth.”
Total revenue increased 20.9% to $4 billion, Penske said. The revenue increase was driven by a 13.1% increase in total retail unit sales, including a 9.9% increase on a same-store basis. Gross profit improved 18.5% to $624.0 million while operating income increased 13.8% to $119.7 million.
On a same-store basis, automotive retail revenue increased 14.9%, including a 7.5% increase in the United States and a 28.2% increase internationally.
New-vehicle revenue, Penske said, increased 11.6% to 50,300 units, representing a 6.3% increase in the United States and a 23.3% internationally. “New-vehicle units revenue and gross profit were positively impacted by the mix shift to a higher percentage of international operations during the first quarter,” he noted.
The company also realized gains in F&I, with revenue increasing 22.2%. On a same-store basis, revenue increased 18.6%. On a worldwide basis, the group’s F&I per-copy average improved $82 to $1,097.
“F&I per unit was $1,048 in the U.S. and $1,190 per unit in our international markets,” Penske said. “In the first quarter, 63% of our F&I income was generated in the U.S. and 37% was generated in our international markets.”
The company’s average transaction price per unit was $40,294 for new and $26,484 for used, a 5.8% and 5.9% increase, respectively.
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