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Note 10 - Acquisitions
 6 Months Ended
Jun. 30, 2013
Business Combination Disclosure [Text Block]  
Business Combination Disclosure [Text Block]

Note 10. Acquisitions


On June 10, 2013, we acquired the inventory, property, equipment and intangible assets and assumed certain liabilities of OB Salem Auto Group, Inc. in Salem, Oregon from Michael O’Brien.


This acquired company contributed revenues of $2.9 million for the six months ended June 30, 2013.


The following unaudited pro forma summary presents consolidated information as if the acquisitions in the three- and six-month periods ended June 30, 2012 and 2013 had occurred on January 1, 2012 (in thousands, except for per share amounts):


Three Months Ended June 30,

 

2013

   

2012

 

Revenue

  $ 1,026,597     $ 850,733  

Income from continuing operations, net of tax

    25,489       20,199  

Basic income per share from continuing operations, net of tax

    0.99       0.79  

Diluted income per share from continuing operations, net of tax

    0.98       0.77  

Six Months Ended June 30,

 

2013

   

2012

 

Revenue

  $ 1,950,436     $ 1,620,574  

Income from continuing operations, net of tax

    47,609       36,995  

Basic income per share from continuing operations, net of tax

    1.85       1.43  

Diluted income per share from continuing operations, net of tax

    1.82       1.40  

These amounts have been calculated by applying our accounting policies and estimates. The results of the acquired stores have been adjusted to reflect the following: depreciation on a straight-line basis over the expected lives for property, plant and equipment; accounting for inventory on a specific identification method; and recognition of interest expense for real estate financing related to stores where we purchased the facility. No nonrecurring pro forma adjustments directly attributable to the acquisitions are included in the reported pro forma revenues and earnings.


The acquisition was accounted for using the acquisition method of accounting. No portion of the purchase price was paid with our equity securities. The following table summarizes the consideration paid for the acquisition and the amount of identified assets acquired and liabilities assumed as of the acquisition date (in thousands):


   

Consideration  

 

Cash paid, net of cash acquired

  $ 31,786  

   

Assets Acquired and Liabilities Assumed

 

Inventories

  $ 15,198  

Franchise value

    4,036  

Property, plant and equipment

    4,697  

Other assets

    122  

Other liabilities

    (533 )
      23,520  

Goodwill

    8,266  
    $ 31,786  

We account for franchise value as an indefinite-lived intangible asset. We expect the full amount of the goodwill recognized to be deductible for tax purposes.