EX-99.1 2 exhibit991-4thqtr2016.htm EXHIBIT 99.1 Exhibit
Exhibit 99.1

gp1logoa01.gif

FOR IMMEDIATE RELEASE

Group 1 Automotive Reports Fourth Quarter and Full Year 2016 Financial Results
Sets Record Revenue of $10.9 Billion for 2016
HOUSTON, Feb 2, 2017 - Group 1 Automotive, Inc. (NYSE: GPI), (“Group 1” or the “Company”), an international, Fortune 500 automotive retailer, today reported 2016 fourth quarter net income of $30.8 million, diluted earnings per common share of $1.44, adjusted net income (a non-GAAP measure) of $37.3 million, and adjusted diluted earnings per common share (a non-GAAP measure) of $1.74.
As shown in the attached non-GAAP reconciliation tables, the 2016 fourth quarter adjusted results exclude approximately $6.4 million of net after-tax adjustments, or $0.30 per share, for non-core items. These adjustments primarily consist of non-cash asset impairment charges of approximately $12.8 million after-tax, or $0.59 per share; and severance costs of approximately $1.2 million after-tax, or $0.06 per share. These adjustments were partially offset by gains related to both a settlement with an OEM of approximately $7.3 million after-tax, or $0.34 per share; and real estate and dealership transactions of approximately $0.3 million after-tax, or $0.01 per share.
For the full year of 2016, net income increased 56.5 percent from the comparable prior-year period, to $147.1 million; and diluted earnings per common share increased 71.0 percent, to $6.67. Full year 2016 adjusted net income decreased 1.1 percent, to $163.7 million; and adjusted diluted earnings per common share increased 8.0 percent, to an all-time high of $7.42. Total revenue grew 2.4 percent (4.7 percent on a constant currency basis), to a record $10.9 billion.
“We are pleased with our overall performance in 2016 given the economic and political challenges we faced in each of our regions. Despite those headwinds, we delivered record revenue of $10.9 billion and grew adjusted diluted earnings per share 8 percent to a new, all-time record of $7.42. We closed the year on a strong note, with fourth quarter adjusted EPS growth of 15 percent over last year, reflecting improved new vehicle margins and strong cost control,” said Earl J. Hesterberg, Group 1’s president and chief executive officer. “In addition, the progress we delivered on both our cost structure during the fourth quarter and the reduction of our U.S. new vehicle inventory, which ended the Quarter with a 65 day supply, has us well positioned as we enter 2017.”
Consolidated Results for Fourth Quarter 2016 (year-over-year comparable basis)
For ease of comparison, we have included constant currency metrics (a non-GAAP measure) both below (shown in parenthesis) and in the financial tables that follow:
▪
Total revenue was flat at $2.7 billion (2.6 percent).
▪
Total gross profit grew 2.4 percent (4.4 percent), to $389.2 million.
▪
New vehicle revenues decreased 1.7 percent (0.8 percent). New vehicle gross profit improved 3.7 percent (6.4 percent), to $83.1 million. While total new vehicles sales volume decreased, new vehicle gross profit per retail unit (PRU) grew 7.2 percent (10.1 percent), to $1,976.
▪
Retail used vehicle revenues increased 0.8 percent (3.6 percent) on 0.5 percent higher unit sales. Retail used vehicle gross profit decreased 4.1 percent ((2.2) percent), to $39.0 million.
▪
Parts and service gross profit increased 4.4 percent (6.5 percent) on revenue growth of 4.6 percent (6.5 percent). Same Store parts and service gross profit increased 3.6 percent (5.0 percent) on revenue growth of 4.0 percent (5.1 percent). U.S. Same Store parts and service gross profit increased 4.1 percent on revenue growth of 5.1 percent.
▪
Finance and Insurance (F&I) gross profit PRU increased 4.8 percent (6.5 percent), to $1,440. U.S. F&I gross profit PRU increased $129, or 8.5 percent, to an all-time record of $1,644.

1


▪
Selling, General and Administrative (SG&A) expenses as a percent of gross profit improved 190 basis points, to 71.7 percent. Adjusted SG&A expenses as a percent of gross profit improved 90 basis points, to 74.4 percent.
Consolidated Results for Full Year 2016 (year-over-year comparable basis)
▪
Total revenue increased 2.4 percent (4.7 percent), to a record $10.9 billion.
▪
Total gross profit grew 4.0 percent (5.7 percent).
▪
New vehicle gross profit increased 3.6 percent (6.2 percent) on 0.7 percent (3.1 percent) higher revenues, as the Company retailed 172,053 new vehicles in 2016.
▪
Retail used vehicle gross profit was 1.7 percent (3.3 percent) higher on a 4.5 percent (6.7 percent) revenue increase, as the Company retailed 129,131 used units in 2016, a 4.0 percent increase over 2015 levels.
▪
Parts and service gross profit rose 5.9 percent (7.7 percent) on 6.3 percent (8.1 percent) higher revenues.
▪
F&I revenues rose 2.9 percent (4.1 percent) on 0.8 percent more retail unit sales; U.S. F&I gross PRU was $1,599, an increase of $74 over 2015.
▪
SG&A expenses as a percent of gross profit increased 30 basis points, to 73.4 percent. Adjusted U.S. SG&A expenses as a percent of gross profit improved 40 basis points, to 71.7 percent.
▪
Operating margin improved 50 basis points to 3.1 percent. Adjusted operating margin remained flat at 3.4 percent.
Segment Results for Fourth Quarter 2016 (year-over-year comparable basis)
▪
United States:
The Company’s U.S. operations accounted for 81.2 percent of total revenues and 85.1 percent of total gross profit. Total U.S. revenues were $2.2 billion, a decrease of 4.1 percent, driven by a 6.8 percent decrease in retail new vehicle revenue. While new vehicle sales volume decreased, new vehicle gross profit PRU sold grew $225, or 12.3 percent per unit, to $2,049; and total gross profit of $331.3 million was only down 0.8 percent. New vehicle inventory improved 9 days from third-quarter levels and ended the quarter at 65 days’ supply.
SG&A expenses as a percent of gross profit improved 330 basis points to 68.6 percent and operating margin improved 90 basis points to 3.8 percent. Adjusted SG&A expenses as a percent of gross profit improved 210 basis points, to 71.9 percent. Adjusted operating margin improved 40 basis points to 3.8 percent.\
▪
United Kingdom:
The Company’s U.K. operations accounted for 14.5 percent of total revenues and 11.4 percent of total gross profit. Total U.K. revenues increased 35.9 percent (66.1 percent), to $387.5 million, and gross profit increased 33.3 percent (62.4 percent), to $44.4 million. On a constant currency basis, Same Store total revenue increased 15.1 percent, driven by revenue growth of 21.3 percent in new vehicles, 18.0 percent in F&I, and 7.7 percent in parts and service.
Same Store SG&A expenses as a percent of gross profit increased 90 basis points to 82.6 percent and operating margin decreased 10 basis points to 1.6 percent.
▪
Brazil:
The Company’s Brazilian operations were profitable during the fourth quarter and accounted for 4.3 percent of total revenues and 3.5 percent of total gross profit. The Company’s Same Store new vehicle revenue declined 25.6 percent on a constant currency basis in a continued weak economic environment. Year-to-date, Brazil’s new vehicle industry volumes have declined about 20 percent. On a constant currency basis, fourth quarter Same Store total revenue was down 19.1 percent, as F&I gross profit PRU growth of 19.7 percent partially offset the decline in new and used vehicles.
The Company continues to improve its used vehicle operations in Brazil. On a Same Store constant currency basis, used vehicle retail margins increased 360 basis points to 7.1 percent and total used vehicle gross profit grew 97.3 percent.

2



Share Repurchase Authorization
For the full year of 2016, the Company repurchased 2,282,579 shares, or approximately 10 percent of its outstanding common shares, at an average price per common share of $55.90 for a total of $127.6 million. As of February 1, 2017, $22.4 million remains available under the Company’s prior common stock share repurchase authorization.
Future repurchases may be made from time to time, based on market conditions, legal requirements and other corporate considerations, in the open market or in privately negotiated transactions, and subject to Board approval and covenant restrictions.     
Corporate Development
As previously announced in October 2016, the Company acquired the Ford Basingstoke and Ford Newbury stores in the U.K., which were rebranded as Think Ford Basingstoke and Think Ford Newbury. These franchises are expected to generate approximately $65 million in annualized revenues.
During October 2016, the Company announced the divestiture of the Honda of Van Nuys store in California. Also during the fourth quarter, the Company disposed of Spire Skoda in the U.K. These franchises generated approximately $80 million in trailing-twelve-month revenues.
During 2016, the Company acquired a total of 21 franchises, which are expected to generate an estimated $660 million in annual revenues. The Company disposed of 10 franchises that generated approximately $240 million in trailing-twelve-month revenues.
Subsequently, in January 2017, the Company acquired a BMW motorcycle franchise in the state of Paraná in Brazil. The franchise, which is expected to generate approximately $5 million in annual revenues, will be moved into one of our existing BMW locations to expand dealership scale. On February 1, 2017, the Company disposed of its remaining two Nissan stores in Brazil, which generated approximately $25 million in trailing-twelve-month revenues.
Fourth Quarter 2016 Earnings Conference Call Details
Group 1’s senior management will host a conference call today at 10 a.m. ET to discuss the fourth quarter financial results and the Company’s outlook and strategy.
The conference call will be simulcast live on the Internet at www.group1auto.com, then click on ‘Investor Relations’ and then ‘Events’ or through this link: http://www.group1corp.com/events. A webcast replay will be available for 30 days.
The conference call will also be available live by dialing in 15 minutes prior to the start of the call at:
Domestic:     1-888-317-6003
International:     1-412-317-6061
Conference ID:    6564959
A telephonic replay will be available following the call through February 9, 2017 by dialing:
Domestic:     1-877-344-7529
International:     1-412-317-0088
Replay ID:    10100191

3


About Group 1 Automotive, Inc.
Group 1 owns and operates 157 automotive dealerships, 208 franchises, and 38 collision centers in the United States, the United Kingdom and Brazil that offer 31 brands of automobiles. Through its dealerships, the Company sells new and used cars and light trucks; arranges related vehicle financing; sells service contracts; provides automotive maintenance and repair services; and sells vehicle parts.
Investors please visit www.group1corp.com, www.group1auto.com, www.group1collision.com, www.facebook.com/group1auto, and www.twitter.com/group1auto, where Group 1 discloses additional information about the Company, its business, and its results of operations.
FORWARD-LOOKING STATEMENTS
This press release contains "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995, which are statements related to future, not past, events and are based on our current expectations and assumptions regarding our business, the economy and other future conditions. In this context, the forward-looking statements often include statements regarding our goals, plans, projections and guidance regarding our financial position, results of operations, market position, pending and potential future acquisitions and business strategy, and often contain words such as “expects,” “anticipates,” “intends,” “plans,” “believes,” “seeks,” “should,” “foresee,” “may” or “will” and similar expressions. While management believes that these forward-looking statements are reasonable as and when made, there can be no assurance that future developments affecting us will be those that we anticipate. Any such forward-looking statements are not assurances of future performance and involve risks and uncertainties that may cause actual results to differ materially from those set forth in the statements. These risks and uncertainties include, among other things, (a) general economic and business conditions, (b) the level of manufacturer incentives, (c) the future regulatory environment, (d) our ability to obtain an inventory of desirable new and used vehicles, (e) our relationship with our automobile manufacturers and the willingness of manufacturers to approve future acquisitions, (f) our cost of financing and the availability of credit for consumers, (g) our ability to complete acquisitions and dispositions and the risks associated therewith, (h) foreign exchange controls and currency fluctuations, and (i) our ability to retain key personnel. For additional information regarding known material factors that could cause our actual results to differ from our projected results, please see our filings with the SEC, including our Annual Report on Form 10-K, Quarterly Reports on Form 10-Q and Current Reports on Form 8-K. Readers are cautioned not to place undue reliance on forward-looking statements, which speak only as of the date hereof. We undertake no obligation to publicly update or revise any forward-looking statements after the date they are made, whether as a result of new information, future events or otherwise.
NON-GAAP FINANCIAL MEASURES
In addition to evaluating the financial condition and results of our operations in accordance with GAAP, from time to time our management evaluates and analyzes results and any impact on the Company of strategic decisions and actions relating to, among other things, cost reduction, growth, and profitability improvement initiatives, and other events outside of normal, or "core," business and operations, by considering alternative financial measures not prepared in accordance with GAAP. This includes evaluating measures such as adjusted selling, general and administrative expenses, adjusted net income and adjusted diluted earnings per share. These adjusted measures are not measures of financial performance under U.S. GAAP, but are instead considered non-GAAP financial performance measures. Non-GAAP measures do not have definitions under GAAP and may be defined differently by and not be comparable to similarly titled measures used by other companies. As a result, any non-GAAP financial measures considered and evaluated by management are reviewed in conjunction with a review of the most directly comparable measures calculated in accordance with GAAP. We caution investors not to place undue reliance on such non-GAAP measures, but also to consider them with the most directly comparable GAAP measures. In our evaluation of results from time to time, we exclude items that do not arise directly from core operations, such as non-cash asset impairment charges, gains and losses on dealership franchise or real estate transactions, and catastrophic weather events such as hail storms, hurricanes, and snow storms. Because these non-core charges and gains materially affect the Company's financial condition or results in the specific period in which they are recognized, management also evaluates, and makes resource allocation and performance evaluation decisions based on, the related non-GAAP measures excluding such items.

4


In addition to using such non-GAAP measures to evaluate results in a specific period, management believes that such measures may provide more complete and consistent comparisons of operational performance on a period-over-period historical basis and a better indication of expected future trends. Our management also uses these adjusted measures in conjunction with U.S. GAAP financial measures to assess our business, including communication with our Board of Directors, investors and industry analysts concerning financial performance. We disclose these non-GAAP measures, and the related reconciliations, because we believe investors use these metrics in evaluating longer-term period-over-period performance, and to allow investors to better understand and evaluate the information used by management to assess operating performance. The exclusion of certain expenses in the calculation of non-GAAP financial measures should not be construed as an inference that these costs are unusual or infrequent. We anticipate excluding these expenses in the future presentation of our non-GAAP financial measures.
In addition, we evaluate our results of operations on both an as reported and a constant currency basis. The constant currency presentation, which is a non-GAAP measure, excludes the impact of fluctuations in foreign currency exchange rates. We believe providing constant currency information provides valuable supplemental information regarding our underlying business and results of operations, consistent with how we evaluate our performance. We calculate constant currency percentages by converting our current period reported results for entities reporting in currencies other than United States dollars using comparative period exchange rates rather than the actual exchange rates in effect during the respective periods. The constant currency performance measures should not be considered a substitute for, or superior to, the measures of financial performance prepared in accordance with U.S. GAAP.
SOURCE: Group 1 Automotive, Inc.

Investor contacts:
Sheila Roth
Manager, Investor Relations
Group 1 Automotive, Inc.
713-647-5741 | sroth@group1auto.com

Media contacts:
Pete DeLongchamps
V.P. Manufacturer Relations, Financial Services and Public Affairs
Group 1 Automotive, Inc.
713-647-5770 | pdelongchamps@group1auto.com
or
Clint Woods
Pierpont Communications, Inc.
713-627-2223 | cwoods@piercom.com


5


Group 1 Automotive, Inc.
 
Consolidated Statements of Operations
 
(Unaudited)
 
(In thousands, except per share amounts)
 
 
 
 
 
 
 
 
 
 
 
Three Months Ended December 31,
 
 
 
2016
 
2015
 
% Increase/(Decrease)
 
REVENUES:
 
 
 
 
 
 
 
New vehicle retail sales
 
$
1,507,513

 
$
1,533,108

 
(1.7
)
 
Used vehicle retail sales
 
651,144

 
645,844

 
0.8

 
Used vehicle wholesale sales
 
99,774

 
95,064

 
5.0

 
Parts and service
 
310,966

 
297,254

 
4.6

 
Finance, insurance and other, net
 
104,235

 
101,332

 
2.9

 
Total revenues
 
2,673,632

 
2,672,602

 
—

 
COST OF SALES:
 
 
 
 
 
 
 
New vehicle retail sales
 
1,424,445

 
1,452,982

 
(2.0
)
 
Used vehicle retail sales
 
612,098

 
605,137

 
1.2

 
Used vehicle wholesale sales
 
103,754

 
96,896

 
7.1

 
Parts and service
 
144,154

 
137,454

 
4.9

 
Total cost of sales
 
2,284,451

 
2,292,469

 
(0.3
)
 
GROSS PROFIT
 
389,181

 
380,133

 
2.4

 
SELLING, GENERAL AND ADMINISTRATIVE EXPENSES
 
279,071

 
279,785

 
(0.3
)
 
DEPRECIATION AND AMORTIZATION EXPENSE
 
13,166

 
11,798

 
11.6

 
ASSET IMPAIRMENTS
 
20,027

 
85,606

 
(76.6
)
 
OPERATING INCOME
 
76,917

 
2,944

 
2,512.7

 
OTHER EXPENSE:
 
 
 
 
 
 
 
Floorplan interest expense
 
(11,189
)
 
(10,216
)
 
9.5

 
Other interest expense, net
 
(17,208
)
 
(14,843
)
 
15.9

 
INCOME (LOSS) BEFORE INCOME TAXES
 
48,520

 
(22,115
)
 
319.4

 
PROVISION FOR INCOME TAXES
 
(17,692
)
 
(11,272
)
 
57.0

 
NET INCOME (LOSS)
 
$
30,828

 
$
(33,387
)
 
192.3

 
Less: Earnings (loss) allocated to participating securities
 
$
1,220

 
$
(1,279
)
 
195.4

 
Earnings (loss) available to diluted common shares
 
$
29,608

 
$
(32,108
)
 
192.2

 
DILUTED EARNINGS (LOSS) PER SHARE
 
$
1.44

 
$
(1.41
)
 
202.1

 
Weighted average dilutive common shares outstanding
 
20,592

 
22,718

 
(9.4
)
 
Weighted average participating securities
 
858

 
897

 
(4.3
)
 
Total weighted average shares outstanding
 
21,450

 
23,615

 
(9.2
)
 


1


 
 
Twelve Months Ended December 31,
 
 
 
2016
 
2015
 
% Increase/(Decrease)
 
REVENUES:
 
 
 
 
 
 
 
New vehicle retail sales
 
$
6,046,075

 
$
6,001,306

 
0.7

 
Used vehicle retail sales
 
2,757,713

 
2,638,969

 
4.5

 
Used vehicle wholesale sales
 
401,863

 
397,251

 
1.2

 
Parts and service
 
1,261,307

 
1,186,193

 
6.3

 
Finance, insurance and other, net
 
420,654

 
408,786

 
2.9

 
Total revenues
 
10,887,612

 
10,632,505

 
2.4

 
COST OF SALES:
 
 
 
 
 
 
 
New vehicle retail sales
 
5,729,697

 
5,695,829

 
0.6

 
Used vehicle retail sales
 
2,575,234

 
2,459,499

 
4.7

 
Used vehicle wholesale sales
 
406,305

 
399,171

 
1.8

 
Parts and service
 
581,307

 
544,034

 
6.9

 
Total cost of sales
 
9,292,543

 
9,098,533

 
2.1

 
GROSS PROFIT
 
1,595,069

 
1,533,972

 
4.0

 
SELLING, GENERAL AND ADMINISTRATIVE EXPENSES
 
1,170,763

 
1,120,833

 
4.5

 
DEPRECIATION AND AMORTIZATION EXPENSE
 
51,234

 
47,239

 
8.5

 
ASSET IMPAIRMENTS
 
32,838

 
87,562

 
(62.5
)
 
OPERATING INCOME
 
340,234

 
278,338

 
22.2

 
OTHER EXPENSE:
 
 
 
 
 
 
 
Floorplan interest expense
 
(44,927
)
 
(39,264
)
 
14.4

 
Other interest expense, net
 
(67,936
)
 
(56,903
)
 
19.4

 
INCOME BEFORE INCOME TAXES
 
227,371

 
182,171

 
24.8

 
PROVISION FOR INCOME TAXES
 
(80,306
)
 
(88,172
)
 
(8.9
)
 
NET INCOME
 
$
147,065

 
$
93,999

 
56.5

 
Less: Earnings allocated to participating securities
 
$
5,869

 
$
3,595

 
63.3

 
Earnings available to diluted common shares
 
$
141,196

 
$
90,404

 
56.2

 
DILUTED EARNINGS PER SHARE
 
$
6.67

 
$
3.90

 
71.0

 
Weighted average dilutive common shares outstanding
 
21,170
 
23,152
 
(8.6
)
 
Weighted average participating securities
 
886
 
924
 
(4.1
)
 
Total weighted average shares outstanding
 
22,056
 
24,076
 
(8.4
)
 


2


Group 1 Automotive, Inc.
 
Consolidated Balance Sheets
 
(Unaudited)
 
(Dollars in thousands)
 
 
 
December 31, 2016
 
December 31, 2015
 
% Increase/(Decrease)
 
ASSETS:
 
 
 
 
 
 
 
CURRENT ASSETS:
 
 
 
 
 
 
 
Cash and cash equivalents
 
$
20,992

 
$
13,037

 
61.0

 
Contracts in transit and vehicle receivables, net
 
269,508

 
252,438

 
6.8

 
Accounts and notes receivable, net
 
173,364

 
157,768

 
9.9

 
Inventories, net
 
1,651,815

 
1,737,751

 
(4.9
)
 
Prepaid expenses and other current assets
 
34,908

 
27,376

 
27.5

 
Total current assets
 
2,150,587

 
2,188,370

 
(1.7
)
 
PROPERTY AND EQUIPMENT, net
 
1,125,883

 
1,033,981

 
8.9

 
GOODWILL AND INTANGIBLE FRANCHISE RIGHTS
 
1,161,639

 
1,162,503

 
(0.1
)
 
OTHER ASSETS
 
23,794

 
11,862

 
100.6

 
Total assets
 
$
4,461,903

 
$
4,396,716

 
1.5

 
 
 
 
 
 
 
 
 
LIABILITIES AND STOCKHOLDERS' EQUITY:
 
 
 
 
 
 
 
CURRENT LIABILITIES:
 
 
 
 
 
 
 
Floorplan notes payable - credit facility and other
 
$
1,136,654

 
$
1,265,719

 
(10.2
)
 
Offset account related to floorplan notes payable - credit facility
 
(59,626
)
 
(110,759
)
 
(46.2
)
 
Floorplan notes payable - manufacturer affiliates
 
392,661

 
389,071

 
0.9

 
Offset account related to floorplan notes payable - manufacturer affiliates
 
(25,500
)
 
(25,500
)
 
—

 
Current maturities of long-term debt and short-term financing
 
72,419

 
54,991

 
31.7

 
Current liabilities from interest rate risk management activities
 
3,941

 
—

 
100.0

 
Accounts payable
 
356,099

 
280,423

 
27.0

 
Accrued expenses
 
176,469

 
185,323

 
(4.8
)
 
Total current liabilities
 
2,053,117

 
2,039,268

 
0.7

 
5.00% SENIOR NOTES (principal of $550,000 at December 31, 2016 and December 31, 2015, respectively)
 
540,465

 
538,933

 
0.3

 
5.25% SENIOR NOTES (principal of $300,000 at December 31, 2016 and December 31, 2015, respectively)
 
295,591

 
295,156

 
0.1

 
REAL ESTATE RELATED AND OTHER LONG-TERM DEBT, net of current maturities
 
333,326

 
317,290

 
5.1

 
CAPITAL LEASE OBLIGATIONS RELATED TO REAL ESTATE, net of current maturities
 
43,427

 
48,155

 
(9.8
)
 
DEFERRED INCOME TAXES
 
161,502

 
136,644

 
18.2

 
LIABILITIES FROM INTEREST RATE RISK MANAGEMENT ACTIVITIES
 
20,470

 
31,153

 
(34.3
)
 
OTHER LIABILITIES
 
83,805

 
71,865

 
16.6

 
STOCKHOLDERS' EQUITY:
 
 
 
 
 
 
 
Common stock
 
257

 
257

 
—

 
Additional paid-in capital
 
290,899

 
291,092

 
(0.1
)
 
Retained earnings
 
1,053,301

 
926,169

 
13.7

 
Accumulated other comprehensive loss
 
(146,944
)
 
(137,984
)
 
6.5

 
Treasury stock
 
(267,313
)
 
(161,282
)
 
65.7

 
Total stockholders' equity
 
930,200

 
918,252

 
1.3

 
Total liabilities and stockholders' equity
 
$
4,461,903

 
$
4,396,716

 
1.5

 

3



Group 1 Automotive, Inc.
Additional Information - Consolidated
(Unaudited)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Three Months Ended
 
Twelve Months Ended
 
 
 
 
December 31,
 
December 31,
 
 
 
 
2016 (%)
 
2015 (%)
 
2016 (%)
 
2015 (%)
 
NEW VEHICLE UNIT SALES GEOGRAPHIC MIX:
 
 
 
 
 
 
 
 
Region
Geographic Market
 
 
 
 
 
 
 
 
 
East
Massachusetts
 
4.6

 
5.7

 
4.8

 
6.0

 
 
Georgia
 
4.5

 
4.4

 
4.3

 
4.5

 
 
Florida
 
2.8

 
2.6

 
2.6

 
2.1

 
 
New Hampshire
 
2.0

 
2.0

 
1.9

 
2.0

 
 
New Jersey
 
1.7

 
2.2

 
1.6

 
2.3

 
 
South Carolina
 
1.6

 
1.5

 
1.4

 
1.4

 
 
Louisiana
 
1.5

 
1.5

 
1.5

 
1.6

 
 
Mississippi
 
1.3

 
1.3

 
1.5

 
1.5

 
 
Alabama
 
0.9

 
0.9

 
0.9

 
0.8

 
 
Maryland
 
0.5

 
0.6

 
0.5

 
0.5

 
 
 
 
21.4

 
22.7

 
21.0

 
22.7

 
 
 
 
 
 
 
 
 
 
 
 
West
Texas
 
37.1

 
39.0

 
36.5

 
38.7

 
 
California
 
8.6

 
10.0

 
9.1

 
9.7

 
 
Oklahoma
 
6.4

 
7.5

 
6.8

 
7.6

 
 
Kansas
 
1.7

 
2.0

 
1.8

 
2.1

 
 
Louisiana
 
0.5

 
0.6

 
0.6

 
0.7

 
 
 
 
54.3

 
59.1

 
54.8

 
58.8

 
 
 
 
 
 
 
 
 
 
 
 
International
United Kingdom
 
18.7

 
9.9

 
18.4

 
10.7

 
 
Brazil
 
5.6

 
8.3

 
5.8

 
7.8

 
 
 
 
100.0

 
100.0

 
100.0

 
100.0

 
NEW VEHICLE UNIT SALES BRAND MIX:
 
 
 
 
 
 
 
 
 
Toyota/Scion/Lexus
 
25.8

 
26.2

 
24.9

 
26.5

 
BMW/MINI
 
14.4

 
12.3

 
13.5

 
11.6

 
Volkswagen/Audi/Porsche
 
11.2

 
6.7

 
11.0

 
6.9

 
Ford/Lincoln
 
10.8

 
10.9

 
11.0

 
11.4

 
Honda/Acura
 
8.8

 
11.0

 
9.9

 
10.9

 
Nissan
 
7.5

 
8.1

 
7.1

 
8.4

 
Chevrolet/GMC/Buick/Cadillac
 
7.0

 
8.0

 
7.4

 
7.6

 
Mercedes-Benz/smart/Sprinter
 
4.8

 
4.9

 
4.3

 
4.3

 
Chrysler/Dodge/Jeep/RAM
 
3.6

 
4.4

 
4.0

 
4.6

 
Hyundai/Kia
 
3.6

 
5.0

 
4.2

 
5.6

 
Other
 
2.5

 
2.5

 
2.7

 
2.2

 
 
 
100.0

 
100.0

 
100.0

 
100.0

 


4


Group 1 Automotive, Inc.
 
Additional Information - U.S.
 
(Unaudited)
 
(Dollars in thousands, except per unit amounts)
 
 
 
 
Three Months Ended December 31,
 
 
 
2016
 
2015
 
% Increase/(Decrease)
 
REVENUES:
 
 
 
 
 
 
 
New vehicle retail sales
 
$
1,207,922

 
$
1,295,513

 
(6.8
)
 
Used vehicle retail sales
 
532,913

 
542,796

 
(1.8
)
 
Used vehicle wholesale sales
 
70,954

 
72,548

 
(2.2
)
 
Total used
 
603,867

 
615,344

 
(1.9
)
 
Parts and service
 
266,033

 
260,974

 
1.9

 
Finance, insurance and other, net
 
93,112

 
92,645

 
0.5

 
Total
 
$
2,170,934

 
$
2,264,476

 
(4.1
)
 
GROSS MARGIN %:
 
 
 
 
 
 
 
New vehicle retail sales
 
5.4

 
5.0

 
 
 
Used vehicle retail sales
 
6.2

 
6.6

 
 
 
Used vehicle wholesale sales
 
(3.9
)
 
(1.6
)
 
 
 
Total used
 
5.0

 
5.6

 
 
 
Parts and service
 
53.8

 
54.3

 
 
 
Finance, insurance and other, net
 
100.0

 
100.0

 
 
 
Total
 
15.3

 
14.7

 
 
 
GROSS PROFIT:
 
 
 
 
 
 
 
New vehicle retail sales
 
$
65,101

 
$
64,947

 
0.2

 
Used vehicle retail sales
 
32,877

 
35,746

 
(8.0
)
 
Used vehicle wholesale sales
 
(2,796
)
 
(1,167
)
 
(139.6
)
 
Total used
 
30,081

 
34,579

 
(13.0
)
 
Parts and service
 
143,023

 
141,789

 
0.9

 
Finance, insurance and other, net
 
93,112

 
92,645

 
0.5

 
Total
 
$
331,317

 
$
333,960

 
(0.8
)
 
UNITS SOLD:
 
 
 
 
 
 
 
Retail new vehicles sold
 
31,779

 
35,605

 
(10.7
)
 
Retail used vehicles sold
 
24,866

 
25,564

 
(2.7
)
 
Wholesale used vehicles sold
 
10,115

 
10,768

 
(6.1
)
 
Total used
 
34,981

 
36,332

 
(3.7
)
 
AVERAGE RETAIL SALES PRICE:
 
 
 
 
 
 
 
New vehicle retail
 
$
38,010

 
$
36,386

 
4.5

 
Used vehicle retail
 
$
21,431

 
$
21,233

 
0.9

 
GROSS PROFIT PER UNIT SOLD:
 
 
 
 
 
 
 
New vehicle retail sales
 
$
2,049

 
$
1,824

 
12.3

 
Used vehicle retail sales
 
1,322

 
1,398

 
(5.4
)
 
Used vehicle wholesale sales
 
(276
)
 
(108
)
 
(155.6
)
 
Total used
 
860

 
952

 
(9.7
)
 
Finance, insurance and other, net (per retail unit)
 
$
1,644

 
$
1,515

 
8.5

 
OTHER:
 
 
 
 
 
 
 
SG&A expenses
 
$
227,411

 
$
240,001

 
(5.2
)
 
Adjusted SG&A expenses (1)
 
$
238,227

 
$
247,203

 
(3.6
)
 
SG&A as % revenues
 
10.5

 
10.6

 
 
 
Adjusted SG&A as % revenues (1)
 
11.0

 
10.9

 
 
 
SG&A as % gross profit
 
68.6

 
71.9

 
 
 
Adjusted SG&A as % gross profit (1)
 
71.9

 
74.0

 
 
 
Operating margin %
 
3.8

 
2.9

 
 
 
Adjusted operating margin % (1)
 
3.8

 
3.4

 
 
 
Pretax margin %
 
2.7

 
1.9

 
 
 
Adjusted pretax margin % (1)
 
2.6

 
2.3

 
 
 
INTEREST EXPENSE:
 
 
 
 
 
 
 
Floorplan interest expense
 
$
(10,015
)
 
$
(9,622
)
 
4.1

 
Floorplan assistance
 
12,201

 
13,128

 
(7.1
)
 
Net floorplan income
 
$
2,186

 
$
3,506

 
(37.6
)
 
Other interest expense, net
 
$
(15,740
)
 
$
(13,744
)
 
14.5

 

5


 
 
 
 
 
 
 
 
 
 
Twelve Months Ended December 31,
 
 
 
2016
 
2015
 
% Increase/(Decrease)
 
REVENUES:
 
 
 
 
 
 
 
New vehicle retail sales
 
$
4,766,047

 
$
4,989,290

 
(4.5
)
 
Used vehicle retail sales
 
2,242,508

 
2,204,728

 
1.7

 
Used vehicle wholesale sales
 
276,710

 
289,580

 
(4.4
)
 
Total used
 
2,519,218

 
2,494,308

 
1.0

 
Parts and service
 
1,071,651

 
1,032,960

 
3.7

 
Finance, insurance and other, net
 
377,756

 
377,432

 
0.1

 
Total
 
$
8,734,672

 
$
8,893,990

 
(1.8
)
 
GROSS MARGIN %:
 
 
 
 
 
 
 
New vehicle retail sales
 
5.1

 
4.8

 
 
 
Used vehicle retail sales
 
6.9

 
7.2

 
 
 
Used vehicle wholesale sales
 
(1.2
)
 
(0.5
)
 
 
 
Total used
 
6.0

 
6.3

 
 
 
Parts and service
 
54.4

 
54.7

 
 
 
Finance, insurance and other, net
 
100.0

 
100.0

 
 
 
Total
 
15.5

 
15.1

 
 
 
GROSS PROFIT:
 
 
 
 
 
 
 
New vehicle retail sales
 
$
242,773

 
$
240,496

 
0.9

 
Used vehicle retail sales
 
155,709

 
157,652

 
(1.2
)
 
Used vehicle wholesale sales
 
(3,439
)
 
(1,334
)
 
(157.8
)
 
Total used
 
152,270

 
156,318

 
(2.6
)
 
Parts and service
 
582,550

 
564,701

 
3.2

 
Finance, insurance and other, net
 
377,756

 
377,432

 
0.1

 
Total
 
$
1,355,349

 
$
1,338,947

 
1.2

 
UNITS SOLD:
 
 
 
 
 
 
 
Retail new vehicles sold
 
130,471

 
142,256

 
(8.3
)
 
Retail used vehicles sold
 
105,754

 
105,211

 
0.5

 
Wholesale used vehicles sold
 
41,009

 
44,310

 
(7.4
)
 
Total used
 
146,763

 
149,521

 
(1.8
)
 
AVERAGE RETAIL SALES PRICE:
 
 
 
 
 
 
 
New vehicle retail
 
$
36,530

 
$
35,073

 
4.2

 
Used vehicle retail
 
$
21,205

 
$
20,955

 
1.2

 
GROSS PROFIT PER UNIT SOLD:
 
 
 
 
 
 
 
New vehicle retail sales
 
$
1,861

 
$
1,691

 
10.1

 
Used vehicle retail sales
 
1,472

 
1,498

 
(1.7
)
 
Used vehicle wholesale sales
 
(84
)
 
(30
)
 
(180.0
)
 
Total used
 
1,038

 
1,045

 
(0.7
)
 
Finance, insurance and other, net (per retail unit)
 
$
1,599

 
$
1,525

 
4.9

 
OTHER:
 
 
 
 
 
 
 
SG&A expenses
 
$
965,139

 
$
958,608

 
0.7

 
Adjusted SG&A expenses (1)
 
$
971,908

 
$
964,911

 
0.7

 
SG&A as % revenues
 
11.0

 
10.8

 
 
 
Adjusted SG&A as % revenues (1)
 
11.1

 
10.8

 
 
 
SG&A as % gross profit
 
71.2

 
71.6

 
 
 
Adjusted SG&A as % gross profit (1)
 
71.7

 
72.1

 
 
 
Operating margin %
 
3.7

 
3.6

 
 
 
Adjusted operating margin % (1)
 
3.9

 
3.7

 
 
 
Pretax margin %
 
2.5

 
2.6

 
 
 
Adjusted pretax margin % (1)
 
2.7

 
2.7

 
 
 
INTEREST EXPENSE:
 
 
 
 
 
 
 
Floorplan interest expense
 
$
(40,444
)
 
$
(36,062
)
 
12.2

 
Floorplan assistance
 
48,377

 
49,631

 
(2.5
)
 
Net floorplan income
 
$
7,933

 
$
13,569

 
(41.5
)
 
Other interest expense, net
 
$
(62,320
)
 
$
(52,277
)
 
19.2

 
(1) See the section of this release entitled "Non-GAAP Financial Measures " and the tables attached hereto for information regarding certain selected items that the Company believes impact comparability of financial results between reporting periods, as well as for information regarding non-GAAP financial measures and their reconciliation to the most directly comparable measures as reported in accordance with U.S. GAAP.

6


Group 1 Automotive, Inc.
 
Additional Information - U.K.
 
(Unaudited)
 
(Dollars in thousands, except per unit amounts)
 
 
 
Three Months Ended December 31,
 
 
2016
 
2015
 
% Increase/(Decrease)
 
Constant Currency (1) % Increase/(Decrease)
 
REVENUES:
 
 
 
 
 
 
 
 
New vehicle retail sales
$
222,831

 
$
149,465

 
49.1

 
82.1

 
Used vehicle retail sales
94,403

 
81,682

 
15.6

 
41.3

 
Used vehicle wholesale sales
27,762

 
22,013

 
26.1

 
54.3

 
Total used
122,165

 
103,695

 
17.8

 
44.1

 
Parts and service
33,182

 
25,200

 
31.7

 
60.9

 
Finance, insurance and other, net
9,314

 
6,706

 
38.9

 
68.9

 
Total
$
387,492

 
$
285,066

 
35.9

 
66.1

 
GROSS MARGIN %:
 
 
 
 
 
 
 
 
New vehicle retail sales
6.0

 
6.4

 
 
 
 
 
Used vehicle retail sales
4.8

 
5.1

 
 
 
 
 
Used vehicle wholesale sales
(4.4
)
 
(3.2
)
 
 
 
 
 
Total used
2.7

 
3.3

 
 
 
 
 
Parts and service
55.8

 
54.1

 
 
 
 
 
Finance, insurance and other, net
100.0

 
100.0

 
 
 
 
 
Total
11.5

 
11.7

 
 
 
 
 
GROSS PROFIT:
 
 
 
 
 
 
 
 
New vehicle retail sales
$
13,308

 
$
9,506

 
40.0

 
69.8

 
Used vehicle retail sales
4,497

 
4,172

 
7.8

 
31.7

 
Used vehicle wholesale sales
(1,235
)
 
(699
)
 
(76.7
)
 
(114.4
)
 
Total used
3,262

 
3,473

 
(6.1
)
 
15.1

 
Parts and service
18,532

 
13,624

 
36.0

 
66.2

 
Finance, insurance and other, net
9,314

 
6,706

 
38.9

 
68.9

 
Total
$
44,416

 
$
33,309

 
33.3

 
62.4

 
UNITS SOLD:
 
 
 
 
 
 
 
 
Retail new vehicles sold
7,880

 
4,293

 
83.6

 
 
 
Retail used vehicles sold
4,429

 
3,211

 
37.9

 
 
 
Wholesale used vehicles sold
3,780

 
2,678

 
41.2

 
 
 
Total used
8,209

 
5,889

 
39.4

 
 
 
AVERAGE RETAIL SALES PRICE:
 
 
 
 
 
 
 
 
New vehicle retail
$
28,278

 
$
34,816

 
(18.8
)
 
(0.8
)
 
Used vehicle retail
$
21,315

 
$
25,438

 
(16.2
)
 
2.4

 
GROSS PROFIT PER UNIT SOLD:
 
 
 
 
 
 
 
 
New vehicle retail sales
$
1,689

 
$
2,214

 
(23.7
)
 
(7.5
)
 
Used vehicle retail sales
1,015

 
1,299

 
(21.9
)
 
(4.5
)
 
Used vehicle wholesale sales
(327
)
 
(261
)
 
(25.3
)
 
(51.9
)
 
Total used
397

 
590

 
(32.7
)
 
(17.4
)
 
Finance, insurance and other, net (per retail unit)
$
757

 
$
894

 
(15.3
)
 
3.0

 
OTHER:
 
 
 
 
 
 
 
 
SG&A expenses
$
39,482

 
$
27,191

 
45.2

 
77.2

 
Adjusted SG&A expenses (1)
$
39,137

 
$
27,191

 
43.9

 
75.7

 
SG&A as % revenues
10.2

 
9.5

 
 
 
 
 
Adjusted SG&A as % revenues (1)
10.1

 
9.5

 
 
 
 
 
SG&A as % gross profit
88.9

 
81.6

 
 
 
 
 
Adjusted SG&A as % gross profit (1)
88.1

 
81.6

 
 
 
 
 
Operating margin %
0.8

 
1.7

 
 
 
 
 
Adjusted operating margin % (1)
0.9

 
1.7

 
 
 
 
 
Pretax margin %
0.2

 
1.3

 
 
 
 
 
Adjusted pretax margin % (1)
0.3

 
1.3

 
 
 
 
 
INTEREST EXPENSE:
 
 
 
 
 
 
 
 
Floorplan interest expense
$
(1,085
)
 
$
(587
)
 
84.8

 
125.9

 
Floorplan assistance
182

 
259

 
(29.7
)
 
(14.0
)
 
Net floorplan expense
$
(903
)
 
$
(328
)
 
175.3

 
236.2

 
Other interest expense, net
$
(1,231
)
 
$
(796
)
 
54.6

 
88.6

 

7


 
Twelve Months Ended December 31,
 
 
2016
 
2015
 
% Increase/(Decrease)
 
Constant Currency (1) % Increase/(Decrease)
 
REVENUES:
 
 
 
 
 
 
 
 
New vehicle retail sales
$
987,538

 
$
641,888

 
53.8

 
73.5

 
Used vehicle retail sales
434,203

 
351,311

 
23.6

 
39.2

 
Used vehicle wholesale sales
121,747

 
100,706

 
20.9

 
36.2

 
Total used
555,950

 
452,017

 
23.0

 
38.6

 
Parts and service
143,362

 
102,183

 
40.3

 
58.4

 
Finance, insurance and other, net
36,305

 
24,117

 
50.5

 
70.1

 
Total
$
1,723,155

 
$
1,220,205

 
41.2

 
59.2

 
GROSS MARGIN %:
 
 
 
 
 
 
 
 
New vehicle retail sales
5.7

 
6.3

 
 
 
 
 
Used vehicle retail sales
5.0

 
5.2

 
 
 
 
 
Used vehicle wholesale sales
(1.0
)
 
(1.1
)
 
 
 
 
 
Total used
3.7

 
3.8

 
 
 
 
 
Parts and service
55.4

 
54.8

 
 
 
 
 
Finance, insurance and other, net
100.0

 
100.0

 
 
 
 
 
Total
11.2

 
11.3

 
 
 
 
 
GROSS PROFIT:
 
 
 
 
 
 
 
 
New vehicle retail sales
$
56,655

 
$
40,308

 
40.6

 
58.3

 
Used vehicle retail sales
21,826

 
18,335

 
19.0

 
33.7

 
Used vehicle wholesale sales
(1,181
)
 
(1,083
)
 
(9.0
)
 
(38.8
)
 
Total used
20,645

 
17,252

 
19.7

 
33.4

 
Parts and service
79,377

 
55,969

 
41.8

 
60.2

 
Finance, insurance and other, net
36,305

 
24,117

 
50.5

 
70.1

 
Total
$
192,982

 
$
137,646

 
40.2

 
58.0

 
UNITS SOLD:
 
 
 
 
 
 
 
 
Retail new vehicles sold
31,574

 
18,701

 
68.8

 
 
 
Retail used vehicles sold
18,830

 
14,074

 
33.8

 
 
 
Wholesale used vehicles sold
15,108

 
11,360

 
33.0

 
 
 
Total used
33,938

 
25,434

 
33.4

 
 
 
AVERAGE RETAIL SALES PRICE:
 
 
 
 
 
 
 
 
New vehicle retail
$
31,277

 
$
34,324

 
(8.9
)
 
2.7

 
Used vehicle retail
$
23,059

 
$
24,962

 
(7.6
)
 
4.1

 
GROSS PROFIT PER UNIT SOLD:
 
 
 
 
 
 
 
 
New vehicle retail sales
$
1,794

 
$
2,155

 
(16.8
)
 
(6.2
)
 
Used vehicle retail sales
1,159

 
1,303

 
(11.1
)
 
—

 
Used vehicle wholesale sales
(78
)
 
(95
)
 
17.9

 
(4.4
)
 
Total used
608

 
678

 
(10.3
)
 
—

 
Finance, insurance and other, net (per retail unit)
$
720

 
$
736

 
(2.2
)
 
10.6

 
OTHER:
 
 
 
 
 
 
 
 
SG&A expenses
$
158,636

 
$
108,719

 
45.9

 
65.1

 
Adjusted SG&A expenses (1)
$
157,730

 
$
108,511

 
45.4

 
64.5

 
SG&A as % revenues
9.2

 
8.9

 
 
 
 
 
Adjusted SG&A as % revenues (1)
9.2

 
8.9

 
 
 
 
 
SG&A as % gross profit
82.2

 
79.0

 
 
 
 
 
Adjusted SG&A as % gross profit (1)
81.7

 
78.8

 
 
 
 
 
Operating margin %
1.6

 
2.0

 
 
 
 
 
Adjusted operating margin % (1)
1.7

 
2.0

 
 
 
 
 
Pretax margin %
1.1

 
1.5

 
 
 
 
 
Adjusted pretax margin % (1)
1.1

 
1.6

 
 
 
 
 
INTEREST EXPENSE:
 
 
 
 
 
 
 
 
Floorplan interest expense
$
(4,222
)
 
$
(2,276
)
 
85.5

 
110.4

 
Floorplan assistance
825

 
843

 
(2.1
)
 
9.4

 
Net floorplan expense
$
(3,397
)
 
$
(1,433
)
 
137.1

 
169.8

 
Other interest expense, net
$
(5,197
)
 
$
(3,135
)
 
65.8

 
87.3

 
(1) See the section of this release entitled "Non-GAAP Financial Measures " and the tables attached hereto for information regarding certain selected items that the Company believes impact comparability of financial results between reporting periods, as well as for information regarding non-GAAP financial measures and their reconciliation to the most directly comparable measures as reported in accordance with U.S. GAAP.


8


 
Group 1 Automotive, Inc.
 
Additional Information - Brazil
 
(Unaudited)
 
(Dollars in thousands, except per unit amounts)
 
 
 
Three Months Ended December 31,
 
 
 
2016
 
2015
 
% Increase/(Decrease)
 
Constant Currency (1)  % Increase/(Decrease)
 
 
REVENUES:
 
 
 
 
 
 
 
 
 
New vehicle retail sales
$
76,760

 
$
88,130

 
(12.9
)
 
(25.1
)
 
 
Used vehicle retail sales
23,828

 
21,366

 
11.5

 
(4.2
)
 
 
Used vehicle wholesale sales
1,058

 
503

 
110.3

 
81.1

 
 
Total used
24,886

 
21,869

 
13.8

 
(2.2
)
 
 
Parts and service
11,751

 
11,080

 
6.1

 
(9.1
)
 
 
Finance, insurance and other, net
1,809

 
1,981

 
(8.7
)
 
(21.7
)
 
 
Total
$
115,206

 
$
123,060

 
(6.4
)
 
(19.5
)
 
 
GROSS MARGIN %:
 
 
 
 
 
 
 
 
 
New vehicle retail sales
6.1

 
6.4

 
 
 
 
 
 
Used vehicle retail sales
7.0

 
3.7

 
 
 
 
 
 
Used vehicle wholesale sales
4.8

 
6.8

 
 
 
 
 
 
Total used
6.9

 
3.8

 
 
 
 
 
 
Parts and service
44.7

 
39.6

 
 
 
 
 
 
Finance, insurance and other, net
100.0

 
100.0

 
 
 
 
 
 
Total
11.7

 
10.5

 
 
 
 
 
 
GROSS PROFIT:
 
 
 
 
 
 
 
 
 
New vehicle retail sales
$
4,659

 
$
5,673

 
(17.9
)
 
(29.4
)
 
 
Used vehicle retail sales
1,672

 
789

 
111.9

 
82.0

 
 
Used vehicle wholesale sales
51

 
34

 
50.0

 
27.2

 
 
Total used
1,723

 
823

 
109.4

 
79.7

 
 
Parts and service
5,257

 
4,387

 
19.8

 
3.0

 
 
Finance, insurance and other, net
1,809

 
1,981

 
(8.7
)
 
(21.7
)
 
 
Total
$
13,448

 
$
12,864

 
4.5

 
(10.2
)
 
 
UNITS SOLD:
 
 
 
 
 
 
 
 
 
Retail new vehicles sold
2,372

 
3,586

 
(33.9
)
 
 
 
 
Retail used vehicles sold
1,082

 
1,465

 
(26.1
)
 
 
 
 
Wholesale used vehicles sold
367

 
287

 
27.9

 
 
 
 
Total used
1,449

 
1,752

 
(17.3
)
 
 
 
 
AVERAGE RETAIL SALES PRICE:
 
 
 
 
 
 
 
 
 
New vehicle retail
$
32,361

 
$
24,576

 
31.7

 
13.2

 
 
Used vehicle retail
$
22,022

 
$
14,584

 
51.0

 
29.7

 
 
GROSS PROFIT PER UNIT SOLD:
 
 
 
 
 
 
 
 
 
New vehicle retail sales
$
1,964

 
$
1,582

 
24.1

 
6.7

 
 
Used vehicle retail sales
1,545

 
539

 
186.6

 
146.4

 
 
Used vehicle wholesale sales
139

 
118

 
17.8

 
(0.5
)
 
 
Total used
1,189

 
470

 
153.0

 
117.3

 
 
Finance, insurance and other, net (per retail unit)
$
524

 
$
392

 
33.7

 
14.5

 
 
OTHER:
 
 
 
 
 
 
 
 
 
SG&A expenses
$
12,178

 
$
12,593

 
(3.3
)
 
(17.1
)
 
 
Adjusted SG&A expenses (1)
$
12,178

 
$
11,847

 
2.8

 
(11.8
)
 
 
SG&A as % revenues
10.6

 
10.2

 
 
 
 
 
 
Adjusted SG&A as % revenues (1)
10.6

 
9.6

 
 
 
 
 
 
SG&A as % gross profit
90.6

 
97.9

 
 
 
 
 
 
Adjusted SG&A as % gross profit (1)
90.6

 
92.1

 
 
 
 
 
 
Operating margin %
(8.2
)
 
(54.8
)
 
 
 
 
 
 
Adjusted operating margin % (1)
0.8

 
0.6

 
 
 
 
 
 
Pretax margin %
(8.5
)
 
(55.0
)
 
 
 
 
 
 
Adjusted pretax margin % (1)
0.5

 
0.3

 
 
 
 
 
 
INTEREST EXPENSE:
 
 
 
 
 
 
 
 
 
Floorplan interest expense
$
(89
)
 
$
(7
)
 
1,171.4

 
877.4

 
 
Floorplan assistance
—

 
—

 
—

 
—

 
 
Net floorplan expense
$
(89
)
 
$
(7
)
 
1,171.4

 
877.4

 
 
Other interest expense, net
$
(237
)
 
$
(303
)
 
(21.8
)
 
(33.1
)
 


9


 
Twelve Months Ended December 31,
 
 
2016
 
2015
 
% Increase/(Decrease)
 
Constant Currency (1) % Increase/(Decrease)
 
REVENUES:
 
 
 
 
 
 
 
 
New vehicle retail sales
$
292,490

 
$
370,128

 
(21.0
)
 
(17.2
)
 
Used vehicle retail sales
81,002

 
82,930

 
(2.3
)
 
2.4

 
Used vehicle wholesale sales
3,406

 
6,965

 
(51.1
)
 
(45.5
)
 
Total used
84,408

 
89,895

 
(6.1
)
 
(1.3
)
 
Parts and service
46,294

 
51,050

 
(9.3
)
 
(4.2
)
 
Finance, insurance and other, net
6,593

 
7,237

 
(8.9
)
 
(5.5
)
 
Total
$
429,785

 
$
518,310

 
(17.1
)
 
(12.9
)
 
GROSS MARGIN %:
 
 
 
 
 
 
 
 
New vehicle retail sales
5.8

 
6.7

 
 
 
 
 
Used vehicle retail sales
6.1

 
4.2

 
 
 
 
 
Used vehicle wholesale sales
5.2

 
7.1

 
 
 
 
 
Total used
6.1

 
4.4

 
 
 
 
 
Parts and service
39.0

 
42.1

 
 
 
 
 
Finance, insurance and other, net
100.0

 
100.0

 
 
 
 
 
Total
10.9

 
11.1

 
 
 
 
 
GROSS PROFIT:
 
 
 
 
 
 
 
 
New vehicle retail sales
$
16,950

 
$
24,673

 
(31.3
)
 
(27.7
)
 
Used vehicle retail sales
4,944

 
3,483

 
41.9

 
47.0

 
Used vehicle wholesale sales
178

 
497

 
(64.2
)
 
(60.0
)
 
Total used
5,122

 
3,980

 
28.7

 
33.7

 
Parts and service
18,073

 
21,489

 
(15.9
)
 
(10.8
)
 
Finance, insurance and other, net
6,593

 
7,237

 
(8.9
)
 
(5.5
)
 
Total
$
46,738

 
$
57,379

 
(18.5
)
 
(14.3
)
 
UNITS SOLD:
 
 
 
 
 
 
 
 
Retail new vehicles sold
10,008

 
13,657

 
(26.7
)
 
 
 
Retail used vehicles sold
4,547

 
4,868

 
(6.6
)
 
 
 
Wholesale used vehicles sold
1,222

 
1,556

 
(21.5
)
 
 
 
Total used
5,769

 
6,424

 
(10.2
)
 
 
 
AVERAGE RETAIL SALES PRICE:
 
 
 
 
 
 
 
 
New vehicle retail
$
29,226

 
$
27,102

 
7.8

 
13.0

 
Used vehicle retail
$
17,814

 
$
17,036

 
4.6

 
9.6

 
GROSS PROFIT PER UNIT SOLD:
 
 
 
 
 
 
 
 
New vehicle retail sales
$
1,694

 
$
1,807

 
(6.3
)
 
(1.3
)
 
Used vehicle retail sales
1,087

 
715

 
52.0

 
57.4

 
Used vehicle wholesale sales
146

 
319

 
(54.2
)
 
(49.0
)
 
Total used
888

 
620

 
43.2

 
48.8

 
Finance, insurance and other, net (per retail unit)
$
453

 
$
391

 
15.9

 
20.3

 
OTHER:
 
 
 
 
 
 
 
 
SG&A expenses
$
46,988

 
$
53,506

 
(12.2
)
 
(7.5
)
 
Adjusted SG&A expenses (1)
$
46,342

 
$
52,760

 
(12.2
)
 
(7.3
)
 
SG&A as % revenues
10.9

 
10.3

 
 
 
 
 
Adjusted SG&A as % revenues (1)
10.8

 
10.2

 
 
 
 
 
SG&A as % gross profit
100.5

 
93.3

 
 
 
 
 
Adjusted SG&A as % gross profit (1)
99.2

 
92.0

 
 
 
 
 
Operating margin %
(2.9
)
 
(12.8
)
 
 
 
 
 
Adjusted operating margin % (1)
(0.2
)
 
0.6

 
 
 
 
 
Pretax margin %
(3.0
)
 
(13.2
)
 
 
 
 
 
Adjusted pretax margin % (1)
(0.3
)
 
0.1

 
 
 
 
 
INTEREST EXPENSE:
 
 
 
 
 
 
 
 
Floorplan interest expense
$
(261
)
 
$
(926
)
 
(71.8
)
 
(67.5
)
 
Floorplan assistance
—

 
—

 
—

 
—

 
Net floorplan expense
$
(261
)
 
$
(926
)
 
(71.8
)
 
(67.5
)
 
Other interest expense, net
$
(418
)
 
$
(1,491
)
 
(72.0
)
 
(70.0
)
 
(1) See the section of this release entitled "Non-GAAP Financial Measures " and the tables attached hereto for information regarding certain selected items that the Company believes impact comparability of financial results between reporting periods, as well as for information regarding non-GAAP financial measures and their reconciliation to the most directly comparable measures as reported in accordance with U.S. GAAP.


10


Group 1 Automotive, Inc.
 
Additional Information - Consolidated
 
(Unaudited)
 
(Dollars in thousands, except per unit amounts)
 
 
 
Three Months Ended December 31,
 
 
2016
 
2015
 
% Increase/(Decrease)
 
Constant Currency (1)  % Increase/(Decrease)
 
REVENUES:
 
 
 
 
 
 
 
 
New vehicle retail sales
$
1,507,513

 
$
1,533,108

 
(1.7
)
 
0.8

 
Used vehicle retail sales
651,144

 
645,844

 
0.8

 
3.6

 
Used vehicle wholesale sales
99,774

 
95,064

 
5.0

 
11.3

 
Total used
750,918

 
740,908

 
1.4

 
4.6

 
Parts and service
310,966

 
297,254

 
4.6

 
6.5

 
Finance, insurance and other, net
104,235

 
101,332

 
2.9

 
4.6

 
Total
$
2,673,632

 
$
2,672,602

 
—

 
2.6

 
GROSS MARGIN %:
 
 
 
 
 
 
 
 
New vehicle retail sales
5.5

 
5.2

 
 
 
 
 
Used vehicle retail sales
6.0

 
6.3

 
 
 
 
 
Used vehicle wholesale sales
(4.0
)
 
(1.9
)
 
 
 
 
 
Total used
4.7

 
5.2

 
 
 
 
 
Parts and service
53.6

 
53.8

 
 
 
 
 
Finance, insurance and other, net
100.0

 
100.0

 
 
 
 
 
Total
14.6

 
14.2

 
 
 
 
 
GROSS PROFIT:
 
 
 
 
 
 
 
 
New vehicle retail sales
$
83,068

 
$
80,126

 
3.7

 
6.4

 
Used vehicle retail sales
39,046

 
40,707

 
(4.1
)
 
(2.2
)
 
Used vehicle wholesale sales
(3,980
)
 
(1,832
)
 
(117.2
)
 
(132.1
)
 
Total used
35,066

 
38,875

 
(9.8
)
 
(8.5
)
 
Parts and service
166,812

 
159,800

 
4.4

 
6.5

 
Finance, insurance and other, net
104,235

 
101,332

 
2.9

 
4.6

 
Total
$
389,181

 
$
380,133

 
2.4

 
4.4

 
UNITS SOLD:
 
 
 
 
 
 
 
 
Retail new vehicles sold
42,031

 
43,484

 
(3.3
)
 
 
 
Retail used vehicles sold
30,377

 
30,240

 
0.5

 
 
 
Wholesale used vehicles sold
14,262

 
13,733

 
3.9

 
 
 
Total used
44,639

 
43,973

 
1.5

 
 
 
AVERAGE RETAIL SALES PRICE:
 
 
 
 
 
 
 
 
New vehicle retail
$
35,867

 
$
35,257

 
1.7

 
4.3

 
Used vehicle retail
$
21,435

 
$
21,357

 
0.4

 
3.1

 
GROSS PROFIT PER UNIT SOLD:
 
 
 
 
 
 
 
 
New vehicle retail sales
$
1,976

 
$
1,843

 
7.2

 
10.1

 
Used vehicle retail sales
1,285

 
1,346

 
(4.5
)
 
(2.6
)
 
Used vehicle wholesale sales
(279
)
 
(133
)
 
(109.8
)
 
(123.5
)
 
Total used
786

 
884

 
(11.1
)
 
(9.9
)
 
Finance, insurance and other, net (per retail unit)
$
1,440

 
$
1,374

 
4.8

 
6.5

 
OTHER:
 
 
 
 
 
 
 
 
SG&A expenses
$
279,071

 
$
279,785

 
(0.3
)
 
2.2

 
Adjusted SG&A expenses (1)
$
289,542

 
$
286,240

 
1.2

 
3.6

 
SG&A as % revenues
10.4

 
10.5

 
 
 
 
 
Adjusted SG&A as % revenues (1)
10.8

 
10.7

 
 
 
 
 
SG&A as % gross profit
71.7

 
73.6

 
 
 
 
 
Adjusted SG&A as % gross profit (1)
74.4

 
75.3

 
 
 
 
 
Operating margin %
2.9

 
0.1

 
 
 
 
 
Adjusted operating margin % (1)
3.2

 
3.1

 
 
 
 
 
Pretax margin %
1.8

 
(0.8
)
 
 
 
 
 
Adjusted pretax margin % (1)
2.2

 
2.1

 
 
 
 
 
INTEREST EXPENSE:
 
 
 
 
 
 
 
 
Floorplan interest expense
$
(11,189
)
 
$
(10,216
)
 
9.5

 
11.7

 
Floorplan assistance
12,383

 
13,387

 
(7.5
)
 
(7.5
)
 
Net floorplan income
$
1,194

 
$
3,171

 
(62.3
)
 
(69.5
)
 
Other interest expense, net
$
(17,208
)
 
$
(14,843
)
 
15.9

 
17.5

 

11


 
Twelve Months Ended December 31,
 
 
2016
 
2015
 
% Increase/(Decrease)
 
Constant Currency (1) % Increase/(Decrease)
 
REVENUES:
 
 
 
 
 
 
 
 
New vehicle retail sales
$
6,046,075

 
$
6,001,306

 
0.7

 
3.1

 
Used vehicle retail sales
2,757,713

 
2,638,969

 
4.5

 
6.7

 
Used vehicle wholesale sales
401,863

 
397,251

 
1.2

 
5.2

 
Total used
3,159,576

 
3,036,220

 
4.1

 
6.5

 
Parts and service
1,261,307

 
1,186,193

 
6.3

 
8.1

 
Finance, insurance and other, net
420,654

 
408,786

 
2.9

 
4.1

 
Total
$
10,887,612

 
$
10,632,505

 
2.4

 
4.7

 
GROSS MARGIN %:
 
 
 
 
 
 
 
 
New vehicle retail sales
5.2

 
5.1

 
 
 
 
 
Used vehicle retail sales
6.6

 
6.8

 
 
 
 
 
Used vehicle wholesale sales
(1.1
)
 
(0.5
)
 
 
 
 
 
Total used
5.6

 
5.8

 
 
 
 
 
Parts and service
53.9

 
54.1

 
 
 
 
 
Finance, insurance and other, net
100.0

 
100.0

 
 
 
 
 
Total
14.7

 
14.4

 
 
 
 
 
GROSS PROFIT:
 
 
 
 
 
 
 
 
New vehicle retail sales
$
316,378

 
$
305,477

 
3.6

 
6.2

 
Used vehicle retail sales
182,479

 
179,470

 
1.7

 
3.3

 
Used vehicle wholesale sales
(4,442
)
 
(1,920
)
 
(131.4
)
 
(146.9
)
 
Total used
178,037

 
177,550

 
0.3

 
1.7

 
Parts and service
680,000

 
642,159

 
5.9

 
7.7

 
Finance, insurance and other, net
420,654

 
408,786

 
2.9

 
4.1

 
Total
$
1,595,069

 
$
1,533,972

 
4.0

 
5.7

 
UNITS SOLD:
 
 
 
 
 
 
 
 
Retail new vehicles sold
172,053

 
174,614

 
(1.5
)
 
 
 
Retail used vehicles sold
129,131

 
124,153

 
4.0

 
 
 
Wholesale used vehicles sold
57,339

 
57,226

 
0.2

 
 
 
Total used
186,470

 
181,379

 
2.8

 
 
 
AVERAGE RETAIL SALES PRICE:
 
 
 
 
 
 
 
 
New vehicle retail
$
35,141

 
$
34,369

 
2.2

 
4.6

 
Used vehicle retail
$
21,356

 
$
21,256

 
0.5

 
2.6

 
GROSS PROFIT PER UNIT SOLD:
 
 
 
 
 
 
 
 
New vehicle retail sales
$
1,839

 
$
1,749

 
5.1

 
7.8

 
Used vehicle retail sales
1,413

 
1,446

 
(2.3
)
 
(0.7
)
 
Used vehicle wholesale sales
(77
)
 
(34
)
 
(126.5
)
 
(146.5
)
 
Total used
955

 
979

 
(2.5
)
 
(1.1
)
 
Finance, insurance and other, net (per retail unit)
$
1,397

 
$
1,368

 
2.1

 
3.3

 
OTHER:
 
 
 
 
 
 
 
 
SG&A expenses
$
1,170,763

 
$
1,120,833

 
4.5

 
6.5

 
Adjusted SG&A expenses (1)
$
1,175,980

 
$
1,126,182

 
4.4

 
6.5

 
SG&A as % revenues
10.8

 
10.5

 
 
 
 
 
Adjusted SG&A as % revenues (1)
10.8

 
10.6

 
 
 
 
 
SG&A as % gross profit
73.4

 
73.1

 
 
 
 
 
Adjusted SG&A as % gross profit (1)
73.7

 
73.4

 
 
 
 
 
Operating margin %
3.1

 
2.6

 
 
 
 
 
Adjusted operating margin % (1)
3.4

 
3.4

 
 
 
 
 
Pretax margin %
2.1

 
1.7

 
 
 
 
 
Adjusted pretax margin % (1)
2.3

 
2.5

 
 
 
 
 
INTEREST EXPENSE:
 
 
 
 
 
 
 
 
Floorplan interest expense
$
(44,927
)
 
$
(39,264
)
 
14.4

 
16.0

 
Floorplan assistance
49,202

 
50,474

 
(2.5
)
 
(2.5
)
 
Net floorplan income
$
4,275

 
$
11,210

 
(61.9
)
 
(67.3
)
 
Other interest expense, net
$
(67,936
)
 
$
(56,903
)
 
19.4

 
20.6

 
(1) See the section of this release entitled "Non-GAAP Financial Measures " and the tables attached hereto for information regarding certain selected items that the Company believes impact comparability of financial results between reporting periods, as well as for information regarding non-GAAP financial measures and their reconciliation to the most directly comparable measures as reported in accordance with U.S. GAAP.


12


Group 1 Automotive, Inc.
Additional Information - Same Store U.S. (1)
(Unaudited)
(Dollars in thousands, except per unit amounts)
 
 
 
 
 
 
 
 
Three Months Ended December 31,
 
 
2016
 
2015
 
% Increase/(Decrease)
 
REVENUES:
 
 
 
 
 
 
New vehicle retail sales
$
1,207,486

 
$
1,253,970

 
(3.7
)
 
Used vehicle retail sales
532,880

 
527,051

 
1.1

 
Used vehicle wholesale sales
70,622

 
69,223

 
2.0

 
Total used
603,502

 
596,274

 
1.2

 
Parts and service
266,012

 
253,165

 
5.1

 
Finance, insurance and other, net
92,661

 
90,563

 
2.3

 
Total
$
2,169,661

 
$
2,193,972

 
(1.1
)
 
GROSS MARGIN %:
 
 
 
 
 
 
New vehicle retail sales
5.4

 
5.1

 
 
 
Used vehicle retail sales
6.2

 
6.6

 
 
 
Used vehicle wholesale sales
(3.9
)
 
(1.4
)
 
 
 
Total used
5.0

 
5.7

 
 
 
Parts and service
53.7

 
54.2

 
 
 
Finance, insurance and other, net
100.0

 
100.0

 
 
 
Total
15.2

 
14.8

 
 
 
GROSS PROFIT:
 
 
 
 
 
 
New vehicle retail sales
$
64,912

 
$
63,728

 
1.9

 
Used vehicle retail sales
32,880

 
34,963

 
(6.0
)
 
Used vehicle wholesale sales
(2,748
)
 
(985
)
 
(179.0
)
 
Total used
30,132

 
33,978

 
(11.3
)
 
Parts and service
142,892

 
137,316

 
4.1

 
Finance, insurance and other, net
92,661

 
90,563

 
2.3

 
Total
$
330,597

 
$
325,585

 
1.5

 
UNITS SOLD:
 
 
 
 
 
 
Retail new vehicles sold
31,765

 
34,175

 
(7.1
)
 
Retail used vehicles sold
24,864

 
24,859

 
—

 
Wholesale used vehicles sold
10,090

 
10,277

 
(1.8
)
 
Total used
34,954

 
35,136

 
(0.5
)
 
AVERAGE RETAIL SALES PRICE:
 
 
 
 
 
 
New vehicle retail
$
38,013

 
$
36,693

 
3.6

 
Used vehicle retail
$
21,432

 
$
21,202

 
1.1

 
GROSS PROFIT PER UNIT SOLD:
 
 
 
 
 
 
New vehicle retail sales
$
2,044

 
$
1,865

 
9.6

 
Used vehicle retail sales
1,322

 
1,406

 
(6.0
)
 
Used vehicle wholesale sales
(272
)
 
(96
)
 
(183.3
)
 
Total used
862

 
967

 
(10.9
)
 
Finance, insurance and other, net (per retail unit)
$
1,636

 
$
1,534

 
6.6

 
OTHER:
 
 
 
 
 
 
SG&A expenses
$
229,943

 
$
238,889

 
(3.7
)
 
Adjusted SG&A expenses (2)
$
237,970

 
$
238,047

 
—

 
SG&A as % revenues
10.6

 
10.9

 
 
 
Adjusted SG&A as % revenues (2)
11.0

 
10.9

 
 
 
SG&A as % gross profit
69.6

 
73.4

 
 
 
Adjusted SG&A as % gross profit (2)
72.0

 
73.1

 
 
 
Operating margin %
3.7

 
2.8

 
 
 
Adjusted operating margin % (2)
3.8

 
3.5

 
 
 


13


 
Twelve Months Ended December 31,
 
 
2016
 
2015
 
% Increase/(Decrease)
 
REVENUES:
 
 
 
 
 
 
New vehicle retail sales
$
4,691,033

 
$
4,869,109

 
(3.7
)
 
Used vehicle retail sales
2,203,802

 
2,155,468

 
2.2

 
Used vehicle wholesale sales
270,687

 
278,909

 
(2.9
)
 
Total used
2,474,489

 
2,434,377

 
1.6

 
Parts and service
1,054,945

 
1,006,640

 
4.8

 
Finance, insurance and other, net
371,544

 
371,603

 
—

 
Total
$
8,592,011

 
$
8,681,729

 
(1.0
)
 
GROSS MARGIN %:
 
 
 
 
 
 
New vehicle retail sales
5.1

 
4.8

 
 
 
Used vehicle retail sales
6.9

 
7.2

 
 
 
Used vehicle wholesale sales
(1.2
)
 
(0.3
)
 
 
 
Total used
6.1

 
6.3

 
 
 
Parts and service
54.3

 
54.6

 
 
 
Finance, insurance and other, net
100.0

 
100.0

 
 
 
Total
15.5

 
15.1

 
 
 
GROSS PROFIT:
 
 
 
 
 
 
New vehicle retail sales
$
237,915

 
$
235,706

 
0.9

 
Used vehicle retail sales
152,960

 
154,958

 
(1.3
)
 
Used vehicle wholesale sales
(3,120
)
 
(834
)
 
(274.1
)
 
Total used
149,840

 
154,124

 
(2.8
)
 
Parts and service
572,729

 
549,952

 
4.1

 
Finance, insurance and other, net
371,544

 
371,603

 
—

 
Total
$
1,332,028

 
$
1,311,385

 
1.6

 
UNITS SOLD:
 
 
 
 
 
 
Retail new vehicles sold
128,928

 
138,599

 
(7.0
)
 
Retail used vehicles sold
104,451

 
103,151

 
1.3

 
Wholesale used vehicles sold
40,457

 
42,928

 
(5.8
)
 
Total used
144,908

 
146,079

 
(0.8
)
 
AVERAGE RETAIL SALES PRICE:
 
 
 
 
 
 
New vehicle retail
$
36,385

 
$
35,131

 
3.6

 
Used vehicle retail
$
21,099

 
$
20,896

 
1.0

 
GROSS PROFIT PER UNIT SOLD:
 
 
 
 
 
 
New vehicle retail sales
$
1,845

 
$
1,701

 
8.5

 
Used vehicle retail sales
1,464

 
1,502

 
(2.5
)
 
Used vehicle wholesale sales
(77
)
 
(19
)
 
(305.3
)
 
Total used
1,034

 
1,055

 
(2.0
)
 
Finance, insurance and other, net (per retail unit)
$
1,592

 
$
1,537

 
3.6

 
OTHER: 
 
 
 
 
 
 
SG&A expenses
$
952,597

 
$
939,535

 
1.4

 
Adjusted SG&A expenses (2)
$
954,336

 
$
936,378

 
1.9

 
SG&A as % revenues
11.1

 
10.8

 
 
 
Adjusted SG&A as % revenues (2)
11.1

 
10.8

 
 
 
SG&A as % gross profit
71.5

 
71.6

 
 
 
Adjusted SG&A as % gross profit (2)
71.6

 
71.4

 
 
 
Operating margin %
3.7

 
3.6

 
 
 
Adjusted operating margin % (2)
3.9

 
3.9

 
 
 
(1) Same Store amounts include the results for the identical months in each period presented in the comparison, commencing with the first full month we owned the dealership and, in the case of dispositions, ending with the last full month we owned it. Same Store results also include the activities of our corporate office.
(2) See the section of this release entitled "Non-GAAP Financial Measures " and the tables attached hereto for information regarding certain selected items that the Company believes impact comparability of financial results between reporting periods, as well as for information regarding non-GAAP financial measures and their reconciliation to the most directly comparable measures as reported in accordance with U.S. GAAP.


14


Group 1 Automotive, Inc.
Additional Information - Same Store U.K. (1)
(Unaudited)
(Dollars in thousands, except per unit amounts)
 
 
 
 
 
 
 
 
 
 
Three Months Ended December 31,
 
 
2016
 
2015
 
% Increase/(Decrease)
 
Constant Currency (2) % Increase/(Decrease)
 
REVENUES:
 
 
 
 
 
 
 
 
New vehicle retail sales
$
148,449

 
$
149,465

 
(0.7
)
 
21.3

 
Used vehicle retail sales
71,210

 
81,682

 
(12.8
)
 
6.6

 
Used vehicle wholesale sales
20,106

 
22,014

 
(8.7
)
 
11.8

 
Total used
91,316

 
103,696

 
(11.9
)
 
7.7

 
Parts and service
22,209

 
25,199

 
(11.9
)
 
7.7

 
Finance, insurance and other, net
6,508

 
6,706

 
(3.0
)
 
18.0

 
Total
$
268,482

 
$
285,066

 
(5.8
)
 
15.1

 
GROSS MARGIN %:
 
 
 
 
 
 
 
 
New vehicle retail sales
5.9

 
6.4

 
 
 
 
 
Used vehicle retail sales
5.2

 
5.1

 
 
 
 
 
Used vehicle wholesale sales
(2.2
)
 
(3.2
)
 
 
 
 
 
Total used
3.6

 
3.3

 
 
 
 
 
Parts and service
56.3

 
54.1

 
 
 
 
 
Finance, insurance and other, net
100.0

 
100.0

 
 
 
 
 
Total
11.6

 
11.7

 
 
 
 
 
GROSS PROFIT:
 
 
 
 
 
 
 
 
New vehicle retail sales
$
8,814

 
$
9,506

 
(7.3
)
 
12.5

 
Used vehicle retail sales
3,718

 
4,172

 
(10.9
)
 
8.9

 
Used vehicle wholesale sales
(447
)
 
(699
)
 
36.1

 
22.6

 
Total used
3,271

 
3,473

 
(5.8
)
 
15.3

 
Parts and service
12,507

 
13,624

 
(8.2
)
 
12.1

 
Finance, insurance and other, net
6,508

 
6,706

 
(3.0
)
 
18.0

 
Total
$
31,100

 
$
33,309

 
(6.6
)
 
13.7

 
UNITS SOLD:
 
 
 
 
 
 
 
 
Retail new vehicles sold
5,105

 
4,293

 
18.9

 
 
 
Retail used vehicles sold
3,448

 
3,211

 
7.4

 
 
 
Wholesale used vehicles sold
2,761

 
2,678

 
3.1

 
 
 
Total used
6,209

 
5,889

 
5.4

 
 
 
AVERAGE RETAIL SALES PRICE:
 
 
 
 
 
 
 
 
New vehicle retail
$
29,079

 
$
34,816

 
(16.5
)
 
2.0

 
Used vehicle retail
$
20,653

 
$
25,438

 
(18.8
)
 
(0.7
)
 
GROSS PROFIT PER UNIT SOLD:
 
 
 
 
 
 
 
 
New vehicle retail sales
$
1,727

 
$
2,214

 
(22.0
)
 
(5.4
)
 
Used vehicle retail sales
1,078

 
1,299

 
(17.0
)
 
1.4

 
Used vehicle wholesale sales
(162
)
 
(261
)
 
37.9

 
25.0

 
Total used
527

 
590

 
(10.7
)
 
9.3

 
Finance, insurance and other, net (per retail unit)
$
761

 
$
894

 
(14.9
)
 
3.6

 
OTHER:
 
 
 
 
 
 
 
 
SG&A expenses
$
25,682

 
$
27,223

 
(5.7
)
 
15.1

 
Adjusted SG&A expenses (2)
$
25,621

 
$
27,223

 
(5.9
)
 
14.9

 
SG&A as % revenues
9.6

 
9.5

 
 
 
 
 
Adjusted SG&A as % revenues (2)
9.5

 
9.5

 
 
 
 
 
SG&A as % gross profit
82.6

 
81.7

 
 
 
 
 
Adjusted SG&A as % gross profit (2)
82.4

 
81.7

 
 
 
 
 
Operating margin %
1.6

 
1.7

 
 
 
 
 
Adjusted operating margin % (2)
1.6

 
1.7

 
 
 
 
 


15


 
Twelve Months Ended December 31,
 
 
2016
 
2015
 
% Increase/(Decrease)
 
Constant Currency (2) % Increase/(Decrease)
 
REVENUES:
 
 
 
 
 
 
 
 
New vehicle retail sales
$
652,057

 
$
641,888

 
1.6

 
14.5

 
Used vehicle retail sales
332,439

 
351,311

 
(5.4
)
 
6.5

 
Used vehicle wholesale sales
90,468

 
100,706

 
(10.2
)
 
1.1

 
Total used
422,907

 
452,017

 
(6.4
)
 
5.3

 
Parts and service
98,273

 
102,183

 
(3.8
)
 
8.5

 
Finance, insurance and other, net
25,694

 
24,117

 
6.5

 
20.3

 
Total
$
1,198,931

 
$
1,220,205

 
(1.7
)
 
10.7

 
GROSS MARGIN %:
 
 
 
 
 
 
 
 
New vehicle retail sales
6.0

 
6.3

 
 
 
 
 
Used vehicle retail sales
5.3

 
5.2

 
 
 
 
 
Used vehicle wholesale sales
(0.1
)
 
(1.1
)
 
 
 
 
 
Total used
4.1

 
3.8

 
 
 
 
 
Parts and service
55.5

 
54.8

 
 
 
 
 
Finance, insurance and other, net
100.0

 
100.0

 
 
 
 
 
Total
11.4

 
11.3

 
 
 
 
 
GROSS PROFIT:
 
 
 
 
 
 
 
 
New vehicle retail sales
$
39,241

 
$
40,300

 
(2.6
)
 
9.5

 
Used vehicle retail sales
17,514

 
18,335

 
(4.5
)
 
7.4

 
Used vehicle wholesale sales
(100
)
 
(1,083
)
 
90.8

 
83.2

 
Total used
17,414

 
17,252

 
0.9

 
13.1

 
Parts and service
54,509

 
55,970

 
(2.6
)
 
9.9

 
Finance, insurance and other, net
25,694

 
24,117

 
6.5

 
20.3

 
Total
$
136,858

 
$
137,639

 
(0.6
)
 
12.0

 
UNITS SOLD:
 
 
 
 
 
 
 
 
Retail new vehicles sold
20,401

 
18,701

 
9.1

 
 
 
Retail used vehicles sold
14,861

 
14,074

 
5.6

 
 
 
Wholesale used vehicles sold
11,645

 
11,360

 
2.5

 
 
 
Total used
26,506

 
25,434

 
4.2

 
 
 
AVERAGE RETAIL SALES PRICE:
 
 
 
 
 
 
 
 
New vehicle retail
$
31,962

 
$
34,324

 
(6.9
)
 
4.9

 
Used vehicle retail
$
22,370

 
$
24,962

 
(10.4
)
 
0.8

 
GROSS PROFIT PER UNIT SOLD:
 
 
 
 
 
 
 
 
New vehicle retail sales
$
1,923

 
$
2,155

 
(10.8
)
 
0.4

 
Used vehicle retail sales
1,179

 
1,303

 
(9.5
)
 
1.7

 
Used vehicle wholesale sales
(9
)
 
(95
)
 
90.5

 
83.6

 
Total used
657

 
678

 
(3.1
)
 
8.5

 
Finance, insurance and other, net (per retail unit)
$
729

 
$
736

 
(1.0
)
 
11.8

 
OTHER: 
 
 
 
 
 
 
 
 
SG&A expenses
$
106,551

 
$
108,770

 
(2.0
)
 
10.6

 
Adjusted SG&A expenses (2)
$
105,929

 
$
108,562

 
(2.4
)
 
10.2

 
SG&A as % revenues
8.9

 
8.9

 
 
 
 
 
Adjusted SG&A as % revenues (2)
8.8

 
8.9

 
 
 
 
 
SG&A as % gross profit
77.9

 
79.0

 
 
 
 
 
Adjusted SG&A as % gross profit (2)
77.4

 
78.9

 
 
 
 
 
Operating margin %
2.1

 
2.0

 
 
 
 
 
Adjusted operating margin % (2)
2.2

 
2.0

 
 
 
 
 
(1) Same Store amounts include the results for the identical months in each period presented in the comparison, commencing with the first full month we owned the dealership and, in the case of dispositions, ending with the last full month we owned it. Same Store results also include the activities of our corporate office.
(2) See the section of this release entitled "Non-GAAP Financial Measures " and the tables attached hereto for information regarding certain selected items that the Company believes impact comparability of financial results between reporting periods, as well as for information regarding non-GAAP financial measures and their reconciliation to the most directly comparable measures as reported in accordance with U.S. GAAP.


16


Group 1 Automotive, Inc.
Additional Information - Same Store Brazil (1)
(Unaudited)
(Dollars in thousands, except per unit amounts)
 
 
 
 
 
 
 
 
 
 
Three Months Ended December 31,
 
 
2016
 
2015
 
% Increase/(Decrease)
 
Constant Currency (2) % Increase/(Decrease)
 
REVENUES:
 
 
 
 
 
 
 
 
New vehicle retail sales
$
72,232

 
$
83,451

 
(13.4
)
 
(25.6
)
 
Used vehicle retail sales
21,742

 
19,498

 
11.5

 
(4.2
)
 
Used vehicle wholesale sales
1,058

 
302

 
250.3

 
200.8

 
Total used
22,800

 
19,800

 
15.2

 
(1.1
)
 
Parts and service
10,971

 
9,452

 
16.1

 
(0.4
)
 
Finance, insurance and other, net
1,786

 
1,779

 
0.4

 
(13.9
)
 
Total
$
107,789

 
$
114,482

 
(5.8
)
 
(19.1
)
 
GROSS MARGIN %:
 
 
 
 
 
 
 
 
New vehicle retail sales
6.1

 
6.4

 
 
 
 
 
Used vehicle retail sales
7.2

 
3.5

 
 
 
 
 
Used vehicle wholesale sales
4.9

 
7.3

 
 
 
 
 
Total used
7.1

 
3.5

 
 
 
 
 
Parts and service
45.2

 
40.0

 
 
 
 
 
Finance, insurance and other, net
100.0

 
100.0

 
 
 
 
 
Total
11.9

 
10.2

 
 
 
 
 
GROSS PROFIT:
 
 
 
 
 
 
 
 
New vehicle retail sales
$
4,432

 
$
5,365

 
(17.4
)
 
(29.0
)
 
Used vehicle retail sales
1,557

 
678

 
129.6

 
97.3

 
Used vehicle wholesale sales
52

 
22

 
136.4

 
98.5

 
Total used
1,609

 
700

 
129.9

 
97.3

 
Parts and service
4,954

 
3,783

 
31.0

 
12.6

 
Finance, insurance and other, net
1,786

 
1,779

 
0.4

 
(13.9
)
 
Total
$
12,781

 
$
11,627

 
9.9

 
(5.6
)
 
UNITS SOLD:
 
 
 
 
 
 
 
 
Retail new vehicles sold
2,253

 
3,269

 
(31.1
)
 
 
 
Retail used vehicles sold
1,013

 
1,273

 
(20.4
)
 
 
 
Wholesale used vehicles sold
326

 
216

 
50.9

 
 
 
Total used
1,339

 
1,489

 
(10.1
)
 
 
 
AVERAGE RETAIL SALES PRICE:
 
 
 
 
 
 
 
 
New vehicle retail
$
32,060

 
$
25,528

 
25.6

 
8.0

 
Used vehicle retail
$
21,463

 
$
15,317

 
40.1

 
20.4

 
GROSS PROFIT PER UNIT SOLD:
 
 
 
 
 
 
 
 
New vehicle retail sales
$
1,967

 
$
1,641

 
19.9

 
3.0

 
Used vehicle retail sales
1,537

 
533

 
188.4

 
147.9

 
Used vehicle wholesale sales
160

 
102

 
56.9

 
31.5

 
Total used
1,202

 
470

 
155.7

 
119.4

 
Finance, insurance and other, net (per retail unit)
$
547

 
$
392

 
39.5

 
19.7

 
OTHER:
 
 
 
 
 
 
 
 
SG&A expenses
$
11,409

 
$
10,135

 
12.6

 
(3.4
)
 
Adjusted SG&A expenses (2)
$
11,409

 
$
9,985

 
14.3

 
(2.0
)
 
SG&A as % revenues
10.6

 
8.9

 
 
 
 
 
Adjusted SG&A as % revenues (2)
10.6

 
8.7

 
 
 
 
 
SG&A as % gross profit
89.3

 
87.2

 
 
 
 
 
Adjusted SG&A as % gross profit (2)
89.3

 
85.9

 
 
 
 
 
Operating margin %
(8.2
)
 
(56.4
)
 
 
 
 
 
Adjusted operating margin % (2)
1.0

 
1.2

 
 
 
 
 


17


 
Twelve Months Ended December 31,
 
 
2016
 
2015
 
% Increase/(Decrease)
 
Constant Currency (2) % Increase/(Decrease)
 
REVENUES:
 
 
 
 
 
 
 
 
New vehicle retail sales
$
276,791

 
$
349,858

 
(20.9
)
 
(16.9
)
 
Used vehicle retail sales
76,063

 
75,658

 
0.5

 
5.8

 
Used vehicle wholesale sales
3,116

 
5,354

 
(41.8
)
 
(34.4
)
 
Total used
79,179

 
81,012

 
(2.3
)
 
3.1

 
Parts and service
43,977

 
44,542

 
(1.3
)
 
4.8

 
Finance, insurance and other, net
6,447

 
6,568

 
(1.8
)
 
2.3

 
Total
$
406,394

 
$
481,980

 
(15.7
)
 
(11.2
)
 
GROSS MARGIN %:
 
 
 
 
 
 
 
 
New vehicle retail sales
5.9

 
6.7

 
 
 
 
 
Used vehicle retail sales
6.2

 
4.0

 
 
 
 
 
Used vehicle wholesale sales
6.2

 
7.3

 
 
 
 
 
Total used
6.2

 
4.2

 
 
 
 
 
Parts and service
39.6

 
42.8

 
 
 
 
 
Finance, insurance and other, net
100.0

 
100.0

 
 
 
 
 
Total
11.1

 
10.9

 
 
 
 
 
GROSS PROFIT:
 
 
 
 
 
 
 
 
New vehicle retail sales
$
16,221

 
$
23,419

 
(30.7
)
 
(26.9
)
 
Used vehicle retail sales
4,716

 
3,009

 
56.7

 
63.5

 
Used vehicle wholesale sales
192

 
390

 
(50.8
)
 
(44.5
)
 
Total used
4,908

 
3,399

 
44.4

 
51.1

 
Parts and service
17,398

 
19,050

 
(8.7
)
 
(2.7
)
 
Finance, insurance and other, net
6,447

 
6,568

 
(1.8
)
 
2.3

 
Total
$
44,974

 
$
52,436

 
(14.2
)
 
(9.4
)
 
UNITS SOLD:
 
 
 
 
 
 
 
 
Retail new vehicles sold
9,518

 
12,434

 
(23.5
)
 
 
 
Retail used vehicles sold
4,325

 
4,221

 
2.5

 
 
 
Wholesale used vehicles sold
1,086

 
1,214

 
(10.5
)
 
 
 
Total used
5,411

 
5,435

 
(0.4
)
 
 
 
AVERAGE RETAIL SALES PRICE:
 
 
 
 
 
 
 
 
New vehicle retail
$
29,081

 
$
28,137

 
3.4

 
8.6

 
Used vehicle retail
$
17,587

 
$
17,924

 
(1.9
)
 
3.3

 
GROSS PROFIT PER UNIT SOLD:
 
 
 
 
 
 
 
 
New vehicle retail sales
$
1,704

 
$
1,883

 
(9.5
)
 
(4.5
)
 
Used vehicle retail sales
1,090

 
713

 
52.9

 
59.5

 
Used vehicle wholesale sales
177

 
321

 
(44.9
)
 
(37.9
)
 
Total used
907

 
625

 
45.1

 
51.7

 
Finance, insurance and other, net (per retail unit)
$
466

 
$
394

 
18.3

 
23.1

 
OTHER: 
 
 
 
 
 
 
 
 
SG&A expenses
$
43,393

 
$
44,677

 
(2.9
)
 
2.7

 
Adjusted SG&A expenses (2)
$
43,119

 
$
44,527

 
(3.2
)
 
2.5

 
SG&A as % revenues
10.7

 
9.3

 
 
 
 
 
Adjusted SG&A as % revenues (2)
10.6

 
9.2

 
 
 
 
 
SG&A as % gross profit
96.5

 
85.2

 
 
 
 
 
Adjusted SG&A as % gross profit (2)
95.9

 
84.9

 
 
 
 
 
Operating margin %
(2.4
)
 
(12.3
)
 
 
 
 
 
Adjusted operating margin % (2)
0.2

 
1.4

 
 
 
 
 
(1) Same Store amounts include the results for the identical months in each period presented in the comparison, commencing with the first full month we owned the dealership and, in the case of dispositions, ending with the last full month we owned it. Same Store results also include the activities of our corporate office.
(2) See the section of this release entitled "Non-GAAP Financial Measures " and the tables attached hereto for information regarding certain selected items that the Company believes impact comparability of financial results between reporting periods, as well as for information regarding non-GAAP financial measures and their reconciliation to the most directly comparable measures as reported in accordance with U.S. GAAP.


18


Group 1 Automotive, Inc.
 
Additional Information - Same Store Consolidated (1)
 
(Unaudited)
 
(Dollars in thousands, except per unit amounts)
 
 
 
 
 
 
 
 
 
 
 
 
 
Three Months Ended December 31,
 
 
 
2016
 
2015
 
% Increase/(Decrease)
 
Constant Currency (2) % Increase/(Decrease)
 
REVENUES:
 
 
 
 
 
 
 
 
New vehicle retail sales
$
1,428,167

 
$
1,486,886

 
(3.9
)
 
(2.4
)
 
Used vehicle retail sales
625,832

 
628,231

 
(0.4
)
 
1.7

 
Used vehicle wholesale sales
91,786

 
91,539

 
0.3

 
5.0

 
Total used
717,618

 
719,770

 
(0.3
)
 
2.1

 
Parts and service
299,192

 
287,816

 
4.0

 
5.1

 
Finance, insurance and other, net
100,955

 
99,048

 
1.9

 
3.1

 
Total
$
2,545,932

 
$
2,593,520

 
(1.8
)
 
(0.1
)
 
GROSS MARGIN %:
 
 
 
 
 
 
 
 
New vehicle retail sales
5.5

 
5.3

 
 
 
 
 
Used vehicle retail sales
6.1

 
6.3

 
 
 
 
 
Used vehicle wholesale sales
(3.4
)
 
(1.8
)
 
 
 
 
 
Total used
4.9

 
5.3

 
 
 
 
 
Parts and service
53.6

 
53.8

 
 
 
 
 
Finance, insurance and other, net
100.0

 
100.0

 
 
 
 
 
Total
14.7

 
14.3

 
 
 
 
 
GROSS PROFIT:
 
 
 
 
 
 
 
 
New vehicle retail sales
$
78,158

 
$
78,599

 
(0.6
)
 
1.0

 
Used vehicle retail sales
38,155

 
39,813

 
(4.2
)
 
(2.6
)
 
Used vehicle wholesale sales
(3,143
)
 
(1,662
)
 
(89.1
)
 
(95.3
)
 
Total used
35,012

 
38,151

 
(8.2
)
 
(6.9
)
 
Parts and service
160,353

 
154,723

 
3.6

 
5.0

 
Finance, insurance and other, net
100,955

 
99,048

 
1.9

 
3.1

 
Total
$
374,478

 
$
370,521

 
1.1

 
2.4

 
UNITS SOLD:
 
 
 
 
 
 
 
 
Retail new vehicles sold
39,123

 
41,737

 
(6.3
)
 
 
 
Retail used vehicles sold
29,325

 
29,343

 
(0.1
)
 
 
 
Wholesale used vehicles sold
13,177

 
13,171

 
—

 
 
 
Total used
42,502

 
42,514

 
—

 
 
 
AVERAGE RETAIL SALES PRICE:
 
 
 
 
 
 
 
 
New vehicle retail
$
36,505

 
$
35,625

 
2.5

 
4.1

 
Used vehicle retail
$
21,341

 
$
21,410

 
(0.3
)
 
1.7

 
GROSS PROFIT PER UNIT SOLD:
 
 
 
 
 
 
 
 
New vehicle retail sales
$
1,998

 
$
1,883

 
6.1

 
7.8

 
Used vehicle retail sales
1,301

 
1,357

 
(4.1
)
 
(2.6
)
 
Used vehicle wholesale sales
(239
)
 
(126
)
 
(89.7
)
 
(95.2
)
 
Total used
824

 
897

 
(8.1
)
 
(6.9
)
 
Finance, insurance and other, net (per retail unit)
$
1,475

 
$
1,393

 
5.9

 
7.1

 
OTHER:
 
 
 
 
 
 
 
 
SG&A expenses
$
267,034

 
$
276,247

 
(3.3
)
 
(1.9
)
 
Adjusted SG&A expenses (2)
$
275,000

 
$
275,255

 
(0.1
)
 
1.4

 
SG&A as % revenues
10.5

 
10.7

 
 
 
 
 
Adjusted SG&A as % revenues (2)
10.8

 
10.6

 
 
 
 
 
SG&A as % gross profit
71.3

 
74.6

 
 
 
 
 
Adjusted SG&A as % gross profit (2)
73.4

 
74.3

 
 
 
 
 
Operating margin %
3.0

 
0.1

 
 
 
 
 
Adjusted operating margin % (2)
3.4

 
3.2

 
 
 
 
 

19


 
 
Twelve Months Ended December 31,
 
 
 
2016
 
2015
 
% Increase/(Decrease)
 
Constant Currency (2) % Increase/(Decrease)
 
REVENUES:
 
 
 
 
 
 
 
 
New vehicle retail sales
$
5,619,881

 
$
5,860,855

 
(4.1
)
 
(2.5
)
 
Used vehicle retail sales
2,612,304

 
2,582,437

 
1.2

 
2.9

 
Used vehicle wholesale sales
364,271

 
384,969

 
(5.4
)
 
(2.3
)
 
Total used
2,976,575

 
2,967,406

 
0.3

 
2.2

 
Parts and service
1,197,195

 
1,153,365

 
3.8

 
5.1

 
Finance, insurance and other, net
403,685

 
402,288

 
0.3

 
1.2

 
Total
$
10,197,336

 
$
10,383,914

 
(1.8
)
 
(0.1
)
 
GROSS MARGIN %:
 
 
 
 
 
 
 
 
New vehicle retail sales
5.2

 
5.1

 
 
 
 
 
Used vehicle retail sales
6.7

 
6.8

 
 
 
 
 
Used vehicle wholesale sales
(0.8
)
 
(0.4
)
 
 
 
 
 
Total used
5.8

 
5.9

 
 
 
 
 
Parts and service
53.8

 
54.2

 
 
 
 
 
Finance, insurance and other, net
100.0

 
100.0

 
 
 
 
 
Total
14.8

 
14.5

 
 
 
 
 
GROSS PROFIT:
 
 
 
 
 
 
 
 
New vehicle retail sales
$
293,377

 
$
299,425

 
(2.0
)
 
(0.1
)
 
Used vehicle retail sales
175,190

 
176,302

 
(0.6
)
 
0.7

 
Used vehicle wholesale sales
(3,028
)
 
(1,527
)
 
(98.3
)
 
(102.1
)
 
Total used
172,162

 
174,775

 
(1.5
)
 
(0.2
)
 
Parts and service
644,636

 
624,972

 
3.1

 
4.4

 
Finance, insurance and other, net
403,685

 
402,288

 
0.3

 
1.2

 
Total
$
1,513,860

 
$
1,501,460

 
0.8

 
2.1

 
UNITS SOLD:
 
 
 
 
 
 
 
 
Retail new vehicles sold
158,847

 
169,734

 
(6.4
)
 
 
 
Retail used vehicles sold
123,637

 
121,446

 
1.8

 
 
 
Wholesale used vehicles sold
53,188

 
55,502

 
(4.2
)
 
 
 
Total used
176,825

 
176,948

 
(0.1
)
 
 
 
AVERAGE RETAIL SALES PRICE:
 
 
 
 
 
 
 
 
New vehicle retail
$
35,379

 
$
34,530

 
2.5

 
4.2

 
Used vehicle retail
$
21,129

 
$
21,264

 
(0.6
)
 
1.1

 
GROSS PROFIT PER UNIT SOLD:
 
 
 
 
 
 
 
 
New vehicle retail sales
$
1,847

 
$
1,764

 
4.7

 
6.8

 
Used vehicle retail sales
1,417

 
1,452

 
(2.4
)
 
(1.1
)
 
Used vehicle wholesale sales
(57
)
 
(28
)
 
(103.6
)
 
(110.9
)
 
Total used
974

 
988

 
(1.4
)
 
(0.1
)
 
Finance, insurance and other, net (per retail unit)
$
1,429

 
$
1,382

 
3.4

 
4.4

 
OTHER:
 
 
 
 
 
 
 
 
SG&A expenses
$
1,102,541

 
$
1,092,982

 
0.9

 
2.4

 
Adjusted SG&A expenses (2)
$
1,103,384

 
$
1,089,467

 
1.3

 
2.8

 
SG&A as % revenues
10.8

 
10.5

 
 
 
 
 
Adjusted SG&A as % revenues (2)
10.8

 
10.5

 
 
 
 
 
SG&A as % gross profit
72.8

 
72.8

 
 
 
 
 
Adjusted SG&A as % gross profit (2)
72.9

 
72.6

 
 
 
 
 
Operating margin %
3.2

 
2.7

 
 
 
 
 
Adjusted operating margin % (2)
3.6

 
3.5

 
 
 
 
 
(1) Same Store amounts include the results for the identical months in each period presented in the comparison, commencing with the first full month we owned the dealership and, in the case of dispositions, ending with the last full month we owned it. Same Store results also include the activities of our corporate office.
(2) See the section of this release entitled "Non-GAAP Financial Measures " and the tables attached hereto for information regarding certain selected items that the Company believes impact comparability of financial results between reporting periods, as well as for information regarding non-GAAP financial measures and their reconciliation to the most directly comparable measures as reported in accordance with U.S. GAAP.


20


Group 1 Automotive, Inc.
 
Reconciliation of Certain Non-GAAP Financial Measures - U.S.
 
(Unaudited)
 
 (Dollars in thousands)
 
 
 
 
 
 
 
 
 
 
 
Three Months Ended December 31,
 
 
 
2016
 
2015
 
% Increase/(Decrease)
 
SG&A RECONCILIATION:
 
 
 
 
 
 
 
As reported
$
227,411

 
$
240,001

 
(5.2
)
 
 
  Pre-tax adjustments:
 
 
 
 
 
 
 
Catastrophic events
—

 
(637
)
 
 
 
 
Gain on real estate and dealership transactions
982

 
7,839

 
 
 
 
Severance costs
(1,837
)
 
—

 
 
 
 
Legal settlements (4)
11,671

 
—

 
 
 
 
Adjusted SG&A (1)
$
238,227

 
$
247,203

 
(3.6
)
 
SG&A AS % REVENUES:
 
 
 
 
 
 
 
Unadjusted
10.5

 
10.6

 
 
 
 
Adjusted (1)
11.0

 
10.9

 
 
 
SG&A AS % GROSS PROFIT:
 
 
 
 
 
 
 
Unadjusted
68.6

 
71.9

 
 
 
 
Adjusted (1)
71.9

 
74.0

 
 
 
OPERATING MARGIN %:
 
 
 
 
 
 
 
Unadjusted
3.8

 
2.9

 
 
 
 
Adjusted (1),(2)
3.8

 
3.4

 
 
 
PRETAX MARGIN %:
 
 
 
 
 
 
 
Unadjusted
2.7

 
1.9

 
 
 
 
Adjusted (1),(2)
2.6

 
2.3

 
 
 
SAME STORE SG&A RECONCILIATION:
 
 
 
 
 
 
 
As reported
$
229,943

 
$
238,889

 
(3.7
)
 
 
  Pre-tax adjustments:
 
 
 
 
 
 
 
Catastrophic events
—

 
(637
)
 
 
 
 
Loss on real estate and dealership transactions
—

 
(205
)
 
 
 
 
Severance costs
(1,837
)
 
—

 
 
 
 
Legal settlements (4)
9,864

 
—

 
 
 
 
Adjusted Same Store SG&A (1)
$
237,970

 
$
238,047

 
—

 
SAME STORE SG&A AS % REVENUES:
 
 
 
 
 
 
 
Unadjusted
10.6

 
10.9

 
 
 
 
Adjusted (1)
11.0

 
10.9

 
 
 
SAME STORE SG&A AS % GROSS PROFIT:
 
 
 
 
 
 
 
Unadjusted
69.6

 
73.4

 
 
 
 
Adjusted (1)
72.0

 
73.1

 
 
 
SAME STORE OPERATING MARGIN %:
 
 
 
 
 
 
 
Unadjusted
3.7

 
2.8

 
 
 
 
Adjusted (1),(3)
3.8

 
3.5

 
 
 
 
 
 
 
 
 
 
 

21


 
 
Twelve Months Ended December 31,
 
 
 
2016
 
2015
 
% Increase/(Decrease)
 
SG&A RECONCILIATION:
 
 
 
 
 
 
 
As reported
$
965,139

 
$
958,608

 
0.7

 
 
  Pre-tax adjustments:
 
 
 
 
 
 
 
Catastrophic events
(5,873
)
 
(1,588
)
 
 
 
 
Gain on real estate and dealership transactions
2,838

 
8,891

 
 
 
 
Severance costs
(1,837
)
 
—

 
 
 
 
Acquisition costs
(30
)
 
—

 
 
 
 
Legal settlements (4)
11,671

 
(1,000
)
 
 
 
 
Adjusted SG&A (1)
$
971,908

 
$
964,911

 
0.7

 
SG&A AS % REVENUES:
 
 
 
 
 
 
 
Unadjusted
11.0

 
10.8

 
 
 
 
Adjusted (1)
11.1

 
10.8

 
 
 
SG&A AS % GROSS PROFIT:
 
 
 
 
 
 
 
Unadjusted
71.2

 
71.6

 
 
 
 
Adjusted (1)
71.7

 
72.1

 
 
 
OPERATING MARGIN %:
 
 
 
 
 
 
 
Unadjusted
3.7

 
3.6

 
 
 
 
Adjusted (1),(2)
3.9

 
3.7

 
 
 
PRETAX MARGIN %:
 
 
 
 
 
 
 
Unadjusted
2.5

 
2.6

 
 
 
 
Adjusted (1),(2)
2.7

 
2.7

 
 
 
SAME STORE SG&A RECONCILIATION:
 
 
 
 
 
 
 
As reported
$
952,597

 
$
939,535

 
1.4

 
 
  Pre-tax adjustments:
 
 
 
 
 
 
 
Catastrophic events
(5,873
)
 
(1,588
)
 
 
 
 
Loss on real estate and dealership transactions
(385
)
 
(569
)
 
 
 
 
Severance costs
(1,837
)
 
—

 
 
 
 
Acquisition costs
(30
)
 
—

 
 
 
 
Legal settlements (4)
9,864

 
(1,000
)
 
 
 
 
Adjusted Same Store SG&A (1)
$
954,336

 
$
936,378

 
1.9

 
SAME STORE SG&A AS % REVENUES:
 
 
 
 
 
 
 
Unadjusted
11.1

 
10.8

 
 
 
 
Adjusted (1)
11.1

 
10.8

 
 
 
SAME STORE SG&A AS % GROSS PROFIT:
 
 
 
 
 
 
 
Unadjusted
71.5

 
71.6

 
 
 
 
Adjusted (1)
71.6

 
71.4

 
 
 
SAME STORE OPERATING MARGIN %:
 
 
 
 
 
 
 
Unadjusted
3.7

 
3.6

 
 
 
 
Adjusted (1),(3)
3.9

 
3.9

 
 
 
 
 
 
 
 
 
 
 
(1)
See the section of this release entitled "Non-GAAP Financial Measures " for information regarding non-GAAP financial measures and certain selected items that the Company believes impact comparability of financial results between reporting periods.
 
(2)
Excludes the impact of SG&A reconciling items above, as well as non-cash asset impairment charges of $9,406 and $21,794 for the three and twelve months ended December 31, 2016, respectively, and $18,197 and $18,983 for the three and twelve months ended December 31, 2015, respectively.
 
(3)
Excludes the impact of Same Store SG&A reconciling items above, as well as non-cash asset impairment charges of $9,344 and $21,653 for the three and twelve months ended December 31, 2016, respectively, and $15,749 and $16,535 for the three and twelve months ended December 31, 2015, respectively.
 
(4)
For the three months ended December 31, 2016, the Company recognized a net pre-tax gain related to a settlement with an OEM of $11.7 million ($9.9 million on a Same Store basis).
 

22


Group 1 Automotive, Inc.
 
Reconciliation of Certain Non-GAAP Financial Measures - U.K.
 
(Unaudited)
 
 (Dollars in thousands)
 
 
 
 
 
 
 
 
 
 
 
Three Months Ended December 31,
 
 
 
2016
 
2015
 
% Increase/(Decrease)
 
SG&A RECONCILIATION:
 
 
 
 
 
 
 
As reported
$
39,482

 
$
27,191

 
45.2

 
 
  Pre-tax adjustments:
 
 
 
 
 
 
 
Loss on real estate and dealership transactions
(223
)
 
—

 
 
 
 
Severance costs
(122
)
 
—

 
 
 
 
Adjusted SG&A (1)
$
39,137

 
$
27,191

 
43.9

 
SG&A AS % REVENUES:
 
 
 
 
 
 
 
Unadjusted
10.2

 
9.5

 
 
 
 
Adjusted (1)
10.1

 
9.5

 
 
 
SG&A AS % GROSS PROFIT:
 
 
 
 
 
 
 
Unadjusted
88.9

 
81.6

 
 
 
 
Adjusted (1)
88.1

 
81.6

 
 
 
OPERATING MARGIN %:
 
 
 
 
 
 
 
Unadjusted
0.8

 
1.7

 
 
 
 
Adjusted (1),(2)
0.9

 
1.7

 
 
 
PRETAX MARGIN %:
 
 
 
 
 
 
 
Unadjusted
0.2

 
1.3

 
 
 
 
Adjusted (1),(2)
0.3

 
1.3

 
 
 
SAME STORE SG&A RECONCILIATION:
 
 
 
 
 
 
 
As reported
$
25,682

 
$
27,223

 
(5.7
)
 
 
  Pre-tax adjustments:
 
 
 
 
 
 
 
Loss on real estate and dealership transactions
(61
)
 
—

 
 
 
 
Adjusted Same Store SG&A (1)
$
25,621

 
$
27,223

 
(5.9
)
 
SAME STORE SG&A AS % REVENUES:
 
 
 
 
 
 
 
Unadjusted
9.6

 
9.5

 
 
 
 
Adjusted (1)
9.5

 
9.5

 
 
 
SAME STORE SG&A AS % GROSS PROFIT:
 
 
 
 
 
 
 
Unadjusted
82.6

 
81.7

 
 
 
 
Adjusted (1)
82.4

 
81.7

 
 
 
SAME STORE OPERATING MARGIN %:
 
 
 
 
 
 
 
Unadjusted
1.6

 
1.7

 
 
 
 
Adjusted (1),(3)
1.6

 
1.7

 
 
 
 
 
 
 
 
 
 
 

23


 
 
Twelve Months Ended December 31,
 
 
 
2016
 
2015
 
% Increase/(Decrease)
 
SG&A RECONCILIATION:
 
 
 
 
 
 
 
As reported
$
158,636

 
$
108,719

 
45.9

 
 
  Pre-tax adjustments:
 
 
 
 
 
 
 
Loss on real estate and dealership transactions
(223
)
 
—

 
 
 
 
Severance costs
(122
)
 
(208
)
 
 
 
 
Acquisition costs
(561
)
 
—

 
 
 
 
Adjusted SG&A (1)
$
157,730

 
$
108,511

 
45.4

 
SG&A AS % REVENUES:
 
 
 
 
 
 
 
Unadjusted
9.2

 
8.9

 
 
 
 
Adjusted (1)
9.2

 
8.9

 
 
 
SG&A AS % GROSS PROFIT:
 
 
 
 
 
 
 
Unadjusted
82.2

 
79.0

 
 
 
 
Adjusted (1)
81.7

 
78.8

 
 
 
OPERATING MARGIN %:
 
 
 
 
 
 
 
Unadjusted
1.6

 
2.0

 
 
 
 
Adjusted (1),(2)
1.7

 
2.0

 
 
 
PRETAX MARGIN %:
 
 
 
 
 
 
 
Unadjusted
1.1

 
1.5

 
 
 
 
Adjusted (1),(2)
1.1

 
1.6

 
 
 
SAME STORE SG&A RECONCILIATION:
 
 
 
 
 
 
 
As reported
$
106,551

 
$
108,770

 
(2.0
)
 
 
  Pre-tax adjustments:
 
 
 
 
 
 
 
Loss on real estate and dealership transactions
(61
)
 
—

 
 
 
 
Severance costs
—

 
(208
)
 
 
 
 
Acquisition costs
(561
)
 
—

 
 
 
 
Adjusted Same Store SG&A (1)
$
105,929

 
$
108,562

 
(2.4
)
 
SAME STORE SG&A AS % REVENUES:
 
 
 
 
 
 
 
Unadjusted
8.9

 
8.9

 
 
 
 
Adjusted (1)
8.8

 
8.9

 
 
 
SAME STORE SG&A AS % GROSS PROFIT:
 
 
 
 
 
 
 
Unadjusted
77.9

 
79.0

 
 
 
 
Adjusted (1)
77.4

 
78.9

 
 
 
SAME STORE OPERATING MARGIN %:
 
 
 
 
 
 
 
Unadjusted
2.1

 
2.0

 
 
 
 
Adjusted (1),(3)
2.2

 
2.0

 
 
 
 
 
 
 
 
 
 
 
(1)
See the section of this release entitled "Non-GAAP Financial Measures " for information regarding non-GAAP financial measures and certain selected items that the Company believes impact comparability of financial results between reporting periods.
 
(2)
Excludes the impact of SG&A reconciling items above, as well as non-cash asset impairment charges of $201 for the three and twelve months ended December 31, 2016, respectively, and $333 for the twelve months ended December 31, 2015.
 
(3)
Excludes the impact of Same Store SG&A reconciling items above, as well as non-cash asset impairment charges of $333 for the twelve months ended December 31, 2015.
 

24


Group 1 Automotive, Inc.
 
Reconciliation of Certain Non-GAAP Financial Measures - Brazil
 
(Unaudited)
 
 (Dollars in thousands)
 
 
 
 
 
 
 
 
 
 
 
Three Months Ended December 31,
 
 
 
2016
 
2015
 
% Increase/(Decrease)
 
SG&A RECONCILIATION:
 
 
 
 
 
 
 
As reported
$
12,178

 
$
12,593

 
(3.3
)
 
 
Pre-tax adjustments:
 
 
 
 
 
 
 
Loss on real estate and dealership transactions
—

 
(520
)
 
 
 
 
Severance costs
—

 
(226
)
 
 
 
 
Adjusted SG&A (1)
$
12,178

 
$
11,847

 
2.8

 
SG&A AS % REVENUES:
 
 
 
 
 
 
 
Unadjusted
10.6

 
10.2

 
 
 
 
Adjusted (1)
10.6

 
9.6

 
 
 
SG&A AS % GROSS PROFIT:
 
 
 
 
 
 
 
Unadjusted
90.6

 
97.9

 
 
 
 
Adjusted (1)
90.6

 
92.1

 
 
 
OPERATING MARGIN %
 
 
 
 
 
 
 
Unadjusted
(8.2
)
 
(54.8
)
 
 
 
 
Adjusted (1),(2)
0.8

 
0.6

 
 
 
PRETAX MARGIN %:
 
 
 
 
 
 
 
Unadjusted
(8.5
)
 
(55.0
)
 
 
 
 
Adjusted (1),(2)
0.5

 
0.3

 
 
 
SAME STORE SG&A RECONCILIATION:
 
 
 
 
 
 
 
As reported
$
11,409

 
$
10,135

 
12.6

 
 
  Pre-tax adjustments:
 
 
 
 
 
 
 
Severance costs
—

 
(150
)
 
 
 
 
Adjusted Same Store SG&A (1)
$
11,409

 
$
9,985

 
14.3

 
SAME STORE SG&A AS % REVENUES:
 
 
 
 
 
 
 
Unadjusted
10.6

 
8.9

 
 
 
 
Adjusted (1)
10.6

 
8.7

 
 
 
SAME STORE SG&A AS % GROSS PROFIT:
 
 
 
 
 
 
 
Unadjusted
89.3

 
87.2

 
 
 
 
Adjusted (1)
89.3

 
85.9

 
 
 
SAME STORE OPERATING MARGIN %:
 
 
 
 
 
 
 
Unadjusted
(8.2
)
 
(56.4
)
 
 
 
 
Adjusted (1),(3)
1.0

 
1.2

 
 
 
 
 
 
 
 
 
 
 

25



 
 
Twelve Months Ended December 31,
 
 
 
2016
 
2015
 
% Increase/(Decrease)
 
SG&A RECONCILIATION:
 
 
 
 
 
 
 
As reported
$
46,988

 
$
53,506

 
(12.2
)
 
 
  Pre-tax adjustments:
 
 
 
 
 
 
 
Loss on real estate and dealership transactions
(372
)
 
(520
)
 
 
 
 
Severance costs
—

 
(226
)
 
 
 
 
Foreign transaction tax
(274
)
 
—

 
 
 
 
Adjusted SG&A (1)
$
46,342

 
$
52,760

 
(12.2
)
 
SG&A AS % REVENUES:
 
 
 
 
 
 
 
Unadjusted
10.9

 
10.3

 
 
 
 
Adjusted (1)
10.8

 
10.2

 
 
 
SG&A AS % GROSS PROFIT:
 
 
 
 
 
 
 
Unadjusted
100.5

 
93.3

 
 
 
 
Adjusted (1)
99.2

 
92.0

 
 
 
OPERATING MARGIN %:
 
 
 
 
 
 
 
Unadjusted
(2.9
)
 
(12.8
)
 
 
 
 
Adjusted (1),(2)
(0.2
)
 
0.6

 
 
 
PRETAX MARGIN %:
 
 
 
 
 
 
 
Unadjusted
(3.0
)
 
(13.2
)
 
 
 
 
Adjusted (1),(2)
(0.3
)
 
0.1

 
 
 
SAME STORE SG&A RECONCILIATION:
 
 
 
 
 
 
 
As reported
$
43,393

 
$
44,677

 
(2.9
)
 
 
  Pre-tax adjustments:
 
 
 
 
 
 
 
Severance costs
—

 
(150
)
 
 
 
 
Foreign transaction tax
(274
)
 
—

 
 
 
 
Adjusted Same Store SG&A (1)
$
43,119

 
$
44,527

 
(3.2
)
 
SAME STORE SG&A AS % REVENUES:
 
 
 
 
 
 
 
Unadjusted
10.7

 
9.3

 
 
 
 
Adjusted (1)
10.6

 
9.2

 
 
 
SAME STORE SG&A AS % GROSS PROFIT:
 
 
 
 
 
 
 
Unadjusted
96.5

 
85.2

 
 
 
 
Adjusted (1)
95.9

 
84.9

 
 
 
SAME STORE OPERATING MARGIN %:
 
 
 
 
 
 
 
Unadjusted
(2.4
)
 
(12.3
)
 
 
 
 
Adjusted (1),(3)
0.2

 
1.4

 
 
 
 
 
 
 
 
 
 
 
(1)
See the section of this release entitled "Non-GAAP Financial Measures " for information regarding non-GAAP financial measures and certain selected items that the Company believes impact comparability of financial results between reporting periods.
 
(2)
Excludes the impact of SG&A reconciling items above, as well as non-cash asset impairment charges of $10,420 and $10,843 for the three and twelve months ended December 31, 2016, respectively, and $67,410 and $68,249 for the three and twelve months ended December 31, 2015, respectively.
 
(3)
Excludes the impact of Same Store SG&A reconciling items above, as well as non-cash asset impairment charges of $9,901 and $10,324 for the three and twelve months ended December 31, 2016, respectively, and $65,806 and $66,021 for the three and twelve months ended December 31, 2015, respectively.
 

26


Group 1 Automotive, Inc.
 
Reconciliation of Certain Non-GAAP Financial Measures - Consolidated
 
(Unaudited)
 
 (Dollars in thousands, except per share amounts)
 
 
 
Three Months Ended December 31,
 
 
 
2016
 
2015
 
% Increase/(Decrease)
 
NET INCOME RECONCILIATION:
 
 
 
 
 
 
 
As reported
$
30,828

 
$
(33,387
)
 
192.3

 
 
  Adjustments:
 
 
 
 
 
 
 
Catastrophic events
 
 
 
 
 
 
 
Pre-tax
—

 
637

 
 
 
 
Tax impact
—

 
(239
)
 
 
 
 
Gain on real estate and dealership transactions
 
 
 
 
 
 
 
Pre-tax
(529
)
 
(7,319
)
 
 
 
 
Tax impact
264

 
2,962

 
 
 
 
Severance costs
 
 
 
 
 
 
 
Pre-tax
1,959

 
227

 
 
 
 
Tax impact
(710
)
 
(7
)
 
 
 
 
Legal settlements (4)
 
 
 
 
 
 
 
Pre-tax
(11,671
)
 
—

 
 
 
 
Tax impact
4,359

 
—

 
 
 
 
Non-cash asset impairment
 
 
 
 
 
 
 
Pre-tax
19,797

 
85,607

 
 
 
 
Tax impact
(7,041
)
 
(12,809
)
 
 
 
 
Adjusted net income (1)
$
37,256

 
$
35,672

 
4.4

 
ADJUSTED NET INCOME ATTRIBUTABLE TO DILUTED
COMMON SHARES RECONCILIATION:
 
 
 
 
 
Adjusted net income (1)
$
37,256

 
$
35,672

 
4.4

 
 
Less: Adjusted earnings allocated to participating securities
1,477

 
1,344

 
9.9

 
 
Adjusted net income available to diluted common shares (1)
$
35,779

 
$
34,328

 
4.2

 
DILUTED INCOME PER COMMON SHARE RECONCILIATION:
 
 
 
 
 
 
 
As reported
$
1.44

 
$
(1.41
)
 
202.1

 
 
  After-tax adjustments:
 
 
 
 
 
 
 
Catastrophic events
—

 
0.02

 
 
 
 
Gain on real estate and dealership transactions
(0.01
)
 
(0.18
)
 
 
 
 
Severance costs
0.06

 
0.01

 
 
 
 
Legal settlements (4)
(0.34
)
 
—

 
 
 
 
Non-cash asset impairment
0.59

 
3.07

 
 
 
 
Adjusted diluted income per share (1)
$
1.74

 
$
1.51

 
15.2

 
SG&A RECONCILIATION:
 
 
 
 
 
 
 
As reported
$
279,071

 
$
279,785

 
(0.3
)
 
 
  Pre-tax adjustments:
 
 
 
 
 
 
 
Catastrophic events
—

 
(637
)
 
 
 
 
Gain on real estate and dealership transactions
759

 
7,318

 
 
 
 
Severance costs
(1,959
)
 
(226
)
 
 
 
 
Legal settlements (4)
11,671

 
—

 
 
 
 
Foreign transaction tax
—

 
—

 
 
 
 
Adjusted SG&A (1)
$
289,542

 
$
286,240

 
1.2

 

27


SG&A AS % REVENUES:
 
 
 
 
 
 
 
Unadjusted
10.4

 
10.5

 
 
 
 
Adjusted (1)
10.8

 
10.7

 
 
 
SG&A AS % GROSS PROFIT:
 
 
 
 
 
 
 
Unadjusted
71.7

 
73.6

 
 
 
 
Adjusted (1)
74.4

 
75.3

 
 
 
OPERATING MARGIN %:
 
 
 
 
 
 
 
Unadjusted
2.9

 
0.1

 
 
 
 
Adjusted (1),(2)
3.2

 
3.1

 
 
 
PRETAX MARGIN %:
 
 
 
 
 
 
 
Unadjusted
1.8

 
(0.8
)
 
 
 
 
Adjusted (1),(2)
2.2

 
2.1

 
 
 
SAME STORE SG&A RECONCILIATION:
 
 
 
 
 
 
 
As reported
$
267,034

 
$
276,247

 
(3.3
)
 
 
  Pre-tax adjustments:
 
 
 
 
 
 
 
Catastrophic events
—

 
(637
)
 
 
 
 
Loss on real estate and dealership transactions
(61
)
 
(205
)
 
 
 
 
Severance costs
(1,837
)
 
(150
)
 
 
 
 
Legal settlements (4)
9,864

 
—

 
 
 
 
Adjusted Same Store SG&A (1)
$
275,000

 
$
275,255

 
(0.1
)
 
SAME STORE SG&A AS % REVENUES:
 
 
 
 
 
 
 
Unadjusted
10.5

 
10.7

 
 
 
 
Adjusted (1)
10.8

 
10.6

 
 
 
SAME STORE SG&A AS % GROSS PROFIT:
 
 
 
 
 
 
 
Unadjusted
71.3

 
74.6

 
 
 
 
Adjusted (1)
73.4

 
74.3

 
 
 
SAME STORE OPERATING MARGIN %:
 
 
 
 
 
 
 
Unadjusted
3.0

 
0.1

 
 
 
 
Adjusted (1),(3)
3.4

 
3.2

 
 
 

28


 
 
Twelve Months Ended December 31,
 
 
 
2016
 
2015
 
% Increase/(Decrease)
 
NET INCOME RECONCILIATION:
 
 
 
 
 
 
 
As reported
$
147,065

 
$
93,999

 
56.5

 
 
  Adjustments:
 
 
 
 
 
 
 
Catastrophic events
 
 
 
 
 
 
 
Pre-tax
5,873

 
1,588

 
 
 
 
Tax impact
(2,207
)
 
(597
)
 
 
 
 
Gain on real estate and dealership transactions
 
 
 
 
 
 
 
Pre-tax
(1,530
)
 
(8,372
)
 
 
 
 
Tax impact
937

 
3,413

 
 
 
 
Severance costs
 
 
 
 
 
 
 
Pre-tax
1,959

 
435

 
 
 
 
Tax impact
(710
)
 
(48
)
 
 
 
 
Acquisition costs
 
 
 
 
 
 
 
Pre-tax
591

 
—

 
 
 
 
Tax impact
(11
)
 
—

 
 
 
 
Legal settlements (4)
 
 
 
 
 
 
 
Pre-tax
(11,671
)
 
1,000

 
 
 
 
Tax impact
4,359

 
(390
)
 
 
 
 
Foreign transaction tax
 
 
 
 
 
 
 
Pre-tax
274

 
—

 
 
 
 
Tax impact
—

 
—

 
 
 
 
Non-cash asset impairment
 
 
 
 
 
 
 
Pre-tax
32,124

 
87,565

 
 
 
 
Tax impact
(11,676
)
 
(13,143
)
 
 
 
 
Foreign deferred income tax benefit
 
 
 
 
 
 
 
Pre-tax
—

 
—

 
 
 
 
Tax impact
(1,686
)
 
—

 
 
 
 
Adjusted net income (1)
$
163,691

 
$
165,450

 
(1.1
)
 
ADJUSTED NET INCOME ATTRIBUTABLE TO DILUTED
COMMON SHARES RECONCILIATION:
 
 
 
 
 
Adjusted net income (1)
$
163,691

 
$
165,450

 
(1.1
)
 
 
Less: Adjusted earnings allocated to participating securities
6,537

 
6,338

 
3.1

 
 
Adjusted net income available to diluted common shares (1)
$
157,154

 
$
159,112

 
(1.2
)
 
DILUTED INCOME PER COMMON SHARE RECONCILIATION:
 
 
As reported
$
6.67

 
$
3.90

 
71.0

 
 
After-tax adjustments:
 
 
 
 
 
 
 
Catastrophic events
0.17

 
0.04

 
 
 
 
Gain on real estate and dealership transactions
(0.03
)
 
(0.21
)
 
 
 
 
Severance costs
0.05

 
0.02

 
 
 
 
Acquisition costs including related tax impact
0.02

 
—

 
 
 
 
Legal settlements (4)
(0.33
)
 
0.03

 
 
 
 
Foreign transaction tax
0.01

 
—

 
 
 
 
Non-cash asset impairment
0.93

 
3.09

 
 
 
 
Foreign deferred income tax benefit
(0.07
)
 
—

 
 
 
 
Adjusted diluted income per share (1)
$
7.42

 
$
6.87

 
8.0

 

29


SG&A RECONCILIATION:
 
 
 
 
 
 
 
As reported
$
1,170,763

 
$
1,120,833

 
4.5

 
 
  Pre-tax adjustments:
 
 
 
 
 
 
 
Catastrophic events
(5,873
)
 
(1,588
)
 
 
 
 
Gain on real estate and dealership transactions
2,243

 
8,372

 
 
 
 
Severance costs
(1,959
)
 
(435
)
 
 
 
 
Acquisition costs
(591
)
 
—

 
 
 
 
Legal settlements (4)
11,671

 
(1,000
)
 
 
 
 
Foreign transaction tax
(274
)
 
—

 
 
 
 
Adjusted SG&A (1)
$
1,175,980

 
$
1,126,182

 
4.4

 
SG&A AS % REVENUES:
 
 
 
 
 
 
 
Unadjusted
10.8

 
10.5

 
 
 
 
Adjusted (1)
10.8

 
10.6

 
 
 
SG&A AS % GROSS PROFIT:
 
 
 
 
 
 
 
Unadjusted
73.4

 
73.1

 
 
 
 
Adjusted (1)
73.7

 
73.4

 
 
 
OPERATING MARGIN %:
 
 
 
 
 
 
 
Unadjusted
3.1

 
2.6

 
 
 
 
Adjusted (1),(2)
3.4

 
3.4

 
 
 
PRETAX MARGIN %:
 
 
 
 
 
 
 
Unadjusted
2.1

 
1.7

 
 
 
 
Adjusted (1),(2)
2.3

 
2.5

 
 
 
SAME STORE SG&A RECONCILIATION:
 
 
 
 
 
 
 
As reported
$
1,102,541

 
$
1,092,982

 
0.9

 
 
  Pre-tax adjustments:
 
 
 
 
 
 
 
Catastrophic events
(5,873
)
 
(1,588
)
 
 
 
 
Loss on real estate and dealership transactions
(446
)
 
(569
)
 
 
 
 
Severance costs
(1,837
)
 
(358
)
 
 
 
 
Acquisition costs
(591
)
 
—

 
 
 
 
Legal settlements (4)
9,864

 
(1,000
)
 
 
 
 
Foreign transaction tax
(274
)
 
—

 
 
 
 
Adjusted Same Store SG&A (1)
$
1,103,384

 
$
1,089,467

 
1.3

 
SAME STORE SG&A AS % REVENUES:
 
 
 
 
 
 
 
Unadjusted
10.8

 
10.5

 
 
 
 
Adjusted (1)
10.8

 
10.5

 
 
 
SAME STORE SG&A AS % GROSS PROFIT:
 
 
 
 
 
 
 
Unadjusted
72.8

 
72.8

 
 
 
 
Adjusted (1)
72.9

 
72.6

 
 
 
SAME STORE OPERATING MARGIN %:
 
 
 
 
 
 
 
Unadjusted
3.2

 
2.7

 
 
 
 
Adjusted (1),(3)
3.6

 
3.5

 
 
 
 
 
 
 
 
 
 
 
(1)
See the section of this release entitled "Non-GAAP Financial Measures " for information regarding non-GAAP financial measures and certain selected items that the Company believes impact comparability of financial results between reporting periods.
 
(2)
Excludes the impact of SG&A reconciling items above, as well as non-cash asset impairment charges of $20,027 and $32,838 for the three and twelve months ended December 31, 2016, respectively, and $85,606 and $87,565 for the three and twelve months ended December 31, 2015, respectively.
 
(3)
Excludes the impact of Same Store SG&A reconciling items above, as well as non-cash asset impairment charges of $19,245 and $31,977 for the three and twelve months ended December 31, 2016, respectively, and $81,555 and $82,889 for the three and twelve months ended December 31, 2015, respectively.
 
(4)
For the three months ended December 31, 2016, the Company recognized a net pre-tax gain related to a settlement with an OEM of $11.7 million ($9.9 million on a Same Store basis).
 

30