SOURCE: Lithia Motors

Lithia Motors

October 24, 2012 07:29 ET

Lithia Motors Reports EPS of $0.90 for Third Quarter 2012; Provides Guidance for 2013 EPS of $3.11 to $3.21

Lithia Motors Declares $0.10 per Share Dividend for Third Quarter 2012

MEDFORD, OR--(Marketwire - Oct 24, 2012) - Lithia Motors, Inc. (NYSE: LAD) today reported 2012 third quarter income from continuing operations of $23.3 million, or $0.90 per diluted share. This compares to a 2011 third quarter income from continuing operations of $16.3 million, or $0.61 per diluted share, an increase of 48%.

Third quarter 2012 revenue from continuing operations increased $173.2 million, or 24%, to $888.4 million from $715.2 million in the third quarter of 2011.

Third Quarter Year-over-Year Operating Highlights:

  • New vehicle same store sales increased 30%
  • Used vehicle retail same store sales increased 24%
  • Service, body and parts same store sales increased 6%
  • SG&A expense as a percentage of gross profit was 66.8%, a reduction of 340 basis points, and the lowest quarterly percentage in company history
  • Earnings per share (EPS) increased 48% to $0.90

"Our stores delivered solid results in the third quarter," said Bryan DeBoer, President and CEO. "We generated the highest quarterly EPS in our history while driving SG&A expense as a percentage of gross profit to an all-time low. We continue our focus on improving vehicle sales volumes, service revenues and customer satisfaction. Our team challenges each other every day to increase performance throughout the organization, and remains vigilant to identify areas of opportunity."

For the first nine months of 2012, revenue from continuing operations increased 27% to $2.5 billion from $2.0 billion in 2011. Same store new vehicle sales increased 30%, used vehicle retail same store sales increased 21% and service, body and parts same store sales increased 6%. For the first nine months of 2012, adjusted net income from continuing operations was $2.24 per share compared to $1.48 per share in the first nine months of 2011. Unadjusted, for the first nine months of 2012, net income from continuing operations was $2.30 per diluted share, compared to $1.47 per diluted share for the first nine months of 2011.

Sid DeBoer, Founder and Executive Chairman, commented, "New vehicle sales volumes in the United States continue to recover. New safety and technology features, improved fuel economy and improving consumer credit markets, coupled with an aging fleet of vehicles, are all tailwinds for increasing sales levels through the remainder of 2012 and in 2013. Our new leadership team and a revitalized group of store managers is poised to continue this growth."

Recent Developments
On August 27, 2012, we purchased Connell Chevrolet in Killeen, Texas, with estimated annual revenues of $60 million. Our earnings guidance has been updated to reflect the impact of this transaction.

"We are excited to add this new store in Texas, which fits our core strategy of seeking exclusive franchises in our markets, and welcome our new employees to the family," said Bryan DeBoer.

Balance Sheet Update
We ended the third quarter with $20 million in cash and $29 million in available credit on our credit facilities. We also have the ability to expand the existing credit facilities by $150 million to $800 million in total, subject to lender approval. Additionally, approximately $115 million of operating real estate is currently unfinanced, which could provide an additional $86 million in available liquidity.

During the third quarter, we strategically retired approximately $5 million in mortgages, and refinanced approximately $16 million of mortgages to extend the maturity dates. As a result, we have no mortgage maturities until 2016.

Chris Holzshu, SVP and CFO said, "We've taken actions throughout the third quarter to strengthen our balance sheet and improve our capital position. As of the end of the quarter, we have fixed the interest rates on approximately 60% of our outstanding mortgages. This year we have retired approximately $35 million in mortgage debt, and reduced our overall average mortgage interest rate by 180 basis points while significantly extending maturity dates. We remain well-positioned to use free cash flow and available liquidity for acquisitions and internal investments that meet our strict return metrics."

Dividend Payment
Our Board of Directors approved a dividend of $0.10 per share for the third quarter 2012. We will pay the dividend on November 23, 2012 to shareholders of record on November 9, 2012.

Updated Outlook for 2012
We project 2012 fourth quarter earnings of $0.64 to $0.66 per diluted share. Full-year 2012 earnings are projected between $2.88 to $2.90 per diluted share. Both projections are based on the following annual assumptions:

  • Total revenues of $3.2 to $3.3 billion
  • New vehicle same store sales increasing 27%
  • New vehicle gross margin of 7.1% to 7.3%
  • Used vehicle same store sales increasing 20%
  • Used vehicle gross margin of 14.3% to 14.5%
  • Service body and parts same store sales increasing 5.6%
  • Service body and parts gross margin of 48.1% to 48.3%
  • Finance and insurance gross profit of $1,050 per unit
  • Tax rate of 40%
  • Average diluted shares outstanding of 26.1 million
  • Capital expenditures of $67 million
  • Guidance excludes the impact of future acquisitions, dispositions, and any potential non-core items

Outlook for 2013
We project 2013 first quarter earnings of $0.65 to $0.67 per diluted share and full-year 2013 earnings of $3.11 to $3.21 per diluted share. Both projections are based on the following annual assumptions:

  • Total revenues of $3.5 to $3.6 billion
  • New vehicle same store sales increasing 10.6%
  • New vehicle gross margin of 7.1% to 7.3%
  • Used vehicle same store sales increasing 7.7%
  • Used vehicle gross margin of 14.3% to 14.5%
  • Service body and parts same store sales increasing 4.8%
  • Service body and parts gross margin of 48.0% to 48.2%
  • Finance and insurance gross profit of $1,050 per unit
  • Tax rate of 40%
  • Average diluted shares outstanding of 26.4 million
  • Capital expenditures of $25 million
  • Guidance excludes the impact of future acquisitions, dispositions, and any potential non-core items

Third Quarter Earnings Conference Call and Updated Presentation
The third quarter conference call may be accessed at 10:00 a.m. ET today by telephone at 877-407-8029. An updated presentation highlighting the third quarter results has been added to Investor Relations on www.lithia.com.

To listen live on our website or for replay, visit Investor Relations on www.lithia.com and click on webcasts. A playback of the conference call will be available on October 24, 2012 through November 7, 2012 by calling 877-660-6853 (Conference ID: 401506).

About Lithia
Lithia Motors, Inc. is the ninth largest automotive retailer in the United States. Lithia sells 29 brands of new vehicles and all brands of used vehicles at 87 stores in 11 states. Lithia also arranges finance, warranty, and credit insurance contracts; and provides vehicle parts, maintenance, and repair services at all of its locations.

Sites
www.lithia.com
www.lithiacareers.com
www.assuredservice.com

Lithia Motors on Facebook
http://www.facebook.com/LithiaMotors

Lithia Motors on Twitter
http://twitter.com/lithiamotors

Forward-Looking Statements
This press release includes "forward-looking statements" within the meaning of the "Safe-Harbor" provisions of the Private Securities Litigation Reform Act of 1995, that management believes are a benefit to shareholders. Forward looking statements 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" or "will." The risks and uncertainties that could cause actual results to differ materially from estimated or projected results include without limitation, future economic conditions and others set forth from time to time in our filings with the SEC. We urge you to carefully consider this information. We undertake no duty to update our forward-looking statements, including our earnings outlook, which are made as of the date of this release.

Non-GAAP Financial Measures
This press release and the attached financial tables contain non-GAAP financial measures such as adjusted net income and diluted earnings per share from continuing operations, adjusted SG&A as a percentage of revenues and gross profit, adjusted operating margin, adjusted operating profit as a percentage of gross profit, and adjusted pre-tax margin. These measures exclude certain items disclosed in the attached financial tables. We present cash flows from operations in the attached tables, adjusted to include the change in non-trade floor plan debt to improve the visibility of cash flows related to vehicle financing. As required by SEC rules, we have reconciled these measures to the most directly comparable GAAP measures in the attachments to this release. We believe each of the non-GAAP financial measures we present improve the transparency of our disclosures; provide a meaningful presentation of our results from core business operations, because they exclude items not related to core business operations and other non-cash items; and improve the period-to-period comparability of our results from core business operations. These presentations should not be considered an alternative to GAAP measures.

 
Lithia Motors, Inc.
Consolidated Statements of Operations (Unaudited)
(In thousands except per share data)
                       
      Three months ended             %  
      September 30,       Increase     Increase  
      2012       2011       (Decrease)     (Decrease)  
Revenues:                              
New vehicle retail   $ 496,365     $ 377,860     $ 118,505     31.4 %
Used vehicle retail     230,278       184,632       45,646     24.7  
Used vehicle wholesale     35,419       35,597       (178 )   (0.5 )
Finance and insurance     31,088       22,423       8,665     38.6  
Service, body and parts     90,626       84,592       6,034     7.1  
Fleet and other     4,597       10,111       (5,514 )   (54.5 )
  Total revenues     888,373       715,215       173,158     24.2  
Cost of sales:                              
New vehicle retail     460,754       348,495       112,259     32.2  
Used vehicle retail     196,735       157,902       38,833     24.6  
Used vehicle wholesale     35,446       35,663       (217 )   (0.6 )
Service, body and parts     46,866       43,478       3,388     7.8  
Fleet and other     4,348       9,442       (5,094 )   (54.0 )
  Total cost of sales     744,149       594,980       149,169     25.1  
Gross profit     144,224       120,235       23,989     20.0  
SG&A expense     96,380       84,360       12,020     14.2  
Depreciation and amortization     4,381       4,129       252     6.1  
Income from operations     43,463       31,746       11,717     36.9  
Floor plan interest expense     (3,397 )     (1,977 )     1,420     71.8  
Other interest expense     (2,131 )     (3,067 )     (936 )   (30.5 )
Other income, net     452       213       239     112.2  
Income from continuing operations before income taxes     38,387       26,915       11,472     42.6  
Income tax expense     (15,048 )     (10,594 )     4,454     42.0  
Income tax rate     39.2 %     39.4 %              
Income from continuing operations   $ 23,339     $ 16,321     $ 7,018     43.0 %
Income (loss) from discontinued operations     (96 )     242       (338 )   NM  
Net income   $ 23,243     $ 16,563     $ 6,680     40.3 %
                               
Diluted net income per share:                              
Continuing operations   $ 0.90     $ 0.61     $ 0.29     47.5 %
Discontinued operations     -       0.01       (0.01 )   NM  
Net income per share   $ 0.90     $ 0.62     $ 0.28     45.2 %
                               
Diluted shares outstanding     25,947       26,654       (707 )   (2.7 )%
                               

NM - not meaningful

 
 
Lithia Motors, Inc.
Key Performance Metrics (Unaudited)
                   
    Three months ended           %  
    September 30,     Increase     Increase  
    2012     2011     (Decrease)     (Decrease)  
Gross margin                        
New vehicle retail     7.2 %     7.8 %     (60) bps        
Used vehicle retail     14.6       14.5       10 bps        
Used vehicle wholesale     (0.1 )     (0.2 )     10 bps        
Finance and insurance     100.0       100.0       - bps        
Service, body and parts     48.3       48.6       (30) bps        
Fleet and Other     5.4       6.6       (120) bps        
Gross profit margin     16.2       16.8       (60) bps        
                               
Unit sales                              
New vehicle retail     14,923       11,262       3,661     32.5 %
Used vehicle retail     13,320       10,567       2,753     26.1  
Used vehicle wholesale     5,173       4,452       721     16.2  
Total units sold     33,416       26,281       7,135     27.1  
                               
Average selling price                              
New vehicle retail   $ 33,262     $ 33,552     $ (290 )   (0.9) %
Used vehicle retail     17,288       17,473       (185 )   (1.1 )
Used vehicle wholesale     6,847       7,996       (1,149 )   (14.4 )
                               
Average gross profit per unit                              
New vehicle retail   $ 2,386     $ 2,607     $ (221 )   (8.5) %
Used vehicle retail     2,518       2,530       (12 )   (0.5 )
Used vehicle wholesale     (5 )     (15 )     10     66.7  
Finance and insurance     1,101       1,027       74     7.2  
                               
Revenue mix                              
New vehicle retail     55.9 %     52.8 %              
Used vehicle retail     25.9       25.8                
Used vehicle wholesale     4.0       5.1                
Finance and insurance, net     3.5       3.1                
Service, body and parts     10.2       11.8                
Fleet and other     0.5       1.4                
                               
    Three months ended
September 30,
         
Other metrics   2012     2011                
SG&A as a % of revenue     10.8 %     11.8 %              
SG&A as a % of gross profit     66.8       70.2                
Operating profit as a % of revenue     4.9       4.4                
Operating profit as a % of gross profit     30.1       26.4                
Pretax margin     4.3       3.8                
Net profit margin     2.6       2.3                
                               
                               
 
Lithia Motors, Inc.
Same Store Operating Highlights (Unaudited)
                   
    Three months ended           %  
    September 30,     Increase     Increase  
    2012   2011     (Decrease)     (Decrease)  
Revenues                      
New vehicle retail   $ 484,527   $ 372,858     $ 111,669     29.9 %
Used vehicle retail     223,890     180,691       43,199     23.9  
Used vehicle wholesale     34,566     34,269       297     0.9  
Finance and insurance     29,430     21,585       7,845     36.3  
Service, body and parts     88,442     83,330       5,112     6.1  
Fleet and Other     4,375     9,971       (5,596 )   (56.1 )
Total revenues   $ 865,230   $ 702,704     $ 162,526     23.1  
                             
Gross profit                            
New vehicle retail   $ 34,851   $ 28,846     $ 6,005     20.8 %
Used vehicle retail     32,721     26,377       6,344     24.1  
Used vehicle wholesale     9     (57 )     66     NM  
Finance and insurance     29,430     21,585       7,845     36.3  
Service, body and parts     41,676     39,798       1,878     4.7  
Fleet and Other     97     141       (44 )   (31.2 )
Total gross profit   $ 138,784   $ 116,690     $ 22,094     18.9  
                             
Unit sales                            
New vehicle retail     14,528     11,106       3,422     30.8 %
Used vehicle retail     12,926     10,345       2,581     24.9  
Used vehicle wholesale     5,054     4,329       725     16.7  
Total units sold     32,508     25,780       6,728     26.1  
                             
Average selling price                            
New vehicle retail   $ 33,351   $ 33,573     $ (222 )   (0.7) %
Used vehicle retail     17,321     17,467       (146 )   (0.8 )
Used vehicle wholesale     6,839     7,916       (1,077 )   (13.6 )
                             
Average gross profit per unit                            
New vehicle retail   $ 2,399   $ 2,597     $ (198 )   (7.6) %
Used vehicle retail     2,531     2,550       (19 )   (0.7 )
Used vehicle wholesale     2     (13 )     15     NM  
Finance and insurance     1,072     1,006       66     6.6  
                             

NM - not meaningful

 
Lithia Motors, Inc.
Consolidated Statements of Operations (Unaudited)
(In thousands except per share data)
                   
    Nine months ended           %  
    September 30,     Increase     Increase  
    2012     2011     (Decrease)     (Decrease)  
Revenues:                              
New vehicle retail   $ 1,355,463     $ 1,015,872     $ 339,591     33.4 %
Used vehicle retail     632,361       512,006       120,355     23.5  
Used vehicle wholesale     104,663       93,800       10,863     11.6  
Finance and insurance     83,440       61,915       21,525     34.8  
Service, body and parts     262,589       236,216       26,373     11.2  
Fleet and other     28,971       30,408       (1,437 )   (4.7 )
  Total revenues     2,467,487       1,950,217       517,270     26.5  
Cost of sales:                              
New vehicle retail     1,255,024       936,762       318,262     34.0  
Used vehicle retail     539,121       436,196       102,925     23.6  
Used vehicle wholesale     103,998       93,204       10,794     11.6  
Service, body and parts     135,545       121,173       14,372     11.9  
Fleet and other     27,933       27,927       6     0.0  
  Total cost of sales     2,061,621       1,615,262       446,359     27.6  
Gross profit     405,866       334,955       70,911     21.2  
Asset impairments     115       872       (757 )   (86.8 )
SG&A expense     280,292       240,537       39,755     16.5  
Depreciation and amortization     12,777       12,372       405     3.3  
Income from operations     112,682       81,174       31,508     38.8  
Floor plan interest expense     (9,402 )     (7,723 )     1,679     21.7  
Other interest expense     (7,398 )     (9,353 )     (1,955 )   (20.9 )
Other income, net     1,771       462       1,309     283.3  
Income from continuing operations before income taxes     97,653       64,560       33,093     51.3  
Income tax expense     (37,287 )     (25,244 )     12,043     47.7  
Income tax rate     38.2 %     39.1 %              
Income from continuing operations   $ 60,366     $ 39,316     $ 21,050     53.5 %
Income from discontinued operations     164       778       (614 )   (78.9 )
Net income   $ 60,530     $ 40,094     $ 20,436     51.0 %
                               
Diluted net income per share:                              
Continuing operations   $ 2.30     $ 1.47     $ 0.83     56.5 %
Discontinued operations     0.01       0.03       (0.02 )   (66.7 )
Net income per share   $ 2.31     $ 1.50     $ 0.81     54.0 %
                               
Diluted shares outstanding     26,203       26,738       (535 )   (2.0) %
                               
                               
 
Lithia Motors, Inc.
Key Performance Metrics (Unaudited)
                   
    Nine months ended           %  
    September 30,     Increase     Increase  
    2012     2011     (Decrease)     (Decrease)  
Gross margin                        
New vehicle retail     7.4 %     7.8 %     (40) bps        
Used vehicle retail     14.7       14.8       (10) bps        
Used vehicle wholesale     0.6       0.6       - bps        
Finance and insurance     100.0       100.0       - bps        
Service, body and parts     48.4       48.7       (30) bps        
Fleet and Other     3.6       8.2       (460) bps        
Gross profit margin     16.4       17.2       (80) bps        
                               
Unit sales                              
New vehicle retail     41,217       31,097       10,120     32.5 %
Used vehicle retail     36,286       29,750       6,536     22.0  
Used vehicle wholesale     14,206       11,834       2,372     20.0  
Total units sold     91,709       72,681       19,028     26.2  
                               
Average selling price                              
New vehicle retail   $ 32,886     $ 32,668     $ 218     0.7 %
Used vehicle retail     17,427       17,210       217     1.3  
Used vehicle wholesale     7,368       7,926       (558 )   (7.0 )
                               
Average gross profit per unit                              
New vehicle retail   $ 2,437     $ 2,544     $ (107 )   (4.2) %
Used vehicle retail     2,570       2,548       22     0.9  
Used vehicle wholesale     47       50       (3 )   (6.0 )
Finance and insurance     1,077       1,018       59     5.8  
                               
Revenue mix                              
New vehicle retail     54.9 %     52.1 %              
Used vehicle retail     25.6       26.3                
Used vehicle wholesale     4.3       4.7                
Finance and insurance, net     3.4       3.2                
Service, body and parts     10.6       12.1                
Fleet and other     1.2       1.6                
                               
    Adjusted     As reported  
    Nine months ended
September 30,
    Nine months ended
September 30,
 
Other metrics   2012     2011     2012     2011  
SG&A as a % of revenue     11.4 %     12.4 %     11.4 %   12.3 %
SG&A as a % of gross profit     69.2       72.0       69.1     71.8  
Operating profit as a % of revenue     4.5       4.2       4.6     4.2  
Operating profit as a % of gross profit     27.6       24.3       27.8     24.2  
Pretax margin     3.9       3.3       4.0     3.3  
Net profit margin     2.4       2.0       2.4     2.0  
                               
                               
 
Lithia Motors, Inc.
Same Store Operating Highlights (Unaudited)
                 
    Nine months ended         %  
    September 30,   Increase     Increase  
    2012   2011   (Decrease)     (Decrease)  
Revenues                          
New vehicle retail   $ 1,294,861   $ 998,609   $ 296,252     29.7 %
Used vehicle retail     606,556     500,671     105,885     21.1  
Used vehicle wholesale     100,180     90,726     9,454     10.4  
Finance and insurance     79,316     59,519     19,797     33.3  
Service, body and parts     245,315     231,378     13,937     6.0  
Fleet and Other     23,751     29,887     (6,136 )   (20.5 )
Total revenues   $ 2,349,979   $ 1,910,790   $ 439,189     23.0  
                           
Gross profit                          
New vehicle retail   $ 95,662   $ 77,503   $ 18,159     23.4 %
Used vehicle retail     89,951     74,101     15,850     21.4  
Used vehicle wholesale     649     587     62     10.6  
Finance and insurance     79,316     59,519     19,797     33.3  
Service, body and parts     115,803     110,188     5,615     5.1  
Fleet and Other     501     1,087     (586 )   (54.0 )
Total gross profit   $ 381,882   $ 322,985   $ 58,897     18.2  
                           
Unit sales                          
New vehicle retail     39,517     30,568     8,949     29.3 %
Used vehicle retail     34,864     29,134     5,730     19.7  
Used vehicle wholesale     13,682     11,556     2,126     18.4  
Total units sold     88,063     71,258     16,805     23.6  
                           
Average selling price                          
New vehicle retail   $ 32,767   $ 32,668   $ 99     0.3 %
Used vehicle retail     17,398     17,185     213     1.2  
Used vehicle wholesale     7,322     7,851     (529 )   (6.7 )
                           
Average gross profit per unit                          
New vehicle retail   $ 2,421   $ 2,535   $ (114 )   (4.5) %
Used vehicle retail     2,580     2,543     37     1.5  
Used vehicle wholesale     47     51     (4 )   (7.8 )
Finance and insurance     1,066     997     69     6.9  
                           
                           
 
Lithia Motors, Inc.
Other Highlights (Unaudited)
     
    As of
    September 30,   December 31,   September 30,
    2012   2011   2011
Days Supply(1)            
New vehicle inventory   75   62   66
Used vehicle inventory   50   52   53
             
(1) Days supply calculated based on current inventory levels, excluding in-transit vehicles, and a 30-day historical cost of sales level.
 
         
Financial covenants        
    Requirement   As of September 30, 2012
Current ratio   Not less than 1.20 to 1   1.35 to 1
Fixed charge coverage ratio   Not less than 1.20 to 1   1.95 to 1
Leverage ratio   Not more than 5.00 to 1   2.11 to 1
Funded debt restriction   Not more than $375 million   $173.4 million
         
         
 
Lithia Motors, Inc.
Other Highlights (Unaudited)
             
    Three months ended
September 30,
    Nine months ended
September 30,
 
    2012     2011     2012     2011  
New vehicle unit sales brand mix                        
Chrysler   32.5 %   34.3 %   32.1 %   31.3 %
General Motors   15.1     16.7     15.3     16.9  
Toyota   14.2     10.9     13.6     12.3  
Subaru   6.7     4.8     7.0     5.2  
Honda, Acura   6.8     5.6     6.9     7.2  
BMW, Mini   6.3     6.9     6.6     6.5  
Ford   5.2     6.1     5.3     6.1  
Hyundai   3.7     4.4     3.8     4.5  
Nissan   2.9     3.5     2.9     3.8  
Mercedes   2.7     2.2     2.6     1.8  
Volkswagen, Audi   2.4     2.4     2.1     2.4  
Kia   0.8     1.4     0.9     1.3  
Other   0.7     0.8     0.9     0.7  
   
Three months ended
September 30,
   
Nine months ended
September 30,
 
    2012     2011     2012     2011  
Revenue geographic mix                        
Texas   23.7 %   23.9 %   24.4 %   24.4 %
Oregon   20.7     20.6     20.8     19.6  
California   9.7     9.8     10.1     9.9  
Washington   9.9     9.2     9.5     9.6  
Montana   9.0     8.6     8.7     8.3  
Alaska   8.2     9.6     8.4     9.4  
Idaho   5.2     5.8     5.2     5.9  
Iowa   5.1     5.0     4.8     5.2  
Nevada   4.5     4.1     4.6     4.4  
North Dakota   2.3     2.2     2.2     2.1  
New Mexico   1.7     1.2     1.3     1.2  
   
As of October 26, 2012
       
Current store count mix   # of stores     % of total              
Chrysler   23     26.4 %            
General Motors   14     16.1              
Honda, Acura   9     10.3              
Toyota   8     9.2              
BMW, MINI   7     8.0              
Hyundai   6     6.9              
Ford   5     5.7              
Nissan   3     3.5              
Mercedes   3     3.5              
Subaru   3     3.5              
Other   3     3.5              
Kia   2     2.3              
Volkswagen, Audi   1     1.1              
                         
                         
 
Lithia Motors, Inc.
Consolidated Balance Sheets (Unaudited)
(In thousands except per share data)
             
    September 30, 2012     December 31, 2011  
Cash and cash equivalents   $ 19,757     $ 20,851  
Trade receivables, net     128,602       99,407  
Inventories, net     658,694       506,484  
Deferred income taxes     4,532       4,730  
Other current assets     11,240       16,719  
Assets held for sale     14,671       -  
Total current assets   $ 837,496     $ 648,191  
                 
Property and equipment, net     397,754       373,779  
Goodwill     25,838       18,958  
Franchise value     61,972       59,095  
Deferred income taxes     23,005       29,270  
Other non-current assets     20,472       16,840  
Total assets   $ 1,366,537       1,146,133  
                 
Floor plan notes payable   $ 14,073     $ 114,760  
Floor plan notes payable: non trade     489,935       229,180  
Current maturities of long-term debt     7,810       8,221  
Trade payables     38,973       31,712  
Accrued liabilities     81,635       72,711  
Liabilities related to assets held for sale     10,065       -  
Total current liabilities   $ 642,491       456,584  
                 
Long-term debt     261,419       278,653  
Deferred revenue     31,857       25,146  
Other long-term liabilities     21,286       18,629  
Total liabilities   $ 957,053     $ 779,012  
                 
Class A common stock     266,104       279,366  
Class B common stock     362       468  
Additional paid-in capital     11,789       10,918  
Accumulated other comprehensive loss     (3,234 )     (4,508 )
Retained earnings     134,463       80,877  
Total liabilities & stockholders' equity   $ 1,366,537     $ 1,146,133  
                 
                 
 
Lithia Motors, Inc.
Summarized Cash Flow from Operations (Unaudited)
(In thousands)
       
    Nine months Ended  
    September 30,  
    2012     2011  
Net income   $ 60,530     $ 40,094  
                 
Adjustments to reconcile net income to net cash used in operating activities:                
Asset impairments     115       872  
Depreciation and amortization     12,777       12,372  
Depreciation and amortization within discontinued operations     96       381  
Stock-based compensation     2,329       1,686  
Gain on disposal of assets     (775 )     (134 )
(Gain) loss from disposal activities within discontinued operations     397       (116 )
Deferred income taxes     6,851       3,325  
Excess tax benefit from share-based payment arrangements     (1,629 )     (360 )
(Increase) decrease:                
  Trade receivables, net     (29,160 )     (7,177 )
  Inventories     (158,186 )     (53,389 )
  Other current assets     3,169       (1,078 )
  Other non-current assets     (4,346 )     (4,079 )
Increase (decrease):                
  Floor plan notes payable     (93,975 )     (10,637 )
  Trade payables     5,381       3,759  
  Accrued liabilities     10,164       9,890  
  Other long-term liabilities and deferred revenue     9,927       8,018  
Net cash provided by (used in) operating activities   $ (176,335 )   $ 3,427  
                 
                 
 
Lithia Motors, Inc.
Reconciliation of Non-GAAP Cash Flow from Operations (Unaudited)
(In thousands)
     
    Nine months Ended
    September 30,
Net cash provided by (used in) operating activities   2012     2011
As reported   $ (176,335 )   $ 3,427
  Floor plan notes payable, non-trade     272,760       67,402
Adjusted   $ 96,425     $ 70,829
               
               
 
Lithia Motors, Inc.
Reconciliation of Certain Non-GAAP Financial Measures (Unaudited)
(In thousands, except for per share data)
       
    Nine months Ended September 30, 2012  
    As reported     Asset impairment and disposal gain     Equity investment     Tax attribute     Adjusted  
Asset impairments   $ 115     $ (115 )   $ -     $ -     $ -  
Selling, general and administrative     280,292       739       -       -       281,031  
                                         
Income from operations     112,682       (624 )     -       -       112,058  
                                         
Other income, net     1,771       -       (244 )     -       1,527  
                                         
Income from continuing operations before income taxes   $ 97,653     $ (624 )   $ (244 )   $ -     $ 96,785  
Income tax expense     (37,287 )     244       95       (1,072 )     (38,020 )
Net income from continuing operations   $ 60,366     $ (380 )   $ (149 )   $ (1,072 )   $ 58,765  
                                         
Diluted earnings per share from continuing operations   $ 2.30     $ (0.01 )   $ (0.01 )   $ (0.04 )   $ 2.24  
Diluted share count     26,203                                  
                                         
                                         
       
    Nine months Ended September 30, 2011  
    As reported     Asset impairment and disposal gain     Adjusted  
Asset impairments   $ 872     $ (872 )   $ -  
Selling, general and administrative     240,537       580       241,117  
                         
Income from operations     81,174       292       81,466  
                         
Income from continuing operations before income taxes   $ 64,560     $ 292     $ 64,852  
Income tax expense     (25,244 )     (116 )     (25,360 )
Net income from continuing operations   $ 39,316     $ 176     $ 39,492  
                         
Diluted earnings per share from continuing operations   $ 1.47     $ 0.01     $ 1.48  
Diluted share count     26,738                  
                         

Contact Information

  • Contact:
    John North
    VP Finance and Controller
    (541) 618-5748