Lithia Reports Adjusted EPS of $1.55 for First Quarter 2016
Lithia Increases Dividend to $0.25 per Share for First Quarter
MEDFORD, OR--(Marketwired - Apr 21, 2016) - Lithia Motors, Inc. (
Unadjusted net income for the first quarter 2016 was $40.3 million, or $1.55 per diluted share, compared to $40.7 million, or $1.53 per diluted share, for the first quarter of 2015. As shown in the attached non-GAAP reconciliation tables, the 2016 first quarter adjusted results exclude a non-core benefit related to an equity investment and the gain on the sale of a store offset by a legal reserve adjustment. These non-core items result in no change to earnings per share. The 2015 first quarter adjusted results exclude a $0.14 non-core net benefit from an equity investment and the gain on the sale of a store.
First quarter 2016 revenue increased $193.7 million, or 11%, to $2.0 billion from $1.8 billion for the first quarter 2015.
First Quarter-over-Quarter Operating Highlights:
- Total same store sales increased 8%
- New vehicle same store sales increased 6%
- Used vehicle retail same store sales increased 12%
- Service, body and parts same store sales increased 10%
- Same store F&I per unit increased $111 to $1,292
- Adjusted SG&A expense as a percentage of gross profit was 71.1%
"Our performance in the first quarter was solid," said Bryan DeBoer, President and CEO. "We grew adjusted earnings per share 12%, drove double digit increases in both used retail vehicle and service, body and parts sales and set a record in F&I per unit. We also continued to increase revenue and profitability in our DCH stores. While national new vehicle sales growth is moderating, we have significant opportunity to drive earnings growth through focus on growing vehicle market share and retaining service customers longer, improving store performance and targeting strategic acquisitions."
Chris Holzshu, SVP and CFO, said, "Adjusted SG&A as a percentage of gross profit was 71.1% in the first quarter of 2016, an improvement of 20 basis points over the first quarter of 2015. In the first quarter, incremental throughput, or the percentage of additional same store gross profit dollars that we retain after deducting incremental selling costs on a same store basis, was estimated at 37%. Our stores generated strong increases in gross profit and will continue to focus on controlling advertising and personnel cost to improve operating leverage."
Balance Sheet Update
We ended the first quarter with $22 million in cash and $149 million in availability under our credit facilities. Additionally, approximately $200 million of our operating real estate is currently unfinanced, which we estimate could provide an additional $150 million in available liquidity, for total potential liquidity of $321 million.
Dividend Payment and Share Repurchase
Our Board of Directors has approved a 25% increase in our quarterly dividend to $0.25 per share related to first quarter 2016 financial results. We expect to pay the dividend May 27, 2016 to shareholders of record on May 13, 2016.
Since March 31, 2016 we have repurchased approximately 157,500 shares at a weighted average price of $80.90 per share. Year to date, we have repurchased approximately 759,000 shares at a weighted average price of $79.80. Under our existing $250 million share repurchase authorization, approximately $236 million remains available.
2016 Outlook
We project 2016 second quarter earnings of $1.86 to $1.90 per diluted share and 2016 full year earnings of $7.30 to $7.50 per diluted share. Both projections are based on the following annual assumptions:
- Total revenues of $8.5 to $8.6 billion
- New vehicle sales increasing 4.5%
- New vehicle gross margin of 5.8% to 6.0%
- Used vehicle sales increasing 9.5%
- Used vehicle gross margin of 11.8% to 12.0%
- Service body and parts sales increasing 7.5%
- Service body and parts gross margin of 48.8% to 49.0%
- Finance and insurance gross profit of $1,270 to $1,290 per unit
- Tax rate of 39.5%
- Average diluted shares outstanding of 25.9 million
These projections exclude the impact of future acquisitions, dispositions and non-core items. Actual results may be affected by items described under Forward-Looking Statements below.
First Quarter Earnings Conference Call and Updated Presentation
The first quarter conference call may be accessed at 10:00 a.m. ET today by telephone at 877-407-8029. An updated presentation highlighting the first quarter results has been added to www.lithiainvestorrelations.com.
To listen live on our website or for replay, visit www.lithiainvestorrelations.com and click on webcasts.
About Lithia
Lithia Motors, Inc. is one of the largest automotive retailers in the United States. Lithia sells 31 brands of new vehicles and all brands of used vehicles at 138 stores in 15 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.lithiainvestorrelations.com
www.lithiacareers.com
Lithia Motors on Facebook
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. 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 "project," "outlook," "expect," "anticipate," "intend," "plan," "believe," "estimate," "may," "seek," "would," "should," "likely," "goal," "strategy," "future," "maintain," "continue," "remain," "target" or "will" and similar references to future periods. Examples of forward-looking statements in this press release include, among others, statements regarding:
- Expected operating results, such as improved store efficiency and performance; generating 2016 second quarter earnings per share of $1.86 to $1.90 per diluted share and 2016 full year earnings of $7.30 to $7.50 per diluted share and all projections set forth under the headings "2016 Outlook";
- Anticipated ability to improve store performance;
- Anticipated additions of dealership locations to our portfolio in the future; and
- Anticipated availability of liquidity from our credit facility and unfinanced operating real estate.
By their nature, forward-looking statements involve risks and uncertainties because they relate to events that depend on circumstances that may or may not occur in the future. Forward-looking statements are not guarantees of future performance, and our actual results of operations, financial condition and liquidity and development of the industry in which we operate may differ materially from those made in or suggested by the forward-looking statements in this press release. The risks and uncertainties that could cause actual results to differ materially from estimated or projected results include, without limitation, future economic and financial conditions (both nationally and locally), changes in customer demand, our relationship with, and the financial and operational stability of, vehicle manufacturers and other suppliers, risks associated with our indebtedness (including available borrowing capacity, compliance with financial covenants and ability to refinance or repay indebtedness on favorable terms), government regulations, legislation and others set forth throughout Part II, Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations and in Part I, Item 1A. Risk Factors of our most recent Annual Report on Form 10-K, and from time to time in our other filings with the SEC. We urge you to carefully consider this information and not place undue reliance on forward-looking statements. 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, 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. Non-GAAP measures do not have definitions under GAAP and may be defined differently by and not comparable to similarly titled measures used by other companies. As a result, we review any non-GAAP financial measures in connection with a review of the most directly comparable measures calculated in accordance with GAAP. We caution you not to place undue reliance on such non-GAAP measures, but also to consider them with the most directly comparable GAAP measures. 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 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 March 31, |
Increase | % Increase |
|||||||||||||
| 2016 | 2015 | (Decrease) | (Decrease) | ||||||||||||
| Revenues: | |||||||||||||||
| New vehicle retail | $ | 1,096,055 | $ | 1,007,816 | $ | 88,239 | 8.8 | % | |||||||
| Used vehicle retail | 532,726 | 462,931 | 69,795 | 15.1 | |||||||||||
| Used vehicle wholesale | 65,146 | 62,208 | 2,938 | 4.7 | |||||||||||
| Finance and insurance | 77,638 | 64,604 | 13,034 | 20.2 | |||||||||||
| Service, body and parts | 196,675 | 173,475 | 23,200 | 13.4 | |||||||||||
| Fleet and other | 14,621 | 18,144 | (3,523 | ) | (19.4 | ) | |||||||||
| Total revenues | 1,982,861 | 1,789,178 | 193,683 | 10.8 | |||||||||||
| Cost of sales: | |||||||||||||||
| New vehicle retail | 1,029,289 | 946,042 | 83,247 | 8.8 | |||||||||||
| Used vehicle retail | 468,449 | 403,489 | 64,960 | 16.1 | |||||||||||
| Used vehicle wholesale | 63,316 | 60,047 | 3,269 | 5.4 | |||||||||||
| Service, body and parts | 100,556 | 89,036 | 11,520 | 12.9 | |||||||||||
| Fleet and other | 14,069 | 17,189 | (3,120 | ) | (18.2 | ) | |||||||||
| Total cost of sales | 1,675,679 | 1,515,803 | 159,876 | 10.5 | |||||||||||
| Gross profit | 307,182 | 273,375 | 33,807 | 12.4 | |||||||||||
| Asset impairments | 3,498 | 4,130 | (632 | ) | NM | ||||||||||
| SG&A expense | 219,106 | 191,618 | 27,488 | 14.3 | |||||||||||
| Depreciation and amortization | 11,663 | 9,726 | 1,937 | 19.9 | |||||||||||
| Income from operations | 72,915 | 67,901 | 5,014 | 7.4 | |||||||||||
| Floor plan interest expense | (5,909 | ) | (4,649 | ) | 1,260 | 27.1 | |||||||||
| Other interest expense | (5,459 | ) | (4,828 | ) | 631 | 13.1 | |||||||||
| Other expense, net | (1,526 | ) | (368 | ) | 1,158 | NM | |||||||||
| Income before income taxes | 60,021 | 58,056 | 1,965 | 3.4 | |||||||||||
| Income tax expense | (19,751 | ) | (17,403 | ) | 2,348 | 13.5 | |||||||||
| Income tax rate | 32.9 | % | 30.0 | % | |||||||||||
| Net income | $ | 40,270 | $ | 40,653 | $ | (383 | ) | (0.9 | )% | ||||||
| Diluted net income per share: | |||||||||||||||
| Net income per share | $ | 1.55 | $ | 1.53 | $ | 0.02 | 1.3 | % | |||||||
| Diluted shares outstanding | 25,973 | 26,519 | (546 | ) | (2.1 | )% | |||||||||
| NM - not meaningful | |||||||||||||||
| Lithia Motors, Inc. | ||||||||||||||
| Key Performance Metrics (Unaudited) | ||||||||||||||
| Three months ended March 31, |
Increase | % Increase |
||||||||||||
| 2016 | 2015 | (Decrease) | (Decrease) | |||||||||||
| Gross margin | ||||||||||||||
| New vehicle retail | 6.1 | % | 6.1 | % | -- bps | |||||||||
| Used vehicle retail | 12.1 | 12.8 | (70 | ) | ||||||||||
| Used vehicle wholesale | 2.8 | 3.5 | (70 | ) | ||||||||||
| Finance and insurance | 100.0 | 100.0 | -- | |||||||||||
| Service, body and parts | 48.9 | 48.7 | 20 | |||||||||||
| Fleet and other | 3.8 | 5.3 | (150 | ) | ||||||||||
| Gross profit margin | 15.5 | 15.3 | 20 | |||||||||||
| Unit sales | ||||||||||||||
| New vehicle retail | 32,749 | 30,623 | 2,126 | 6.9 | % | |||||||||
| Used vehicle retail | 27,431 | 24,204 | 3,227 | 13.3 | ||||||||||
| Total retail units sold | 60,180 | 54,827 | 5,353 | 9.8 | ||||||||||
| Used vehicle wholesale | 9,513 | 9,144 | 369 | 4.0 | ||||||||||
| Average selling price | ||||||||||||||
| New vehicle retail | $ | 33,468 | $ | 32,910 | $ | 558 | 1.7 | % | ||||||
| Used vehicle retail | 19,421 | 19,126 | 295 | 1.5 | ||||||||||
| Used vehicle wholesale | 6,848 | 6,803 | 45 | 0.7 | ||||||||||
| Average gross profit per unit | ||||||||||||||
| New vehicle retail | $ | 2,039 | $ | 2,017 | $ | 22 | 1.1 | % | ||||||
| Used vehicle retail | 2,343 | 2,456 | (113 | ) | (4.6 | ) | ||||||||
| Used vehicle wholesale | 192 | 236 | (44 | ) | (18.6 | ) | ||||||||
| Finance and insurance | 1,290 | 1,178 | 112 | 9.5 | ||||||||||
| Total vehicle(1) | 3,498 | 3,429 | 69 | 2.0 | ||||||||||
| Revenue mix | ||||||||||||||
| New vehicle retail | 55.3 | % | 56.3 | % | ||||||||||
| Used vehicle retail | 26.9 | 25.9 | ||||||||||||
| Used vehicle wholesale | 3.3 | 3.5 | ||||||||||||
| Finance and insurance, net | 3.9 | 3.6 | ||||||||||||
| Service, body and parts | 9.9 | 9.7 | ||||||||||||
| Fleet and other | 0.7 | 1.0 | ||||||||||||
| Adjusted | As reported | |||||||||
| Three Months Ended March 31, |
Three months ended March 31, |
|||||||||
| Other metrics | 2016 | 2015 | 2016 | 2015 | ||||||
| SG&A as a % of revenue | 11.0 | % | 10.9 | % | 11.0 | 10.7 | % | |||
| SG&A as a % of gross profit | 71.1 | 71.3 | 71.3 | 70.1 | ||||||
| Operating profit as a % of revenue | 3.9 | 3.8 | 3.7 | 3.8 | ||||||
| Operating profit as a % of gross profit | 25.1 | 25.1 | 23.7 | 24.8 | ||||||
| Pretax margin | 3.3 | 3.4 | 3.0 | 3.2 | ||||||
| Net profit margin | 2.0 | 2.1 | 2.0 | 2.3 | ||||||
| (1) - includes the sales and gross profit related to new, used retail, used wholesale and finance and insurance and unit sales for new and used retail | ||||||||||
| Lithia Motors, Inc. | ||||||||||||||
| Same Store Operating Highlights (Unaudited) | ||||||||||||||
| Three months ended March 31, |
Increase | % Increase |
||||||||||||
| 2016 | 2015 | (Decrease) | (Decrease) | |||||||||||
| Revenues | ||||||||||||||
| New vehicle retail | $ | 1,062,335 | $ | 1,000,768 | $ | 61,567 | 6.2 | % | ||||||
| Used vehicle retail | 516,277 | 459,192 | 57,085 | 12.4 | ||||||||||
| Used vehicle wholesale | 63,805 | 61,949 | 1,856 | 3.0 | ||||||||||
| Finance and insurance | 75,365 | 64,206 | 11,159 | 17.4 | ||||||||||
| Service, body and parts | 189,968 | 172,116 | 17,852 | 10.4 | ||||||||||
| Fleet and other | 14,583 | 18,145 | (3,562 | ) | (19.6 | ) | ||||||||
| Total revenues | $ | 1,922,333 | $ | 1,776,376 | $ | 145,957 | 8.2 | |||||||
| Gross profit | ||||||||||||||
| New vehicle retail | $ | 64,818 | $ | 61,278 | $ | 3,540 | 5.8 | % | ||||||
| Used vehicle retail | 62,543 | 59,026 | 3,517 | 6.0 | ||||||||||
| Used vehicle wholesale | 1,755 | 2,222 | (467 | ) | (21.0 | ) | ||||||||
| Finance and insurance | 75,365 | 64,206 | 11,159 | 17.4 | ||||||||||
| Service, body and parts | 92,956 | 83,749 | 9,207 | 11.0 | ||||||||||
| Fleet and other | 544 | 956 | (412 | ) | (43.1 | ) | ||||||||
| Total gross profit | $ | 297,981 | $ | 271,437 | $ | 26,544 | 9.8 | |||||||
| Gross margin | ||||||||||||||
| New vehicle retail | 6.1 | % | 6.1 | % | -- bps | |||||||||
| Used vehicle retail | 12.1 | 12.9 | (80 | ) | ||||||||||
| Used vehicle wholesale | 2.8 | 3.6 | (80 | ) | ||||||||||
| Finance and insurance | 100.0 | 100.0 | -- | |||||||||||
| Service, body and parts | 48.9 | 48.7 | 20 | |||||||||||
| Fleet and other | 3.7 | 5.3 | (160 | ) | ||||||||||
| Total gross profit | 15.5 | 15.3 | 20 | |||||||||||
| Unit sales | ||||||||||||||
| New vehicle retail | 31,779 | 30,391 | 1,388 | 4.6 | % | |||||||||
| Used vehicle retail | 26,531 | 23,972 | 2,559 | 10.7 | ||||||||||
| Total retail units sold | 58,310 | 54,363 | 3,947 | 7.3 | ||||||||||
| Used vehicle wholesale | 9,255 | 9,063 | 192 | 2.1 | ||||||||||
| Average selling price | ||||||||||||||
| New vehicle retail | $ | 33,429 | $ | 32,930 | $ | 499 | 1.5 | % | ||||||
| Used vehicle retail | 19,459 | 19,155 | 304 | 1.6 | ||||||||||
| Used vehicle wholesale | 6,894 | 6,835 | 59 | 0.9 | ||||||||||
| Average gross profit per unit | ||||||||||||||
| New vehicle retail | $ | 2,040 | $ | 2,016 | $ | 24 | 1.2 | % | ||||||
| Used vehicle retail | 2,357 | 2,462 | (105 | ) | (4.3 | ) | ||||||||
| Used vehicle wholesale | 190 | 245 | (55 | ) | (22.4 | ) | ||||||||
| Finance and insurance | 1,292 | 1,181 | 111 | 9.4 | ||||||||||
| Total vehicle(1) | 3,507 | 3,435 | 72 | 2.1 | ||||||||||
| (1) - includes the sales and gross profit related to new, used retail, used wholesale and finance and insurance and unit sales for new and used retail | ||||||||||||||
| Lithia Motors, Inc. | ||||||||||||||
| Segment Operating Highlights (Unaudited) | ||||||||||||||
| Three months ended March 31, |
Increase | % Increase |
||||||||||||
| 2016 | 2015 | (Decrease) | (Decrease) | |||||||||||
| Revenues | ||||||||||||||
| Domestic | $ | 768,902 | $ | 690,682 | $ | 78,220 | 11.3 | % | ||||||
| Import | 865,743 | 760,080 | 105,663 | 13.9 | ||||||||||
| Luxury | 346,813 | 336,993 | 9,820 | 2.9 | ||||||||||
| Total segment revenues | 1,981,458 | 1,787,755 | 193,703 | 10.8 | ||||||||||
| Corporate and other | 1,403 | 1,423 | (20 | ) | (1.4 | ) | ||||||||
| Total revenues | $ | 1,982,861 | $ | 1,789,178 | $ | 193,683 | 10.8 | |||||||
| Segment Income(1) | ||||||||||||||
| Domestic | $ | 21,730 | $ | 27,294 | $ | (5,564 | ) | (20.4) | % | |||||
| Import | 22,633 | 17,063 | 5,570 | 32.6 | ||||||||||
| Luxury | 4,235 | 6,645 | (2,410 | ) | (36.3 | ) | ||||||||
| Total segment income | 48,598 | 51,002 | (2,404 | ) | (4.7 | ) | ||||||||
| Corporate and other | 30,071 | 21,976 | 8,095 | 36.8 | ||||||||||
| Depreciation and amortization | (11,663 | ) | (9,726 | ) | (1,937 | ) | 19.9 | |||||||
| Other interest expense | (5,459 | ) | (4,828 | ) | (631 | ) | 13.1 | |||||||
| Other expense, net | (1,526 | ) | (368 | ) | (1,158 | ) | NM | |||||||
| Income before income taxes | $ | 60,021 | 58,056 | $ | 1,965 | 3.4 | ||||||||
| (1) Segment income for each of the segments is defined as Income before income taxes, less Depreciation and amortization, Other interest expense and Other expense, net. | ||||||||||||||
| Retail New Vehicle Unit Sales | |||||||||||
| Domestic | 10,649 | 10,012 | 637 | 6.4 | % | ||||||
| Import | 18,114 | 16,805 | 1,309 | 7.8 | |||||||
| Luxury | 4,063 | 3,865 | 198 | 5.1 | |||||||
| Total | 32,826 | 30,682 | 2,144 | 7.0 | |||||||
| Allocated to management | (77 | ) | (59 | ) | (18 | ) | NM | ||||
| Total retail new vehicle unit sales | 32,749 | 30,623 | 2,126 | 6.9 | |||||||
| NM - not meaningful | |||||||||||
| Lithia Motors, Inc. | |||||
| Other Highlights (Unaudited) | |||||
| As of | |||||
| March 31, | December 31, | March 31, | |||
| 2016 | 2015 | 2015 | |||
| Days Supply(1) | |||||
| New vehicle inventory | 78 | 67 | 62 | ||
| Used vehicle inventory | 53 | 55 | 49 | ||
| (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 March 31, 2016 | |||
| Current ratio | Not less than 1.10 to 1 | 1.25 to 1 | ||
| Fixed charge coverage ratio | Not less than 1.20 to 1 | 2.87 to 1 | ||
| Leverage ratio | Not more than 5.00 to 1 | 1.75 to 1 | ||
| Funded debt restriction | Not more than $600 million | $414.4 million | ||
| Lithia Motors, Inc. | ||||||
| Other Highlights (Unaudited) | ||||||
| Three months ended March 31, |
||||||
| 2016 | 2015 | |||||
| New vehicle unit sales brand mix | ||||||
| Honda, Acura | 23.2 | % | 22.0 | % | ||
| Toyota, Lexus | 19.7 | 20.1 | ||||
| Chrysler | 18.6 | 19.1 | ||||
| General Motors | 8.8 | 9.0 | ||||
| Subaru | 7.3 | 7.2 | ||||
| BMW, Mini | 5.5 | 5.8 | ||||
| Ford | 5.2 | 4.6 | ||||
| Nissan | 3.8 | 4.0 | ||||
| Volkswagen, Audi | 2.7 | 2.8 | ||||
| Hyundai | 1.9 | 2.1 | ||||
| Mercedes Benz | 1.3 | 1.6 | ||||
| Kia | 1.3 | 1.3 | ||||
| Other | 0.7 | 0.4 | ||||
| Three months ended March 31, |
||||||
| 2016 | 2015 | |||||
| Revenue geographic mix | ||||||
| California | 23.0 | % | 22.2 | % | ||
| Oregon | 16.8 | 16.8 | ||||
| Texas | 14.0 | 15.7 | ||||
| New Jersey | 13.9 | 13.7 | ||||
| Montana | 6.3 | 5.8 | ||||
| Washington | 5.4 | 5.1 | ||||
| Alaska | 4.7 | 5.1 | ||||
| Nevada | 3.2 | 3.2 | ||||
| New York | 3.0 | 2.7 | ||||
| Idaho | 2.8 | 3.1 | ||||
| Iowa | 2.5 | 2.8 | ||||
| Hawaii | 2.0 | 1.4 | ||||
| North Dakota | 1.2 | 1.5 | ||||
| New Mexico | 0.9 | 0.9 | ||||
| Massachusetts | 0.3 | -- | ||||
| As of March 31, 2016 | |||||
| Current store count mix | # of stores | % of total | |||
| Chrysler | 27 | 19.6 | % | ||
| Honda, Acura | 21 | 15.2 | |||
| Toyota, Lexus | 20 | 14.5 | |||
| General Motors | 16 | 11.6 | |||
| BMW, Mini | 11 | 8.0 | |||
| Subaru | 8 | 5.8 | |||
| Volkswagen, Audi | 8 | 5.8 | |||
| Ford | 7 | 5.1 | |||
| Nissan | 6 | 4.3 | |||
| Hyundai | 4 | 2.9 | |||
| Mercedes Benz | 4 | 2.9 | |||
| Other | 6 | 4.3 | |||
| Lithia Motors, Inc. | ||||||||
| Consolidated Balance Sheets (Unaudited) | ||||||||
| (In thousands) | ||||||||
| March 31, 2016 | December 31, 2015 | |||||||
| Cash and cash equivalents | $ | 21,559 | $ | 45,008 | ||||
| Trade receivables, net | 286,292 | 308,462 | ||||||
| Inventories, net | 1,541,085 | 1,470,987 | ||||||
| Other current assets | 50,473 | 54,408 | ||||||
| Total current assets | $ | 1,899,409 | $ | 1,878,865 | ||||
| Property and equipment, net | 882,405 | 876,660 | ||||||
| Goodwill | 213,934 | 213,220 | ||||||
| Franchise value | 161,668 | 157,699 | ||||||
| Other non-current assets | 110,202 | 100,855 | ||||||
| Total assets | $ | 3,267,618 | $ | 3,227,299 | ||||
| Floor plan notes payable | $ | 55,836 | $ | 48,083 | ||||
| Floor plan notes payable: non trade | 1,296,751 | 1,265,872 | ||||||
| Current maturities of long-term debt | 33,721 | 38,891 | ||||||
| Trade payables | 78,250 | 70,871 | ||||||
| Accrued liabilities | 179,145 | 167,108 | ||||||
| Total current liabilities | $ | 1,643,703 | $ | 1,590,825 | ||||
| Long-term debt | 595,663 | 606,463 | ||||||
| Deferred revenue | 70,066 | 66,734 | ||||||
| Deferred income taxes | 59,134 | 53,129 | ||||||
| Other long-term liabilities | 84,375 | 81,984 | ||||||
| Total liabilities | $ | 2,452,941 | $ | 2,399,135 | ||||
| Class A common stock | 213,699 | 258,410 | ||||||
| Class B common stock | 219 | 316 | ||||||
| Additional paid-in capital | 34,866 | 38,822 | ||||||
| Accumulated other comprehensive loss | (114 | ) | (277 | ) | ||||
| Retained earnings | 566,007 | 530,893 | ||||||
| Total liabilities & stockholders' equity | $ | 3,267,618 | $ | 3,227,299 | ||||
| Lithia Motors, Inc. | |||||||||
| Summarized Cash Flow from Operations (Unaudited) | |||||||||
| (In thousands) | |||||||||
| Three Months Ended March 31, |
|||||||||
| 2016 | 2015 | ||||||||
| Net income | $ | 40,270 | $ | 40,653 | |||||
| Adjustments to reconcile net income to net cash provided by operating activities: | |||||||||
| Asset impairments | 3,498 | 4,130 | |||||||
| Depreciation and amortization | 11,663 | 9,726 | |||||||
| Stock-based compensation | 3,149 | 2,727 | |||||||
| Gain on disposal of assets | (3,391 | ) | 8 | ||||||
| Gain on sale of franchise | (1,087 | ) | (3,349 | ) | |||||
| Deferred income taxes | 10,261 | 3,863 | |||||||
| Excess tax benefit from share-based payment arrangements | (4,379 | ) | (4,733 | ) | |||||
| (Increase) decrease: | |||||||||
| Trade receivables, net | 25,564 | 7,569 | |||||||
| Inventories | (73,744 | ) | (39,460 | ) | |||||
| Other assets | (4,705 | ) | (2,078 | ) | |||||
| Increase (decrease): | |||||||||
| Floor plan notes payable, net | 7,753 | 1,092 | |||||||
| Trade payables | 920 | 6,799 | |||||||
| Accrued liabilities | 13,425 | 4,444 | |||||||
| Other long-term liabilities and deferred revenue | 5,396 | 6,838 | |||||||
| Net cash provided by operating activities | $ | 34,593 | $ | 38,229 | |||||
| Lithia Motors, Inc. | ||||||||
| Reconciliation of Non-GAAP Cash Flow from Operations (Unaudited) | ||||||||
| (In thousands) | ||||||||
| Three Months Ended March 31, |
||||||||
| Net cash provided by operating activities | 2016 | 2015 | ||||||
| As reported | $ | 34,593 | $ | 38,229 | ||||
| Floor plan notes payable, non-trade, net | 38,626 | (21,984 | ) | |||||
| Adjusted | $ | 73,219 | $ | 16,245 | ||||
| Lithia Motors, Inc. | ||||||||||||||||||||
| Reconciliation of Certain Non-GAAP Financial Measures (Unaudited) | ||||||||||||||||||||
| (In thousands, except for per share data) | ||||||||||||||||||||
| Three Months Ended March 31, 2016 | ||||||||||||||||||||
| As reported | Disposal gain on sale of store | Equity investment fair value adjustment | Legal reserve adjustment | Adjusted | ||||||||||||||||
| Asset impairments | $ | 3,498 | $ | -- | $ | (3,498 | ) | $ | -- | $ | -- | |||||||||
| Selling, general and administrative | 219,106 | 1,087 | -- | (1,906 | ) | 218,287 | ||||||||||||||
| Income from operations | 72,916 | (1,087 | ) | 3,498 | 1,906 | 77,233 | ||||||||||||||
| Other expense, net | (1,526 | ) | -- | 2,066 | -- | 540 | ||||||||||||||
| Income before income taxes | $ | 60,021 | $ | (1,087 | ) | $ | 5,564 | $ | 1,906 | $ | 66,404 | |||||||||
| Income tax expense | (19,751 | ) | 426 | (5,945 | ) | (747 | ) | (26,017 | ) | |||||||||||
| Net income | $ | 40,270 | $ | (661 | ) | $ | (381 | ) | $ | 1,159 | $ | 40,387 | ||||||||
| Diluted earnings per share | $ | 1.55 | $ | (0.03 | ) | $ | (0.01 | ) | $ | 0.04 | $ | 1.55 | ||||||||
| Diluted share count | 25,973 | |||||||||||||||||||
| Three Months Ended March 31, 2015 | |||||||||||||||
| As reported | Disposal gain on sale of store | Equity investment fair value adjustment | Adjusted | ||||||||||||
| Asset impairments | $ | 4,130 | -- | $ | (4,130 | ) | $ | -- | |||||||
| Selling, general and administrative | 191,618 | 3,349 | -- | 194,967 | |||||||||||
| Income from operations | 67,901 | (3,349 | ) | 4,130 | 68,682 | ||||||||||
| Other expense, net | (368 | ) | -- | 1,732 | 1,364 | ||||||||||
| Income before income taxes | $ | 58,056 | (3,349 | ) | $ | 5,862 | $ | 60,569 | |||||||
| Income tax expense | (17,403 | ) | 1,004 | (7,250 | ) | (23,649 | ) | ||||||||
| Net income | $ | 40,653 | (2,345 | ) | $ | (1,388 | ) | $ | 36,920 | ||||||
| Diluted earnings per share | $ | 1.53 | (0.09 | ) | $ | (0.05 | ) | $ | 1.39 | ||||||
| Diluted share count | 26,519 | ||||||||||||||
