Sonic Automotive, Inc. · NYSE:SAH
Sonic Automotive — Q2 2013 Earnings Presentation
20 slides from Sonic Automotive's earnings presentation, Jul 23, 2013
Slide 1: Q2 2013 Earnings Review
Exhibit 99.2 Q2 2013 Earnings Review July 23, 2013
Slide 2: Forward-Looking Statements
Forward-Looking Statements This presentation contains “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. These statements relate to future events, are not historical facts and are based on our current expectations and assumptions regarding our bu
Slide 3: Contents
Contents Quarter in Review Financial Results Operations Recap Summary and Outlook
Slide 4: Overall Results
Overall Results Revenue Growth – Up 3.8% New retail revenue up 5.1%—volume up 1.7% Used unit volume up 0.3% F&I revenue up 8.6% Fixed operations revenue up 4.5% SG&A at 76.6%—flat compared to the prior year Adjusted income from continuing operations of $26.4 million Q2 2013 adjusted diluted EPS from
Slide 5: Q2 2013 Adjusted Results
Q2 2013 Adjusted Results B/(W) than Q2 2012 (amounts in millions, except per share data) Q2 2013 $% Revenue $ 2,202 $ 80 4% Gross Profit $ 324 $ 11 4% Operating Profit $ 63 $ 1 1% Interest & Other (1) ($ 19) ($ 1) (3%) Continuing Ops: Profit (after tax) (1) $ 26 ($ 1) (2%) Diluted EPS (1) $ 0.50 $ 0
Slide 6: SG&A to Gross
SG&A to Gross 76.6% 76.6% Q1 2012 Q1 2013 Targeting Below 77% for the Full Year Sonic Automotive, Inc.
Slide 7: Capital Spending
Capital Spending Estimated (amounts in millions) YTD 2013 2013 (1) Real Estate Acquisitions $ 32.7 $ 66.5 All Other Cap Ex 56.4 105.1 Subtotal $ 89.1 $ 171.6 Less: Mortgage Funding (25.8) (56.9) Total Cash Used – Cap Ex $ 63.3 $ 114.7 (1) – Excludes the effect of any pending franchise acquisitions
Slide 8: Public Debt Maturities
Public Debt Maturities $300 $210 $200 5% Notes 9% Notes 7% Notes No Near Term Maturities $0 $0 $0 2013 2014 2015 2018 2022 2023 (amounts in millions) Weighted Average Coupon Rate Down From 8.0% to 5.8% Cash Interest Savings of $3.9M Per Year
Slide 9: Debt Covenants
Debt Covenants Actual Q2 Covenant 2013 Liquidity Ratio >= 1.05 1.17 Fixed Charge Coverage Ratio >= 1.20 1.71 Total Lease Adjusted Leverage <= 5.50 4.07 Ratio Compliant with all Covenants Sonic Automotive, Inc.
Slide 10: Share Repurchases
Share Repurchases Average (shares in thousands) Shares Price YTD Q2 2013 Activity 627 $22.59 Unused authorization of approximately $135.4 million Sonic Automotive, Inc.
Slide 11: New Retail Vehicles
New Retail Vehicles Q2 2013 Q2 2012 B/(W) Volume 33,685 33,115 2% Selling Price $ 35,616 $ 34,478 3% Gross Margin % 5.5% 6.0% (50 bps) GPU $ 1,976 $ 2,075 ($ 99) SAAR (includes fleet) 15.3 million 14.1 million 9% Sonic Automotive, Inc.
Slide 12: Used Retail Vehicles
Used Retail Vehicles Q2 2013 Q2 2012 B/(W) Retail Volume 26,599 26,525 0% Used Retail GPU $ 1,414 $ 1,347 $ 67 Used Related Retail Gross* $ 83 million $ 80 million $ 3 million Used to New 0.79 : 1 0.80 : 1 (.01) Vehicles / store / month 89 88 1 *—Includes front-end gross plus F&I related gross and f
Slide 13: Fixed Operations
Fixed Operations B/(W) than Q2 2012 (amounts in millions) Q2 2013 $% Revenue $ 307 $ 12 4.0% Gross Profit $ 151 $ 6 4.5% QTD YOY Gross Profit Change Breakdown: Customer Pay Up 3% Whsl. Parts Up 3% Internal & Sublet flat Warranty Up 19% Sonic Automotive, Inc.
Slide 14: Summary
Summary Improved EPS consistently from quarter to quarter Double digit continuing operations EPS growth of 11.1% True Price affected performance, but we see the long-term benefit Refinancing of the 9% Notes with 5% Notes a home run Inventory in good shape Mercedes and BMW acquisitions to close in Q3
Slide 15: Appendix
Appendix Sonic Automotive, Inc.
Slide 16: Reconciliation of Non-GAAP Financial Information
Reconciliation of Non-GAAP Financial Information This release contains certain non-GAAP financial measures (the “Adjusted” columns) as defined under SEC rules, such as, but not limited to, adjusted income from continuing operations and related earnings per share data. The Company has reconciled thes
Slide 17: Reconciliation of Non-GAAP Financial Information
Reconciliation of Non-GAAP Financial Information Second Quarter Ended June 30, 2013 Continuing Operations Discontinued Operations Total Operations Net Income Share Net Income Share Net Income Share ($ in millions, shares in (Loss): Count: Diluted (Loss): Count: Diluted (Loss): Count: Diluted thousan
Slide 18: Reconciliation of Non-GAAP Financial Information
Reconciliation of Non-GAAP Financial Information This release contains certain non-GAAP financial measures (the “Adjusted” columns) as defined under SEC rules, such as, but not limited to, adjusted income from continuing operations and related earnings per share data. The Company has reconciled thes
Slide 19: Reconciliation of Non-GAAP Financial Information
Reconciliation of Non-GAAP Financial Information Six Months ended June 30, 2013 Continuing Operations Discontinued Operations Total Operations Net Income Share Net Income Share Net Income Share ($ in millions, shares in (Loss): Count: Diluted (Loss): Count: Diluted (Loss): Count: Diluted thousands,
Slide 20: Sonic Automotive
Sonic Automotive