Sonic Automotive, Inc. · NYSE:SAH
Sonic Automotive — Q4 2011 Earnings Presentation
22 slides from Sonic Automotive's earnings presentation, Feb 28, 2012
Slide 1: Q4 Earnings Review
Sonic Automotive, Inc. 1 Q4 Earnings Review February 28, 2012 Exhibit 99.2 Q4 Earnings Review February 28, 2012
Slide 2: Forward-Looking Statements
Sonic Automotive, Inc. 2 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 ass
Slide 3: Sonic Automotive Q4 2011
Sonic Automotive, Inc. 3 Sonic Automotive Q4 2011 o Quarter in Review o Financial Results o Operations Recap o Summary and Outlook Sonic Automotive Q4 2011 o Quarter in Review o Financial Results o Operations Recap o Summary and Outlook
Slide 4: Overall Results
Sonic Automotive, Inc. 4 Overall Results Strong revenue growth – up 12% New vehicle revenue up 15% - volume up 12% - exceeds industry growth Pre-owned revenue up 12% F&I revenue up 19% Fixed Operations revenue up 2% Adjusted SG&A to gross declined to 76.6% (1) Adjusted income from continuing operati
Slide 5: Adjusted Q4 and Full Year Results
Sonic Automotive, Inc. Adjusted Q4 and Full Year Results (1) B/(W) than Q4 2010 B/(W) than FY 2010 5 ` (1) – See appendix for reconciliation to GAAP amounts. Adjusted Q4 and Full Year Results (1) (amounts in millions, except per share data) Q4 $ % $ % Revenue $ 2,071 $ 226 12% $ 7,871 $ 990 14% Gros
Slide 6: SG&A to Gross
Sonic Automotive, Inc. SG&A to Gross (1) 220 bps improvement in both periods Q4 2010 Q4 2011 FY 2010 FY 2011 (1) – See appendix for reconciliation to GAAP amounts. SG&A to Gross (1)
Slide 7: Capital Spending
Sonic Automotive, Inc. Capital Spending 7 (amounts in millions) YTD Q4 2011 Estimated 2012 Capital Spending Real Estate Acquisitions $ 91.4 $ 14.5 All Other Cap Ex 67.3 118.9 Subtotal $ 158.7 $ 133.4 Less: Mortgage Funding (54.4) (33.5) Total Cash Used – Cap Ex $ 104.3 $ 99.9
Slide 8: Debt Covenants
Sonic Automotive, Inc. 8 Debt Covenants Covenant Actual Q4 2011 Memo: March 2012 Covenant Compliant with all Covenants Debt Covenants Liquidity Ratio >= 1.05 1.13 >= 1.10 Fixed Charge Coverage Ratio >= 1.15 1.65 >= 1.20 Total Lease Adjusted Leverage Ratio <= 5.50 4.02 <= 5.50
Slide 9: New Vehicles
Sonic Automotive, Inc. New Vehicles Q4 2011 Q4 2010 B/(W) 9 New Vehicles Retail Volume 30,928 27,011 14.5% Total Volume (including fleet) 32,868 29,300 12.2% Selling Price $ 36,074 $ 35,297 2.2% Gross Margin % 6.1% 6.3% (20 bps) GPU $ 2,189 $ 2,225 ($ 35) Gross Profit $ 72 million $ 65 million 10.4%
Slide 10: Pre-Owned Retail Vehicles
Sonic Automotive, Inc. Pre-Owned Retail Vehicles Q4 2011 Q4 2010 B/(W) 10 * - Includes: pre-owned gross + pre-owned reconditioning gross + pre-owned F&I gross 11 Consecutive Quarters of Double-Digit Volume Growth Pre-Owned Retail Vehicles Retail Volume 23,880 21,429 11.4% Pre-Owned Related Gross* $
Slide 11: Pre-Owned Retail Vehicle Units - Average Sold / Month / Store
Sonic Automotive, Inc. Pre-Owned Retail Vehicle Units 11 -Average Sold / Month / Store Compounded Annual Growth Rate (CAGR): Since 2008 – 15.2% Since 2006 – 11.0% Pre-Owned Retail Vehicle Units
Slide 12: Fixed Operations
Sonic Automotive, Inc. Fixed Operations Revenue Gross Profit 12 Customer Pay gross up 4% Overall gross profit up 2% despite lower warranty activity Fixed Operations
Slide 13: Fixed Operations Revenue
Sonic Automotive, Inc. Fixed Operations Revenue 13 (Amounts in millions) • Revenue grew $34 million on average each year over the last five years • Revenue growth in four of the last five years Fixed Operations Revenue
Slide 14: Summary
Sonic Automotive, Inc. 14 Summary Automotive retail industry continues its recovery SAAR rose steadily throughout 2011 Base business continues to grow New vehicle market share continues to increase Pre-Owned retail vehicle volume continues to grow at double-digit rate F&I and fixed operations are be
Slide 15: 2012 Outlook
Sonic Automotive, Inc. 2012 Outlook • Expect New Vehicle SAAR of 13.5 Million • Pre-Owned Vehicle Growth in High Single Digits • Property Purchases to Continue • Expect SG&A to be Below 78% • Targeting 2012 Diluted EPS from Continuing Operations of $1.55 - $1.65 15 2012 Outlook • Expect New Vehicle
Slide 16: Sonic Automotive, Inc. 16
Sonic Automotive, Inc. 16
Slide 17: Reconciliation of Non-GAAP Financial Information - Three Months Ended December 31
Sonic Automotive, Inc. 17 Reconciliation of Non-GAAP Financial Information Three Months Ended December 31, Adjusted 2011 B/(W) 2011 2010 than Adjusted 2010 ($ in millions, shares in thousands, except per share data) As Reported Adjustments As Adjusted As Reported Adjustments As Adjusted $ % Revenues
Slide 18: Reconciliation of Non-GAAP Financial Information - Year Ended December 31
Sonic Automotive, Inc. 18 Reconciliation of Non-GAAP Financial Information Year Ended December 31, Adjusted 2011 B/(W) 2011 2010 than Adjusted 2010 ($ in millions, shares in thousands, except per share data) As Reported Adjustments As Adjusted As Reported Adjustments As Adjusted $ % Revenues 7,871.3
Slide 19: Reconciliation of Non-GAAP Financial Information - Three Months Ended December 31, 2011
Sonic Automotive, Inc. 19 Reconciliation of Non-GAAP Financial Information Three Months Ended December 31, 2011 Continuing Operations Discontinued Operations Total Operations ($ in millions, shares in thousands, except per share data) Net Income (Loss): Numerator Share Count: Denominator Diluted EPS
Slide 20: Reconciliation of Non-GAAP Financial Information - Three Months Ended December 31, 2010
Sonic Automotive, Inc. 20 Reconciliation of Non-GAAP Financial Information Three Months Ended December 31, 2010 Continuing Operations Discontinued Operations Total Operations ($ in millions, shares in thousands, except per share data) Net Income (Loss): Numerator Share Count: Denominator Diluted EPS
Slide 21: Reconciliation of Non-GAAP Financial Information - Year Ended December 31, 2011
Sonic Automotive, Inc. 21 Reconciliation of Non-GAAP Financial Information Year Ended December 31, 2011 Continuing Operations Discontinued Operations Total Operations ($ in millions, shares in thousands, except per share data) Net Income (Loss): Numerator Share Count: Denominator Diluted EPS Net Inc
Slide 22: Reconciliation of Non-GAAP Financial Information - Year Ended December 31, 2010
Sonic Automotive, Inc. 22 Reconciliation of Non-GAAP Financial Information Year Ended December 31, 2010 Continuing Operations Discontinued Operations Total Operations ($ in millions, shares in thousands, except per share data) Net Income (Loss): Numerator Share Count: Denominator Diluted EPS Net Inc